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November 20th 2015 No 3778 scripintelligence.com Brandicourt’s ‘Big Reveal’ Falls Flat For Sanofi Seven months into the job and the shine is wearing off Sanofi’s new CEO Olivier Brandicourt. His first “Meet the Management” investor day on Nov. 6 left analysts underwhelmed and shares slipping. Previous CEO Christopher Viehbacher’s ignominious departure last year was blamed on the poor performance of its US diabetes franchise, weak oversight of local management and poor communication with Sanofi’s board of directors. Brandicourt may feel he has made strides to tackle management Bplanet/shutterstock.com and communication issues, but the diabetes franchise continues to be problematic. “Sanofi provided a 2020 growth outlook with a disappointing near-term earnings MISSING THE TARGET: Sanofi CEO lays out plans as further diabetes trajectory – flat EPS growth to 2017 versus franchise decline looms consensus expectations of 3-5% growth,” noted Goldman Sachs. Building on a reorganization of Sanofi that Brandicourt outlined four strategic priorities 2. To deliver “outstanding” launches with a he announced in July, Brandicourt delivered for Sanofi: particular focus on six major products: a set of ambitious priorities for the French 1. To reshape its portfolio around the Toujeo (insulin glargine injection), Praluent pharma major. “The company will remain core businesses where it can sustain a (alirocumab), Dengvaxia (dengue fever diversified but with a portfolio focused on leadership position or build a competitive vaccine), sarilumab, LixiLan (lixisenatide and areas where we can win,” he said. position. Turn to page 6 Beyond Tax: Portfolio Opportunities In Pfizer-Allergan Deal Pfizer Inc. and Allergan plc continue to be in they have in common, Allergan could add and established Alzheimer’s franchise (see closed-door discussions regarding a potential marketed drugs and investigational therapies separate article here), its growing antibiotics merger that could significantly cut Pfizer’s tax for indications that Pfizer lacks – and vice business and a large women’s health focus. rate due to Allergan’s Irish corporate base, but versa, since it’s possible that Allergan could Pfizer also could tap into categories like Allergan also has several commercial products buy Pfizer to prevent the larger company from dermatology and aesthetics – where it doesn’t and research-stage assets that could fill gaps moving its tax base overseas in a controversial have any products – and ophthalmology, in Pfizer’s portfolio. tax inversion following the merger. which are big businesses for Allergan. Allergan The companies have some overlapping Some portfolio opportunities for Pfizer CEO Brent Saunders told Scrip in an interview programs, but within therapeutic areas that include Allergan’s diverse neurology portfolio Turn to page 8 We are tweeting, chatting, liking and Let’s get sharing the latest industry news and insights from our global team of editors SOCIAL and analysts, join us! @scripnews /scripintelligence contents/editor’s letter 21 focal point/shutterstock.com focal Vjom/shutterstock.com Eleanor Malone, Editor, 4 Scrip Intelligence The trend of increasing co-operation between 1 Brandicourt’s ‘Big Reveal’ 14 Policy & Regulation Briefs Falls Flat For Sanofi industry and the regulators has its critics, but 16 Interview: Lilly’s Carroll: Let’s Debate by and large most would probably agree that 1 Beyond Tax: Portfolio Opportunities Pricing But Don’t Lump Us With Turing the net effect is a benefit to patients. In Pfizer-Allergan Deal 18 R&D Bites Closer dialog between regulatory agencies and manufacturers has sped up 3 The Culture Of Change: Pfizer’s The Perfect Storm For 20 Expert View: and to some extent reduced unnecessary Workforce Challenge M&A Shows No Signs Of Abating uncertainties in the process whereby better 4 FDA Pazdur’s Opdivo Love Affair 21 Stockwatch: Bulls, Bears And White medicines become available to the public. And Other Adventures Elephants There is a desire on both sides to continue 6 Citron Tweet Whacks Mallinckrodt 22 US Capitol Capsule: Don’t Make to evolve through dialog. True, in some Assumptions On Biosimilars Actions, cases accusations have been levelled quite Cellectis Success With Off-The-Shelf 7 FDA Official Warns vociferously at a regulator for apparently CAR-T Threatens Kite, Juno, Novartis bending to external pressures (the FDA’s 23 Pipeline Watch 10 Business Bulletin approval of Sprout Pharmaceuticals’ female 24 Appointments sexual dysfunction pill Addyi springs to 11 More Drug Pricing Probes: Merck, Lilly Targeted mind). Nevertheless, medicines agencies listening to companies in order to adapt 11 Cost Could Drag regulatory pathways to accommodate On Lilly’s Baricitinib Outlook new types of therapy, or giving companies 12 Horizon Infected By Valeant Scandal earlier guidance on their products’ route to approval, are signs that the relationship 12 Bayer’s Wolters Explains Downside between industry and regulation has usefully Of Success matured from one of head-on confrontation. 13 Cell Therapy Developers Debate But even in the context of regulators and Hurdles, Big Pharma Drags Its Feet industry holding each other in higher regard than they once did, comments by the FDA’s Valeant Looks For Forgiveness 13 head of hematology and oncology Richard Pazdur reveal a surprisingly pro-active attitude towards getting drugs to market. Scrip By his account the FDA practically dragged Editor: [email protected] Opdivo onto the lung cancer market while its Managing Editor: [email protected] maker, Bristol-Myers Squibb, kicked its heels News Editor: [email protected] waiting for a conference to report its data. For South Asia Editor: [email protected] Washington Editor: [email protected] more on Pazdur’s remarkably frank discussion US West Coast Editor: [email protected] of the backroom workings of the US agency Features Editor: [email protected] – and for an insight into how he might be Senior Reporter: [email protected] Principal Analysts: [email protected]; injecting some oomph into proceedings [email protected]; [email protected] We would love to hear your comments about there – see Donna Young’s report on p4. Reporter: [email protected] Scrip’s coverage. Feel free to tweet us or post Innovative therapies are one thing, [email protected] Reporter: a discussion on our LinkedIn group, for your Creative Content Reporter: [email protected] biosimilars quite another. While breakthrough chance to interact with editor Editorial Assistant: [email protected] Eleanor Malone medicines are seemingly being ushered and the rest of the Scrip Intelligence team. Production: [email protected] through the FDA on red carpets, the rate of Pharma Data Editor: [email protected] Global Content Director: [email protected] Follow us at: @scripnews action on biosimilars is far slower (see p22). All stock images in this publication courtesy of Some of this will be to do with deficiencies in www.shutterstock.com unless otherwise stated. Join us at: linkd.in/scripintelligence the drugs or in manufacturing facilities, but Customer Services that’s not the whole story. The agency also Tel: +44 (0)20 7017 5540 or (US) Toll Free: 1 800 997 3892 Email: [email protected] grossly under-estimated the number of drugs To subscribe, visit scripintelligence.com that would be put through its new biosimilar To advertise, contact [email protected] pathway and has not had the necessary Scrip is published by Informa UK Limited. resources to deal with its workload. The ©Informa UK Ltd 2015: All rights reserved. ISSN 0143 7690. pathway was a long time coming and it looks like we’re now at the start of another long road to effective implementation. 2 November 20th 2015 @scripnews scripintelligence.com © Informa UK Ltd 2015 HEADLINE NEWS The Culture Of Change: Pfizer’s Workforce Challenge Pharmaceutical firms boast a wealth of experience in M&A thanks in no small part to a boom in activity over the past year, but the struggle to prevent value leaking from a deal remains a major challenge. The huge scale of the potential deal between Pfizer Inc. and Allergan PLC dramatically raises the stakes. At this stage, it would be easy for those at the top to focus on the terms of a merger, but it’s also vital that they do not forget to start thinking in practical terms about how to Lightspring/shutterstock.com make it work. So where should they start? People As Assets Workforce stability is often talked about REALISING POTENTIAL: Any company being as the greatest business challenge after acquired has value locked in its people a merger or acquisition. It’s a problem that extends far beyond retention, to performance, engagement, and ultimately, Fear Of The Unknown speed is of the utmost importance, but productivity. Yet, even though the majority Fear of loss is often one of the predominant speed alone is not enough. of executives recognize the importance of individual concerns. This can mean loss of To execute the new narrative successfully getting this aspect of a deal right, in reality, money, colleagues, privileges, the job itself, and consistently across the whole business integrating systems and processes effectively or more generally the loss of a comfortable requires a detailed strategy, but individuals almost always comes before the cultural status quo. While this fear is an inevitable also need to be involved, for instance being aspect of integration. feature of change, it is something that leaders given responsibility as a team to implement Placing the workforce towards the and managers can mitigate against early top-level changes. If staff feel they’ve bottom of a long list of priorities is perhaps in the process, if it’s a problem that they’re individually had a hand in authoring change a particular risk for pharmaceutical firms, focused on solving.