Abbott Labora Tories Zambon Actelion Wockhardt Ajinomoto W a Tson Pharmaceuticals Alexion Pharmaceuticals W Arner Chilcott Aller
zambon abbott laboratories wockhardt actelion watson pharmaceuticals ajinomoto warner chilcott alexion pharmaceuticals vertex pharmaceuticals allergan valeant pharmaceuticals almirall united therapeutics amgen ucb amylin pharmaceuticals toray industries asahi kasei teva aspen pharmacare teijin astellas takeda astrazeneca taisho pharmaceutical baxter international sun pharmaceutical industries bayer stada biogen idec sigma-tau boehringer ingelheim shire bristol-myers squibb shionogi cadila servier celgene sawai pharmaceutical chiesi santen cipla sanofi covidien roche csl recordati cubist pharmaceuticals pierre fabre daiichi sankyo pharmstandard dainippon sumitomo pfizer dong-a par pharmaceutical companies dr reddy’s otsuka holdings eisai orion pharma elan ono pharmaceutical endo pharmaceuticals novo nordisk esteve novartis ferring nippon shinyaku forest laboratories mylan galderma mochida galenica ag mitsubishi tanabe gedeon richter 100 merz gilead sciences merck kgaa glaxosmithkline merck & co green cross
menarini gruenenthal meiji holdings hisamitsu medicis pharmaceutical hospira meda ipsen maruho japan tobacco lupin johnson & Johnson lundbeck kaken pharmaceutical lilly kissei leo pharma krka kyowa hakko kirin kyorin holdings Pharma&Biotech
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Contents
How to feed your giant SCRIP 100 5 BUSINESS 10
Since 2009, the pharma industry has C-SUITE 17 cut almost 150,000 jobs in the US alone. If news of layoffs were not LEADERSHIP 24 uncomfortable enough, the challenges facing this industry – which have CAREERS 31 never been so present nor acute – make the cuts even more painful and R&d 38 even more necessary. At a time when the pharma giant CLINICAL TRIALS 48 confronts its greatest tests head on (data disclosure, an anachronistic THE PATIENT 59 business model, patent expiries, and reimbursement to name a few), will the EMERGING MARKETS 65 limbs that have survived amputation be strong enough to drag the weighty POLICY & REGULATION 75 torso of the injured behemoth over the Our front cover image shows the top 100 modern healthcare horizon? MARKET ACCESS 83 pharma companies, ranked by total 2011 Of course, it is down to those that pharmaceutical sales, and in alphabetical have survived the lopping of limbs to MANUFACTURING 89 order. The companies with more sales have save the day, coming to the rescue of a longer line. Designed by Emily Foster. both themselves and the bruised FUTUROLOGY 96 colossus. The message to this group of people is clear: now is the time to provide the muscle, now is the time to SCRIP 100 EDITOR INDIA EDITOR contributors SCRIP HEAD OFFICE Joanne Payne Anju Ghangurde John Bird Informa Pharma, be your own hero. Pharma has never Dr Christine Blazynski 119 Farringdon Road, CHIEF CONTENT WASHINGTON EDITOR been more in need of good ideas – Neena Brizmohun London EC1R 3DA OFFICER, DATAMONITOR Donna Young Dr Peter Charlish Tel: +44 (0)20 7017 5000 intellectual nutrition to bolster its HEALTHCARE Tracy DeGregorio US WEST COAST EDITOR Fax: +44 (0)20 7017 6965 Mike Ward Duncan Emerton waning health – and it is the strongest Mandy Jackson Wang Fangqing US OFFICE CHIEF OF CONTENT, leaders that will find the heroes to Ben Goldacre 52 Vanderbilt Avenue, SCRIP GROUP SENIOR REPORTER George Green 7th Floor, provide this life-saving elixir. Christopher Bowe Francesca Bruce Michael Hay New York In the meantime, the lost limbs of MANAGING EDITOR EDITORIAL ASSISTANT Maura Musciacco NY10017, US the immobile giant have scuttled off, John Hodgson Gemma Sharman Josh Owide Tel: +1 212 972 4899 Ian Schofield Fax: +1 212 972 4855 EDITORIAL INTERN often morphing into innovators that HEAD OF DATA & Andy Smith Lucie Ellis Japan OFFICE may yet herald the salvation of the RESEARCH Ashley Yeo Alex Shimmings T Hirata, Shiryo Kenkyujo DESIGNER healthcare industry, and return to feed Subscriptions Co Ltd Emily Foster 3-5-20-405 Sotokanda, the giant on their own terms. ASIA EDITOR Tel: +(0)800 012 8020 Ian Haydock Chiyoda-ku Tokyo PUBLISHING DIRECTOR Fax: +44 (0)20 7017 6985 101-0021, Japan However, it may yet be those Phil Jarvis [email protected] EMEA EDITOR Tel: +81 3 3258 9207 survivors that nourish the staggering Eleanor Malone Advertising Subscription rates Fax: +81 3 3258 9209 goliath and that navigate new NEWS EDITOR Rakesh Chauhan UK £2,630; Europe €3,900 pathways, that create a future – and a Dr Sukaina Virji James Kenney US/Canada US$5,090 Neil Hartley giant – worth saving. All articles published are the copyright of Informa Healthcare, a trading division of Informa Group plc, and should not be reproduced or copied in whole or in part without the written permission of the publisher. Every effort has been made to ensure the contents of this publication are factually correct but neither the authors nor the publisher accepts liability for injury, damages or losses arising from the material published in this journal. All images courtesy of shutterstock.com unless otherwise stated. Joanne Payne, Editor Printed by Wyndeham Grange, Southwick ISSN 2042-9622 © Informa UK Ltd 2012 FORMERLY EURAND PHARMACEUTICAL TECHNOLOGIES Proprietary technologies for differentiated oral products
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F01 Scrip100 Print Ad 208X273mm.indd 1 11/2/12 10:49 AM scrip 100
Pharma slims down to retain
healthy heart John Bird Lead Analyst, This year’s Scrip 100 company rankings, based on total 2011 pharmaceutical Datamonitor sales, reveal a story of an industry still trying to evolve into a more modern Healthcare beast. John Bird takes a closer look.
Total pharmaceutial sales of the Scrip highest-placed pharma company in decline by $600 million in the final 100 league table members in 2011 2011, French firm Sanofi. These top quarter of 2011 (a significant amount equaled $687 billion, with the leading two players had contrasting years, given generics were only available in the 100 prescription pharmaceutical Pfizer posted a year-on-year sales US for roughly half of that quarter). In companies’ total increasing by 7.8% decline of 1.3%, whereas Sanofi total, sales of Lipitor declined by over over 2010’s figure of $637 billion, or (boosted by consolidating sales of 10% during 2011, versus its 2010 figure. $50 billion in absolute terms. Genzyme following the completion of However, it is not just the leading the acquisition of the US biotech in statin’s sales declines that Pfizer has to expiries have final word April, 2011) ramped up its topline by contend with. Pfizer faces the problems On top of the Scrip 100 table for 2011, 15.2% over its 2010 total. of a maturing portfolio with an extensive with sales of almost $58 billion, is once In the final quarter of 2011, Pfizer’s array of high sales generating-drugs again the US pharma giant Pfizer. The long standing flagship product, the that are experiencing, or are soon to New York-based firm still commands a anti-dyslipidemia therapeutic Lipitor experience, generic sales erosion. dominant position, with its 2011 total (atorvastatin) lost patent protection in In total, over $12 billion in sales are (from prescription pharmaceuticals) a its key US market and with the ensuing expected to be wiped from Pfizer’s clear $11 billion ahead of the second generic sales entry saw its global sales topline over the period 2011-17 which scrip100.com SCRIP 100 5 scrip 100
By 2017, equates to over 20% of the company’s therapy for chronic myeloid leukemia Domestic BRIC companies not Datamonitor total sales in 2011. Lipitor is responsible Gleevec/Glivec (imatinib) and its quite there yet expects Novartis for over $7 billion of this expiry successful 2011 launch of MS drug In terms of the emerging markets, it is to be the biggest portfolio decline, with other significant Gilenya (fingolimod), along with the India that dominates with six companies industry player declines expected to come from continued uptake of the cancer therapy inside the Scrip 100 list (the third Celebrex (celecoxib), Geodon/Zeldox Afinitor (everolimus) will position the highest total for an individual country). (ziprasidone) and Zyvox (linezolid). company as the best performing of the Surprisingly, Chinese pharmaceutical Such is the maturity of Pfizer’s pharma companies with sales in excess firms are absent from the top 100. In offering, Datamonitor has identified 40 of $10 billion. fact, the largest firm from the world’s key brands that are positioned within By 2017, Datamonitor expects highest populated country was in 129th Pfizer’s portfolio that are currently Novartis (including sales from its generic place, the China Pharmaceutical Group, facing generic sales erosion, or will in business unit Sandoz) to be the biggest with 2011 prescription pharma sales the near future. industry player, overtaking Sanofi and of just $315 million, although the Hong The third-placed pharma player Pfizer in the process, with its topline Kong-based firm did see its pharma in 2011, Switzerland’s Novartis, like prescription pharma total forecast to sales increase by a significant 6.2% over Sanofi, had a strong year during 2011, expand at a six year compound annual the year prior. posting an increase in pharmaceutical growth rate (CAGR) of 3.2% and its With 27 companies each within sales of 7.9% over 2010 and jumping topline sales expected to increase by the top 100, the US and Japan- up one place in the league table. It $10 billion over a six year period. headquartered companies equate to overtook US firm Merck & Co, which The remainder of the companies the highest proportion of the Scrip was relegated to the fourth highest. within the group of $10 billion+ 100 overall market size. In 2011, Novartis gained an immediate uplift in of pharmaceutical sales (of which prescription pharmaceuticals from US- pharma sales when it completed its there are 19) show little in the way headquartered firms totaled $266 billion, acquisition of ophthalmology specialist of movement in the rankings (over which was a 38.7% share of the Scrip Alcon in April 2011. 2010’s performance), with half of the 100 total. Japan-headquartered firms However, the company’s suite of companies in the group maintaining amounted to a fraction of this with $93 innovative drugs such as the targeted their respective positions. billion, or a 13.5% share, with Western European companies accounting for 42% of the 2011 total. All combined, top 20 pharmaceutical sales ($m) 2007-11 sales from companies headquartered in 60k the established markets accounted for over 95% of the Scrip 100’s overall sales 55k in 2011, which matched 2010’s share. Assuming most of the Scrip 100 50k derive the majority of their sales from 45k their respective hinterlands, then a logical correlation between the 40k dominance of established market companies within the Scrip 100 and 35k sales from the established markets
30k is arrived at. Despite this a significant number of major pharma companies Sales in $m 25k have managed to penetrate the emerging markets through a range of 20k strategies, for example corporate M&A or through marketing partnerships. 15k Given that the established markets are
10k suffering from a plethora of growth- resisting factors: healthcare reform, 5k the global recession and increasingly cost-conscious and price sensitive 0k 2007 2008 2009 2010 2011 governments and other payers, the rise in the rankings of companies Pfizer Sanofi Novartis Merck & Co. Roche GlaxoSmithKline AstraZeneca Johnson & Johnson Eli Lilly Abbott headquartered in the emerging markets Bristol-Myers Squibb Teva Takeda Amgen Boehringer Ingelheim will be inevitable in future Scrip 100 Bayer Novo Nordisk Astellas Daiichi Sankyo Otsuka league tables. Source: Scrip Market Data 6 SCRIP 100 scrip100.com scrip 100
Cost-cutting returns results over the near term, prompting senior value business capable of generating Away from for 2011’s underperformers management to act. strong cash flow from already off- the stuttering On top of the well-documented Pfizer’s demise has been referenced patent products (the established growth of the impact of generic sales erosion and quite thoroughly so far in this article, products business unit) in addition to a larger players, Big Pharma’s “innovation crisis”, the however, senior management’s re-emergence of sales from over-the- there are some backdrop of continued global economic approach to dealing with the fall-out of counter drugs/consumer healthcare. success stories uncertainty and increasingly difficult the Lipitor expiry (among others) has In-line with this Pfizer has already within the Scrip marketing conditions, particularly in the evolved over recent years. Initially the completed a number of divestments 100 established markets has led pharma company used its 2009 merger with (Capsugel, 2011, Nutrition, 2012) companies to look at ways to deliver Wyeth in order to implement large cost- and is currently in the process of margin growth in an attempt to appease their all-important shareholders. top 15 – pharma sales, r&d and no. of r&D projects 2008-2011 Indeed, while the major 60k 2008 60k 2009 pharmaceutical companies are in the midst of the patent cliff, no major 50k 50k pharmaceutical company will be 40k 40k m), 2008 $ immune in the coming years from major ( 30k 30k patent expiries (AstraZeneca, Bristol- Myers Squibb and Eli Lilly in particular 20k 20k have extremely high expiry burdens)
Pharma sales 10k Pharma sales ($m), 2009 10k and even over-achiever Novartis will 0k 0k see key, mega-blockbuster brands 050100 150200 250300 050100 150200 250300 ravaged by the onslaught of cheaper R&D projects, 2008 R&D projects, 2009 copies of drugs (Gleevec, 2016 and 2010 2011 60k 60k Diovan (valsartan), 2012). It is unsurprising then, that the 50k 50k list of pharma companies that have 40k 40k m), 2010 $
announced major cost-cutting ( 30k 30k initiatives over the past couple of years, be it outsourcing, major 20k 20k organizational restructuring and an
Pharma sales 10k Pharma sales ($m), 2011 10k increase in joint-ventures as a cost sharing activity, is long. 0k 0k 050100 150200 250300 050100 150200 250300 In November 2010, Roche R&D projects, 2010 R&D projects, 2011 announced the implementation of Abbott Bayer GlaxoSmithKline Merck & Co. Pfizer Amgen BI Novartis its Operational Excellence Program Johnson & Johnson Roche AstraZeneca Bristol-Myers Squibb Lilly Novo Nordisk Sanofi which the company estimated would Bubble size reflects R&D spend in each year; Source: Scrip Market Data save almost $5.0 billion over a two year period. A combination of R&D saving initiatives, namely redundancies. spinning out its animal health division. restructuring, site closures and job Interestingly though, commencing in A similar approach is currently being redundancies began during 2011 and late 2011 and more so through 2012, implemented at Abbott Laboratories. have continued into 2012. Roche, Pfizer’s cost-saving strategy has Significantly, when assessing the for a while the golden child of the switched to that of a complete overhaul larger companies with below-par pharmaceutical world, did not enjoy of its company structure, the vision sales growth during 2011 and their a strong 2011, with sales of the being for two primary businesses with operating profit growth over the same company’s key monoclonal antibody distinct cost structures and operating period, some stand-out cases are drug Avastin (bevacizumab) declining approaches – an innovative business visible. The Scrip 100 financial data over 18% over the year prior after and a value business. Pfizer Ceo, shows that the likes of AstraZeneca, losing its breast cancer indication Ian Read envisioned the first as an Roche and Pfizer, which achieved a in the US. Furthermore, with an R&D-based business that is capable combined prescription pharmaceutical increasingly cost-conscious market, of generating revenue and cash flow sales growth of less than $1 billion over the development and acceptance of growth and a sustainable innovation 2010-11, saw a combined operating biosimilars gathering pace and Roche’s engine (the R&D-driven prescription profit total growth of over $7 billion over portfolio of high-priced biologic pharmaceutical business; primary care, the same time period. therapies was faced with strong specialty care, and oncology), with Major pharma companies’ ability resistors to significant sales growth the second business operating as a to make these cuts and achieve profit scrip100.com SCRIP 100 7 scrip 100
2012 has seen growth through a period of topline 2011; US firm Celgene, which saw such growth rates and streamlined a number of stagnation has helped to sustain their total pharma sales increase by 34.0% business models are, naturally, an big pharma market valuations. However in the during 2011, advancing the company attractive proposition for the larger firms acquisitions of long-term they’ll have to show that their up six places in the table to 28th that are suffering from a stagnating small, focused strategies to renew sales growth are position. Celgene, which is highly pharma sales performances. Also, players going to pay off. reliant on the multiple myeloma and given the strong fiscal performances myelodysplastic syndrome treatment of select companies during a period climbers show similar traits Revlimid (lenalidomide) is an almost of dire market conditions through Away from the stuttering growth of the 100% oncology–pure play company major restructuring and cost saving larger players, there are some success and is expected to continue to go from initiatives, which is ultimately feeding stories within the Scrip 100. Significant strength to strength over the period into the company’s operating profit and performances from emerging 2011-17 given that Revlimid (which potentially into the major company’s biopharmaceutical companies such provided over 70% of the company’s cash deposits, small- to as Vertex (the fastest growing year- total pharma sales in 2011) is patent medium-sized companies will be on-year rate in the Scrip 100 with an protected until 2018. looking over their shoulders at annual growth rate in excess of 800%) A similarly focused company, Gilead predatory would-be buyers. Indeed, which ranked the Massachusetts- Sciences, which is the global leader in 2012 has seen a number of big based company as the 64th biggest HIV fixed-dose combination therapies pharma acquisitions of small, focused in 2011 (in 2010 the company was had another strong year during 2011, players such as Bristol-Myers Squibb’s unranked). In 2011 Vertex launched with total pharma sales advancing by acquisition of diabetes specialist Amylin its hepatitis C drug Incivek (telapravir) 9.6%, maintaining the company at the and GlaxoSmithKline’s purchase of along with development partner 24th spot in the league table, although Human Genome Sciences. Johnson & Johnson and furthermore ever edging the company toward the Moreover, given the current trend in 2012 launched its orphan drug dizzy heights of the $10 billion+ group of major pharmaceutical players Kalydeco (ivacaftor), which will help of companies. Shire saw significant restructuring their business models maintain the company’s position in growth during 2011, through its niche into more manageable/focused the top 100. Alexion, a company that disorder focus (in addition to gains in its structures with the primary goal of markets the monoclonal antibody ADHD blockbuster franchise), seeing its being able to focus on innovation and Soliris (eculizumab) for the orphan pharma sales total increase by 26.3%, thereby addressing the lack of R&D disease of paroxysmal nocturnal raising the company up the Scrip 100 productivity, a second consequence hemoglobinuria saw strong growth table by five places to number 33. could be a more simplified and it too entered the Scrip 100 during consolidation of high growth focused 2011, advancing 19 places from its Cost saving initiatives to pharma companies, with many of 2010 position to be situated as the fuel a second wave of M&A? the larger members of the Scrip 100 industry’s 88th biggest player. While these fast-growing, focused tempted to dissolve small, fast growing However, it is not just the emerging companies can enjoy their current pure-play companies into their newly biopharmas that had strong years in rise up the Scrip 100 league table, created divisions.
top 10 company financials 2011
80k Total revenues COGS S,G&A R&D Other operating (expense) income Operating profit
60k
40k
20k
0k
-20k
-40k Eli Lill y Abbott
-60k Roche Sanofi AstraZeneca Pfizer Bristol-Myers Squibb -80k Merck & Co . GlaxoSmithKline
Source: Scrip Market Data
For full interactive charts, visit www.scrip100.com Johnson & Johnso n 8 SCRIP 100 scrip100.com scrip 100
The world’s top 100 pharma companies
Rank Company 2011 pharma Growth in Rank Company 2011 pharma Growth in (2010 rank sales ($ million) Pharma sales (2010 rank sales ($ million) Pharma sales in Brackets) 2011 over in Brackets) 2011 over 2010 (%) 2010 (%)
1 (1) Pfizer 57,747 -1.3 51 (52) Teijin 1,794 15.3
2 (2) Sanofi 46,454 15.2 52 (61) Ferring 1,670 25.8
3 (4) Novartis 41,981 7.9 53 (57) Ipsen 1,614 10.6
4 (3) Merck & Co 41,289 3.7 54 (72) Sun Pharmaceutical Industries 1,601 39.1
5 (6) Roche 36,991 4.0 55 (65) Aspen Pharmacare 1,558 27.3
6 (5) GlaxoSmithKline 35,591 -1.5 56 (62) Gedeon Richter 1,534 16.1
7 (7) AstraZeneca 33,591 1.0 57 (58) Cipla 1,510 8.3
8 (8) Johnson & Johnson 24,368 8.8 58 (70) Dr Reddy's 1,499 28.1
9 (9) Eli Lilly 22,607 7.4 59 (60) Asahi Kasei 1,499 13.0
10 (10) Abbott Laboratories 22,435 12.8 60 (59) Chiesi 1,470 9.2
11 (11) Bristol-Myers Squibb 21,244 9.0 61 (63) Leo Pharma 1,446 12.0
12 (12) Teva 18,312 13.6 62 (81) Pharmstandard 1,428 49.4
13 (15) Takeda 17,048 18.0 63 (55) Hisamitsu 1,424 -6.3
14 (13) Amgen 15,295 4.3 64 (NR) Vertex Pharmaceuticals 1,411 883.9
15 (16) Boehringer Ingelheim 14,046 9.1 65 (56) Meiji Holdings 1,395 -6.3
16 (14) Bayer 13,959 -3.5 66 (67) Santen 1,346 13.7
17 (18) Novo Nordisk 12,389 14.5 67 (66) Gruenenthal 1,318 9.1
18 (17) Astellas 12,162 11.8 68 (76) Taisho Pharmaceutical 1,314 23.7
19 (19) Daiichi Sankyo 11,202 6.5 69 (87) Pierre Fabre 1,276 63.0
20 (22) Otsuka Holdings 9,815 19.3 70 (71) Kyorin Holdings 1,263 9.4
21 (21) Merck KGaA 8,926 8.1 71 (75) KRKA 1,234 12.0
22 (23) Baxter International 8,594 6.7 72 (77) Orion Pharma 1,211 18.1
23 (20) Eisai 8,130 -2.3 73 (78) Cadila 1,106 12.2
24 (24) Gilead Sciences 8,102 9.6 74 (79) Kaken Pharmaceutical 1,104 12.1
25 (25) Mylan 6,106 13.0 75 (74) Esteve 1,102 -1.8
26 (26) Servier 5,426 10.5 76 (69) Almirall 1,069 -8.7
27 (27) Mitsubishi Tanabe 5,108 9.4 77 (68) Elan 1,068 -8.8
28 (34) Celgene 4,700 34.0 78 (85) Mochida 1,033 19.8
29 (30) Allergan 4,432 11.5 79 (83) Recordati 1,021 9.5
30 (28) Forest Laboratories 4,393 4.3 80 (86) Wockhardt 985 20.4
31 (29) CSL 4,323 5.6 81 (82) Ajinomoto 979 3.9
32 (32) UCB 4,001 8.3 82 (64) Lupin 959 -23.4
33 (38) Shire 3,950 26.3 83 (89) Merz 951 29.9
34 (31) Dainippon Sumitomo 3,893 2.1 84 (84) Sigma-Tau 922 3.3
35 (35) Biogen Idec 3,836 10.5 85 (80) Par Pharmaceutical Companies 888 -9.5
36 (33) Menarini 3,784 4.7 86 (90) Sawai Pharmaceutical 848 16.5
37 (42) Watson Pharmaceuticals 3,640 40.8 87 (88) Dong-A 821 7.7
38 (37) Shionogi 3,353 4.2 88 (107) Alexion Pharmaceuticals 783 44.8
39 (45) Hospira 3,170 34.9 89 (102) United Therapeutics 741 25.2
40 (43) Lundbeck 2,916 12.9 90 (96) Cubist Pharmaceuticals 738 18.1
41 (44) Kyowa Hakko Kirin 2,877 20.0 91 (99) Maruho 725 18.9
42 (40) Warner Chilcott 2,637 -5.9 92 (91) Medicis Pharmaceutical 717 3.6
43 (47) STADA 2,386 10.5 93 (100) Nippon Shinyaku 699 16.7
44 (73) Valeant Pharmaceuticals 2,255 99.0 94 (101) Toray Industries 697 16.6
45 (50) Endo Pharmaceuticals 2,209 38.0 95 (94) Kissei 696 10.4
46 (48) Covidien 1,967 -1.2 96 (98) Zambon 662 7.6
47 (49) Actelion 1,932 10.2 97 (104) Galenica AG 659 18.7
48 (51) Galderma 1,926 20.6 98 (108) Japan Tobacco 635 18.5
49 (54) Ono Pharmaceutical 1,829 18.6 99 (92) Green Cross 632 -7.1
50 (53) Meda 1,828 17.9 100 (93) Amylin Pharmaceuticals 622 -4.5
Source: Scrip Market Data. For full tables go to www.scripintelligence.com/leaguetables; NR=not ranked scrip100.com SCRIP 100 9 business Orphan disease specialists find home with Big Pharma Maura Musciacco Senior Analyst, Which specialist pharma companies are ripe for acquisition? Maura Musciacco Datamonitor Healthcare takes a look. Big Pharma now has the lion’s share player in the lucrative oncology been shy in stating their interest in M&A Big Pharma now of the orphan drugs market, as 77% of market. Roche can be credited as the activity, searching for the next wave of has the lion’s approved orphan drug sales in 2011 first Big Pharma company to target promising orphan drugs of the future. share of the are derived from Big Pharma players. the emerging monoclonal antibody For example, in January 2012 Merck orphan drugs The implications of this are two-fold: market: in 1990, Roche acquired & Co stated that it was searching market in recent years, Big Pharma has been a 56% stake in the US biotech for acquisition targets. In July 2012, shifting away from the primary care for $2.1 billion, and subsequently Novartis announced its interest in blockbuster model while placing purchased the remaining 44% shares bolt-on acquisitions, rather than a large greater focus on specialty sectors in March 2009 for $47 billion. As a purchase. In October 2012 AstraZeneca and personalized medicines, targeting result, Roche secured MabThera/ followed suit, when it was rumored to be smaller patient populations with high Rituxan (rituximab), with orphan drug on the lookout for new deals to boost its value drugs. Consequently, many approvals in non-Hodgkin’s B-cell mid-stage pipeline. established companies have turned lymphoma (NHL), chronic lymphocytic As illustrated in Figure 1, companies to dealmaking activity with specialist leukemia (CLL), as well as for the with a below-average net orphan drug players in an effort to secure promising treatment of patients with Wegener’s sales difference (2011–17) are largely Big pipeline candidates. Granulomatosis and microscopic Pharma players such as Merck & Co, M&As have played an integral polyangiitis. Thanks to its indication Novartis, and AstraZeneca. Datamonitor strategy for Big Pharma’s expansion expansion strategy, MabThera/Rituxan expects these players to eye more deals into the orphan drug sector, traditionally became the first monoclonal antibody in the orphan drug arena, and may a field dominated by small biotech to generate blockbuster sales and even undertake intense bidding wars companies. M&A has provided a prove commercially successful in the to secure lucrative assets. And with the rapid entry route into this niche sector, oncology market. Subsequently, in US National Institutes of Health (NIH) enabling companies to secure valuable February 2006 MabThera/Rituxan listing nearly 7,000 rare diseases but drug candidates, manufacturing gained FDA approval in the larger only about 200 of these have approved capabilities and highly specialized sales non-orphan indication of rheumatoid therapies, there is still room for pharma forces. In fact, several companies have arthritis, further expanding its to expand in this sector. Indeed, looking already undertaken this strategy. This patient population. Through Roche’s outside the Big Pharma peer set, it is is perhaps best exemplified by Sanofi’s acquisition of Genentech, the Big notable that collectively Datamonitor’s acquisition of Genzyme, a global Pharma player also secured Herceptin Mid Pharma (companies with branded leader in lysosomal storage disorder (trastuzumab), which gained its first prescription pharmaceutical sales (LSD) enzyme replacement therapies. FDA approval in September 1998 totaling less than $10 billion) and Through this deal (completed in April for HER2-positive metastatic breast Emerging Pharma peer sets are forecast 2011), Sanofi is now positioned as a cancer (non-orphan indication), and higher sales growth ($6.6 billion) over prominent player in the orphan drug in October 2006 its indication was 2011 to 2017 than Big Pharma’s orphan sector, with a solid position in Gaucher’s expanded for the treatment of HER2- drugs portfolio ($4.4 billion). disease (Cerezyme, imiglucerase alpha), positive metastatic stomach cancer In light of these factors, and Big Fabry’s disease (Fabrazyme, agalsidase (orphan indication). Pharma’s acquisitive tendencies – beta), and Pompe disease (Myozyme, Going forward, several orphan drugs even if the era of mega-mergers is alglucosidase alpha). Genzyme marketed by Big Pharma companies truly behind us – many of these Mid represents a key acquisition for Sanofi, are to experience a slowdown in sales and Emerging Pharma companies significantly accelerating its broader growth: with brands becoming more represent plausible takeover targets for diversification strategy whilst also mature, these will face intensifying Big Pharma. Indeed, eight companies providing a platform for long competitive pressures, largely from (see Table 1) particularly stand out as term revenues. novel brands but also from biosimilars attractive candidates, purely from a Similarly, Roche’s acquisition of to a smaller extent (in the monoclonal sales growth perspective: Celgene, Genentech allowed the combined antibody landscape in ex-US markets). Allergan, Shire, Alexion, BioMarin, UCB, company to become the leading Indeed, Big Pharma players have not NPS Pharmaceuticals, and Vertex.
10 SCRIP 100 scrip100.com business
Figure 1. Net orphan drug sales difference, by company ($m), 2011–17
60,000 4,000
50,000 3,000 40,000 m) $ 30,000 2,000
20,000 1,000 10,000
0 0
Prescription sales, 2011 ( -10,000 -1,000 -20,000 Net orphan drug sales difference, 2011-17 ($m)
-30,000 s -2,000 ti s yx ex rt UC B Eisai keda Shire Pfizer Ker Bayer Roche Ve Sano fi anabe Abbot t Eli Lill y Gilead Ta Amge n Savient Acorda Alexion Astellas Actelion Celgene Allergan Novar Shionog i BioMarin Lundbec k Regeneron Biogen Idec AstraZenec a Merck & Co. Merck Serono Novo Nordis k Daiichi Sankyo GlaxoSmithKline Mitsubishi T Johnson & United Therapeutics Bristol-Myers Squibb Boehringer Ingelheim NPS Pharmaceutical
Orphan drug sales 2011 Prescription sales from non-orphan drugs 2011 Net orphan drug sales difference (2011-17)
All of these companies would 89% (the value of the company’s current of acquisition), this would position the The likes of be within the reach of Big Pharma, market cap being generated by orphan likes of Celgene and Shire as pricey Vertex and although the most costly of the selection drug sales by 2017). acquisitions, for moderate returns. Alexion would would be Celgene and Allergan, which In fact, when assessing the other Whereas the likes of Vertex and Alexion be less costly, currently have market caps of quotients from the above group, two would be less costly, for an expected for an expected $32 billion and $28 billion, respectively. cluster of similar performing companies higher orphan drug sales return. higher orphan An interesting metric is to take each are evident: Vertex (7.9%), Celgene With Sanofi having splashed the drug sales of the company’s 2011-17 sales (7.8%), BioMarin (7.0%), Alexion cash in 2011 for Genzyme and with return growth from orphan drugs, and drive (6.6%), Shire (4.7%) and on the lowest Pfizer’s acquisition of FoldRx in 2010, out a ratio (compared to its market end: UCB (2.9%) and Allergan (1.6%). coupled with the rumored takeover of cap figure). In doing so, the stand out Given that the average acquisition BioMarin in June 2012, further deal- target for acquisition would be NPS carries with it a control premium of 20– making activity is on the horizon, and Pharmaceuticals, which has an orphan 50% (the amount the buyer is willing needless to say, it will have an drug sales return quotient of almost to pay over the market cap at the time exciting premium.
Table 1. Key orphan disease players as acquisition targets for major pharma companies Company Market cap Orphan Orphan 2011-17 Number of FDA- Comment ($m) drugs sales, drugs sales, difference approved orphan 2011 ($m) 2017 ($m) ($m) drugs marketed, 2011 Celgene 31,692 4,284 6,767 2,483 4 Growth reliant on Revlimid (Lenalidomide; myelodysplastic syndromes) Allergan 27,900 1,733 2,172 439 2 Growth from Botox (onabotulinumtoxinA; uncontrolled blinking, neck pain and muscle spasms) Shire 15,932 834 1,587 753 4 Following Sanofi’s acquisition of Genzyme, Shire stands as the leading non-Big Pharma company in the lysosomal storage disorders sector. Alexion 17,091 783 1,911 1,128 1 Growth centered on Soliris (oculizumab; paroxysmal nocturnal hemoglobinuria). BioMarin 5,758 225 613 406 1 Growth from Naglazyme (galsulfase; Mucopolysaccharidosis VI) UCB 10,734 24 341 317 1 Xyrem (sodium oxybate; excessive daytime sleepiness) UCB’s only marketed orphan drug in 2011. NPS 773 n/a 684 773 0 Growth from Gattex and Natpara Pharmaceuticals Vertex 9,950 n/a 787 787 0 Launch of cystic fibrosis therapy Kalydeco in 2012. Source, for all data: Datamonitor, PharmaVitae Explorer, Company information scrip100.com SCRIP 100 11 business The ever-shrinking biosimilar pie
Duncan Emerton A look at recent dealmaking in the biosimilar market shows pharma’s growing Business appetite for a tasty deal, but is it becoming a frustrating case of larger spoons Development and smaller bowls? Duncan Emerton assesses the menu. Director, Datamonitor Biosimilars are big business. The was only worth $243 million at the interchangeable biosimilars, Baxter Consulting global biologics market reached end of 2010, investment has, thus far, and Momenta would have a significant $125 billion in 2011, and is predicted significantly exceeded return. advantage over the competition. Fully to top $150 billion by the end of interchangeable biosimilars could 2016. Of this, roughly $60 billion will A high price for a lean cut? potentially be perceived as “more be in off-patent sales. The extensive barriers to entry: high biosimilar” than the reference product. Driven by significant opportunity up-front investment costs, the likely As such, uptake could be faster. and a perceived lower risk strategy for need to compete on price rather than A significant number of taking a slice of the booming biologics product differentiation, and uncertainty manufacturing deals have also been market, companies have been over issues such as substitution may struck in the biosimilars market. Back investing heavily in this area in order to seem to make the biosimilar market in January 2009, Teva Pharmaceuticals capitalize on a market forecast to be unattractive to potential investors. joined forces with Lonza to create worth $3.5 billion by 2015. However, since the approval of the Teva-Lonza Biopharmaceuticals, To exploit this opportunity, world’s first biosimilar in April 2006, thereby allowing Teva to gain access companies have embarked on a deal flow in the biosimilars market to Lonza’s biologics manufacturing hearty meal of dealmaking. Since the has been solid. Multiple deals have capabilities. A key part of the deal was biosimilar market’s formal inception in been announced, and at all stages of the manufacturing and supply of Teva’s Europe in 2005, deal flow has been the value chain. And while financial biosimilar rituximab, TL-011. Three solid. Generics companies made terms of many deals have never been years after the deal was announced, early forays, seeking to leverage published, it is assumed that the total Teva suspended the development of relationships with payers and drive value of deals announced so far is in TL-011 “to consider the best path to long-term growth. Over time, more the region of $10 billion. a regulatory approval in Europe and companies, including several originator From a technology perspective, the US”. pharma and biotech companies have one deal stands out from the rest. In Soon after the Teva/Lonza invested in the market. December 2011, Baxter International announcement, US-based Merck & Co To date, biosimilar deals have and Momenta Pharmaceuticals made its first external investment in the focused on building synergies and de- announced a collaboration to develop biosimilars market. In December 2008, risking investments. Companies have and commercialize interchangeable it kicked off its biosimilar strategy by joined forces to maximize the potential biosimilars. While the deal focuses on investing $1.5 billion to establish Merck of combined resources, or have development and commercialization of BioVentures (MBV). Then in February licensed assets or capabilities to fill biosimilars, technology is at its heart. 2009, it acquired the biosimilar internal gaps. Rarely have companies Momenta Pharmaceuticals manufacturing facilities of Insmed for hit the acquisition trail. When they specializes in the detailed structural $130 million. The deal also included a have, biosimilars have been part of analysis of complex drugs. In a number of pipeline products, including the deal, rather than the key driver of statement to the market, Momenta’s a biosimilar G-CSF (INS-19) and a the purchase. president and CEO, Craig Wheeler, biosimilar pegylated G-CSF (INS-20). Collaborative deals have given commented that the main focus of the Other manufacturing deals have companies the ability to walk away deal was to “create interchangeable been struck, including Roche’s biologics from deals with manageable losses, biologic products by taking manufacturing deal with Indian biotech, should things not play out as expected. advantage of Momenta’s innovative Emcure. Roche has given Emcure rights Acquisitions, on the other hand, are physicochemical and biologic to manufacture Rituxan (rituximab) higher risk and more expensive. characterization capabilities, coupled and Herceptin (trastuzumab) for India. Due to limited information, and with a quality-by-design approach to Innovation as a way of competing with companies keeping their cards very process development”. biosimilars has been, and remains, the close to their chests, total deal value in A key market-shaping issue of the name of the game at Roche. This deal the biosimilars market is hard (almost biosimilars market is interchangeability does indicate, however, that Roche is impossible) to calculate. However, between the reference product and willing to adopt a flexible strategy in one thing is for sure; in a market that the biosimilar. By developing fully certain markets.
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Enbrel (etanercept; Amgen) from To date, Korea’s Hanwha Chemical. Only a biosimilar deals few months later, Amgen put those have focused plans to the sword by announcing a on building ‘stealth patent’ that could keep Enbrel synergies and biosimilars off the US market for de-risking another 15 years. While Merck & Co investments can continue development outside the US, the new patent will impact entry into the US market, which accounts for just under half of Enbrel’s global sales. And not to be overshadowed by Merck & Co, Amgen has also struck several deals to gain access to pipeline biosimilars. Kicking off in December 2011, Amgen joined forces with Watson Pharmaceuticals to collaborate on the development and commercialization of biosimilar oncology mAbs, with Watson paying $400 million for the privilege. Then in July 2012, Amgen and Watson licensed global rights to Synthon’s biosimilar Herceptin (trastuzumab; Roche). Synthon’s biosimilar Investors may earn a smaller trastuzumab completed Phase I piece of the pie in future testing in March 2012, and Phase III trials are planned for early 2013. In the clinic has also been spent on biosimilar While this is only a small selection Driven by regulatory requirements for product licensing deals. Over the last of the deals seen in the biosimilars clinical testing of biosimilars, clinical four years, several high profile deals market over the last few years, it development services have also been have been struck, many of which have shows that deal flow has been solid. in high demand. Companies such as been focused on complex biosimilars, As companies jostle for position and Merck & Co, Samsung and Amgen including monoclonal antibodies strive to establish themselves in a have all set up strategic biosimilar (mAbs) and fusion proteins. potentially lucrative segment of the development collaborations with Indian biotech Biocon has out- biologics market, much investment CROs in order to gain expertise in licensed rights to its biosimilar has been made. biosimilar clinical development and pipeline twice in the last few years. However, the rate at which generic, support regulatory activities. In June 2009, Biocon out-licensed biotech and pharma companies invest In January 2011, MBV partnered rights to its mAbs portfolio, including in biosimilars, and aim to incorporate with Parexel International to gain trastuzumab (Herceptin; Roche) and biosimilars into their core businesses, access to clinical development and bevacizumab (Avastin; Roche) to is likely to slow down in the next regulatory services. As part of the Mylan. And in October 2010, Biocon couple of years. Why? A simple deal, a MBV unit was established struck a deal with Pfizer, allowing explanation is that rates of return within Parexel to support all ongoing Pfizer to gain access to its biosimilar are not as meaty as companies clinical and regulatory activities for insulin portfolio, a deal which has have expected. the company. Samsung’s $266 million subsequently been cancelled. While more investment is likely to be deal to establish a joint venture with To complement its deal activity in announced in the near-term, there will Quintiles in April 2011 and Amgen’s the clinical trials and manufacturing also be announcements of strategy deal with PRA International in May spaces, MBV has also licensed rights changes, with companies pulling 2012 were struck for similar reasons. to certain pipeline biosimilar assets. out of the space due to investments Outside of deals that were In June 2011, the company invested not bringing the expected rates of focused on technology platforms, a potential $720 million to gain global return. While the biosimilars market is manufacturing capacity and clinical rights (except Turkey and Korea) to attractive, there is only so much of the development services, big money HD-203, a biosimilar version of pie to go around. scrip100.com SCRIP 100 13 business
US patent expiry calendar 2013 patent company drug Indication target note expiration date
According to the FDA Orange Book the drug serotonin 5-HT3 13/01/2013 GlaxoSmithKline Lotronex irritable bowel syndrome substance patent for Lotronex expires on 13 receptor January 2013.
Six of nine Abraxane patents in the FDA's breast cancer/non-small cell microtubules 22/02/2013 Celgene Abraxane Orange Book will expire on 22 February lung cancer (tubulin) 2013 and a seventh on 12 March 2013.
The drug substance patent for this compound expired on 2 September 2012, but in bone complications (including December 2007 the US FDA granted Zometa 02/03/2013 Novartis Zometa osteoclast bone metastases) an additional six months of marketing exclusivity following the completion of pediatric studies.
osteoporosis / osteopenia / Pediatric exclusivity on the patent for Reclast 02/03/2013 Novartis Reclast osteoclast Paget's disease expires on 2 March 2013.
gastroesophageal reflux disease Johnson & / ulcers and other acid-peptic The composition of matter patent for Aciphex 08/05/2013 Aciphex proton pump Johnson gastrointestinal disorders / expires on 8 May 2013. Zollinger-Ellison syndrome
Bristol-Myers reverse Composition of matter patent US5519021 21/05/2013 Sustiva HIV / AIDS Squibb Company transcriptase expires on 21 May 2013.
Synageva Composition of matter patent US5464933 07/06/2013 Fuzeon HIV / AIDS gp41 BioPharma expires 7 June 2013.
Abbott HIV-1 protease Composition of matter patent US5541206 30/06/2013 Kaletra HIV / AIDS Laboratories (HIV PR) expires 30 June 2016.
influenza viral The drug substance patent for Relenza expires 26/07/2013 GlaxoSmithKline Relenza influenza neuraminidase on 26 July 2013.
serotonin 5-HT1 The patent for Relpax expires on 13 August 13/08/2013 Pfizer Relpax migraine and other headaches receptor 2013.
The sole Orange Book listed patent protecting Watson progesterone Crinone 4% exclusivity in the US formulation 15/09/2013 Crinone amenorrhea Pharmaceuticals receptor patent US5543150 expires on 15 September 2013.
Under an agreement with, Watson can launch its lidocaine topical patch 5% product on 15 Endo Health 15/09/2013 Lidoderm postherpetic neuralgia sodium channels September 2013 following its ANDA approval Solutions by the US FDA, and it believes it is entitled to 180 days of marketing exclusivity.
beta US Patents 5378804 and 5792746 expire on 16/09/2013 Merck & Co Cancidas fungal infections (1,3)-D-glucan 16 September 2013.
Under a settlement agreement between Kos Pharmaceuticals and Barr Labs Barr was permitted to launch a generic version of Abbott dyslipidemia / 20/09/2013 Niaspan niacin receptors Niaspan and Advicor as well as future dosage Laboratories hypercholesterolemia formulations strengths or modified versions of the products under terms of an exclusive license commencing on 20 September 2013.
US patent 5079262 expires on 30 September reactive oxygen DUSA Levulan 2013. The Orange Book lists three other 30/09/2013 actinic keratoses species/free Pharmaceuticals PDT patents protecting Levulan PDT with expiration radicals dates between October 2017 and June 2019.
14 SCRIP 100 scrip100.com business
patent company drug Indication target note expiration date
According to the company's most recent 10-K Otsuka 30/09/2013 IV Busulfex chronic myelogenous leukemia DNA filing the patent exclusivity for IV Busulfex will Pharmaceutical expire on 30 September 2013.
reverse The patent for Rescriptor expires on 8 October 08/10/2013 GlaxoSmithKline Rescriptor HIV / AIDS transcriptase 2013.
granulocyte- Regarding Teva's Neugranin (a Neulasta colony biosimilar) Teva agrees not to sell Neugranin 10/11/2013 Amgen Neulasta neutropenia / leukopenia stimulating factor until 10 November 2013 unless it first obtains (G-CSF)/G-CSF a final court decision that Amgen's patents are receptor not infringed by Neugranin.
granulocyte- colony After a US District Court in Pennsylvania 10/11/2013 Amgen Neupogen neutropenia / leukopenia stimulating factor judgment Teva cannot sell its Neutroval (G-CSF)/G-CSF biosimilar in the US until 10 November 2013. receptor
Zalicus confirmed the settlement of the litigation between Mallinckrodt a subsidiary of Covidien and Watson Laboratories regarding Exalgo. Under the terms of the settlement Exalgo 15/11/2013 Covidien chronic pain opioid receptors Watson can introduce a generic version of the Tablets approved 8 12 and 16 mg dosage strengths of Exalgo starting on 15 November 2013 as opposed to 7 July 2014 the original patent expiration date.
The sole Orange Book listed patent protecting histamine H1 08/12/2013 Novartis Emadine allergic conjunctivitis Emadine exclusivity US5441958 expires on 8 receptor December 2013.
Xopenex is protected by five Orange Book listed patents. Among these US5362755 Dainippon Xopenex asthma / chronic obstructive beta adrenergic 25/03/2013 expires on 25 March 2013. Other patents Sumitomo Pharma HFA MDI pulmonary disease receptors could extend exclusivity up to 8 October 2024.
Zyflo CR is protected by two Orange Book listed patents. Among these US5422123 Cornerstone 21/09/2013 Zyflo CR asthma 5-lipoxygenase expires on 6 June 2012. Additonal protection Therapeutics out to 21 September 2013 may be provided by US6183778.
Drug substance patents for Zolinza expire 29/11/2012- histone between 29 November 2012 (patent no. Merck & Co Zolinza cutaneous T-Cell lymphoma 14/11/2026 deacetylase RE38506) and 14 November 2026 (patent no. 7456219).
Eli Lilly expects to lose patent protection for 31/12/2013 Eli Lilly Humalog diabetes insulin receptor Humalog in 2013.
norepinephrine diabetic peripheral neuropathy/ (noradrenaline) Eli Lilly has met the US FDA requirements for fibromyalgia/generalized reuptake, pediatric exclusivity for Cymbalta and has 31/12/2013 Eli Lilly Cymbalta anxiety disorder/major serotonin gained an additional six months of US market depressive disorder /chronic reuptake, exclusivity, which now will expire in December pain dopamine 2013. reuptake
Source: Sagient Research Systems
scrip100.com SCRIP 100 15 Excellence and Innovation in Clinical Research
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Sharing the strategy with AZ’s dealmaker Mike Ward Chief Content As pharma companies have struggled to come to terms with the revenues Officer, vacuum created through patent expiry and the slip ups in their own pipeline Datamonitor developments, the role of business development has moved to the strategic Healthcare and Scrip centre. Shaun Grady, AstraZeneca’s VP of strategic partnering and business Intelligence development, explains to Mike Ward how the transition to being more externally focused has developed in the past three years.
It has been an interesting and busy on track but has concluded some where a lot of the rhetoric we talked 2012 for Shaun Grady. Despite having innovative deals. about in the past two to three years is to report to three different CEOs in the “We’ve been on a long journey actually no longer aspirational but is past 12 months – David Brennan at coming from an ‘organic not invented coming to pass,” he explains. the start of the year, CFO Simon Lowth here’ company, where business The foundations for this shift in who held the reins as interim CEO from development was both peripheral and business development’s role in pipeline June through to October, and incoming opportunistic, to now have placed it and portfolio management were laid CEO Pascal Soriot – Grady has not absolutely at the centre of our strategy down by Brennan, the recently retired only managed to keep AstraZeneca’s and key to how we now discover and CEO, and involved the hiring of Martin business development activities develop drugs. We are now at a point Mackay as president R&D and Mene scrip100.com SCRIP 100 17 c-suite
Recently, Pangalos as head of discovery, both programs, which we feedback to the His teams look at and monitor all of Grady’s priority from Pfizer. Indeed, some 60% of the potential partner,” he explains. the small- to mid-cap biotechs that has been to company’s R&D leaders are new to This translates into Grady’s teams could potentially be bolted on by the look for assets the organization and were recruited making informed judgments with R&D company. By looking at others’ pipelines that are either partially with business development and experts about trial design, anticipating and trying to identify potential value already on the externalization in mind. how the regulators such as the FDA that they may not have spotted, his market or are in “So the job description of the and EMA might respond, what the teams also engage in late stage asset the later stages heads of the I-Meds – our innovative competition is up to and, assuming conventional licensing and collaborative of clinical medicine units – includes them being the product wins approval, what the deals. The third route is peer to peer development externally focused and agnostic to the uptake might look like. “We take this transactions. The company’s business source as well as having a track record very seriously. There is no point in development teams assess peer of working on licensing or acquisitions. doing licensing deals that don’t lead to pharma company pipelines and look They understand that doing good products for patients,” he tells Scrip. for overlaps in areas that might still be business development is part and To make sure the scouting is not considered too high risk or expensive to parcel of them being able to deliver so focused that promising ideas pursue on their own. on their objectives and achieve their that are potentially disruptive and pipeline targets,” he notes. currently off-strategy fall through the The late stage mantra Reassuringly for potential partners, net, AstraZeneca does have a New How has this late stage mantra this means that all programs, whether Opportunities team which almost has manifested itself? In 2012, internal or external, are now assessed carte blanche to look at all areas. AstraZeneca, in tandem with its in exactly the same way. So long as AstraZeneca believes biologics arm MedImmune, started the “We did an analysis of pretty much it can make a contribution to a year by signing a global collaboration to all of the programs that had failed in program’s success. co-develop and co-commercialize five the clinic in recent years and from that With about three quarters of the monoclonal antibodies from Amgen’s we developed our 5Rs approach. Any company’s Phase III pipeline coming clinical portfolio. The deal, for which program needs to meet the 5R criteria from business development activity, AstraZeneca paid $50 million upfront, of right target, right tissue/exposure, Grady acknowledges how essential secured brodalumab, which is in Phase right safety, right patients and right it is that all parties’ aspirations III for psoriasis and in Phase II trials commercial. We use these as a screen remain aligned. Consequently, key for asthma and psoriatic arthritis, as for taking internal programs forward or performance indicators have been well as four other earlier stage clinical as part of our due diligence for external introduced to monitor how quickly the phase programs across a range of business development teams respond inflammatory indications. to partners and how well they manage Under the terms of the agreement, those relationships. the companies will share both costs “We’ve really focused on the and profits. Approximately 65% of interaction between us and our costs for 2012-2014 will be funded by partners. We’ve been doing this for AstraZeneca; thereafter the companies about two years now and we’re hopeful will split costs equally. Amgen will get a that when the partnering surveys low single-digit royalty for brodalumab emerge we’ll see a response in how and a mid single-digit royalty for the AstraZeneca is perceived as a good rest of the portfolio, after which the partner,” he added. companies will share profits equally. Recently, Grady’s priority has been Grady believes the scope of the deal to look for assets that are either already – in terms of number of molecules on the market or are in the later stages and indications involved – sets a of clinical development. “We’re focusing benchmark for other companies on late stage because we have had our pursuing similar deal structures. own late stage disappointments. The Hot on the heels of the Amgen deal focus is now on good high quality Phase was the $1 billion acquisition of Ardea III programs where we believe we can Biosciences, the San Diego-based optimize the potential because of our biotech focused on the development global sales and marketing presence,” of small molecule therapeutics he adds. including lesinurad, which is currently To achieve this, Grady has about 130 in Phase III development as a potential staff scouring the planet for attractive treatment for the chronic management assets via three different routes. of hyperuricemia in patients with
18 SCRIP 100 scrip100.com c-suite
gout. The $32 per share bid that and business development approach and indeed the cons, of working “We’ve talked AstraZeneca had to make to beat off its most is the audacious expansion of together on this. It did not take long for to Bristol to say rivals in the auction represented a 50% its diabetes deal with Bristol-Myers the discussions to take place at more we should look premium on the prevailing share price. Squibb that allowed the US pharma to senior levels,” he recalls. at other assets “We generally work on the acquire Amylin, the diabetes-focused With agreement at the top level, it in the future assumption that if you win an auction US biotech. was decided that Bristol-Myers Squibb that would fit it means that you are paying the full Amylin essentially hit the M&A radar would take the lead on the acquisition and extend price. My boss, Simon Lowth, will screen after it had dissolved its nine and then AstraZeneca would expand the diabetes regularly ask why are we going to pay year partnership with Eli Lilly after its deal with the US pharma company franchise” more than Merck, or Pfizer or Sanofi the US pharma had signed a deal by paying to get access to the former for a company like Ardea. What is it with Boehringer Ingelheim to jointly Amylin franchise. What made this about our development of that asset or develop and commercialize Tradjenta possible was firstly the commitment our commercialization that allows us to (linagliptin), a potential competitor by Bristol-Myers Squibb to be wholly make a forecast that translates into a to the US biotech’s programs. What transparent with AstraZeneca, secondly bigger price?” he says. Amylin had to offer was expected the existing relationship between the AstraZeneca had been looking to catch the attention of companies two pharma companies, and thirdly, the at Ardea for some time having met with an interest in the diabetes space, decision to hold off renegotiating the up with Barry Quart, the biotech’s especially those that did not have existing deal until after the acquisition president and CEO, two years ago at exposure to the promising GLP-1 class had gone through. a BIO conference. While the assets of drugs which have been gaining “We should feel pleased with what on show looked interesting to Grady’s much traction. we have achieved. Acquisitions require team, the risk profile at the time was Up for grabs was the exenatide cross functional working, strong not appropriate. The company’s scout franchise that includes the approved leadership and transparency. Doing set about building a relationship which Bydureon (once weekly formulation) it with another partner doubles the included keeping a watchful eye Byetta (twice daily formulation), complexity but it comes back to the on progress. plus suspension formulations being same things – strong leadership and “At the back end of last year they got co-developed with Alkermes that relationships at the highest levels. Yet their data and the issue that we were are to start Phase III trials for weekly when you have strong leadership, concerned about seemed to have gone administration soon and monthly clear timelines, clear roles and away and so it now looked like a good administration in 2013, and a responsibilities decisions can be made quality asset. We arranged to meet transdermal patch version currently quickly,” he says. with Barry at this year’s JP Morgan in Phase I trials, as well as Symlin Indeed, despite four trips to the meeting, not only to see the BD (pramlintide acetate) and the late board, countless senior executive director but to be introduced to Simon stage candidate metreleptin. In 2011, engagements both internally and with to show that we were serious about the franchise generated revenues of counterparts at Bristol-Myers Squibb, starting something,” adds Grady. While $651 million. the deal got done and dusted in Ardea then said it would also like to talk Among the front runners as nine weeks. “Don’t get me wrong, it to others, Grady believes that having purchaser of Amylin, as identified by was hard work and there were a few built a relationship with the company Scrip, were both Bristol-Myers Squibb anxious moments, but great leadership gave it a first mover advantage. and AstraZeneca who had, since and project management got the job “We are confident that we can fulfil 2007, been in a collaboration focused done,” he adds. the potential of lesinurad because of around Onglyza (saxagliptin), a DPP-4 While Grady takes some satisfaction our global primary care and specialty inhibitor, Komboglye (saxagliptin plus in concluding the year’s marquee care position, especially in markets such immediate release metformin) and transaction, he does not expect to see as China and Japan where gout is a Forxiga (dapagliflozin) an investigational too many co-acquisition deals, but major unmet medical need. We believe SGLT2 inhibitor. doesn’t rule them out either. “I don’t we’ve got distinctive attributes around “It was clear that Bristol was looking think you would want every transaction the payer proposition, understanding at Amylin as were we. The more we to be a co-acquisition, not least what uptake will be, and how best to thought about it the more it made because you’re sharing the economics. get products on the formularies. It is a sense for us to look at this together. We’ve talked to Bristol to say we different game now from what it was Or put it another way, it would not should look at other assets in the future four to five years ago,” he adds. make sense one of us having a GLP-1 that would fit and extend the diabetes franchise and the other not. So I had franchise. We’ve shown that with the Acquiring Amylin some phone calls with Demetrios right people, the right skills set and the What characterizes the personality Kydonieus, head of M&A over at right motivation and behaviors, we can of AstraZeneca’s strategic partnering Bristol, and we talked about the pros, do it,” he concludes. scrip100.com SCRIP 100 19 c-suite The sense and sensibility of Shire Joanne Payne Outsourcing All agree that when Shire’s CEO retires from the role in 2013, he will leave the Editor, Datamonitor company in pretty good shape. Angus Russell talks to Joanne Payne about his Healthcare, Scrip journey from reliance to diversification. Intelligence When Angus Russell stood in front of successes that bring real benefits to exclusivity on that product and come the employees of Advanced BioHealing the patients,” he says. back into the industry to grow earnings (ABH) last year he felt a distinct feeling of For a CEO on the brink of retirement, so strongly is “pretty rare” says Russell. déjà vu. For the third time in seven years, Russell doesn’t talk with the attitude He cites anticipation and planning as he was standing in front of a group of an executive about to leave the the core strategy for this, and is quick roughly numbering 400; employees who world of drug development forever. to applaud the “tremendous people at were uncertain about their future and But retiring he is. Apart from a non- Shire who made that happen”. who had developed one specialized and executive directorship on the board of Today, Shire has offices in 32 commercialized product. Intermune, a company specializing in countries, and has products for sale ABH had one commercialized rare orphan diseases, Russell will be in something between 40 and 50 product (Dermagraft) which made the spending his time indulging his love of countries. It has 10 core products company sales of approximately cycling (he already had a few business that are driving the growth of the $125 million per year. This was a interests in this area) and charity work. company and Russell says that none situation spookily similar to the position After 32 years in the pharmaceutical of the Shire products, including the that the biotech Transkaryotics industry, 13 at Shire, Russell has latest product for ADHD, Vyvanse Therapies (TKT) was in when Shire no interest in trying to emulate past (lisdexamfetamine dimesylate), will swooped in to acquire it for $1.6 billion achievements. ever become more than 25% of the in 2005 (Replagal being the product in Look forward, never back, is business in one indication. question this time). Further still, it was Russell’s mantra. And looking forward This risk-averse business model is the same position that Shire itself was to the future of Shire, and the future to counter the “nightmare” of patent in when Russell joined as CFO in 1999. of the pharma business, has certainly exclusivity coming to an end, and you At that time, Shire was making around influenced his decision to retire. can understand this strategy when you $100 million a year in sales for the Understanding and exploiting the consider how badly Shire had been attention-deficit hyperactivity disorder new global frontiers of pharma, Asia burned by protection issues in the past. (ADHD) drug Adderall (amphetamine), and Latin America, requires a different Adderall had no patent, something and employed 400 people in type of leadership to that which Russell describes as one of the “quirks two countries. Russell believes he can provide. “I of the history of the product”. It had As Russell took to the platform think that Flemming [Ornskov, Russell’s been developed as a potential drug to speak to the ABH employees, he successor] has a lot of the skills that I for weight loss, and to treat obesity, told them about his aspirations for have, but on top of that he brings this but it hadn’t worked. However, when it the company: how he wanted to turn wealth of international experience, so was given to obese children who had this small firm into a global business, that’s one dimension that I would say is co-morbidity of ADHD, they improved. no longer dependent on the success certainly different,” he says. The drug went back into development of one product. He used his own but Shire couldn’t get new IP for it, and success as an example, his experience The Adderall evolution when Russell first joined the company in turning both Shire and TKT into Since Russell joined Shire 13 years he inherited a situation whereby the multi-billion dollar global businesses. ago, moving from CFO to the top job company’s biggest (almost only) earner Achievements for which he will be best after Matthew Emmens moved to had no IP protection. remembered when he retires next year. non-executive chairmanship of the The CEO at the time, Rolf Stahel, Russell hopes ABH can do for company in 2007, the company has reformulated Adderall into a drug that regenerative medicine what Shire evolved significantly. Just 10 years ago, could be taken once a day, Adderall did for ADHD. “That has been a 90% of Shire’s business was driven XR. “We thought when we made the wonderful part of my time at Shire, to by one product, Adderall XR. Only five transition to Adderall XR, it would give take these embryonic opportunities years ago, 50% of the business was us probably five years of exclusivity and see them grow to very major driven by the same product. To lose and protection to build our business.
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Within a year we had a generic generate some very good opportunities change is the one thing that Russell Russell hopes challenge come with litigation from for us. As they say, the rest is history,” says he is most proud of from his time ABH can do for Barr Laboratories [which subsequently he explains. at the company. regenerative became Teva] and that shocked medicine what everybody. It surprised the stock Blockbusters and beyond Turning the lights off Shire did for market: “The day the generic threat Russell may have other, more personal, Russell will officially retire from Shire in ADHD was announced the stock went down reasons for shying away from the April 2013 when the board convenes by 30%,” Russell recalls. one-product dependent strategy. He at its AGM, at which point Dr Flemming describes the pharmaceutical industry Ornskov, the current chief marketing Sleepless nights as a warzone in the “blockbuster officer at Bayer, will take the reins. Russell jokes that losing sleep over big decade” of his career while working at Russell has described Ornskov as decisions was never a challenge for AstraZeneca. This, coupled with direct talented and visionary, and his parting him. The challenge, for the amount of consumer advertising, changed the advice to his successor is clear: travel involved in his role, was staying culture of the pharmaceutical industry, “Just remember, you’re not the most awake. However, the big decision, the he says, and turned it into “just another important person in the company.” diversification decision, was one that big industry making money”. he tackled head on alongside Matthew Working in Big Pharma at that time, Emmens, the CEO at the time. “It was he says that he and his colleagues very clear that this old strategy, that got swept along on a tide of success. worked very well to build the company However, when he joined Shire and initially, of reformulating old medicines “had the opportunity to start again” and actually making them more the reason he had joined the drug effective, had basic flaws,” he says. development industry came flooding To find a new growth area for Shire, back to him. one that would offer a greater amount The specialist nature of the drugs of protection for a longer period of developed at Shire meant a much time, Emmens and Russell took to closer connection with the patients the road. “We went out globally with that benefited from them. With this that framework in mind, of finding a closeness in mind, when Russell business that was still very specialized became CEO five years ago, he sent in nature, that allowed us to get a his staff a very clear message about the better protection than just these wider pharmaceutical industry: we’ve formulation patents which are very lost our way, we’ve lost the agenda, the vulnerable to generic attack, that industry has got a terrible reputation provided us a platform to build a truly and the public’s view is very negative. global business,” he says. “And I said, we’ve created that for That hunt found TKT, a company ourselves, we’ve got to get back to an This is, of course, no reflection on that “ticked all the boxes” because the agenda of focusing on the patient, so the new CEO’s personality, Russell enzyme replacement product gave we started the cultural initiative in Shire explains, but is a wider statement Shire an ultra specialist drug protection. of putting the patient at the center of about the role of the CEO in any large This acquisition was a rare shaft of light everything we do, reminding everybody company; that it should be the priority in otherwise dark times, the darkest that that’s what we’re here to do, to of the CEO to create a vision for a Russell can remember. help these patients,” he says. company that provides his employees In the 2002/03 period, confidence This became known internally with the motivation to want to come to was so low that Russell and Emmens as the Brave Culture. Russell, who work every day. talked about buying the company, as describes his approach to business The time it takes to support senior the stock price had hit rock bottom, as philosophical, encouraged all managers is something that Russell and analysts were wondering if the employees to tackle challenges in the says he underestimated when he company would survive. “There was a Shire business with the same attitude transitioned from CFO to CEO. “It’s string of things, one after the other, and as those patients they were developing really not about me, it’s not that I’m ‘the that sometimes happens in business. medicines for. chief’. I’m really there to help everyone One thing after another didn’t seem This had a unifying effect on the around me do the best they possibly to go well for us. And then post-TKT company, he explains, and never can,” he explains. “These are tough acquisition, things seemed to turn fails to put the business into context. challenges,” he says, “and everybody around – that was a business we Despite the huge evolution of the needs some kind of support; it’s basic invested in heavily and that started to business over time, this culture human nature.” scrip100.com SCRIP 100 21 c-suite How Pfizer reinvented invention Mikael Dolsten, Pfizer’s president of worldwide research and development, tells John Hodgson John Hodgson, how Pfizer converted the Lipitor patent plunge into a strategic Managing Editor, Scrip Intelligence bungee rebound, how a business and R&D bioathlon prevents over-optimistic pipeline decisions, how virtual products frame a shared vision and how the company motivates a new flexible generation of R&D talent. We have moved from task Scrip: Let us start with an easy one: Pfizer has really changed across that allows scientists to visualize the orientation Can Pfizer’s R&D drive the company all of these dimensions to reset the shape of a product even for very early to outcome forward through what appear to be company for a new environment. phase projects. orientation, changing and more economically There have been few examples in this As the project moves more forward from participant constrained times? industry where such a dramatic change and we understand more about it, we to owner of To get a better return on investment, has been necessary. We have seen start, in effect, to draw up an internal your business we recognized that we need to take that we could stabilize our revenue business contract between R&D challenge a step back and reposition R&D to base, continue to provide tremendous and business: what data are needed be innovative and to generate great cash flow and profitability that we think before we go from an investment of business value, as this industry did a is reasonable and relevant during such few million dollars to the hundred couple of decades ago. a transition. million scale. It is really created as a So we decided to focus on a few There is much more to do. But as a detailed business contract? areas, core capabilities and put in company we have really learned how to This is something that, to the best place a new way of looking at external pull all levers – innovation, commercial, of my knowledge, has rarely occurred partnerships and differentiated putting new commercial models in in this industry. It’s a lot of work innovation. This was our R&D place – and we have learned how to because it requires a lot of dialog. turnaround and it touched all areas: become financially leaner and able to But the dialogs are also productive What scientific focus? How to blend execute on a smaller base. in themselves, because they help science with business? Where can commercial guys learn science and biomedical innovation thrive? And how Scrip: In this newly reinvented world, scientists learn commercial language. can the company reinvent its culture to how do you transmit throughout the It’s part of the training for a new breed include external stakeholders? company, clinically, what a Pfizer of talent. The leadership team wanted Pfizer product should look like? How do It also allows Pfizer to move away to use change to reshape the future, you do this when it is just a concept from being an ‘optimistic buyer’, rather than change reactively to cope or a compound in early R&D? How something we saw in many big with an increasingly difficult do you align R&D thinking with companies. ‘Optimist buyers’ tend to operating environment. commercial necessity, to rein in believe more and more in a product technological push or overbearing despite countervailing data: the worse Scrip: In 2012, the patent cliff was commercial imperatives? the data, the more blind optimism at its most precipitous. Now that For Pfizer, this has been a very you need. we are over it, does Pfizer no longer deliberate process. Our CEO, Ian With our internal contract, product have to be preoccupied with filling Read, has tremendous insight into how value is eroded if the data doesn’t the Lipitor revenue gap? Did it mean you can bring business dialog – with an stand up to the original metrics. We you could think differently about appropriate tone – earlier into R&D. think this has allowed us to make R&D? At the start of setting R&D priorities, decisions with open eyes and to avoid Lipitor at its peak had almost scientists and commercial specialists being optimist buyers. $12.886 billion in revenues, meaning work closely together to define what There is also one more step, that over one to two years our company a target product would look like in, particularly for the larger, Phase III lost income in different markets say, Alzheimer’s disease, in obesity, or investment decisions. We bring in exceeding the revenue base of many big in ovarian cancer. The profiling is not external challenge, inviting outside UK companies. That was tremendous product-specific but more general, experts to challenge us about what business challenge. And to respond to defining the type of outcome, the type they see as the most attractive it, we needed to mobilize a strategy that of clinical data, the type of label that compound or not attractive, why they included innovation, reconfiguration and we can promote or that would translate are excited, why they are not excited. also adapting the company to be leaner into a differentiated product. This allows a crisp internal dialogue and more agile. This process creates a framework and an unbiased external challenge.
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Of course, we take the final how the pipeline matures and grows In the CTIs, we have joint project There has been decision. The committee that decides in value, from getting into the clinic to teams with academia, with a a very deliberate is co-chaired by me as the leader proof-of-concept to registration and joint plan. We, Pfizer, enable the investment in of the business of science and a approval. And it’s not just the numbers academics to take their vision of a ownership culture colleague who leads the business of approved drugs but the business new treatment in a particular disease from Ian Read, of commercialization. value of the drugs that go into the into clinical trials, or into a proof and that has It is a continuous process – product equation. This trains our breed of of mechanism trial. We are project changed R&D profiling, business contract, the ‘robust talent to be owners of the business of members but the team is co-led by decision making’, then the Phase III science rather than just scientists doing an academic and an industry person. combination of science and commerce, a certain task. We have moved from We have tried to foster a new type of often with external challenges.
Scrip: How do you manage that process? After all, you are asking R&D team members to be very flexible in their approach, dealing with different kinds of external collaborators and internal colleagues. So how do you create an internal environment of flexibility? We know we are creating a new breed of talent. These people want to own the business outcome, are eager to work with the best (whether inside our company or outside), value entrepreneurial problem solving, and really want to take the initiative. There has been a very deliberate investment in ownership culture from Ian Read, and that has changed R&D. We have used story telling as a very powerful tool to make that culture come alive. We encourage scientists to talk about how they have solved major challenges, overcome barriers. Our task orientation to outcome orientation, culture of working together. It’s not teams have really taken ownership of from participant to owner of your Pfizer keeping a watching brief: Its decision-making: they think about the business challenge. trying to create an open innovation Pfizer program as if they were running system reaching thousands of their own businesses. Scrip: Pfizer has been very visible in scientists at major academic centers, its attempts to reach out to external each feeling that they are part of Scrip: That’s a nice philosophical partners in academia through creating the next generation answer! But what about establishing collaborations in San of medicines. incentives, rewards – the practical Diego, San Francisco, Boston and encouragement that reinforces the New York, with more to come. How Scrip: And to manage that process desired behavior? do you make these collaborations has Pfizer needed to hire different Thank you for mentioning ‘rewards’. work for the company? kinds of R&D leaders, or to re- We started in 2011 an incentive system The Centers for Therapeutic educate existing ones? for scientists that actually captures this. Innovation go beyond traditional We did both. We certainly had a Historically, we and many other big ways of working with academia. The number of internal entrepreneurs pharma had long term incentives that traditional way was very reactive and with the right technical skills to make were dominated by financial metrics. directed: academia asked for funding medicines but we also recruited a lot Scientists would be rewarded mainly and either reached a goal, or did not: of staff, particularly from small biotech according to how well the company while pharma got a report, or did not; to complement them. And we created was doing financially. or pharmaceutical companies asked some of the CTIs in purposed facilities We changed that and now the main investigators to study a drug within close to academic and medical incentive for scientists is based on very specific, narrow parameters. centers, often just next door. scrip100.com SCRIP 100 23 leadership Measuring R&D success and myth Christopher Bowe conducts his own proprietary research into who the best R&D Christopher Bowe Chief of Content, chief is within Big Pharma, and finds some provocative results. Scrip Group Who has been the best Big Pharma This resulted in a comparison pool and successful expansion to existing research and development (R&D) chief of four big-name R&D chiefs from the assets. Mark Fishman, of Novartis, Now, customer in the pharmaceutical industry recently? ranks of the top 12 innovative pharma holds second place. and societal Those interested in the industry likely companies by sales. Mark Fishman In contrast, Kim, of Merck, and expectations have found themselves asking this of Novartis, Peter Kim of Merck & Perlmutter, of Amgen, ranked lower have shifted question. Often, it is argued that it is Co, Roger Perlmutter of Amgen, and in the aggregate measurements of difficult to make an apples-to-apples Elliott Sigal of Bristol-Myers Squibb are the group. (See table for the overall judgment due to long development the only top tier R&D chiefs to serve rankings and individual metrics.) timelines, or different market climates. concurrent tenures in one company This research analysis sought to find over the period 2004 to 2011. A fifth, A broad assessment an answer. The results are instructive Moncef Slaoui, of GlaxoSmithKline, has At the job’s most essential level, the on an individual level, as well as a served as R&D chief from 2006, but R&D chief has three main things to do: macro industry level. They show who joined GSK in 1988 and was a senior • translate a big research budget into deserves accolades, and who does development executive in 2004-2005, as many new successful products not. They show the persistent need the last two years of Tachi Yamada’s as possible; for business model transformation, tenure in the job. If an allowance • proactively anticipate and ensure specifically in R&D. It is the function were made for Slaoui’s possible and that most, if not all, new products with the most power to radically probable input in Yamada’s final two they develop bring obvious new change pharma’s direction. years, Slaoui is the fifth R&D chief in an value to all who use them; So, the answer to the all important alternate comparison. • and develop other ways to increase question is this: Elliott Sigal, of Bristol- Sigal ranked first in each of the high-margin revenue, through Myers Squibb is the best R&D chief analysis’s three most important lifecycle management of approved of the analysis group used in this measures. He was first in measures drugs or developing other new research, and quite probably the best of total R&D spending/FDA approvals follow-on products to approval. in Big Pharma. of New Molecular Entity (NME) or new Two decades ago, any mixture of This analysis required Big Pharma Biologic Approval (nBLA); total R&D these factors was a job well done. It R&D chiefs to serve concurrent tenures spending/FDA approvals of NME/nBLA once was enough for R&D to deliver for a significant amount of years, in order + innovative vaccines; and perhaps value according to the company’s to make a relevant comparison. They most importantly: the co-efficient of measures. Now, customer and societal had to be long-serving to allow them to total R&D spending into average peak expectations have shifted. The R&D have a significant personal impact on sales (from the innovative approvals). chief – and by extension, the company the products, approvals, and results at Also, intriguingly, Sigal was first in – must deliver significantly new value their company. And they had to serve total R&D spending per FDA efficacy by customers’ and society’s standards. concurrently to ensure uniformity in supplement approvals – a surrogate Payers, providers and customers use regulatory and market environments. measure of lifecycle management pharmacoeconomic filters and higher thresholds of value, changing the Mark Fishman, Novartis economics of the pharmaceutical R&D. The best R&D chief delivers new-new products by a better conversion rate of R&D spending to product value. This analysis attempted to use data and metrics that could give a broad but accurate assessment of the effectiveness of R&D chiefs to deliver to their companies, markets and customers in this shifting landscape.
Three deciding factors The three main factors used to provide
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that assessment were: individual R&D chief across the spectrum have many choices when recruiting for There are better • the total R&D spend per NME and of what is expected from them. But there the next leader in pharmaceutical R&D. R&D chiefs than new BLA approval by the FDA; are also big picture lessons. others; that is • the total R&D spend per NMEs/ For full methodology visit: a fact nBLAs plus new innovative The bigger picture scripintelligence.com vaccines; Three broader conclusions are evident • and the co-efficient (or multiplier) from this research. Firstly, it shows Elliott Sigal, Bristol Myers-Squibb indicating how much of the total the relative effects of increasing scale R&D spend was converted into the on Big Pharma R&D organizations. average peak sales of the NMEs/ Although all five men’s budgets were nBLAs and vaccines; massive, R&D spend is somewhat • the total R&D spend per all FDA negatively correlated with the R&D efficacy supplement approvals from chiefs’ performance. 2004 – 2011. Secondly, the ratio of total R&D There is one exception in these spend per innovative approval, and co- measurements worth noting. A few efficient of R&D spend conversion to NMEs approved for some companies average peak sales must become more have no reported sales in regulatory favorable, for everyone’s sake. filings and also no reported forecasts Real, sustainable business model in our databases. Accordingly, they change in the pharmaceutical were excluded from the calculation industry is imperative. The key to that of average peak sales for those business model change starts with re- companies. But one is of particular innovating the way drugs are created note – Coartem, an anti-malarial and developed. This will take a new treatment by Novartis. collaborative mentality beyond current Malaria is still one of the great economic silos of research. Sigal neglected diseases on the planet and and BMS’s good showing also point a successful new treatment delivered toward more focus, more collaboration, through public authorities such as and less size. It is possible that the in Africa has potential to do a good 21st century company will be hyper- service to humanity. It is possible that focused; think Novo Nordisk. Novartis’ Fishman may have climbed Thirdly, individuals matter. One nearer to Sigal if some alternate value person can make a difference in a (rather than peak sales) was ascribed huge company, in a big world, within to Coartem. It could also be argued the infinite realm of science. There are that all the NMEs could have such better R&D chiefs than others; that is alternate value assigned to them. a fact. The industry must set up new These four metrics show a complete ways to develop this talent so that view of the relative success of each companies don’t settle for less and
2004 - R&D $ / NME, nBLA R&D $ / NME, nBLA + Coefficient of Mean Peak R&D $ / FDA FDA Efficacy Total R&D 2011 NME-nBLA Approvals NME, nBLA New Vaccine R&D Spend to Sales $m Efficacy Supplement Spend 2004 (FDA) + New Approvals Mean Peak (estimated) Supplement Approvals - 2011 Vaccines (FDA) Sales Elliott $4.06bn/ 7 $4.06bn/ 7 0.0564 1601 $710m/approval 40 $28.41 bn Sigal, NME new approval Bristol- Myers Squibb Mark $4.74bn/ 9 $4.51bn/ 10 0.0227* 1024 $764m/approval 59 $42.70bn Fishman, NME new Novartis approval* Roger $5.11bn/ 5 $5.11bn/ 5 0.0346 884 $1,700m/ 15 $25.56 bn Perlmutter, NME new approval approval Amgen Peter Kim, $12.72bn/ 4 $7.27bn/ 7 0.0385 1961 $942m/approval 54 $50.88 bn Merck NME new approval
* includes Novartis vaccine R&D spend 2004-11 $2.357bn (total $45.06bn); Source: FDA, Datamonitor, BioMedTracker, Scrip Intelligence
scrip100.com SCRIP 100 25 leadership CROs: new leaders for a new era? A new swathe of CRO leaders have been appointed in the outsourcing business
Joanne Payne within the last six months. Joanne Payne talked to two of them to see if new Outsourcing leadership equals new strategy in the services industry. Editor, Datamonitor The CRO industry is gathering in Pharma: the way they work internally, thus far. “I’ve taken my own form of Healthcare, Scrip pace, influence and authority in the their priorities and anxieties. Hippocratic Oath to the organization Intelligence wider drug development sphere. The Simmons, in an exclusive interview here, which I was committed to at overriding theme within the service with Scrip, was clear on the leadership first, do no harm, then build from In Simmons’ industry over the past two years has incentive that brought him to PPD. He there,” he explains. Now, he has two previous guise been the increasing use of strategic was very happy at Pfizer, had great important “beams of strategic focus” as head of alliances between CROs and Big career progression and good working that he will build on within the CRO. emerging Pharma partners as the R&D talent relationships there, but he says the The first beam is to drive productivity markets for from the latter is increasingly swept up draw to PPD was too great to ignore. and efficiency improvement into the Pfizer he had by the former. He admits he hadn’t been looking PPD core business, and the second access to a very So, as the influence of the CRO specifically at the services industry is to “turn over every stone” to find special thing grows within drug development, the as a career move. However, the innovative ways to drive success for that will aid leadership of these companies is tailwind currently felt in the CRO the company’s client base. PPD’s growth, more important than ever. In this past industry because of the pressure an international year, the chief executive positions put on research productivity, which Turning client thinking into view in Quintiles, PPD and ICON have is “leading to more variability of the competitive advantage changed, with INC Research and research spend and ways to generate In Simmons’ previous guise as head Chiltern following suit in the beginning efficiencies and increased effectiveness of emerging markets for Pfizer he had of 2013. In the two most high-profile of the research investment”, made the access to a very special thing that cases, Quintiles and PPD, the new change attractive to him. will aid PPD’s growth, an international leader has come from outside the It is clear when talking to Simmons view. He opines that the CRO industry CRO industry (Accenture and that he embraces challenges, and will tends to look at emerging markets Pfizer respectively). not sit back and steer the PPD ship as where trials will be placed by a still with only one hand on the rudder. In very predominantly western-centric New leader = new strategy? his new position, his challenge is a customer base. However, this will Many industry observers familiar one, although in a different change, he says, for the benefit of the acknowledged Quintiles’ CEO, Tom manifestation: focus. In his time at CRO business. Pike’s, 22 year-long consultancy Pfizer, Simmons’ challenge was to “If one looks at where the flows of experience as a clue to the strategy allocate capital and time judiciously money are going in biopharma, more behind oftentimes enigmatic Quintiles. into the most important parts of the and more emerging market companies, Many asked why Quintiles, the business. At PPD, the challenge is that are serving their populations largest CRO in the industry, hired the number of clients, he explains. primarily through branded generic a chief executive with no CRO or “The number of medicines that we’re medicines, are gaining a lot of the pharmaceutical experience. With the supporting the development on is growth. Many of these companies, hiring of Pike, it is a clear message to tremendous and the level of dynamic either through an entrepreneurial the wider pharma business: we want to activity that’s going on in the company environment or through a government cement our place as a pharmaceutical is extremely high. who has stated objectives to build consultancy, and put clear blue water “Staying focused on the most critical biopharma, are going to move into the between ourselves and the CRO label. processes, the most critical work innovative side of biopharma. They’re A new chief executive that does on the commitment to quality and going to want to generate IP ultimately have a lot of hands-on pharmaceutical execution, and not allowing oneself with the desire to have IP that can experience is David Simmons, the new to get the field of focus drawn too far be deployed into customer needs chairman and CEO of PPD. He is in a afield but to stay focused on the core globally,” he explains. “Emerging unique position, having left a successful of the business and delivery for the markets may wind up over time being 15-year career as head of emerging clients, that’s a challenge,” he explains. a source of customer base for CROs markets and established products He recognizes how important it is beyond what it is now, which is looked at Pfizer to take on PPD. He brings “not to mess” with the PPD business at primarily as local companies running with him an intimate knowledge of Big model that has worked very well local trials.”
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operational thinking
Jamie Macdonald takes the helm of INC Research at the beginning of 2013. He explains what his focus will be for the CRO next year, and challenges for the wider industry.
You’ve come from the operational side of INC Research, how does this prepare you for the role of CEO? Operations, a strong delivery and a strong foundation are the key to driving the business forward and really providing a platform for growth and for strategy. I think strategy without strong operations, generally doesn’t go to plan. You’ve got to be executing on your current work, you’ve got to be keeping customers satisfied and wanting to come back, you’ve got to be ensuring that you have the right talent pool and that you’re motivating your teams. My focus will be as much on building the right organizational team, the right structure, putting the right people in place and from there ensuring that our management process works and our strategy process works. It’s something that will be driven by me but it’s also the management team and our board who will have input David Simmons into, particularly, the strategic direction of the organization, but having a strong delivery on current work is a critical foundation. Simmons, who admits the only region this diverse experience base of the he doesn’t have a detailed working leadership in PPD, and stitch it together What is your New Year’s message to the INC Research employees? knowledge of is Africa, has a good so that all these insights come together I think its [2013] an exciting year. People are looking forward to understanding of which governments for informed decision making to help us expanding our customer base, then building on the strengths that are serious about developing their do a good job,” he says. INC has. We are strongly therapeutically focused, which I think has biopharma industry, and which are served us well in the current market, but I think we’ve got a lot “some of the leading or probable “it gets a little bit more work to do. winners in those countries, that will be frightening…” One thing that will be key for the organization is not to feel potential clients, who will want to take Doing a good job may seem like a complacent. It’s a very competitive market and we really need to product development globally where we general statement, but Simmons strive for adding value to the customer development pipeline. That can be a great partner”. says he wants PPD clients to “expect will be the key message: focus on time delivery, finding efficiency, Second only to Simmons’ nothing less, and frankly accept and offering value for money. On the quality side, we continue to knowledge of the emerging markets is nothing less, than excellence from us. look at better ways of delivering studies, not just from a regulatory his knowledge of the client perspective That’s a big order and even when I say quality standpoint but operational quality as well as giving of R&D spending, something he it; it gets a little bit frightening because customers the definitive data they need to make decisions about promises to bring his own “personal it is a big standard to live up to”. their pipeline, and ultimately seek the necessary regulatory lens” on. Simmons says he has already PPD’s new CEO does not seem like approval. Providing transparency and timely data to customers is a “weighed in” on client bid proposals a man who is intimidated by the search big part of that as well. when PPD is engaging and responding for excellence. When discussing the with the client to assess the company’s future of the company, he demonstrates What is the biggest challenge for the CRO industry in 2013? “efficient frontier”, which is how that a very detailed understanding of the Continuing to align to customers and allowing customers to be able research sponsor views the asset value pressures on the drug development to outsource a higher proportion of their development with against other development assets they business as a whole, the operational confidence. Customers, certainly for the amount they spend on have. “These types of insights already decisions it will take to make PPD the development, deserve alignment and transparency in the CRO play into more or less handicapping go-to CRO in the industry. “It’s like service. The industry is still relatively young and I think we can some of the client behaviors, in terms anything else,” he says, “If you set a learn lessons from other industries where service providers have of how they value their own portfolios, perfection standard you know you’ll aligned well to the main sponsor activities. and it also leads to a deeper discussion never achieve it, but on the journey to The industry has been criticized for too much variability in its inside the company [CRO] of how we try and achieve it one will get much delivery from project to project and program to program. As we adapt ourselves to gain these insights,” better and develop and evolve and improve our management process and continue to deploy teams he explains. grow much closer to its true aspiration effectively and on time, that will reduce any variability in delivery “I think the real key is not just what than it would otherwise, and that’s really and will continue to give customers the confidence that they need in I’m bringing, but how do we take the feeling I have here in the company.” order to utilize the CRO industry on an increasing basis. scrip100.com SCRIP 100 27 leadership Performance related pay? Not in pharma Eleanor Malone EMEA Editor, Scrip Intelligence Much has been made about the fat wage packets of those at the top of the pharma tree, especially in a time of such financial austerity. With this in mind, Eleanor Malone, Ian Haydock and Gemma Sharman crunched the numbers, and found an unexpected surprise.
When Scrip set about gathering the high numbers in order to retain the of other metrics, including, market data on top pharma CEO pay, bonus top talent. How long before the likes capitalization, dividend yield and EPS, Ian Haydock Asia Editor, Scrip and benefits packages, it came as a of Sanofi’s Chris Viehbacher ($8.03 and it is apparent that there are no Intelligence surprise to find that the total value of million) say enough’s enough and bow clear and consistent correlations. executive compensation in the top 10 to pressure from across the Atlantic For example, while Pfizer’s pharma companies has declined over to take the helm at a US corporation? executive compensation rose steadily the past five years. And even though GlaxoSmithKline’s and healthily from $9.5 million in 2007 Before sympathizing too much with Andrew Witty saw his deal rise nearly to $25 million last year, the firm’s those who perhaps still earn several threefold to $10.62 million last year, is market capitalization has only risen hundred times more than the mean, that enough to keep him in the UK? from $155 billion to $166 billion, taking it should be noted that the absolute The disparity in total packages and a beating in between (despite the level of CEO packages still provides pay trends between the 10 firms raises acquisition of Wyeth); dividend yield Gemma Sharman Editorial for a pretty comfortable existence. many questions about how executive has fallen from 5.1% to 3.7% and EPS Assistant, Scrip The average pay of a top 10 top dog pay is calculated, how it should be is down to $1.27 from $3.12. Intelligence in 2011 was $16.3 million, down from calculated, and what role concepts of At Abbott, on the other hand, $16.7 million in 2007, but up from fairness and proportionality have to play. where CEO compensation has $15.5 million in 2010. These questions clearly vex declined every year since 2007, from Defenders of This level of reimbursement is so shareholders, as advisory ballots of $33.4 million down to $24.01 million, rising packages comfortable that the envy of others shareholders under the 2010 Dodd- market cap is still around $87 million, argue that sometimes becomes a costly discomfort Frank Act Say on Pay provision have while dividend yield has grown from boards are itself: Abbott Laboratories’ Miles White, shown: at Pfizer, the 2011 Say on 2.26% to 3.34% and EPS is up from forced to for example, had to spend $184,000 Pay vote only just scraped majority $2.31 to $3.01. approve high on security in 2010, reimbursed by the approval for its named executive pay Commenting on the data, Chris numbers in company on the recommendation of with 56% of votes cast in favor, while at Walter, head of the international order to retain an independent security study, while Johnson & Johnson the approval vote employment team at law firm the top talent Pfizer’s independent security study left was 61%. J&J’s CEO in 2011, William Covington & Burling, said: “There’s still CEO Ian Read and accompanying family Weldon, received the highest executive a very strong sense that stakeholders obliged to use a company airplane for all compensation package of the top 10 should have a more accessible way to air travel including personal use, adding firms to last year, despite three years assess pay versus performance. It’s an $126,000 to the $48,000 bill footed by of reducing compensation and several evolving story in the US and Europe, the company for his personal car and damaging high-profile product recall and but the common theme is the need for driver in 2011. illegal marketing cases under his watch. greater transparency.” While pressure Nevertheless, let us spare a The global financial crisis (and from the Dodd-Frank Act is helping thought for the CEOs of European associated healthcare cost-cutting by to eradicate some bad corporate pharma firms. The average CEO governments) has added to the patent practices – such as the recalibration compensation last year among cliff crisis and longstanding problem of of share plans without approval, the those of the top 10 firms based in declining Big Pharma R&D productivity payment of guaranteed bonuses and the US amounted to $21.1 million. to stretch CEOs to their limits in recent buying out entitlements from previous Shockingly, the average of those five times, but how do their response and employees – the question of pay top 10 firms based in Europe came in the performance of their companies remains highly controversial. at less than half of that: $10.8 million. map onto the rewards they receive? Defenders of rising packages argue Scrip has compared CEO Japan top dogs slimmer that boards are forced to approve compensation trends with a number than Western fat cats
28 SCRIP 100 scrip100.com leadership
An elite group Figure 1: Who Earned What – Japan Pharma Executive Pay (¥m) of executives at Executive (position, company) Salary Bonus Stock Options Total Change in Japan’s largest total pharma firms Yasuchika Hasegawa (CEO & president, Takeda) 144 77 84 305 +11% Osamu Nagayama (president, CEO, COO, Chugai) 124 98 80 304 -11% broke through Dr Frank Morich (chief commercial officer, Takeda) 93 73 103 269 N/A the ¥100 million Masafumi Nogimori (chair, Astellas) 105 17 37 161 -10% (around $1.26 Joji Nakayama (CEO & president, Daiichi Sankyo) 90 27 33 159 +20% million) barrier Takashi Shoda (chair, Daiichi Sankyo) 90 27 33 151 -12% Yoshihiko Hatanaka (CEO & president, Astellas) 89 21 32 143 N/A Haruo Naito (CEO & president, Eisai) 112 23 6 142 - 7% Lonnel Coats (CEO & president, Eisai Inc) 47 24 62 135 -13% (incl incentives)
$1 is around ¥80. Source: Company information
There were also declines in total pay for Nevertheless, an elite group of salary remained the same. many of Japan’s top pharma executives executives at Japan’s largest pharma He was followed closely by last fiscal year, reflecting the tougher firms broke through the ¥100 million Chugai’s president, CEO and chief business environment and generally (around $1.26 million) barrier. operating officer (now chair and CEO) lower bonuses and stock options. A look at the top five companies Osamu Nagayama, who earned The figures remained modest by by overall sales last fiscal year reveals ¥304 million in the firm’s last fiscal Western Big Pharma standards, in line that Yasuchika Hasegawa, president (calendar) year. This was despite with the relatively small size of Japan’s and CEO of Takeda, not surprisingly the Roche affiliate placing only ninth largest firms compared with the leading came out on top with a total package in prescription sales in the industry Western multinationals, with top of ¥305 million. This was up by around in Japan (including foreign firms), company Takeda at number 13 in the 11% from the ¥276 million in the according to Datamonitor rankings 2011 Scrip 100 rankings. previous fiscal year, although his base (see Figure 1).
figure 2: executive compensation 2007-2011
2007 2008 2009 2010 2011 40
35
30 m) $ 25
20
15 Executive Compensation (
10
5
0 tis
Pfizer Sanofi Roche Eli Lilly Novar Average Merck & Co AstraZeneca GlaxoSmithKline Johnson & Johnson Source: Company information Abbott Laboratories scrip100.com SCRIP 100 29 2 5 t h A n n u A l EuroMEEting AMstErdAM 2013 4-6 March 2013 | Amsterdam RAI | Netherlands
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2 5 t h A n n u A l Sugaring the pill when mass layoffs are inevitable Industry dynamics have made mass lay-offs a fact of life in Big Pharma. But Eleanor Malone EMEA Editor, uro EEting even if cuts are unavoidable, their impact can and should be controlled. Scrip Intelligence E M Eleanor Malone investigates. Professor of management Wayne Gray & Christmas, jobs cut in the US laid off but also their surviving “In many ways Cascio of the University of Colorado, pharmaceutical industry in the first colleagues and business, as well as pharma is Denver, has studied downsizing for 10 months of 2012 were 11,586, other stakeholders including contract in a box and AMstErdAM 2013 some 20 years and is one of the US’s compared with 20,079 in January- workers, supply companies and local will have to most respected authorities on the October 2011. Meanwhile, announced and regional communities, it is worth ruthlessly trim subject. His investigations have led hiring plans in the sector totaled 2,325 considering what might constitute best expenses” him to conclude that laying off staff (adding to 4,043 announced in 2011). practice in these circumstances, and 4-6 March 2013 | Amsterdam RAI | Netherlands only makes sense for companies when In 2011, the pharmaceutical sector how to avoid common pitfalls. the downturn they are experiencing is was the seventh biggest cutter of permanent: when a firm merely faces a jobs, at 21,580 over the full year. This Watch out for the survivors The Annual EuroMeeting is DIA’s largest conference in Europe, attracting more than 3,000 trough in the business cycle, measures was already a marked improvement So what is Professor Cascio’s advice professionals from industry, government, academia, as well as patient groups and students. such as temporary hiring freezes, cutting over 2010, when the industry was the to firms that are about to embark It is unique in the quality of its content and speakers, and in the opportunity to network with the training budget or putting staff on second biggest firer with 53,636 cuts. on a round of cuts? “The greatest furlough leaves that firm in a better place This year it has fallen to 17th place. concern is with people who stay likeminded professionals, regulators and thought-leaders. to recover when conditions improve. Meanwhile, in Europe, the European behind (‘survivors’). The first casualty of For many Big Pharma companies, Monitoring Centre on Change, which downsizing is employee morale. People Make sure you are part of this unique annual opportunity to join fellow however, finding ways of avoiding staff keeps a database of large-scale become risk averse, narrow-minded professionals at the largest European conference of its kind, featuring: cuts altogether is just not realistic. restructuring events reported in national and self-absorbed. That’s exactly what “The structural changes in the industry media of EU member states, highlights you don’t want with your survivors are huge and they don’t seem to be a number of important adjustments temporary. I’ve rarely seen an industry amounting to some 4,500 or more job Notable mass layoffs More than 100 scientific sessions in 17 parallel themes rocked as much as this. There are cuts for the sector. announced in 2012 200+ exhibiting companies pressures from governments to reduce For Professor Cascio, the fact that the cost of drugs, there’s the patent cliff different firms have had “dramatically Special hot-topic sessions • Novartis planning 2,000 cuts in the US; REGISTER and there’s M&A,” Professor Cascio different responses” to the problem NOW! 18 pre-conference tutorials observes. “What can they do? Cutting is “fascinating”. He notes that while • Roche closing its R&D site in Nutley, New Jersey with the loss of 1,000 jobs and shifting its focus A whole range of networking events included costs and growing revenues are really some have focused on reducing to Genentech’s base in California, a new center the only two ways to make profits. In administration and scaling down in Manhattan and further growth in China; many ways they’re in a box and will manufacturing (Merck & Co), others • AstraZeneca revealing a 7,300 job cuts program worldwide; Early-bird Rate: Register by 17 January 2013 and save! have to ruthlessly trim expenses to bring have slashed their R&D budget • Abbott slashing 700 manufacturing jobs across them into line with revenue projections.” (Pfizer), cut sales forces (AstraZeneca) divisions but mainly in the US and Puerto Rico in The relatively good news, that in 2012 or shifted jobs to emerging markets January, and then in October announcing The Exhibition provides a once-a-year opportunity to make contact with the crème-de-la- another 550 immediate cuts with several mass layoffs in the pharma industry were (Roche). “There is no ‘one size fits hundred more to come in 2013; crème of the pharmaceutical world. Multiple networking events provide ample opportunity nowhere near as hefty as in previous all’ response. It depends on where • Takeda ’s January announcement that it would cut to meet old and new contacts, discuss sessions, and exchange professional views. years, should be seen in the light of the they see growth in the business,” he 2,800 jobs in the US and Europe as it integrates significant axe damage that has already comments. Nycomed; been inflicted across business functions While some of the shift in labor to • Merck KGaA’s decision to close Merck Serono’s Visit www.diahome.org/EM2013 Geneva headquarters where 1,250 were over the past few years. emerging markets is about outsourcing employed along with smaller site closures in to download the complete programme and register online. And despite the decline, there have and labor arbitrage, this is not the sole Switzerland and other countries and plans to reduce its workforce in its home country, still been more than 15,000 job cuts reason: “They need to stay close to Germany, by 1,100; documented for the US and Europe consumers. With the rise of the middle • Sanofi ’s decision to cut 900 jobs in France with For more information call DIA Europe so far, and the real figure is likely to class in India and China, there’ll be additionally the future of a major site in Toulouse still hanging in the balance; at +41 61 225 51 51 or email: [email protected] be somewhat higher, as reporting of growing demand and they’re reacting layoffs can be patchy and incomplete. to that in moving operations,” he says. • Lundbeck carrying out European workforce restructuring affecting 600 positions. According to research by the US With cuts impacting potentially outplacement company, Challenger, severely not only on the individuals *In some cases cuts may take a few years to complete
scrip100.com SCRIP 100 31 CAREERS
“People become because the only way to outrun the Top tips when you need to cut costs incredibly competition is through innovation. You creative when don’t want people keeping their heads • first ask for cost-cutting suggestions from the whole workforce their own jobs down and just playing political games • in the event of a mass layoff, be very open about the criteria you’re using are on the line” to keep their jobs.” How do employers avoid this pitfall? • be consistent: use a formula for severance pay and make it known “Survivors have to be able to see • don’t do across the board layoffs: identify departments and functions that are strategically critical to preserve value that the company will be better off. They will be asking: ‘were the departers • don’t approach staff cuts little by little – staff will wonder where the axe will fall next, and that damages morale, productivity and innovation treated fairly and with dignity and • give people a sense of personal control (eg by giving them a window of a respect?’; ‘Why should I stay (is there few months to choose when they leave) a future here?)’; and ‘is there a new • be generous: continue health insurance and other benefits for a few business strategy?’.” months after people leave; offer generous severance pay • treat people with respect and dignity: don’t march them out of the Engage the workforce building, send text messages or block security cards without warning Transparency is the key here, and • use outplacement experts with good contacts within the pharma industry and have them in place from the day the layoffs are announced communication with staff should ideally begin way before a final decision is • plan counselling, coaching and team-building exercises for remaining staff, including managers who have to lay people off taken. “Frequently a small number of executives sit in a room for a few Thanks to Prof Cascio and Mr Wrynne for input weeks and come up with a downsizing strategy. And they don’t involve the size of a layoff, and they may said that while much had been the workforce. Yet people become also help executives figure out how achieved through the establishment incredibly creative when they know best to carry it out. When large- of a Pfizer task force and various their own jobs are on the line,” says scale redundancies are unavoidable, development initiatives, “earlier Professor Cascio. “employers need to put in place confidential dialogue [with Pfizer] would For example, employees at effective systems to support staff have assisted all parties”. He believes Novartis’s OTC facility in Nyon, both practically and emotionally,” that continuing uncertainty over the Switzerland, were able to convince the notes Ciaran Wrynne, who works in future uses of the site have led to firm to backtrack on plans to shutter the career transition services team at potential loss of scientific resource in the plant with the loss of 330 posts. recruitment firm Hays. the area, and says “more could have Instead, they agreed to work longer Meanwhile, beyond the company been done to retain resource locally hours and take a reduced pay increase, itself, the impact on the local economy sooner through an open dialogue”. while the company will also enjoy around a site affected by a major layoff Paul Carter, head of the Pfizer task reduced regional taxes for a period. can be significant. Kent County Council force and Leader of Kent County Novartis even agreed to invest CHF40 and others in the UK scrambled in Council, also calls for early notice. “Let million in modernizing the site. February 2011 to react to Pfizer’s us know any decisions in advance, Staff suggestions may help reduce decision to exit Sandwich, as the local and as early as possible. We’ll retain economy was dominated by the firm, your confidence but give us the time to with local businesses and suppliers, prepare and we’ll line up central, local pharma industry job cuts (US) schools and pubs all representing government and others in planning and potential collateral damage. providing support whenever we can in There has been some limited a whole number of ways.” Rank: 8 success to date in repopulating the Company withdrawals don’t have to Rank: 2 61,109 53,636 site with new firms, but many former spell doom for business at a site. Over workers have moved on, whether that time, conversion to multi-occupancy be through retraining, relocating to business campuses, often with a Europe or the US (many find that their focus on biosciences, can lead to a Rank: 7 21,580 experience at Pfizer has enabled them thriving local infrastructure. Pfizer’s Rank: 17 to find posts with greater responsibility task force singled out The Heath in 11,586 in smaller organizations, or research Runcorn, Cheshire, which was once institutes) or just embracing a new an R&D facility of ICI. Ten years on,
2012*201120102009 lifestyle and taking their biomedicine the business and technology park as it skills out of the local economy. now is employs 2,000 people in some
* first 10 months to end of October; Source: Challenger, Gray & Tim Ingleton, head of inward 160 businesses, more than ICI did Christmas; Rank = position of industry among other industries by number investment at Dover District Council, before it exited. The Task Force also of job cuts
32 SCRIP 100 scrip100.com CAREERS life after big pharma: Mike yeadon
process enables the individuals Until February 2011, Mike Yeadon was vice-president and CSO, in charge of allergy and respiratory research at Pfizer in involved to distance themselves from Sandwich, UK. He was 50, had been at Pfizer for 16 years and the negative effects of their decision); had spent his whole career in Big Pharma. displacement of responsibility (“it’s not Dr Yeadon was happy, productive and comfortable “in the fur- what I want to do: the market makes Beware ‘moral lined rut of a big pharma job”, but after some years of R&D layoffs in the industry, he knew it was “foolish to assume that this me”); or mimicry (“people take their disengagement’: was never going to happen to me”, and had been preparing for that eventuality. cues from what others in the industry engage in early Unwilling to “hop around the world every 18 months, getting fired sequentially”, he are doing: it gets established that it’s an dialogue decided to “extend [him]self into new opportunities and get good at another set of acceptable thing to do”). adjacent and transferable skills”. The problem is that such evasion In fact, this meant speaking to “probably several hundred people over the previous 2-3 years, just asking them open questions about what they were doing and how they got of responsibility may result in a firm there”. In considering what he could do, he came up with three possibilities: consulting, overlooking its ability to mitigate the starting his own life sciences business and setting up a hobby-based business. impact of its withdrawal on the In practice, he has done all three, most recently announcing the $27million funding of wider community. his start-up Ziarco, which is based on assets he worked on at Pfizer and subsequently licensed. A responsible company should work closely with local and where For Dr Yeadon, the Sandwich closure announcement was disappointing but not surprising. “I had probably 12 hours of shock then I was up and running doing my appropriate national authorities to plan,” he says. This is not a man who wanted to leave his job, and he admits he missed ensure a sustainable strategy can the “friends, colleagues, access to resources – it’s nice to have a warm place to work instead of working from your house, a certain rhythm and comfortable predictability of be established, again engaging in the work cycle”. He also loved running the project and portfolio he had at Pfizer (“it was dialogue as early as possible when almost my life”). “But if you asked, ‘would I put Humpty Dumpty back on the wall?’ I’d cost-cutting is foreseen. Planning say not a chance! I love this 10 times more than what I was doing in 2010.” and taking proactive steps to He is glad to be free of the long chains of approval that slow processes up in a large organization (“It’s not a Pfizer thing, it’s a big company thing,” he observes. “I had preserve a biomedical presence in grown to the point in my life when I was just impatient with that.”). the local economy is good corporate
He was also surprised while consulting and fundraising to find that he didn’t miss his responsibility practice, but it could also salary. By relying on the financial cushion he’d been able to build over his career, and prove to be in the company’s interests. with his redundancy pay-out and consulting work, as well as cutting some of his costs, he Big Pharma needs innovative start- and his wife, the parents of two teenagers, found that “no one was suffering, the lights weren’t off and everyone was being fed”. ups and outsourcing providers more
Perhaps his resilience stems from his prior decision to “future-proof” himself. In his view: than ever to feed into its innovation “It’s not a sign of disloyalty or lack of commitment to prepare yourself for the future. It engine. Leaving behind a viable signals taking adult responsibility for yourself to at least toy with what might be the microclimate for such enterprises to unpalatable and turn it into something fantastic.” thrive makes good long-term For others facing similar situations, he advises “having at least a second strand to your life that gives you a degree of resilience in the event of a decision made by others”. business sense.
By preparing the ground in advance, maintaining good relations with Pfizer (it’s an Company Number of Number of Job cuts in investor in his new company) and ensuring that he was making the most of the network employees employees 2012 he continued to synergistically build both through his consulting work and in seeking financing for his new company, Dr Yeadon has created and exploited opportunities that end 2010 end 2011 have enabled him to make the most of a potentially catastrophic upheaval and move Pfizer 116,500 103,700 300 (Canada) forward in his career in biomedicine despite the great uncertainties in the sector. Novartis 119,418 123,686 1,960 (Globally) Roche 80,653 80,129 210 (Germany) noted the example of Pfizer’s R&D take a salary and its accompanying 1,000 (New Jersey) facility in Ann Arbor, Michigan, which long term certainty could soon Johnson & 114,000 117,900 130 (US) now hosts the Michigan Life Science become too great. To help them, we Johnson 200 (Puerto and Innovation Center, employing immediately offered “accelerator” Rico) 1,300 people. grants of up to £20k to the most AstraZeneca 61,000 57,200 7,300 (Globally) GlaxoSmithKline “We needed to act to keep the promising spin-outs, helping them 96,500 97,389 Eli Lilly 38,350 38,080 Pfizer skills in Sandwich,” says Carter. to travel to secure contracts and Merck & Co 94,000 86,000 555 (EU) “Through the site head, we found paying their short-term costs. All of 1,390 that some of the best scientists were these start-ups have since gone from (announced for 2012-15) quietly being lured away to big jobs strength to strength.” Sanofi 100,000 113,719 1,555 (US, elsewhere. We quickly identified short- Sandra Sucher, Professor of Canada and term cash was a problem to those Management Practice at Harvard Europe) looking to be brave and go alone in Business School, believes that moral Abbott 90,000 91,000 1,250 (US & Europe), several starting their own businesses and we disengagement may emerge in mass hundred more needed to encourage them. layoff scenarios. Executives may for 2013 “If someone wanted to start up a employ a series of mechanisms – such Compiled by Lucie Ellis and Eleanor Malone from company information and media reports spin-out business, family pressure to as diffusion of responsibility (a collective scrip100.com SCRIP 100 33 CAREERS Women: know your place – in
Gemma Sharman the boardroom Editorial Assistant, Scrip The European Union has brought in a proposed directive on female board Intelligence representation, compelling companies to ensure that 40% of their directorship is made up of women. To many, the news is unwelcome among fears that companies will be forced to choose board members based on the wrong criteria. To others, the move is long-overdue. Gemma Sharman chairs the debate.
Ingelheim have neither a female Based purely on statistics, the US board member nor listed female is furthest ahead in terms of gender senior executive. And yet in diversification. Currently 19% of board their entirety, women make up positions in the US companies in the roughly 50% of the industry. top 20 pharmas are held by women, The reasons why women and 18% of senior executive roles. In don’t seem to make it to the Europe, these figures are 14% and top in the pharma industry 16% respectively, while Japan and the are, as in all industries, rest of the world (in this instance only vastly complex and due to represented by CSL of Australia) lag a combination of social and behind with just 7% of directorships cultural factors. However, held by women and a paltry 4% of it seems pharma is lagging senior executive jobs. compared to other industries. Anna Protopapas, vice-president Philippe Loewenstein, of global business at Takeda (which who heads the European incidentally employs three senior life sciences practice at women including Protopapas in a executive search firm Egon senior executive committee of 10), Zehnder International, says notes that some of the differences may that in his experience, be because the “burden of family and pharma is “not the top pupil other things fall more on the shoulders in the class”. “Pharma is somewhere of women than men in some cultures”. Unlike in In the pharmaceutical industry, in the middle, but the lower middle,” “In the Japanese workforce,” she adds, industries such women are noticeably absent from he said. Unlike in industries such “women exit the workforce to raise as mining and the upper echelons. In the Scrip 100 mining and steel, there seems to be a family”. Takeda has introduced a steel, there pharmaceutical rankings, there is not no obvious reason for this gap, given daycare facility to help working mothers seems to be no a single female CEO. In the same the high number of female scientists stay in their jobs. obvious reason group, just 11% of the companies’ 940 and saleswomen. But family life is only part of the for this gap directors are women and of their 808 Loewenstein puts it down to industry picture. As Protopapas comments, senior executives women represent culture: “I’m afraid it’s just that these “Whether you’re a woman or a man, we only 13% (these figures only include companies have been managed by all struggle with questions of work-life companies for which this information is sort of, ‘old boys’ clubs’; it has been balance.” An arguably bigger problem publicly available). more difficult, simply from a cultural is the lack of role models and mentors Forty three of the top 100, including perspective, for women to grow.” for women. Loewenstein asserts that, Johnson & Johnson (which came Generally however, barriers for “A certain category of key employees close to having a female CEO at the women include a well-rehearsed list are not focused upon in a systematic start of 2012 when Sherilyn McCoy comprising age, motherhood, lack manner in order to give them the was pipped to the top job by current of role models, qualifications and opportunity to rise in the organization”. CEO Alex Gorsky), have no women experience, among others. The degree The experiences of Genkyotex CEO listed in their senior executive teams, to which these barriers affect a woman Ursula Ney support this view, as she while 35 have no female board vary hugely depending on company recalls several occasions on which the members. Bayer and Boehringer culture and wider culture. importance of role models was brought
34 SCRIP 100 scrip100.com CAREERS
home to her: “I have, at different times diversity) offers huge decision-making board ratio of top 20 pharma companies in my career, been taken by surprise and strategy benefits, but only, as Company Male and female board members or unexpectedly had a junior person Loewenstein explains, if a company say to me, ‘Thank you, it’s good to see is willing to absorb the viewpoints of Pfizer • • • • • • • • • • • • • • a senior woman’. It does give people its minority members. He claims it Sanofi • • • • • • • • • • • • • • • confidence to do things and go out and is not enough merely to fulfil quotas think, ‘Well, if she can do it, so can I’.” (though he adds this may be a good Novartis • • • • • • • • • • • • • The remedy to this could well be place to start in some cases). “It makes Merck & Co • • • • • • • • • • • • better talent management, starting sense if the ultimate goal is to achieve Roche • • • • • • • • • • • • • • from the lowest points in the talent a diversity of viewpoints: of allowing pipeline and moving up. Loewenstein people around the table to really GlaxoSmithKline • • • • • • • • • • • • • • • • sees company education on the real contribute and influence the way that AstraZeneca • • • • • • • • • • • • business benefits of diversity as an table thinks, acts, makes decisions,” essential first step. The company he said. Johnson & Johnson • • • • • • • • • • • • • • then needs to design and implement Takeda’s Protopapas comments, “I Eli Lilly • • • • • • • • • • • • • • a systematic process of talent am a big believer that diversity results • • • • • • • • • • • development, focusing on women in a business benefit. It brings new Abbott Laboratories (though of course not to the exclusion ideas, a more rich culture, and so I Bristol-Myers Squibb • • • • • • • • • • • • of men) so as to accelerate their believe it benefits all of us to focus on Teva • • • • • • • • • • • • • • development in a way that has not embracing diversity.” happened until now. Loewenstein adds, “Diversity is Takeda • • • • • • • • Ney agrees: “Maybe it’s about about counting people; inclusion is Amgen • • • • • • • • • • • • • • grooming the people who are bright making people count. Diversity is and capable and not fast-track extremely powerful and has a direct Boehringer Ingelheim • • • • • them, but really help them to get value for the business if, and only if, Bayer • • • • the experience and interactions they it means you have broadened the • • • • • • • • • • • • need.” Protopapas adds, “It requires a diversity of viewpoints and you have Novo Nordisk commitment at the top. It will take time. really impacted on the culture of that Astellas • • • • • • • You need role models. Ideally you don’t particular board, and by extension, of want to enforce this through regulation, that particular company.” There is little Daiichi Sankyo • • • • • • • • • • you want the business leadership to to no benefit, he asserts, in appointing Otsuka Holdings • • • • • • • understand its value and to make it women to the board if it is on the tacit happen because ultimately they believe agreement that they should become Source: Scrip Intelligence it’s good for the business.” ‘like men’ to retain their position. It may be surprising how much As such, it may be that quotas are could damage business instead of “It requires a female under-representation can have not the answer. Both Protopapas and strengthening it may have a point. commitment a negative impact on business. Gender Ney object to quotas, expressing the “The quota forces companies to at the top. It diversity and corporate performance, feeling there must be a better way to get bring in women, and in parallel we’re will take time. a report conducted by Credit Suisse in to diverse leadership such as educating saying that for a number of reasons You need role August 2012 observed that companies companies on the business case for we should collectively be ashamed of, models” with women on the board saw both a including a wider range of viewpoints. there are few women who have that better financial performance and stock Loewenstein, while emphasizing level. So those extreme people may price performance over the past six that his company does not have be right in the short-term. This only years, concluding that not only was an official position on the subject, re-emphasizes the need to focus on there a correlation between the two, says that he feels quotas treat the the cause, in other words developing but a direct relationship. symptoms of the problem, not the talent in the organization, so that they And with diversity so high on the cause. “It’s masking something much are proved wrong.” agenda at the moment, it seems likely more fundamental, which is if you Loewenstein predicts that when the the pace of change is set to quicken want to have good people on boards, dust settles on European quotas, the worldwide, meaning it won’t be long you need to have good people in the benefits of inclusion will begin to emerge before a lack of diversity is almost organization in the executive positions, in terms of competition: “The ones who a barrier to entry if you want to do and there is a gap in the executive are really able to leverage that diversity global business. level in presence of women. That will become more successful.” Furthermore, there is almost concerns us a lot.” universal agreement that board Further to this, he explains that those Additional research by Lucie Ellis and diversity (of all kinds, not just gender who say the new European quotas Natalie Farrugia scrip100.com SCRIP 100 35 Sponsored by:
The evolution of an association
Amsterdam’s RAI is the venue for the 25th Annual EuroMeeting
DIA is a global, multi-disciplinary community serving more than 30,000 professionals worldwide.
DIA brings together regulatory agencies, the healthcare industry, An independent forum academia, and patient support groups to advance the discovery, Through such offerings DIA has become recognized for development, and lifecycle management of safe and effective stimulating innovation by providing an independent forum for medicinal products, and increase global access to them. knowledge exchange and collaboration. It has five decades It is financially independent and non-profit, funded by of experience as an unbiased convening body that provides meetings, training courses and membership fees. The voluntary an open scientific environment for discussing critical issues, efforts of DIA members and its thought leaders allows DIA challenges, and opportunities related to healthcare innovation; the to provide quality programs, publications and increasingly discovery, development, and lifecycle management of medicinal knowledge resources, to regulatory agencies, academia, industry products; increasing access to medicinal products; and improving professionals, and patient organizations. healthcare worldwide. In Europe, DIA develops programs for its members and DIA educational programs (such as conferences and meetings, volunteers in the region, working closely with the European instructor-led courses, tailored training, online learning, certificate Union and its 27 different member states, including the major programs, and more recently knowledge resources such as output EU agencies of member and non-member states. Flagship from meetings and courses) provide organizations with enterprise- meetings and courses include the Annual EuroMeeting, which wide solutions to the challenges they face in the discovery, celebrates its 25th anniversary next year in Amsterdam, the Annual development, and lifecycle management of medicinal products. Clinical Forum, the European Forum for Qualified Person for Paul Pomerantz, DIA’s worldwide executive director sees exciting Pharmacovigilance (QPPV) now in its seventh year, and Practical times ahead for the expanding DIA community. “As the medicinal GCP Compliance. DIA Europe also runs meetings and training product field continues to grow, DIA’s areas of focus and impact courses in South Africa, the Middle East and Turkey. will continue to expand to meet these needs and demands.
36 SCRIP 100 scrip100.com in their roles. The association also offers the opportunities for DIA celebrates its 25th EuroMeeting interaction between those working in the pharmaceutical industry in Amsterdam and experts they can trust. DIA also provides customized learning experiences that keep them abreast of industry developments. The DIA’s 2013 Annual EuroMeeting, to be held 4-6 March For example, DIA training sessions and events attract key 2013 at the Amsterdam RAI, is global in scope and will attract industry leaders to discuss the most pressing issues in the more than 3,000 medicines development professionals from medicines development process. These events foster relationship- around the world. building with professionals at every level across multiple It will bring together experts from the biopharmaceutical disciplines, while providing opportunities for ongoing conversation industry, contract research and service organizations, academic with regulatory authorities. research centers, regulatory agencies and health ministries as well as delegates from patient organizations. Highlights of the This conference will allow participants the opportunity to network with professional colleagues from around the world. 2013 EuroMeeting include: With an engaging range of topics set in 17 themes the co-chairs, Beatriz Vicén Banzo and Peter Bachman, anticipate • Speakers from the European Medicines Agency, the European fruitful discussions that will serve to further improve healthcare Commission, the FDA and other regulatory agencies from systems everywhere. European countries and other regions of the world Coincidentally, 2013 marks the 50th anniversary of the • Unparalleled multi-disciplinary networking opportunities Netherlands’ Medicines Evaluation Board. The Amsterdam • Student and professional poster sessions EuroMeeting will feature a theme on regulatory science • Active involvement of patient organizations organized by the MEB. With a focus on better public health • Pre-conference tutorials led by expert faculty protection, greater transparency of the processes and the • Hot topic sessions rational use of medicinal products, the proposed areas for • More than 200 exhibitors on one of the discussion for this, the 25th Annual EuroMeeting, are classified largest exhibition floors in Europe into general disciplines including pharmacovigilance and regulatory affairs for medicinal products and medical devices, R&D and clinical trials. The scope of the presentations will cover the experience gathered after the implementation of the new pharmacovigilance legislative framework, as well as from the patients’ and Health Technology Assessment (HTA) perspective. Experts and authorities in the fields will be presenting their considerations for debate.
Professional DIA’s relationships, resources, and knowledge will continue to development evolve in order to span the lifecycle management process for the Regardless of the academic entire universe of medicinal products, including pharmaceuticals, discipline, DIA provides career biotechnology, and medical devices,” he says. development and advancement “We foresee that DIA’s relationships with, and outreach to, the opportunities for all students interested DIA’s worldwide full spectrum of healthcare industry stakeholders, academics, and in medicine development. DIA’s offerings have regulators will continue to foster the discovery, development, and expanded to meet their changing needs and executive director lifecycle management of new medicinal products that are safer, more demands. DIA keeps students up-to-date on Paul Pomerantz effective, and affordable, and reach the market faster to increase the latest industry information through programs global access and advance regulatory science,” he adds. and events that help them to gain a real-world Government regulators and agencies are both interested and understanding of how education will be applied directly to their engaged in the unique opportunities DIA provides to educate and professional careers. inform professionals who are involved in the healthcare industry, “As we broaden our services from a historically events-driven and in efforts to increase access to them. Policymakers also benefit organization to a knowledge provider dedicated to helping improve from feedback on policy through DIA’s industry dialogs created in the global quality of and access to healthcare products we can feel order to advance regulatory science. this transformation taking place,” concludes Paul Pomerantz.
Tools for improvement For more information on DIA and how to become involved in Those involved in all sides of the pharmaceutical industry, from the DIA community go to www.diahome.org or contact us at academics to marketing and sales representatives, all benefit from [email protected] the tools DIA provides for them to help them improve and excel scrip100.com SCRIP 100 37 R&D Mapping the US approvals
Michael Hay landscape in 2013 Vice-President, Sagient Research Michael Hay describes several key catalysts in severe, life-threatening Systems indications and the likelihood of approval (LOA) by the US FDA.
BioMedTracker places the LOA Multiple Sclerosis at 9% above average, based Multiple Sclerosis (MS) treatment has and tolerability profile, with the most Agency (EMA) seeking approval of on the positive evolved over the years to a position common side effects being flushing Lemtrada for treatment of relapsing data seen in where the goal is to modify the and gastrointestinal events. These multiple sclerosis (RMS). However, the CARE – disease. This occurred in the 1990s results support BG-12 as an attractive the FDA issued a Refuse to File Letter MS studies with the approval of biologics such as oral option for patients suffering and requested the company resubmit Biogen’s Avonex. While these disease from RRMS. Prior to the decision, the application. Sanofi plans to re-file modifying drugs (DMDs) reduce the BioMedTracker lists the LOA at 13% the application and a decision on the number of relapse episodes patients above average. approval in both the US and EU is experience, they also require multiple Sanofi’s Lemtrada (alemtuzumab) likely in 2013. BioMedTracker places injections or infusions and carry with was a main feature in the company’s the LOA at 9% above average, based them significant side effects. More acquisition of Genzyme and carries on the positive data seen in the CARE recently the first oral DMDs, Novartis’ its own Contingent Value Right (CVR) MS studies. Gilenya (fingolimod) and Sanofi’s which trades under the symbol Roche and Biogen’s ocrelizumab Aubagio (teriflunomide) were approved. GCVRZ. Lemtrada is a humanized is a second-generation (to Rituxan), In 2013 data and possible approvals anti-CD52 monoclonal antibody in fully-humanized monoclonal antibody from additional promising treatments development for the treatment of against CD20 present on normal will continue to heat up the field of (RRMS). In the Phase III CARE MS and malignant B cells. Ocrelizumab competition in MS. I trial in previously untreated RRMS is currently undergoing trials in both Biogen’s BG-12 (dimethyl fumarate) patients, relapses were reduced RRMS and primary progressive MS is under evaluation for approval by the by 55%, but the study missed its (PPMS). These trials are expected FDA as an oral treatment of relapsing/ co-primary endpoint of reduction in to report top-line results in 2013. remitting multiple sclerosis (RRMS). disability progression. An unexpectedly BioMedTracker lists the LOA for The FDA was originally expected low rate of disability progression in the ocrelizumab at 3% above average to make an approval decision on control group apparently resulted in based on data from earlier studies of 28 December 2012, but extended an underpowered trial. Top-line results Rituxan in RRMS. While numerous the date to 28 March 2013. BG-12 from a second Phase III CARE MS II drugs have been successful in RRMS, works by activating the Nrf-2 signaling trial, in patients with more aggressive none to date has shown promise in pathway. Lack of Nrf-2 expression is or advanced disease were reported in PPMS, which is a more severe stage of associated with cell death and loss of November 2011 and demonstrated a the disease. Rituxan was studied in the myelin, and BG-12 has been shown statistically significant 49% reduction Phase II/III OLYMPUS trial, which failed to provide neuroprotection through in relapse rate and unlike CARE –MS I, to achieve significance in the primary this mechanism. BG-12’s efficacy also produced a statistically significant endpoint of disease progression. The was demonstrated in CONFIRM and result in disability progression. results from both sets of MS patients DEFINE, two pivotal Phase III studies Based on these data, in June will then be interesting to balance given in RRMS patients that each met 2012 Sanofi filed a Biologic License the highly competitive nature of the their primary endpoint of reduction in Application (BLA) with the FDA and a RRMS market, and more risky, but un- annualized relapse rate at two years. Marketing Authorization Application competitive PPMS one. BG-12 also showed a favorable safety (MAA) with the European Medicines
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Rheumatoid Arthritis Historically RA drugs have been Eli Lilly’s baricitinib is a follow-on JAK based on data from its Phase II and injectable and IV delivered biologics inhibitor to Incyte’s Jakafi (ruxolitinib), IIb studies. such as Amgen’s Enbrel (etanercept) which was approved in 2011 for Vertex’s VX-509 is a novel JAK3 and Abbott’s Humira (adalimumab). myeloproliferative disorders. Both inhibitor currently in Phase IIb trial In November 2012 Pfizer’s Xeljanz Baricitinib and Jakafi inhibit JAK 1 and 2. examining different doses of VX- (tofacitinib) became the first oral DMD Baricitinib was chosen as the lead 509 in patients with active RA on approved for RA. Xeljanz is a moderately JAK inhibitor for inflammatory disorders methotrexate. Data from this Phase selective Janus-Kinase-3 (JAK3) based upon having a longer half-life and IIb study will likely be seen in the first inhibitor, but additional pharmacokinetic being a more potent inhibitor of JAK half of 2013. As of November 2012, data have shown that at clinical 1 and 2 than Jakafi. A large Phase III BioMedTracker carried a 3% above concentrations, Xeljanz actually program is underway, beginning with average LOA based on Phase IIa data functions to inhibit Jak1 and Jak2 in the initiation of BEAM, a 1,280 patient reported in September of 2011. These addition to Jak3. JAKs are required study evaluating the proportion of Phase IIa data compared favorably with for cytokine signaling that is essential participants achieving American College Xeljanz. The Xeljanz ORAL Solo study to T-cell development, proliferation or of Rheumatology 20% improvement had a similar study population as this differentiation, making them necessary (ACR20) at week12 as the primary Phase IIa study, and the 66% ACR20 for the initiation of innate and adaptive endpoint. Additional Phase III trials will achieved with the highest VX-509 dose immune responses. With the success of begin in early 2013 and while data may is essentially identical to the 65.7% Xeljanz, several other oral JAK targeted not be seen for a number of years, it will recorded with the highest Xeljanz dose compounds for RA are in development be important to track the trials progress in that study. VX-509 scored slightly in 2013. These developments will help as baricitinib poses the most near-term better in the other primary endpoint of gauge the future competitive landscape threat to Xeljanz. BioMedTracker places DAS28 and secondary endpoints of in this area. the drug’s LOA at 9% above average ACR50 and ACR70.
Pulmonary Arterial hypertension BioMedTracker In 2013 Actelion will look to add company filed an NDA for Opsumit in cardiovascular system. In October of has an average to its arsenal pulmonary arterial October 2012 and is expected to be 2012, top-line results from two Phase LOA on hypertension (PAH) drugs. PAH approved in Q4 2013. BioMedTracker III trials, CHEST -1 and PATENT -1 selexipag, as refers to increased blood pressure is placing a 9% above average LOA on were reported. While the studies were only data from a in pulmonary blood vessels, which the approval based on data from the positive for riociguat, the data were small Phase IIa is caused by vasoconstriction of the Phase III SERAPHIN trial. very similar to that seen with Tracleer study has been blood vessels. This leads to damage Actelion’s Selexipag is an orally and Gilead’s Letairis (ambrisentan). reported to the endothelium (inner lining of available long acting prostaglandin This study did differ in that patients blood vessel). Actelion currently I2 (PGI-2) receptor agonist, which could be on an endothelin antagonist markets Tracleer (bosentan, oral), stimulates PGI-2 receptors in blood already or a prostacyclin analogue Ventavis (iloprost, inhaled) and Veletri vessels and exerts vasodilating effects. (except IV), whereas the others (epoprostenol, intravenous) which The drug is undergoing evaluation in did not allow major pulmonary combined to produce over $1.7 billion the Phase III GRIPHON trial, which hypertension drugs. globally in 2012. These three products is studying 1,150 patients with An issue for the drug is how it will fall into two classes of drugs to treat symptomatic PAH. Top-line data from compete against PDE5 inhibitors, PAH, endothelin receptor antagonists GRIPHON trial are expected in mid- whose mechanism of action overlap. (Tracleer) and prostacyclin receptors 2013. Should this data be positive, Riociguat’s study did not allow (Ventavis/Veletri). it may add the first oral prostacyclin combination with PDE5 inhibitors, Actelion’s Opsumit (macitentan) is receptor option for doctors to better presumably due to this overlap, so a tissue-targeting endothelin receptor manage PAH patients. BioMedTracker physicians are likely to assume they antagonist that was designed to have has an average LOA on selexipag, as should not be used together. While a preference for penetrating tissue, only data from a small Phase IIa study the positive results are supportive and through complete blockade of has been reported. for approval of riociguat, additional tissular endothelin (both A and B These new drugs will be important details will be reported in 2013 from receptors). Opsumit is expected to for Actelion, as a new competitor in the extension studies for each trial. protect tissue from damage due to Bayer’s riociguat is on the horizon. BioMedTracker lists the drug’s LOA at elevated endothelin, specifically in Riociguat stimulates soluble guanylate 3% above average. These data should the cardiovascular system. Actelion cyclase (sGC), a key enzyme in help characterize both the approvability reported that Opsumit is 30 to 100 a signaling cascade with central and marketability for this new class of times more potent than Tracleer. The significance in the regulation of the drug to treat PAH. scrip100.com SCRIP 100 39 R&D Preventing a pre-antibiotic future: meeting the challenge Mike Ward Chief Content Scrip Intelligence recently hosted a roundtable discussion to explore how to Officer, Datamonitor avoid returning to a world that fears infection, chaired by chief content officer Healthcare and Mike Ward, and sponsored by AstraZeneca Scrip Intelligence
Robert Steve Gilman Bob Guidos Manos Perros Nicole Mahoney Charlene Reed John Rex Moellering chief scientific vice-president head of senior officer chief executive vice-president Shields Warren- officer and head for public policy infectious at the Pew officer of the and head of Mallinckrodt of research and and government disease Charitable Trust Foundation infection, global Professor development relations with innovative to Combat medicines of Medical at Cubist the Infectious medicines unit at Antimicrobial development at Research at Pharmaceuticals Diseases Society AstraZeneca Resistance AstraZeneca Harvard Medical of America School
Antibiotics, perhaps more than any that caused disease in humans were different types of drugs than there were other class of medicine, deserve susceptible. The bacteria have a billion in the 90s. But we also have to take into to be called “wonder drugs”. Their or a two billion year head-start on us consideration the people developing development helped control and – it makes it an even greater challenge the drugs and their track record and eradicate infectious bacterial diseases to find ways to solve this problem. level of experience; right now the field and increased life expectancies across We're in an emerging situation and the is dominated by small companies, and industrial countries. Unfortunately, predictions that we might return to the it remains to be seen whether they following such stunning early successes, pre-antibiotic era are not some wild have the tools and the resources that the push for new antibiotics slowed. fantasy. It's real: all of the mechanisms, they need to take those interesting and Now, with the emergence of bugs that all of the ways in which bacteria can do promising new molecules to the market. are resistant to common antibiotics, the this, are sitting out there in nature. BG: I totally agree. There are a lot of world may be destined for a time when JR: We're seeing resistant bacteria right new drugs in development, and the medical staff can no longer treat even now in common situations like urinary work is mostly being carried out right common infections because the drugs tract infections. Anybody can get a UTI now by biotechnology companies and industry has been unable to develop at any time, and this was something so forth. Big Pharma is doing something enough new ones. What follows is a for which we had quite reliable pills, and I'd love to see even more because short abstract of the discussions. but now sometimes you have to treat it historically that's been the source of intravenously for days. It's not that we most of the drugs that we have. MW: How much of a threat does don't have any therapy, we do but we SG: I think that the issue is not one of antibiotic resistance pose? might need to put you in hospital to treat targets and biology. Most of these RM: Bacteria have been in the world a simple UTI. genes are sequenced, for most for over a billion years. Antibiotics, by strains, we know exactly what the definition, are antimicrobial substances MW: How well prepared are we to genes are, which ones are vital which made by one microorganism that inhibit meet the challenges of antibiotic ones are probably good targets. The the growth of the other and every resistance? problem is trying to find a chemical antibiotic-producing organism has genes NM: Before I came to Pew I worked structure that will inhibit whatever your to develop resistance. What's happened at the FDA in the office of antimicrobial target is, whether it's an enzyme, or a is that over the years the bacteria products and I did a project looking binding partner. People have worked haven't had to use these genes as at antibiotic development and found on a lot of targets for years that are much and when we began the antibiotic that there are actually more drugs in very interesting, but if you can't find a era in 1940, many of the organisms development and a greater variety of substance, a molecule, an approach
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to actually inhibit that and get it across different from drugs that interact with part of it is about thinking about how "Big Pharma is Gram-negative cell membranes, it's human cells. you will describe the trade-off that we're doing something really tough. We're kind of target rich MP: We have a limited understanding of making: you would want it to be very and I'd love and lead poor. how bacteria pump drugs out, how the clear in the prescribing information that to see even membrane stops the drugs from getting this drug has not been tested in the more because MW: Who is best placed to tackle in, what kind of molecules would cross same large-scale way as other drugs. historically antibiotic resistance? that membrane and not be pumped out. SG: I think even the US regulators that's been the MP: Industry is best placed to do it That's one of the things that initiatives have softened their position on trials, source of most but in partnership. I don't think pharma such as Innovative Medicines Initiative from an extreme position two years to of the drugs that alone, biotech alone or academia or are aiming to remedy by pulling together still a challenging position. We don't we have" regulators or anyone by themselves the pharmas and biotechs who actually want an agency that prevents new can actually do it; you need all those have the molecules and basic research antibacterials from being discovered to line up and to be working in the groups that can really dig into the causes but they have their own requirements same direction. If there were yet of what we are seeing. and that's to protect safety and prove another effort on microbial genomics Another area is sharing failures. efficacy. The FDA has come a long without a really good understanding Everybody publishes their successes way in the last couple of years and of how exactly this would be applied, but when something fails in infection it's with the GAIN Act and other things. it might not be a fruitful enterprise and more important than other areas to share GAIN’s a good start but we've got to if pharma were going to be investing it that because the volume is smaller, so keep the pressure up. needs to be investing in something that we don't make the same mistakes. basic research has already helped us And the third piece is diagnostics. We MW: Why does society take understand so that we know where we were in a model where volumes were antibiotics for granted and so not are headed. high and price was low, but are we value them properly? JR: It can be helpful to think of it as three moving more to a space where we have JR: Well it's a societal value question: problems. The first is the science bit: it's more targeted therapies coupled with we have a situation now with hospital- hard to find good drugs. The second is diagnostics, treating narrower patient used antibacterials for C difficile, for the issue of the economics of antibiotics, populations but with a higher price? example, that can extend somebody’s because they are used for a short period life from when they're 25 till they're 80, of time and because they are completely MW: What are the regulatory and yet we complain that that costs curative yet we treat them currently as if challenges and how are they being $2,000. Yet when we extend a person's they are relatively low-value drugs. addressed? life with prostate cancer by two months And the third challenge is a development JR: The first one is to find the patient. I it costs $90,000. I think part of it is that challenge for the regulatory agencies. really want a predictive diagnostic tool people think because antibacterials are For other drugs, we expect to be that allows me to find the person who in the background, that nothing is lethal able to do some pretty large-scale is more likely to be appropriate for a because you have antibacterials. Now studies before they're released to clinical trial. And number two is having a the question is how much value are you the marketplace but there's a huge way to achieve registration with smaller going to place on a two-week therapy discussion going on right now about amounts of clinical data. We're not that, yes, per capita or per day, seems how to develop drugs in settings like for able to run the large numbers of very pretty expensive but is actually providing antibiotics where only a limited amount large-scale trials of people with resistant a benefit to that patient that they live for of clinical data can be generated. bacterial infections because doing so another 50 years. How can we develop multiple drugs in would require us to have much more parallel, for which we only develop a little of an epidemic than we've currently MW: How optimistic can we be about bit of data on each but enough to make got, and I don't want to wait that long preventing a pre-antibiotic future? them available so that they are ready to be able to develop the drugs. These CR: I'm optimistic and when I looked at before the epidemic hits? are two innovations that would make a this problem historically, it was like a car big difference and they would function in the driveway that was disassembled: MW: Where are the specific antibiotic as financial incentives because if I can there are a lot of moving parts and R&D bottlenecks? cut the number of patients enrolled by what I'm seeing are the parts coming NM: A huge problem that I hear over 50% I've actually reduced the cost of together, you know the engine’s going in, and over again at conferences is the doing the study by 50% and that's the the transmission’s going in, and I think current state of the chemical libraries equivalent of having a 50% tax credit. the car's going to drive, I really do. that we use to screen and that maybe The European Medicines Agency we're not looking at the correct recently released a roadmap for how to For the full video of this roundtable chemical space or the ideal chemical work in a setting where only a limited discussion, visit scripintelligence.com/ space because antibiotics are very amount of clinical data are possible and roundtable scrip100.com SCRIP 100 41 R&D The door is open for innovation Open innovation may be nothing new, but companies in the Scrip 100 are embracing this style of R&D to great effect. Dr Peter Charlish found out how. Peter Charlish In the traditional Big Pharma to the external market, thus freeing A company could even outsource Principal business model, R&D has focused on up internal resources for projects part of the development of a product, Analyst, Scrip technology developed and exploited considered more strategic or more to exploit expertise it does not have Intelligence almost exclusively in-house. New relevant to Xerox’s core business. in-house, and then bring the project active molecules were discovered, Although most of the projects back in-house for the later stages developed and marketed by a single, subsequently failed, a few went on of development. All these scenarios vertically integrated organization. to form the basis of publicly traded add value to a company’s intellectual More recently, companies have been companies with an aggregated property estate. turning to outside organizations for market value greater than that of new sources of inspiration, be it new Xerox itself. Adobe Systems was one Innovation at present molecular targets, new development such company. Today, open innovation has been technologies or new drug delivery Chesbrough identified a number adopted in many sectors, not just the techniques, a process that has been of factors that had contributed to the pharmaceutical industry. For example, termed ‘open innovation’. demise of the traditional, ‘closed’ the German motor car manufacturer model of innovation. These included BMW has established what it calls the the increased mobility of skilled staff, Co-Creation Lab, a platform where who were easily able to take their anyone can share ideas about the future knowledge, skills and experience of cars and put forward ideas for new to another company; the increased products or services. Recently, the lab availability of venture capital, making it sponsored a competition to generate simpler for former employees to fund ideas for personalizing the interiors the development of promising ideas of cars, with-more than 750 ideas and to set up their own companies; submitted. The winning concept was the greater range of opportunities for the ‘Color Matching Camera’, a camera new technologies outside the narrow mounted in the car’s interior that detects thinking of the originating company; and the colors of the clothes being worn the greater role being played by other by the occupants and adjusts hidden companies in the supply chain, which LED lighting to match. While such a can contribute to the innovation process. product might not exactly take the world The open innovation model not by storm, it is unlikely to have arisen in only allows companies to respond BMW’s internal R&D organization and The concept of open innovation constructively to these factors, it also illustrates the type of visionary thinking was originally expounded by Henry provides them with many possibilities that open innovation can bring. Chesbrough, a professor at the Haas that are not available under the closed Pharmaceutical companies have School of Business of the University paradigm. For example, if a company also realized the benefits of open of California, Berkeley. In his 2003 develops a new technology that is not innovation. One of the first to do so book Open Innovation: The New core to its business, it can out-license it was Lilly: in 2009 it launched The Lilly Imperative for Creating and Profiting to another company, so both partners Phenotypic Drug Discovery Initiative from Technology, Chesbrough pointed benefit. It can also license technology (PD2), a web portal designed to solicit out that the old R&D model had that it is exploiting in one context to and evaluate potential drug candidates become outmoded. another company that may be able in Alzheimer’s disease, cancer, diabetes Chesbrough’s observations were to exploit it in a different way, or for a and osteoporosis. Researchers can based on an analysis of various different market segment. use the portal to submit compounds research programs at Xerox’s Palo By the same token, a company for confidential computational Alto Research Center that were using the open innovation model may evaluation for drug-like properties and subsequently halted due to a lack license-in complementary technology structural novelty. There is no charge of internal funding. In many cases, to help it exploit the fruits of its own for this, and the researcher retains IP Xerox encouraged the employees research. Either way, this allows it to rights in the compound, but Lilly has working on these projects to leave exploit synergies between otherwise the right of first refusal to negotiate a the company and take the research competing technologies. licensing agreement.
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Last year, Lilly built on the success East of England Development Agency. a project steering role, for example Challenges of PD2 by launching a new platform, SBC provides small biotech and ensuring that the partners collaborate are bound to called Open Innovation Drug Discovery, life science companies with access in a structured way, arranging arise when which it said would help build its future to the range of expertise, networks suitable seed funding for projects if organizations pipeline. In addition to PD2, the new and scientific facilities, normally only necessary and handling things like with different platform comprises The Lilly Target available to large companies. Among the legal agreements, for which academic constraints work Drug Discovery Initiative (Target D2), biotechs that have already taken space partners may be ill-prepared. This together which screens submitted molecules for in SBC are Arachos Pharma, which role is particularly relevant in Sweden, their potential to interact with known specializes in drug discovery related to where it is traditional for researchers to disease targets, and The Lilly TB lipid mediator pathways; Peptinnovate, retain the IP in their inventions, rather Drug Discovery Initiative, an additional which is exploiting proteins secreted by than the academic institution for which component to identify molecules with Mycobacterium tuberculosis to evade they work (a principle known as the the potential for treating multidrug- the host’s immune system, and which professor’s privilege). resistant tuberculosis. have potential in the treatment of chronic Uppsala BIO is parts of STUNS, the Pfizer is another company to have inflammatory diseases; and Awridian, an Foundation for Collaboration between recognized the potential of open early-phase drug discovery consultancy. the Universities in Uppsala, industry innovation. In 2010 it established a and society. One of the vehicles it network of laboratories, The Centers Challenges ahead has established to facilitate open for Therapeutic Innovation (CTI), in It’s not all plain sailing, of course. innovation in the region is BIO-X, partnership with various academic Challenges are bound to arise when whose goal is to develop a proof-of- medical centers. CTI laboratory staff organizations with different constraints concept or proof-of-mechanism for include Pfizer employees working work together. For example, smaller new life science products, meeting alongside basic and translational companies tend to be more agile a defined need. Projects can then science investigators and Pfizer-funded and less formal than large ones, continue to grow in new or existing life post-doc scientists from the academic typically taking decisions much faster, science companies. institutions. The company provides and the attitudes of large and small So far, BIO-X has evaluated more easy access to its tools and compound companies to risk-taking may also than 200 proposals, 17 of which have libraries located on or near campus, vary considerably. On the other hand, been taken up. In September last year, and can also provide access to non- cost-control tends to be tighter in small Roche’s global innovation program EIN CTI-based Pfizer scientists with specific companies, and differences of opinion (Expanding the Innovation Network) expertise that may be of benefit to a may arise over who pays for what. selected BIO-X as its first partner for particular research program. Working with academic groups also open innovation in Europe, on the Pfizer says that this collaborative has its pitfalls. Academic partners may basis of its location in a region with model efficiently combines the best have competing demands on their strong academic research, credibility ideas, research and expertise from attention, such as pressure to publish in academia and healthcare, and a partner academic institutions with the research findings and to secure funding structure to supervise and co-ordinate company’s own resources. This results for further academic work and, for that collaborations. Examples of companies in better testing of clinical hypotheses, matter, the industry side may not be that are successfully developing accelerating the establishment of proof- able to devote as much attention to technologies that have emerged from of-mechanism and ultimately bringing the partnership as is ideal. There is a BIO-X include Orexo, which focuses on truly differentiated medicines to patients. high risk of misunderstanding if the two improved treatments using proprietary So far, it has established partnerships sides do not communicate effectively drug delivery technology, and Olink with 20 major academic centers in the and frequently. Bioscience, which is commercializing US, and supports collaborative projects Partly to address issues such as technologies for analyzing proteins and from four dedicated laboratories, in these, Uppsala BIO was set up in nucleic acids. Boston, New York City, San Diego and the Stockholm-Uppsala Region of Perhaps the last word on open San Francisco. Sweden almost 10 years ago to act innovation should go to Henry GlaxoSmithKline has taken a slightly as an independent bridge-builder Chesbrough. In an article in Forbes different approach. It is a founding between local universities and industry magazine last year he wrote, “…the partner in Stevenage Bioscience in the open innovation process. future belongs to those who do the Catalyst, which claims to be the Contrary to some other organizations, best job of integrating the best of their UK’s first open innovation bioscience Uppsala BIO works by first defining internal ideas and capabilities with the campus. Other partners include the the need for new healthcare-related best external ideas and capabilities. Wellcome Trust, the UK Department products and services rather than Designing and orchestrating a global for Business, Innovation and Skills, the trying to push particular technologies network of capabilities is the basis for Technology Strategy Board and the onto individual partners. It then adopts a brighter future for us all.” scrip100.com SCRIP 100 43 R&D
US NBE/NCE Approvals – Nov 2011 to Oct 2012 Brand name Generic name Marketing Authorization Indication Date NCE/NBE Holder
asparaginase Erwinia EUSA Pharma (licensed from Erwinase acute lymphocytic leukemia 18/11/2011 NBE chrysanthemi HPA Porton Down)
age-related wet macular Eylea aflibercept Regeneron 18/11/2011 NBE degeneration
Jakafi ruxolitinib Incyte idiopathic myelofibrosis 16/11/2011 NCE
Janssen Pharmaceutical (Johnson Xarelto rivaroxaban venous thrombosis 04/11/2011 NCE & Johnson; licensed from Bayer)
Voraxaze glucarpidase BTG International methotrexate toxicity 17/01/2012 NBE
Erivedge vismodegib Genentech advanced basal cell carcinoma 30/01/2012 NCE
Picato ingenol mebutate Leo Pharma actinic keratosis 23/01/2012 NCE
Inlyta axitinib Pfizer advanced renal cell carcinoma 27/01/2012 NCE
Kalydeco ivacaftor Vertex Pharmaceuticals cystic fibrosis 31/01/2012 NCE
Zioptan tafluprost Merck & Co glaucoma 10/02/2012 NCE
prevention of respiratory Surfaxin lucinactant Discovery Laboratories distress syndrome in premature 06/03/2012 NBE infants
anemia due to chronic kidney Omontys peginesatide Affymax 27/03/2012 NBE disease
Amyvid florbetapir F 18 Avid Radiopharmaceuitcals Alzheimer's diagnostic 06/04/2012 NCE
Elelyso taliglucerase alfa Protalix Gaucher's disease 01/05/2012 NBE
HER2-positive metastatic breast Perjeta pertuzumab Genentech 08/06/2012 NBE cancer
Belviq lorcaserin hydrochloride Arena obesity 27/06/2012 NCE
Myrbetriq mirabegron Astellas overactive bladder 28/06/2012 NCE
Kyprolis carfilzomib Onyx Pharmaceuticals multiple myeloma 20/07/2012 NCE
chronic obstructive pulmonary Tudorza Pressair aclidinium bromide Forest Laboratories 23/07/2012 NCE disease
Vascepa icosapent ethyl Amarin hypertriglyceridemia 26/07/2012
Zaltrap ziv-aflibercept Sanofi metastatic colorectal cancer 03/08/2012 NBE
irritable bowel syndrome with Linzess linaclotide Forest Laboratories constipation and chronic 30/08/2012 NBE idiopathic constipation hormone refractory prostate Xtandi enzalutamide Medivation 31/08/2012 NCE cancer
Bosulif bosutinib Wyeth chromic myelogenous leukemia 04/09/2012 NCE
relapsing-remitting multiple Aubagio teriflunomide Sanofi 12/09/2012 NCE sclerosis
Stivarga regorafenib Bayer Healthcare metastatic colorectal cancer 27/09/2012 NCE
symptomatic vitreomacular Jetrea ocriplasmin Thrombogenics 17/10/2012 NBE adhesion
Fycompa perampanel Eisai epilepsy 22/10/2012 NCE
omacetaxine Synribo Teva chronic myeloid leukemia 26/10/2012 NCE mepesuccinate
44 SCRIP 100 scrip100.com r&d
EU NBE/NCE Approvals – Nov 2011 to Oct 2012 Brand name Generic name Marketing Authorization Indication Date NCE/NBE Holder
transthyretin-related hereditary Vyndaqel tafamidis Pfizer 16/11/2011 NCE amyloidosis
Edurant rilpivirine Janssen-Cilag (Johnson & Johnson) HIV/AIDS 28/11/2011 NCE
Edarbi/Ipreziv azilsartan Takeda hypertension 07/12/2011 NCE
Colobreathe colistimethate sodium Forest Laboratories chronic pulmonary infections 13/02/2012 NCE
Caprelsa vandetanib AstraZeneca medullary thyroid cancer 17/02/2012 NCE
Esmya ulipristal PregLem uterine fibroids 23/02/2012 NCE
Zelboraf vemurafenib Roche metastatic melanoma 17/02/2012 NCE
prepandemic influenza vaccine (A/H5N1) Vepacel Baxter H5N1 subtype of influenza A 17/02/2012 NBE (whole virion, Vero cell- derived, inactivated)
meningococcal group meningococcal disease Nimenrix A, C, W-135 and Y GlaxoSmithKline Biologicals 20/04/2012 NBE prophylaxis conjugate vaccine
Signifor pasireotide Novartis Europharm Cushing's disease 24/04/2012 NBE
Pixuvri pixantrone CTI Life Sciences non-Hodgkin's B-cell lymphomas 10/05/2012 NCE
Takeda Global Research and iron deficiency anemia in Rienso ferumoxytol 15/06/2012 NCE Development Centre chronic kidney disease
Eklira Genuair/ chronic obstructive pulmonary aclidinium bromide Almirall 20/07/2012 NCE Bretaris Genuair disease
Fycompa perampanel Eisai Europe seizures 23/07/2012 NCE
Kalydeco ivacaftor Vertex Pharmaceuticals cystic fibrosis 23/07/2012 NCE
Jakavi ruxolitinib Novartis Europharm myelofibrosis 23/08/2012 NCE
complicated skin and soft tissue Zinforo ceftaroline fosamil AstraZeneca 23/08/2012 NCE infections
Revestive teduglutide Nycomed Danmark short bowel syndrome 30/08/2012 NBE
Inlyta axitinib Pfizer renal cell carcinoma 03/09/2012 NCE
NovoThirteen catridecacog Novo Nordisk hemophilia 03/09/2012 NBE
Dacogen decitabine Janssen-Cilag (Johnson & Johnson) acute myeloid leukemia 20/09/2012 NCE
anaplastic lymphoma kinase Xalkori crizotinib Pfizer 24/10/2012 NCE (ALK)-positive nsclc
Source, for both tables: Scrip Market Data; NBE = new biological entity; NCE = new chemical entity scrip100.com SCRIP 100 45 R&D
Japanese NCE/NBE Approvals – Nov 2011 to Oct 2012 Brand name Generic name Marketing Authorization Indication Date NCE/NBE Holder
prevention of stroke and systemic embolism in Xarelto rivaroxaban Bayer January NCE patients with non-valvular atrial fibrillation
bone metastases of solid tumors and bone Ranmark denosumab Daiichi Sankyo January NBE complications of multiple myeloma
Azilva azilsartan Takeda hypertension January NCE
RotaTeq oral rotavirus vaccine MSD (Merck & Co) rotavirus infection prophylaxis January NBE
Cancidas caspofungin MSD (Merck & Co) candidiasis and aspergillosis infections January NCE
Regnite gabapentin enacarbil Astellas moderate to severe restless legs syndrome January NCE
Lunesta eszopiclone Eisai insomnia January NCE
Brazaves miglustat Actelion Niemann-Pick type C disease March NCE
relapsed/refractory CCR4-positive adult T-cell Poteligeo mogamulizumab Kyowa Hakko Kirin March NBE leukemia-lymphoma
ALK gene-positive advanced or recurrent non-small Xakori crizotinib Pfizer March NCE cell lung cancer
Pulmozyme dornase alfa Chugai/Roche cystic fibrosis March NBE
hyperphosphatemia in patients with chronic Kiklin bixalomer Astellas March NCE kidney disease on dialysis
Careram/Kolbet iguratimod Eisai/Toyama Chemical rheumatoid arthritis June NCE
inactivated polio Imovax Sanofi-Pasteur polio prophylaxis July NBE vaccine
inactivated polio pertussis, diphtheria, tetanus and poliomyelitis Quattrovac Astellas/Kaketsuken July NBE vaccine prophylaxis
Amitiza lubiprostone Sucampo Pharmaceuticals chronic constipation July NCE
Tenelia teneligliptin Mitsubishi Tanabe type 2 diabetes July NCE
Inlyta axitinib Pfizer renal cell carcinoma July NCE
Gonax degarelix acetate Astellas (licensed from Ferring) hormone-dependent prostate cancer July NCE
Edurant rilpivirine Janssen Pharma HIV infection July NCE
Somatuline lanreotide Teijin Pharma acromegaly and pituitary gigantism July NCE
Suiny anagliptin Sanwa Kagaku Kenkyusho type 2 diabetes September NCE
glycopyrronium Novartis (licensed from Seebri chronic obstructive pulmonary disease September NCE bromide Vecutura/Sosei)
Tresiba insulin degludec Novo Nordisk types 1 and 2 diabetes September
Votrient pazopanib GlaxoSmithKline advanced soft tissue sarcoma September NCE
Diacomit stiripentol Meiji Seika (Biocodex) severe myoclonic epilepsy (Dravet's syndrome) September NCE
omega-3-acid ethyl Lowtriga Takeda (ProNova BioPharma) hypertriglyceridemia September NCE esters 90
infections including peritonitis, intra-abdominal Tygacil tigecycline Pfizer September NCE abscess, cholecystitis and pyoderma
Eylea aflibercept Bayer Yakuhin wet age-related macular degeneration October NBE
Source: Scrip Market Data; NB There were no Japanese approvals in Q4 2011; NBE = new biological entity; NCE = new chemical entity
46 SCRIP 100 scrip100.com r&d
Alex Shimmings Head of Data & The Scrip 100 Research, Scrip Intelligence R&D in numbers
$942 billion global pharma market in 33 novel 2011...due to hit $1.2 trillion in 2016 drugs were 1/ launched 2011 $942 billion 3 last year... 2016 $1.2 trillion 33 ...of these one third More than 544 biosimilars launched or were first-in- in development chasing the class $125+ million global biologics market Neurology brands The industry 4,100 products are currently being tested in the clinic...680 are in Phase III trials achieved $30.6bn in spent on the 7 major markets in $123 billion 2011 – 63% of this on research and was accounted for by development the top 10 brands 4,100 680 in 2011
The value of the Alzheimer’s disease market will more than double over the next 10 years. Branded multiple sclerosis 2011 drugs garnered $11.3bn in $5.3bn 2011…having grown by a CAGR of 14% over 2008-11 2021
The six big antibodies will account $12.6bn for more than half of the biologics market by 2017 – some have 18 biosimilar versions in development
scrip100.com SCRIP 100 47 CODE: UPS-12-18A PUB/POST: Varies per Pubs, Medical Device PRODUCTION: B. Lau LIVE: None DESCRIPTION: 2H EU Healthcare Ad (PE ENG) WORKORDER #: 004773 TRIM: 202 mm x 267 mm Delivery Support: 212.237.7000 FILE: 14A-004773-08A-UPS-12-18A.indd SAP #: UPS.UPSITA.12072.K.011 BLEED: None
UPS DELIVERS AS IF LIVES ARE ON THE LINE. BECAUSE THEY ARE.
The healthcare industry is 375,000 temperature-sensitive flu vaccines from our complex and its products healthcare distribution facility in Kentucky, USA across monumentally vital, and there the globe to Laos, in Southeast Asia. We accomplished this are few companies that have by using our global air freight service, UPS Temperature the logistical capabilities to True®, coupled with the innovative shipping container, handle and deliver cargo the PharmaPortTM 360. This is specifically designed to this precious. There is no safeguard temperature-sensitive healthcare shipments and room for mistakes because allowed us to keep the cargo within a critical temperature often the shipments can of 2–8 degrees Celsius throughout the 11,000 kilometre, literally be the difference five-day journey. between life and death. In many cases, these products need to be transported according to strict temperature requirements We are logistics and supply chain specialists equipped and country-specific regulations. with advanced technology and a dedicated, worldwide Quality Assurance team. Whether you are based in London, At UPS, we offer specific services where we take extra measures Berlin or Paris, our logistics experts can help you to design to ensure product quality and efficacy are maintained. Every the most efficient solutions to protect your products, movement is precisely calculated because lives are on the improve patient health and turn your supply chain into a line, and this we know about firsthand. We recently delivered competitive advantage.
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Art: GettyImages_143175901_V1.TIF (CMYK; 775 ppi; Up to Date), 3A4B9766_FullsizeCMYKV1.tif (CMYK; 958 ppi; Up to Date), UPS- UPS wTag-R Brown Vert- Print English-4C.ai (Up to Date) clinical trials Data today; a new tomorrow? Burgeoning pressure from public campaigners is driving the industry to speed up its efforts to come up with a response to calls for full data transparency that Eleanor Malone is rational, reasonable and comprehensive. Procrastination and resistance are EMEA Editor, choices but do they really serve? Eleanor Malone weighs up the arguments. Scrip Intelligence
The case for making all data available position, leaving them susceptible issue still needs consideration, a A crude – enabling properly informed public to suppressing certain research and stance which is dutifully reflective of numerical health decisions, rooting out nefarious publishing the more rewarding findings. the company consensus in favor of analysis practices, honoring the implicit contract Furthermore, independent analyses, resistance and procrastination. suggests that with trial participants, creating data- even if not influenced by conflicts It is clearly difficult to quantify the all companies based tools for improving patient care of interests, may not be of high financial impact on companies of would win from – is clear. quality. Drug companies are therefore releasing data that they may view as universal open These benefits are not obviously in vulnerable to suffering unfair damage commercially sensitive. But surely the data the interests of the industry that makes when so-called independents get their flipside of having to release your own the drugs, whereas it is easy to see hands on their data. data – having access to detailed data why pharma companies defend data All of these problems are recognized from all the other companies in the secrecy. There are legitimate concerns by EU drug regulators in an article, sector – would more than offset that over the unintended and/or negative Open Clinical Trial Data for All? A view individual commercial risk? consequences of full data disclosure. from Regulators, published in the A crude numerical analysis suggests Some seem surmountable: patient open-access journal PLOS Medicine that all companies would win from confidentiality – if it is really an issue earlier this year. However, they also universal open data. The biggest firms and not simply a red herring – could write that formulating measures and have the most to lose. The largest probably be protected without too guidelines to govern the rules of pharma company has 9% of the drugs much difficulty. engagement should enable satisfactory market: if the value of its secret data Others are trickier: any data can be solutions to be found that would is proportional to revenue, then the misused. Journalists cherry-picking or enable complete trial data to be made largest firm has to open up 9% of misinterpreting data in public media available in a way that will be in the pharma secrets but gains 91% from could have severe public health best interest of public health. the rest of the peloton. It’s the biggest repercussions, leading to patients Meanwhile, for industry, commercial loser, and it’s still 82% up! refusing treatments or vaccinations risk remains a concern. Complex quantitative modeling based on misinformation. The regulators argue that this is of the industry aside, open data Competing companies would not an acceptable reason to block could provide an opportunity for undoubtedly use the data (that’s the data release, basically because the savvy companies to reboot their point, surely – to make clinical trials data derive from the philanthropy of competitive metabolism and get busy data more widely valuable) and some patients enrolling in clinical trials. This slicing and dicing large datasets in could gain an unfair commercial may be true, but it offers cold comfort a way that could help them develop advantage. The counterpoint is to companies already desperately not only new products, but new that all companies might gain an defending their profits against the treatment algorithms and new ways of unfair advantage, making the unfair incursions of the patent cliff and partnering effectively. advantage much fairer. global austerity. The conundrum of declining Aside from this, companies are For some, the concern is unfounded. R&D productivity is still unsolved not the only entities with conflicts of According to Peter Doshi, Tom after several years of frenzied head interests when it comes to clinical data. Jefferson and Chris Del Mar – a scratching, leading firms to look So-called independent academics group that has conducted meta- increasingly outside their own walls may not necessarily be motivated analyses on drugs using clinical study for expertise. by the same desire as the company reports obtained from the EMA “with Open data could be part of that developing a drug to obtain positive minimal redactions” – there was no new way of working. It’s a tradable results, but they do stand to gain from commercially sensitive information commodity and big pharma has a lot of making interesting findings which boost contained in the reports they saw. it. The only questions, surely, are with their research or advancing research Others, such as the pan-European whom does it want to trade and what which backs a previously expressed industry body EFPIA, believe the does it want in return? scrip100.com SCRIP 100 49 clinical trials Time trials:clinical research
Dr Christine speeds up Blazynski Chief Science Officer, Citeline New research discovers a surprising fact: clinical trials, contrary to popular belief, are getting a lot shorter. Christine Blazynski explains the findings.
Citeline research It is a truth universally acknowledged When the trial duration data were Roche (13), AstraZeneca (six) and covers a much in the biopharmaceutical industry that grouped into five-year time cohorts, the GSK (four) performed better, as well larger dataset recruitment challenges, increasing average decrease in Phase III breast as, or worse than the cohort averages. than previous complexity and a trend towards cancer trials between cohorts of the two For Novartis, the relatively older trials work extended trial durations must all be most recent five-year periods (2001- all beat the average trial durations. leading to the increasing costs of 2005 vs 2006-2010) was 16 months. Roche’s more recently started trials clinical development. But analysis For trials looking at first-line therapy, the (post 2008) beat the average, but by Citeline shows that this might not difference was 12.5 months. these trials have a relatively lower be the whole story: trial timelines are Of note are the trends in decreasing patient demand. actually getting shorter, and this cuts average durations for enrollment Looking at Phase II first-line trials across all therapy areas including period (start of patient enrollment to (Figure 2) where the total trial duration oncology, currently the most active enrollment closure), treatment period has been identified, it appears that the area of clinical research. (the time the time patients were on the companies with the largest numbers of It is not entirely clear what the treatment or, for event-driven trials, trials in the data set equal the average explanation of the vanishing trial the median time to primary endpoint) for the cohort years, or are slightly phenomenon is. It could be that and total trial period (enrollment plus faster during the more recent years multicentre trials mean more parallel treatment periods). Also, the numbers (2002 and later). data generation. Perhaps pharma has of sites increased during each five-year got better at halting trials that are either period, but the geographic breadth An overall trend going nowhere or can be stopped decreased slightly. (The analysis of lung Using a larger dataset than in previous early having met their endpoints. Or cancer trials does reveal increases in analyses, unexpected trends in perhaps it is the increased use of geographic breadth.) trial timing benchmarks have been CROs brings with it the efficiency of revealed. While this analysis focused the experienced specialists. company analysis on only two cancer diseases, and a Citeline’s new research uses publicly Figure 1 shows an analysis for first- cross-section of trials involving targeted reported, trial-level data of clinical trial line, Phase III breast cancer trials, therapies, the data show that there milestones of completed industry- for which Citeline has captured trial is an overall trend toward decreases sponsored Phase II and III trials over a duration data. The plot shows only in trial durations – enrollment period, 15 year period and reveals decreases in the companies that were the sole trial study period, and the sum of the two clinical trial durations – both in total trial sponsor of four or more trials (within periods (trial duration). durations and in enrollment periods. the data subsets), and for each of What has not been included in this Citeline research covers a much these trials the difference from the article is the time required to analyze larger dataset than previous work. average trial years cohort and the trial data. This is a difficult metric to The oncology research focuses on specific trial metric was determined. capture in the public domain. Certainly, Phase II and Phase III trials in breast The vertical axis shows these as has been reported in previous cancer, non-small cell lung cancer and differences, both for trials that had analysis by Tuft’s Kenneth Getz, there cancers where targeted therapies were durations longer than the average and is a very real trend toward increasing being studied. The timeframe covered for those shorter than the average. secondary endpoints/measurements 1995 to 2010, and the total data set The size of the bubble is determined in oncology protocols. A Citeline consisted of 471 Phase III trials and by the patient accrual value for the analysis from 2008 demonstrated an 1,101 Phase II trials. specific trial. The “zero” horizontal line increase in the numbers of trials started All three key parameters – enrollment, represents the cohort average and is that included quality of life outcome study duration and total trial duration the point of reference. measures beyond standard disease – showed a declining duration trend of With the exception of Novartis’ outcome measures; the analysis found between 12 and 16 months during the four trials that started between this to be the case in particular for 15 years. 1996–2002, trials sponsored by pivotal, global trials.
50 SCRIP 100 scrip100.com clinical trials
figure 1. phase iii breast cancer – first line differences in For Novartis, the trial duration from average years cohort relatively older trials all beat 80 Roche AstraZeneca Novartis GSK the average trial durations 60
40 verag e
20
0 Difference from A
-20
-40
1992 1994 1996 1998 2000 2002 2004 2006 2008 2010
Trial Start Year figure 2. phase ii breast cancer – first line differences in trial duration from average years cohort 60 BMS Roche Eli Lilly Merck & Co
40
verage 20
0 Difference from A -20
-40
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Trial Start Year Source: Citeline
It seems logical to assume that the sites and number of countries show Unfortunately, surprising trends analyses durations are increasing as an upward trend. Yet when looking at reported here can’t speak directly to the more and more measures/endpoints patient segmentation, the trend lines widely cited increasing costs of clinical are being added to protocols. The for numbers of sites are positive for development. The extensive benchmark longer analysis times feed delays in both subsets, while the country counts timing data available at Citeline has publication of full trial results. Clinical demonstrate a negative trend. For just begun to be mined. Trends in trial transparency has improved over Phase III non-small cell lung cancer trials involving genetically segmented the last decade, and the FDA’s call for trials, across all patient segments, as patients, biomarker stratified patients, trial results transparency will ultimately well as for the two segments assessed, or those using personalized medicine help in deriving even better trial timing the trend in numbers of sites is relatively are all topics that bear study. There benchmarks in the future. flat. However, the time plots for the has been a significant growth in Prior to completing the present numbers of countries data show a development and launch of biologics; analysis, Citeline anticipated that there positive trend for all trials, first-line trials could trials for biologics be “quicker” would be an underlying increase in and second-line trials. It may well be than those involving small molecules? count of sites and countries and this the case that with an additional one As the database grows, the universe of would be a factor in rising clinical trial or two years of data collection (as trial potential analysis will expand. costs. But the data do not reveal this results are fully reported), that more in any uniform way. For example, for significant trends in geographic breadth For full whitepaper visit Phase III breast cancer trials, both will become more apparent. scripintelligence.com scrip100.com SCRIP 100 51 clinical trials Keep an eye on your competitors Citeline’s Tracy DeGregorio looks at recent trial activity to assess the most Tracy DeGregorio competitive drug development strategies. Vice-President, Product The challenges of clinical development countries experienced a decline over China, Poland, and Russia. You can also Management, Development & are well known, and ever increasing this time, with South Africa, Mexico, see differences by trial phase, with Pfizer Strategy, Citeline pressure to do more with less is not Argentina and Brazil all host to fewer starting a good number of Phase II trials unique to this industry. Couple this industry-sponsored oncology trials in these locations, while Novartis favors pressure with lengthy development started in 2010 versus 2004. Phase III trials in these same countries. timelines and increasingly complex Of interesting note across many low To understand which companies have Clearly, costs procedures and protocols, and resource countries is that the number the most experience by region, we also and ease of development costs have soared over the of trials started peaked around 2006- looked at the trials activity by country. recruitment past decade. Above all, trial recruitment 2008, with subsequent decline to 2010; This can unmask a competitor’s strength are driving remains the primary reason trials fail to essentially a downward trend over the in a geographic area of interest. For forces behind complete on time and skyrocket beyond past five years. There are many possible example, while we find that Lilly’s focus the movement projected budgets. explanations for this pattern, many of among these regions is Poland, when of trials to One strategy to shorten enrollment which can be probed with additional we look at activity in Poland, we find low resource period of a trial is to run a large global analyses of trial activity. that it is Pfizer and Roche/Genentech countries development program to access a larger One possible explanation is that with that have the most experience running pool of patients. In this effort to reduce the rapid increase in the number of trials oncology trials in this country over the development costs and hasten trial started 2004-2006, investigator and/or past five years. enrollment, the industry has increasingly site saturation occurred. This hypothesis Clearly, costs and ease of recruitment been conducting trials in low resource can be examined by looking at the are driving forces behind the movement countries. To better understand this number of investigators and sites by of trials to low resource countries. movement, we examine industry- country, and the number of associated Clinical trials activity provides a valuable sponsored cancer trials started 2004- trials over time. A second explanation means to assess what is happening, 2010 as captured in Trialtrove. is that sponsors encountered difficulty where and by whom. But to deduce and Overall, there was a slight increase running trials, and were subsequently understand your competitor’s strategy (7%) in the number of industry- hesitant to start additional trials. Here, and likely future moves, it’s important to sponsored oncology trials started in we can look to see if the number of understand why. One possible reason 2010 versus 2004, with 1,075 and 1,007 terminated trials has increased over why the industry is trending toward trial trials, respectively. This increase is driven time. Alternatively, increasing enrollment activity in low resource countries is that, solely by increased Phase I activity, as periods would suggest an unsuccessful in oncology specifically, sponsors may the number of Phase II and Phase III (and thus tempered) strategy to start be seeking treatment naïve patients. This trials started actually diminished over trials in low resource countries in order to hypothesis is one that can be vetted by that time period. reduce trial timelines. looking at the trials activity and drilling Breaking down the data by country With an understanding of what’s down to patient segment, in this case we see specific gains and losses by happening across the industry with first-line patients. geography, see Figure 1. In most respect to trial locations, the next Not surprisingly, as pharmaceutical developed markets the overall change step looks at activity at the company companies step up their efforts from 2004 to 2010 was unremarkable; level where you can begin to uncover to develop first-line therapies, the the notable exception being Japan, competitors’ geographic areas of interest percentage increase in the number of with substantial increases in both the for oncology trials. trials seeking first-line patients in the number of trials and percentage gain. A Looking cumulatively at the number major markets significantly outpaced significant percentage of this increase of trials started for the five-year period, the overall percentage increase in is attributed to the rise in the number 2006-2010, you can see different trials started, except for the US (where of Phase I trials started – six Phase I approaches being taken (see Figure first-line patients are extremely difficult trials started in 2004; 45 Phase I trials 2). AstraZeneca, Eli Lilly, Merck & to recruit). The UK notably, with a 6% started in 2010. Co and Sanofi have taken a fairly decrease in overall trial activity, saw a Looking at low resources countries, diversified approach with respect to low 138% increase in the number of trials real gain in the number of trials started resource country selection; whereas started that include first-line patients. is seen in Poland, Ukraine, Romania, Novartis, Pfizer and Roche clearly have We see this general trend continuing Russia, China and India. However, many geographic areas of interest, namely over this time period in the low
52 SCRIP 100 scrip100.com clinical trials
resource countries as well, where the recruit this patient segment. (first-line), finding that many companies Romania saw percentage increase in the number Looking by company, specifically are seeking out first-line patients in an explosive of trials seeking first-line patients at these two countries of interest, we specific countries, namely Romania 1,700% increase also significantly outpaced the overall see different driving factors behind the and Ukraine. percentage increase in trials started, increase. In Romania Lilly, Pfizer and However similar analyses can but to a much greater degree than in Roche all contribute heavily toward the be carried across phase, disease, the major markets. There are also two increase; while in Ukraine, we see a big mechanism of action, terminated noteworthy countries. Ukraine, which commitment by Pfizer. trials, investigators, sites, etc. By saw a 41% increase in the overall Certainly many factors contribute understanding what is happening number of oncology trials started, to country selection, and trial counts in the industry in general, with your saw a 1,300% increase in the number provide an excellent dataset to competitors specifically, and being able of trials started that include first line tease out competitor strategies. This to test hypotheses as to why trends are patients. Romania saw an explosive case study looked specifically at occurring, you can better deduce and 1,700% increase; clearly two countries industry-sponsored oncology trials by understand your competitors’ strategies where industry is focusing its efforts to geography, drilling into patient segment and likely future moves.
figure 1. industry-sponsored oncology trials started 2004-2010, with % change 1,000
800 2004 2005 2006 2007 2008 2009 2010
600
-6% 1% 4% 13% 20% 47% 248% 400 change change change change change change change
200
0 UK Germany US Italy France Spain Japan 100 139% 80 -3% change change 186% change -15% -4% 60 change 41% 78% -50% change change change 0% 18% change change 40 change 33% change 91% 20 change
0 South Africa Mexico Argentina Brazil Turkey Thailand Poland Ukraine Romania Russia China India
Source: Citeline Trialtrove
figure 2. industry-sponsored oncology trials started 2006-2010, by phase
50 Phase I Phase II Phase III Poland Russi a 40 Poland
30 China China Russi a Poland Russi a Romania Poland China 20 Ukraine Romania China Indi a Indi a Poland China Russi a Poland Romania Russi a Romania Russi a China Indi a Indi a Russi a Poland Indi a China Romania
10 Ukraine Ukraine Romania Indi a Indi a Ukraine Romania Ukraine Ukraine Ukraine 0 AstraZeneca Eli LillyMerck & Co Novartis Pfizer Roche/Genentech Sanofi
Source: Citeline Trialtrove scrip100.com SCRIP 100 53 clinical trials
Expected Phase III Top-line Data Releases for Novel Products in 2013 Expected Date Range for Study Name/Details company drug indication drug Top-line Results type
01/01/2013-31/01/2013 ONYC-301 Anacor Pharmaceuticals tavaborole fungal infections NME
01/01/2013-15/02/2013 Phase III – Top-Line Results ILJIN Group Luveniq uveitis NME
FISSION, FUSION and 01/01/2013-28/02/2013 Gilead Sciences sofosbuvir hepatitis C NME NEUTRINO
01/01/2013-31/03/2013 ESTEEM 2 Celgene apremilast psoriasis NME
01/01/2013-31/03/2013 PALACE 4 Celgene apremilast psoriatic arthritis NME
01/01/2013-31/03/2013 CHAMPION PHOENIX The Medicines Company cangrelor acute coronary syndrome NME
01/01/2013-31/03/2013 CLAVELA Clavis Pharma Elacyt acute myelogenous leukemia NME
01/01/2013-31/03/2013 SOLO-1 and SOLO-2 The Medicines Company oritavancin skin and skin-structure infections NME
with Velcade + 01/01/2013-31/03/2013 AEterna Zentaris perifosine multiple myeloma NME dexamethasone
01/01/2013-31/03/2013 START Merck KGaA Stimuvax non-small cell lung cancer vaccine
01/01/2013-30/04/2013 ENCORE Sanofi eliglustat tartrate Gaucher's disease NME
01/01/2013-30/04/2013 TR701-113 Trius Therapeutics tedizolid skin and skin-structure infections NME
01/01/2013-30/04/2013 EMPOWER Biogen IDEC dexpramipexole amyotrophic lateral sclerosis NME
HyperAcute 01/01/2013-30/04/2013 Phase III – Top-Line Results NewLink Genetics pancreatic cancer vaccine Pancreas
01/01/2013-30/04/2013 Phase III – Top-Line Results Baxter International BAX 111 Von Willebrand disease biologic
chronic lymphocytic leukemia / 01/01/2013-30/06/2013 CLL11 Roche afutuzumab biologic small-cell lymphocytic lymphoma
01/01/2013-30/06/2013 CENTRIC Merck KGaA cilengitide brain cancer NME
01/01/2013-30/06/2013 vs meropenem Cubist Pharmaceuticals CXA-201 intra-abdominal infections NME
01/01/2013-30/06/2013 Phase III – Top-Line Results Boehringer Ingelheim faldaprevir hepatitis C NME
01/01/2013-30/06/2013 OSKIRA-1 and OSKIRA-2 AstraZeneca fostamatinib rheumatoid arthritis NME
01/01/2013-30/06/2013 chemo-naïve patients Takeda orteronel prostate cancer NME
01/01/2013-30/06/2013 Phase III – Top-Line Results Celgene pomalidomide myelofibrosis NME
01/01/2013-30/06/2013 N01358 UCB Rikelta partial seizures NME
01/01/2013-30/06/2013 STOP NovaRx Lucanix non-small cell lung cancer vaccine
01/01/2013-31/12/2013 Phase III – Top-Line Data Novartis AIN457 psoriasis biologic
01/01/2013-31/12/2013 TOPCAT Pfizer aldactone congestive heart failure NME
TRINOVA-1 (refractory 01/01/2013-31/12/2013 Amgen AMG 386 ovarian cancer biologic PFS)
01/01/2013-31/12/2013 DIAS-4 H. Lundbeck desmoteplase ischemic stroke biologic
01/01/2013-31/12/2013 Phase III – Top-Line Results Boehringer Ingelheim empagliflozin type 2 diabetes mellitus NME
aspergillosis, candidemia 01/01/2013-31/12/2013 Astellas Pharma isavuconazole fungal infections NME and rare mold
MAGE-A3 antigen- 01/01/2013-31/12/2013 Phase III – Top-Line Results GlaxoSmithKline specific cancer melanoma vaccine immunotherapeutic
01/01/2013-31/12/2013 Phase III – Top-Line Results Novartis midostaurin acute myelogenous leukemia NME
54 SCRIP 100 scrip100.com clinical trials
Expected Date Range for Study Name/Details company drug indication drug Top-line Results type
01/01/2013-31/12/2013 NGR015 MolMed NGR-hTNF mesothelioma biologic
01/01/2013-31/12/2013 PPMS and RRMS Roche ocrelizumab multiple sclerosis biologic
01/01/2013-31/12/2013 Phase III – Top-Line Results Novartis TKI258 renal cell cancer NME
01/01/2013-31/12/2013 OPTiM Amgen T-VEC melanoma vaccine
01/01/2013-31/12/2013 US/EU/Latin America Takeda TAK-875 type 2 diabetes NME
15/02/2013-15/03/2013 ONYC-302 Anacor Pharmaceuticals tavaborole fungal infections NME
01/04/2013-31/03/2014 HOKUSAI VTE Daiichi Sankyo edoxaban venous thromboembolism NME
01/04/2013-30/06/2013 ZA-301 Repros Therapeutics Androxal hypogonadism NME
arbaclofen 01/04/2013-30/06/2013 Phase III – Top-Line Results XenoPort neuromuscular spasm and spasticity NME placarbil
01/04/2013-30/06/2013 Phase III – Top-Line Results Sanofi iniparib non-small cell lung cancer NME
01/04/2013-30/06/2013 TAO Sanofi otamixaban acute coronary syndrome NME
01/04/2013-30/06/2013 Phase III – Top-Line Results Sanofi SAR302503 myelofibrosis NME
01/04/2013-30/09/2013 Phase III – Top-Line Results Vical Allovectin melanoma biologic
Kythera 01/04/2013-30/09/2013 REFINE-1 and REFINE-2 ATX-101 dermatology NME Biopharmaceuticals
01/04/2013-30/09/2013 GRIPHON Actelion Pharmaceuticals selexipag pulmonary arterial hypertension NME
01/06/2013-31/12/2013 PIX-R Cell Therapeutics Pixuvri diffuse large B-cell lymphoma NME
CXA-cUTI-10-04 and urinary tract and reproductive tract 01/07/2013-31/12/2013 Cubist Pharmaceuticals CXA-201 NME CXA-cUTI-10-05 infections
01/07/2013-31/12/2013 DIAS-3 H Lundbeck desmoteplase ischemic stroke biologic
01/07/2013-31/12/2013 Phase III – Top-Line Results Onconova Therapeutics Estybon iv myelodysplastic syndrome NME
major depressive disorder 01/07/2013-31/12/2013 Otsuka Pharmaceutical OPC-34712 schizophrenia NME and schizophrenia
01/07/2013-31/12/2013 chemo-experienced Takeda orteronel prostate cancer NME
01/07/2013-31/12/2013 Phase III – Top-Line Results Eli Lilly ramucirumab gastric cancer biologic
01/07/2013-31/12/2013 HEC1, HEC2 and MEC Tesaro rolapitant chemotherapy-induced nausea NME
01/07/2013-31/12/2013 AML-001 Celgene Corporation Vidaza acute myelogenous leukemia NME
01/07/2013-31/12/2013 TARGET 3 (retreatment) Salix Pharmaceuticals Xifaxan irritable bowel syndrome NME
Phase III – Top-Line 01/09/2013-31/12/2013 Alkermes ALKS 9070 schizophrenia NME Results Phase III – Top-Line 01/09/2013-31/12/2013 Roche bitopertin schizophrenia NME Results
01/09/2013-31/12/2013 STABILITY GlaxoSmithKline darapladib atherosclerosis NME
01/09/2013-31/12/2013 PFS Active Biotech tasquinimod prostate cancer NME
Phase III – Top-Line 01/10/2013-30/04/2014 Furiex Pharmaceuticals MuDelta irritable bowel syndrome NME Results
01/10/2013-30/04/2014 SEAMLESS Cyclacel Pharmaceuticals sapacitabine acute myelogenous leukemia NME
01/10/2013-31/12/2013 52-week studies Teva Cinquil asthma biologic
01/10/2013-31/12/2013 SYNERGY Teva custirsen prostate cancer NME
Phase III – Top-Line 01/10/2013-31/12/2013 XOMA gevokizumab uveitis biologic Results
Source: Sagient Research Systems; NME = new molecular entity scrip100.com SCRIP 100 55 Sponsored by UPS:
Establishing a temperature- sensitive supply chain
By 2016 world sales of cold-chain drugs and biologics such as vaccines and blood plasma products will near $240 billion, but how can companies protect their products throughout the transport logistics cycle?
The pharmaceutical and biologics industries have come a long way a product will encounter as it moves through the supply chain in their knowledge of the distribution environment. But there has – improving quality control, customer satisfaction and ultimately never been an all-encompassing temperature-sensitive management patient health. Selecting a partner with expertise and experience resource for all supply chains, market needs and regulatory and agreeing upon a transport protocol for the movements of requirements. Instead there are many separate guidelines describing product shipments is vital. how to maintain temperature – some with very little detail. Companies should also ensure a partner has quality control Not long ago, controlled room temperature (CRT), ambient and assurance in place to support compliance with regulations and room temperature products were synonymous and considered by guidelines. For example, UPS offers UPS Temperature True® many to not require thermal protection. CRT products, however, do and PharmaPort 360TM containers to protect the shipment of vital require temperature control protection as they move through the products and document actual conditions during transit. In addition, supply chain. a trained staff supports shipments together with an independent, To move forward with the development of temperature sensitive healthcare-dedicated QA group. transportation for medical products, the healthcare industry must Transportation providers and life science companies may not define CRT, develop packaging appropriate for temperature automatically understand the transport requirements of specific ranges, including CRT, and partner with providers who can develop healthcare products. Companies and their logistics partners need processes to protect temperature sensitive products. to discuss these requirements, allowing the provider to design a supply chain that meets each product’s specific needs. Among Addressing the challenge other things, both need to agree on mode of transportation, Not meeting temperature regulatory requirements could potentially temperature sensitivity, stability data and reporting of in-transit result in a product being placed on hold by the FDA or equivalent temperatures. non-US agency. Product could also be recalled, diminish in efficacy or, in the worst case, be deemed spoiled. Spoilage could occur Design solutions when an accumulated range of temperature excursion reaches UPS has designed a supply-chain environment that, in conjunction a level considered unacceptable by your quality assurance with appropriate protective packaging, can protect products department, or by government agencies. regardless of outside conditions. Planning a successful temperature-sensitive supply chain helps Offering environments to help protect products with the following maintain product integrity throughout transportation and meets the required temperatures: regulations and guidelines of relevant agencies. Planning should not • Controlled Room Temperature: 15ºC to 25ºC only cover an organization’s specific requirements, including service • Refrigerated: 2ºC to 8ºC modes and packaging and quality requirements, but should also • Frozen: -10ºC to -20ºC take into account quantifiable value. The more information provided • Cryogenic/Deep Frozen: -150ºC to -190ºC during the planning process, the more effective the solution that will Also, UPS conducts seasonal temperature profile studies of its be developed. small package networks to help shippers define actual supply-chain New technologies, new services and new strategies can help a conditions and create plans to help protect temperature-sensitive company accomplish goals faster, compete better and improve the products throughout their journeys. overall performance of their supply chain. Studies include: • Ground temperatures at origin, transfer and destination airports. Product requirements • High-altitude temperature changes in cargo aircraft. Working with a transport and distribution partner will not only • Temperature ranges in UPS hubs and vehicles across climate help to protect shipments, but also to document the conditions zones, from south Florida to northern Alaska.
56 SCRIP 100 scrip100.com Contingency planning The UPS offering Companies and their transport providers should collaborate to identify potential problems and alternate transport plans should a UPS partners with healthcare companies to choreograph logistics of all shipment deviate from the standard operating plan. types – from the manufacturing facility to a patient’s front door – providing It is necessary to create pre-defined alternative flight routes, for a reliable product supply in established and emerging markets, all while example, in the case of weather delays. Typically, a primary route with ensuring compliance and product security. an additional one or two alternative flight routings should be identified. The offering includes: The provider needs to understand the path of escalation if a • More than 35 dedicated multi-client healthcare facilities and over shipment is at risk for a delay or a temperature excursion where the 510.000m2 of cGDP-compliant distribution space globally; product could go out of the acceptable temperature range. • Dedicated quality assurance and regulatory compliance teams In addition, if the shipment completely fails delivery specifications, managing hundreds of licenses worldwide; contingencies must be implemented for the return and replacement • Temperature-controlled and humidity-monitored storage environments; of the compromised product to ensure it does not make its way • Customized service offerings such as bar-coding, labeling, kitting, back into the market – and to patients. inventory management, service parts logistics, and returns management; Regulators • Hazardous materials storage, dry ice replenishment and refrigeration Regulatory agencies are constantly challenged to keep pace with services. the growing demand for temperature-sensitive therapies, including CRT and cold-chain products. UPS products: Awareness of and compliance with legislation and guidelines UPS Temperature True®, a global temperature sensitive air-freight service regarding supply-chain services are essential, as are detailed designed for the pharmaceutical and life science industry that is based on specifications on temperature requirements and the permitted precise, measurable operating procedures. UPS provides container temperature excursions for each product. solutions and routing options with day- and time-definite options to prevent temperature excursions. The PharmaPort 360TM, a new innovative airfreight container with a UPS’ 2011 Pain in the (Supply) Chain hybrid cooling system. It offers maximum protection and allows customers to take advantage of more routing options, providing further possibilities for market penetration and business growth. UPS’ 2011 Pain in the (Supply) Chain survey found product UPS Temperature True® packaging simplifies the process of choosing the damage and spoilage was an issue of far greater concern in right packaging solution for temperature sensitive products. Based on Asia and the US than in Europe. 70% of Asian companies and shipping lane analytics, UPS offers expert advice and provides customers with 67% of US companies reported concerns versus only 27% in an optimized vendor neutral packaging solution to protect valuable Europe. The reasons for the disparities are unclear. shipments. The service also extends to monitoring devices that allow for continuous shipment monitoring and the provision of an auditable trail of temperatures. UPS Proactive Response ®, a contract service that provides 24/7 monitoring of packages as they move through the UPS network. It alerts customers of any US potential delivery delays and includes proactive resolutions by UPS, based on 70% predefined contingency plans. UPS In-room Delivery helps customers to send their products to a single point within a sprawling hospital campus where they are expected for immediate refrigeration, storage, or use. UPS Returns® is an industry-leading service with options that provide enhanced control over reverse logistics and an improved customer Asia 67% experience. The UPS Returns Exchange service, for example, provides for the delivery of a new item and collection of an old one at the same time. The entire return, including a shipping label, packing and collection takes place during a single visit.
More information about UPS can be found at www.ups.com/healthcarelogistics. Europe 27%
scrip100.com SCRIP 100 57 Scrip 100 relies on the unparalleled breadth and depth of pharmaceutical intelligence from Citeline.
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www.citeline.com [email protected] +1 646 957 8919 the patient The rise of the e-Patient The e-Patient movement, which campaigns for healthcare organizations to work in partnership with patients, is gathering momentum. One of the loudest Joanne Payne Outsourcing advocates is Dave deBronkart, Joanne Payne went to meet him. Editor, Datamonitor Today, the e-Patient movement is on medical websites, to stem the Healthcare & growing, and deBronkart is one of its ‘googling’ tide, deBronkart is adamant Scrip Intelligence loudest advocates. He talks about the that this approach is a complete challenge of an overall culture change. failure: accreditation doesn’t succeed “It’s a particular “When people take on new abilities in suppressing bad information, and type of and new responsibilities, there are doesn’t succeed in bringing the best perversion to new things to learn. You have to learn sources to the top. keep people how to operate. When people become He talks about the lethal lag time; uninformed and drivers, at first they bump into things.” the publication delays of 2-5 years then insult them for not knowing DeBronkart recommends that the where new information could exist anything” doctor’s office have a patient education that may save a life. He talks of his Dave deBronkart’s (known on the enabler, an information coach who own experience with crowd sourced internet as e-Patient Dave) life changed helps patients to get better at using information, gleaned from many other in January 2007. He was diagnosed the internet to find correct information. patients who had gone through the with Stage IV, Grade 4 renal cell This would help to counter the current same type of treatment as he was about carcinoma (kidney cancer). His median state of patient enlightenment (which to embark on. He went to his patient survival time at diagnosis was just deBronkart describes as “clumsiness”) community and asked about the side 24 weeks; with tumors in both lungs, which oftentimes leads to adherance to effects of interleukin-2. He received several bones, and muscle tissue. misleading information. 17 very different firsthand stories, He received treatment and “It’s really, really important to none of which were approved by the participated in a clinical trial for Proleukin understand that as new things government or medical community, and (aldesleukin), a recombinant human happen, sometimes they work and took these expectations with him when interleukin-2 developed by Novartis. His sometimes they don’t, and as people he entered the trial. last treatment was in July 2007, and by are gaining experience at something, His particular side effects, including September of the same year it was clear they are inexperienced,” deBronkart rigors and capillary leak syndrome, he’d beaten the disease. His remaining says. “The remedy is more information were severe but because deBronkart lesions have continued to shrink. – not less,” he opines. “It’s a particular had prepared for them through his When deBronkart was first diagnosed type of perversion to keep people own research, he knew what to he sought information on the internet, uninformed and then insult them for expect. A few years after the trial and his physician encouraged him not knowing anything.” deBronkart’s oncologist, Dr David to join an active patient community, DeBronkart references women’s McDermott, confided in his patient that which told him several things: get to a suffrage or the civil rights movement he doubted he could have survived specialist, find out about interleukin 2, as he discusses this shift. “Cultural enough medicine to “do the job” if he and the names and phone numbers change affects how we think of who hadn’t been so informed and prepared. of the four doctors that offered the is capable of what. During that time of DeBronkart is convinced that access to treatment in his part of the country. change, people will find evidence for this information was valuable enough Throughout the course of this the old view, but then also start to see to save his life: “It really makes the nine month experience, in which evidence that the old view point that there is genuine value in what deBronkart says he was “facing the is incomplete.” peers can tell each other, according to grave”, he had become the definition Good sources of data will become the doctor, life-saving value.” of an e-Patient: empowered, engaged, more prominent in the future, says If the patient is enabled and equipped and enabled. deBronkart, whether they be from developed by the healthcare provider, He describes an engaged patient as patients themselves, governments or then they can be seen as true partners, someone that feels ultimately responsible the pharmaceutical industry. In a perfect deBronkart says. When asked if he for their health and acts accordingly. And world, deBronkart says the important believes this time will realistically come, secondly, someone that wants to know information would be “wide open”. he quotes the futurist William Gibson: as much as possible about what’s going When suggested that there should The future is already here — it’s just not on in the medical encounter. be a policy for accredited information very evenly distributed. scrip100.com SCRIP 100 59 the patient Disease foundations sharpen the knife to spread the wealth Mandy Jackson US West Coast Forget venture capitalists or private equity investors, the sharpest dealmakers on Editor, Scrip Intelligence the block are disease foundations. Mandy Jackson meets some to assess the sharpness of their savvy.
Venture Funding basic research remains a Venture philanthropy offered by treatment for SMA. However, the non- philanthropy priority for disease foundations, but patient groups can be the icing on a profit group is funding studies regarding offered by patient non-profit organizations increasingly many-layered cake. The foundations’ the history of SMA and biomarkers for groups can be are making business savvy most valuable resources actually the disease, and it gave Isis an early the icing on a many-layered investments in commercial drug may be their access to key opinion look at the data to aid the company’s cake development on behalf of patients leaders, the ability to reach willing drug development. and families that donate in hopes of clinical trial participants and passionate “It’s been a tremendous benefit finding a cure – or at least a disease- advocacy on behalf of patients. working with them. Their strategy modifying therapy. Also, the credibility that a non-profit’s has been to lower the barriers so that Executives whose companies have endorsement provides may sweeten we can justify going forward,” says applied for funding say foundations the deal for potential for-profit investors Isis senior vice-president of research are just as rigorous in vetting potential and partners. Frank Bennett. investments as venture capital groups Only about 2-3% of pharmaceutical That is the goal of Fast Forward, – maybe more so, because they have research and development funding the foundation that the National scientific connections and massive comes from disease foundations, but Multiple Sclerosis Society established research catalogs that help them patient groups shouldn’t think that five years ago to fund drug and understand whether a business pitch money is the only contribution they diagnostic development. is full of promise or running on can make to companies developing Fast Forward president Timothy empty hope. medicines to treat their constituents, Coetzee said the organization is according to Kristin Schneeman, a a facilitator that helps connect program director at the Washington, companies with useful research and D.C.-based FasterCures, which helps development resources. Even when connect government, foundations, the group rejects a proposal, it tells the companies and investors. “If a patient company what they can do to develop group really wants to pursue this, their project further or where else they they can leverage a lot of change with might go for funding. relatively few dollars,” Schneeman says. Several foundations have patient The sharpened knife registries through which they inform But while foundations gladly help and individuals about clinical trials that encourage firms that show interest they may want to participate in, in an in the patients they represent, that effort to speed up patient enrollment doesn’t mean they coddle startups or in drug trials. Some fund, on their own cater to the whims of corporations. or in partnership with pharmaceutical Even for drugs they’ve invested in, partners, biomarker studies to identify non-profits do not lobby the US FDA to new drug targets. approve specific therapeutics. They are Isis Pharmaceuticals works with willing to educate regulators about the several foundations that represent specific needs of a particular patient patients who have rare diseases population, but they won’t recommend or unmet medical needs, such as a drug that could meet those needs. the Spinal Muscular Atrophy (SMA) And with limited capital to back drug Foundation. Isis did not receive development, non-profits invest only in financing from the SMA Foundation to the best of the best projects and they fund its antisense drug ISIS-SMNRx, aren’t shy about cutting off funds for Smarty McFly? Disease foundations which is in Phase I development in drug candidates that don’t work. back the future of pharma partnership with Biogen Idec as a “We have a due diligence process
60 SCRIP 100 scrip100.com the patient
that rivals any venture capital due partnerships, Sohini Chowdhury. generally educate the industry Many diligence. We also bring a unique Epilepsy is another difficult about the benefits of epilepsy drug foundations also envy the understanding of the basic research neurological disorder in which it is development. For instance, epilepsy Michael J. Fox side of blood cancers. We’ve got difficult to get companies to invest. can be a gateway to other indications Foundation, great insight into new targets and new That’s why the Epilepsy Therapy for new drugs and clinical trials fail in which has spent pathways – probably deeper than Project (ETP) and the Epilepsy epilepsy less frequently than in other about $290 any other venture capital firm could Foundation recently announced that neurological disorders, according million since 2000 muster,” says Louis DeGennaro, chief they would merge into one group to ETP chairman and co-founder mission officer at the Leukemia & under the Epilepsy Foundation Warren Lammert. “There is an Lymphoma Society (LLS). banner. The organizations have economic opportunity here that can In July, LLS invested $5 million in jointly funded research projects for be exploited,” Lammert says. Celator Pharmaceuticals’ Phase III the past eight years, but they hope After all, drug development may clinical trial for CPX-351, a liposomal to maximize their resources as one be all about medical need, but the formulation of the chemotherapeutic foundation going forward. industry is driven by money – revenue agents cytarabine and daunorubicin, They’ll raise money to invest to fund research and profits to which are commonly used to treat in smaller companies alongside repay everyone along the way who hematological malignancies. Previously, venture capital firms or corporate gambles on the slim chance that the Society provided $4.1 million for partners, encourage more patients new medicines will find their way to one of Celator’s two Phase II studies to participate in clinical trials, and patients who need them. for CPX-351. Few non-profit foundations can invest millions of dollars in a single Leukemia & Lymphoma Society turns investor’s eye to drug development project and even drug development on behalf of patients fewer patient groups can stick with a therapeutic program all the way from The Leukemia & Lymphoma Society (LLS) is the world’s largest funder of private research in preclinical studies to FDA approval. hematological malignancies with more than $1 billion invested during the past 63 years. But many non-profits admire Until about five years ago when LLS started its Therapy Acceleration Program (TAP), the vast majority the Cystic Fibrosis Foundation’s of the non-profit organization’s funding was granted to academic scientists doing basic research. In 2012, LLS will provide $60 million in research funding, including about $20 million in TAP $75 million invested over the entire investments. research and development cycle for “We recognized the need to not only fund academic research, but translate it into therapies for Vertex Pharmaceuticals’ Kalydeco patients, so we invested in the work at biotech companies,” LLS chief mission officer Louis (ivacaftor), which was approved in the DeGennaro told Scrip. US earlier this year to treat a small The New York-based organization has invested in nine companies via TAP with millions of dollars committed to each project – ranging from preclinical programs to Phase III drug number of cystic fibrosis patients – candidates. about 4% of the people with a specific In September, the organization said it would invest up to $7.5 million in preclinical and Phase I work gene mutation. for Constellation Pharmaceuticals’ and $12.5 million in Onconova Therapeutics which licensed the Many foundations also envy the European rights for its Phase III drug candidate rigosertib to Baxter International for $50 million up front and $515 million in pre-commercial milestones. Michael J. Fox Foundation, which In October LLS launched its Targets, Leads and Candidates program with cancer drug developer has spent about $290 million since Celgene as its first corporate partner. With an undisclosed financial commitment over the next four 2000 on both basic research and drug years, Celgene will review both academic and commercial requests for funding alongside LLS staff and determine which opportunities the TLC partners should back with grants or investments. development, including $78 million invested in the biopharma industry. Corporations that sign on to participate financially in the TLC program will have the first chance to license or acquire academic research or drug development projects that come to the end of their LLS The organization backs companies funding and need more capital to pay for the next round of clinical trials. large and small to promote private While encouraging firms to pursue therapeutics for hematological malignancies, LLS isn’t afraid to investment in Parkinson’s disease, say no to a company that applies for funding if the science is bad. The organization also isn’t reluctant to end projects that prove ineffective or show dose-limiting toxicities early in development. despite high profile failures in other “We’re an investor who has great insight into the space. We’re willing to come in very early; we’re neurological diseases. willing to take significant risk; and we’re in it for the long haul, because our exit is therapies for “We recognize Parkinson’s disease patients,” Dr DeGennaro says. is a challenging disease to invest in. LLS has two strings attached to its financing: 1) a diligence clause that says after the organization’s Because it’s about the brain, we know financial commitment has ended, the company has to continue development of the drug for a certain period of time; and 2) a return on investment tied to getting a drug on the market, either in the form the chances for success are small, since of a payment tied to a licensing agreement or capped royalties on product sales. we know so little about the brain. It’s At the same time, just because LLS is financially vested in certain companies’ therapeutics, that risky for the industry. So whatever role doesn’t mean that it will advocate on the drug’s or the company’s behalf when it comes time for the FDA to consider marketing approval. Given the organization’s numerous partners and supporters, it we can play in lowering the risk, that’s remains neutral on specific therapies. what we do,” says Fox Foundation senior vice-president of research scrip100.com SCRIP 100 61 the patient Pharma’s finally booted-up but too
Lucie Ellis robotic for the social web Editorial Intern, Scrip Intelligence It holds the promise of progress for the pharma industry, from providing a platform for efficient and authoritative information, to aiding recruitment and The benefits of social media proceedings of clinical trials. But has pharma finally harpooned the giant that is rely on pharmas social media? Lucie Ellis investigates. showing “a human Social media is the world’s worst kept important updates on products or a ‘surround sound’ effect, amplifying empathic face” secret to creating a strong, well- services’. A view point up by 9% from important information. Social media connected, professional web presence 2011 survey findings. Participants can help educate about, and increase in the tech savvy generation of curiosity were also asked to name a pharma awareness of, diseases and conditions + search = 100,000,000 results at your company that stood out from the rest and encourage conversation among fingertips. The pharmaceutical industry in its use of social media platforms; key constituents.” has in the past lagged behind as the Pfizer took the top spot with 32 But who is embracing the digital general public evolves from traditional mentions, ahead of Janssen with 14, media evolution? consumer to web surfer, and though Novartis with 13, and Sanofi with 10. Displayed in the table opposite are historically wary of embracing the social Rob Halkes is the principle current examples of pharmaceutical media surge, the industry is finally consultant of Dutch company companies who are operating various letting the waves wash over it. Health Business Consult, that focus social media tools in a variety of In October 2012 WEGO Health/ on creating and developing health creative ways to communicate with Digital Health Coalition surveyed solutions, marketing strategies and patients and a wider web audience. 356 health activists (people who specifically online solutions to integrate Still, web networking holds an ocean regularly participate in online health care. He says he was skeptical of of opportunities for pharmas to utilize communities) on the topic of health social media in the beginning but its various platforms. social media and results showed 81% believes the continued use of online For example, social media as a believed pharma used social media networking sites by the pharma tool for clinical trial recruitment allows ‘to provide their communities with industry will only improve their image companies to target demographically with the general public. diverse patient groups quickly and cost Top ten Pharmas on Twitter He told Scrip it is “important for effectively. Eli Lilly is one company who Company Twitter Tweets Followers Started pharma to find ways of proving has already piloted digital media as a Handle Tweeting that it can be a trusted source of recruitment system for clinical trials as Pfizer @pfizer_news 1,068 34,742 13 July 2009 fair, balanced, and accurate health appose to using traditional media. Novartis @Novartis 2,194 30,897 7 information on the social web, In early 2012, Lilly conducted a November supporting the dialog between trial recruitment program that used 2009 healthcare professionals and patients in Facebook, Click-it-Forward and Roche @Roche_com 1,878 23,993 13 February the most appropriate way it can”. YouTube as well as propriety health 2009 “Every corporate company is doing networks for trials in the areas of Johnson and @JNJComm 2,872 23,197 9 February something on social media,” he said diabetes and head and neck cancer. Johnson 2009 “some more than others.” But Halkes Lilly reported the trial as delivering a AstraZeneca @AstraZenca 1,014 16,631 3 August 2009 urges pharmas to continue their use of “meaningful volume of responses” and GlaxoSmithKline @GSK 1,037 16,233 21 April digital sources; however, he complains a cost saving of 10-15% through the 2007 that it is still dealt with in a corporate elimination of multiple project fees. Lilly @LillyPad 2,725 10,281 29 July way. The benefits of social media rely on In August 2011, Mayo Clinic 2010 pharmas showing “a human empathic reported results on a pilot social media Merck & Co @Merck 1,012 7,475 28 April face in the frame of public relations”. recruitment process. The company 2009 used social networking platforms to Sanofi @SanofiUS 4,709 5,954 26 August 2010 Big Pharma = Big Twitter? recruit 12 subjects for a spontaneous Abbott @AbbottNews 1,140 5,381 22 August A spokesperson for Novartis, told Scrip coronary artery dissection (SCAD) Laboratories 2011 that “leveraging social media channels study within one week. This particular *all figures correct for date recorded 14/11/2012; Source: Twitter like Twitter and YouTube helps create trial was chosen for a provisional
62 SCRIP 100 scrip100.com the patient
Company Social media tool How they use it GSK Sharing GSK, in the company of other big pharmas, provide buttons on their website to ‘recommend this page’ allowing browsers to share the content on Facebook, Twitter or email to friend. Viewers can also ‘like’ or comment on content. Boehringer Ingelheim Gaming The first of its kind, Syrum is a Facebook-based social game about developing pharmaceutical products. The game allows players to link to Facebook friends, track their progress, exchange lab equipment, recruit them as lab assistants and even steal their discoveries. Syrum aims to demonstrate BI’s commitment to research and innovation, and “make pharma fun”. Bayer Pinning In early 2012 Bayer quickly joined social media platform Pintrest under the user name ‘Bayerus’. Currently displaying seven Pinterest boards, including Business, Sustainability and Innovation. Bayerus have also used the site to pin images and video content. AstraZeneca Careers AstraZeneca currently run a Facebook forum discussing recruitment opportunities within their company. The page has more than 3,800 ‘likes’. Pfizer Blogging Think Science Now, launched by Pfizer, is a blog site designed for communication between Pfizer employees across all areas to discuss their work. Sanofi Digital media Sanofi TV is a video news collection projected on YouTube. Currently the channel has 444 subscribers and nearly 200,000 views. Boehringer Ingelheim Going viral In 2011 BI released a video that went viral on the web, incorporating talking parrots conditioned to correctly pronounce the company’s name.
Source: Scrip Intelligence recruitment process as it was seen media pulls in around 25% of the by appropriately named co-author, Dr patients Acurian recruits for clinical trial Marysia Tweet that “patients with rare research. “It has been increasing but diseases tend to find one another and not in leaps and bounds,” he said. “It connect because they are searching for didn’t go from 5% straight to 25% and information and support”. we don’t expect it to go from 25% to It is not only in the patient 50% but we do think we are going to recruitment aspect of medical research see detrimental gains as we dig more that digital media has shown potential. into the online spaces and little corners In 2011, Pfizer launched a ‘virtual’ of the social media world, the online clinical trial program in the US. The pilot world that hasn’t been tapped yet.” program operated patient clinic visits A recent study carried out by Best A human face is essential for via smartphone or computer interaction Practices, into pharma strategies corporate social media and provided simple information for for effective messaging around new potential trial patients to understand products and the medical conditions Halkes echoes the idea that working how they could get involved and what they treat, found that “more than on a more human approach is the next to expect on a dedicated website. 50% of leading pharma companies step for pharmas. Patients on social media often expect social networking, online video “The only way that the industry can form online communities. Halkes for and other types of digital marketing represent its position on key issues example, follows the hash tag #hcsm or to grow in use as critical tools for in the discussion about the pharma healthcare communications and social communicating disease state and industry is to participate in these media, a community who discuss global product information”. conversations in its own words,” he healthcare news on Twitter. said. “As relationships develop, trust However, Scott Connor, marketing Patient chatter is generated and opinions may be vice-president for clinical trial recruitment Acurian also uses social media to ask revised, accelerating the proliferation of company, Acurian, told Scrip, that what patients their experiences of a disease, the image of the company.” the industry thought “in the beginning which Connor said was “a great way to Those still labeling pharma lagging would be the silver bullet if to solve all use social media where you don’t have in digital and social media trends may problems” is not yet there. to worry about regulations because themselves be at risk of falling behind He said: “It is a great channel all you’re doing is having a discussion the times. That being said there is because you have so much about how you feel”. plenty to still discover, test and perfect aggregation of people online to the He says Acurian use social media in the ever changing environment extent that you can target those platforms this way to get quick and of social networking. Digital media people, it’s great but when it comes relevant feedback from patients on a will have progress throughout areas down to actually filling hundreds and specific illnesses and the conversation of pharmaceutical reputations and hundreds, sometimes thousands of forms a market research tool, “you research, specifically in the area of patients on studies you can’t use social use that as part of your promotion, clinical trials, but it cannot fully replace media as a single tactic approach.” your advertisement to resonate with a the human aspects of interaction with Connor said that currently social potential patient”. patients yet. scrip100.com SCRIP 100 63 Copyright © 2012 Quintiles or www.quintiles.com/locations/asia www.quintiles.com/locations/asia To optimizeTo your product’s value, you have to understand where you are. What is the status the of local healthcare environment? What are the regulatory requirements? With years over 18 experience of in Asia, Quintiles brings the local expertise and the deep understanding relevant of stakeholders necessary to answer these critical questions and drive results for you. Learn more at contact us at [email protected] IN THE local insights results. drive capital | consulting | commercial | clinical EMERGING MARKETS Rebates – the Korean blight that won’t go away Ian Haydock Asia Editor, South Korea’s long-running effort to tackle “rebates” provided by pharmaceutical Scrip Intelligence companies is a seemingly uphill struggle: if a raid on the country’s largest pharma firm doesn’t signal an ongoing problem, what does? Ian Haydock investigates. While not unique, such Regulators including the Ministry Of prescribers gain from the rebates and cases of rebates since November practices are Health And Welfare (MOHW) and Fair can just choose a cheaper drug if 2010. Around a year ago, the FTC engrained in the Trade Commission (FTC) are grappling these are not offered. fined six firms a total of Won11 billion landscape in with business practices that look A recent audit by the National for “repeatedly providing individual South Korea increasingly anachronistic, let alone Assembly’s health and welfare doctors, clinics and hospitals with illegal in some cases, as South Korea committee unearthed 16 cases in the economic incentives through indirect globalizes. past four years where generics were means to increase prescription of their “Rebates” refers euphemistically sold at higher prices than the original. drugs,” leading to “directly inflated to bribes, inducements and irregular Then there is the pressure on the medicine prices”. payments, both direct and indirect, industry from general price cuts that Five were foreign multinationals, offered by manufacturers to hospitals, force manufacturers to seek sales including Novartis and Janssen. clinics and/or individual doctors and and volumes. The MOHW slashed the Fifteen of the 43 domestic pharmacists to encourage use of their maximum reimbursement of 7,500 pharma firms recently designated products. In addition to cash, gifts and drugs by an average of 14% this April as “innovative” by the government entertainment, they can take the form to cut Won1,700 billion in costs. Listed - based mainly on R&D spending - of additional product stock for a fixed manufacturers’ sales barely crept up in are involved in legal proceedings for price or a cut of sales. the first half, while aggregate operating unethical business practices and face While not unique, such practices profit plunged 42%. having their status revoked. are engrained in the landscape in Quantifying opaque rebates is But the small fines are manageable South Korea and are apparently difficult, but an estimate a few years business costs, and obfuscating continuing largely unabated. Dong-A ago put their total value at $1.8 billion counter legal cases have been Pharmaceutical was raided following annually. Indeed, FTC data for 2010 effective in delaying effective action. alleged rebates reportedly worth show SG&A expenses accounted Sanctions for individuals are in place $8.1 million. for 36% of domestic pharma firms’ including imprisonment and revocation But the firm, which has been fined revenues, around three times the level of medical licence, but have a threshold in the past, is not the only suspect and in the overall manufacturing industry. of Won3 million and in practice are local and multinational firms have been Considering combined annual sales modest: up to Won5 million plus two involved in similar actions. of South Korea’s top 48 listed pharma months’ temporary suspension for The driving force is protection of firms of around $9 billion, this is a instance. Of the 5,600 cases, punitive share in a highly cost-competitive, chunk of cash the government insists action was taken in only 58 (10 under generics-led market. As one source could be better used for R&D, which the dual punishment scheme). with knowledge of the practices told now accounts for just 6% of sales. South Korea clearly needs to Scrip: “Smaller companies particularly It’s not that the authorities haven’t sharpen the teeth of its enforcement don’t have much power and naturally been trying. The most significant move and punishment systems if it is serious want to protect their business. Without was the late 2010 “dual punishment” about stamping out rebates, and the rebates they can’t compete with the system for givers and receivers, and MOHW is now looking at toughening big firms.” rewards for whistleblowers. The enforcement provisions of the Ironically, part of the problem is the MOHW has also offered to refund Pharmaceutical Affairs Act on unethical system of reimbursing drugs at actual prescribers part of the difference business practices. transaction prices below a maximum between maximum and actual prices But as the source noted, it is a reimbursement ceiling. While this to encourage cheaper drugs, and pragmatic balancing act given the desire is designed to reduce healthcare threatened price cuts of up to 20% for to develop the indigenous industry: “The costs, manufacturers provide rebated drugs. government may feel it wants to protect incentives for the use of products with But the impact has been limited and domestic small and medium firms that higher reimbursement. Meanwhile, the MOHW recently reported 5,600 could be hard hit by any changes.” scrip100.com SCRIP 100 65 emerging markets Natco’s CEO, India’s price warrior
Anju Ghangurde Natco Pharmaceuticals has no qualms about examining the possibility of fully India Editor, exploiting the compulsory licensing mechanism. Anju Ghangurde talked to its Scrip Intelligence young CEO about his contrarian ways.
Natco is still weighing up its Natco Pharmaceuticals made since their 2008 launch. The Januvia public with respect to the patented options on a CL headlines when it was granted India’s family (Januvia plus Janumet) is the top invention have not been satisfied, or application for first ever compulsory license (CL) for ranking oral antidiabetic agent in India the patented invention is not available Celenstri Bayer’s anticancer Nexavar (sorafenib with 5.5% market share in the segment to the public at a reasonably affordable tosylate) in March this year. It believes for the 12 months ended August 2012, price, or the patented invention is not that transposing Western pricing as per IMS data. In addition, these worked in the territory of India. models to India won’t work. Not least products are also co-marketed by As per the terms of the Nexavar because a large proportion of Indians Merck’s partner, Sun Pharmaceutical CL, the price of Natco’s generic is not do not have adequate health insurance Industries, as Istavel and Istamet. to exceed Rs8,880 for a pack of 120 coverage (and this isn’t going to tablets for one month’s treatment, change dramatically anytime soon, it more CLs compared with Bayer’s price of about believes) and therefore have to pay for While Natco’s CL application for Rs280,000. Natco is also required to healthcare out-of-pocket. Nexavar may have made it somewhat pay a 6% royalty on net sales to Bayer, The firm’s young vice-chairman less popular among multinationals, the among other conditions that also and CEO, Rajeev Nannapaneni, says firm is clear that it won’t shy away from include a commitment to supply the that unless multinational companies such action in future. drug to at least 600 ‘needy, deserving’ consider pricing based on factors Natco had earlier sought a voluntary patients per year for free. Bayer, which such as GDP and purchasing power license to Pfizer’s HIV entry inhibitor has appealed against the CL decision, parity, the debate on pricing and Selzentry/Celsentri (maraviroc), which has offered to provide Nexavar at access may spin out of control – was seen as a prelude before seeking Rs30,000 per month under its patient and then market intervention would a CL for the product in India. Celsentri assistance program. The real market follow. He referred to the recent was originally part of Pfizer’s portfolio, situation, though, has turned more developments in India, where the but rights were acquired by ViiV complex, with Cipla slashing the price Supreme Court had taken a tough Healthcare, the 85%-15% specialist of its sorafenib to Rs6,840 for a pack stance against the Indian government HIV joint venture established by GSK of 120 tablets. Nannapaneni, however, over the delayed drug price control and Pfizer in late 2009. Pfizer received said that Natco has been able to match policy for essential medicines. marketing authorization for the product Cipla’s price through certain discounts “You can’t charge Rs280, 000 in India in November 2009, and ViiV offered to patients. ($5,229) for a drug and say you want has been in discussions to potentially to sell it in India. At some level you license out the HIV therapy in India. less is more need to have differential pricing,” ViiV had contacted Natco as one of Natco has also set its eyes on the Nannapaneni, told Scrip. He believes several Indian companies assessed US, though it clearly believes in a that Merck & Co and GlaxoSmithKline through due diligence to see if they niche approach, focusing on limited have perhaps got it right in India in fulfill these criteria. competition ANDAs. Nannapaneni, terms of their pricing strategy. “Merck Natco does not appear to whose early US exposure included a has a great strategy for the third world, have made it to the next stage stint in Merrill Lynch as a retirement pricing products as per the purchasing of discussions and Nannapaneni plans account manager, said that while capacity of people and backed by confirms that Natco is still weighing many Indian firms typically target 25-30 a good patient access program,” up its options on a CL application for ANDA filings annually in the US, Natco Nannapaneni said, specifically referring Celenstri. More CL action is perhaps prefers to pursue 5-6 Paragraph IV to the antidiabetic Januvia (sitagliptin). in store but the company remains, for filings per year. “It’s a fairly well-thought In India, Januvia was priced at now at least, tight-lipped. out strategy. We believe that success a fraction of its US cost, a game- Under Indian patent law a CL in one [product] is equal to doing about changer according to some experts. application can be made, subject to 20 me-too products,” he said. Januvia and Janumet (sitagliptin plus certain conditions, on the grounds that There are uncertainties, he metformin) have had a strong run the reasonable requirements of the concedes, referring to the recent
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unfavorable ruling in the generic a few domestic players focused on its potential impact on the biosimilars Brazil is another Copaxone (glatiramer acetate) case. A oncology and if it were to build a strong space. “Biosimilars is not going to be market Natco hopes to make a favorable ruling could have “changed pipeline, it could get ahead of the pack,” for everyone. It will be a deep pockets dent in the company’s dimensions completely”, he added. Natco, with revenues of game,’’ he added. he believes. “The [glatiramer] launch Rs4.68 billion in 2011-12, is estimated But Natco’s general unconventional has been delayed till 2015. So, to have a share of around 8% in the approach appears to have won it there are elements of uncertainty,” Indian oncology market. some admiration and attention. Sun Nannapaneni said, referring to the Brazil is another market Natco Pharma’s chairman and managing company’s niche strategy. hopes to make a dent in but is clear director Dilip Shanghvi, a family friend In June this year, the US district that it will do so with its own front- of the young CEO, had earlier referred court for the Southern District of New end, unlike in the US, where the firm to Nannapaneni as one of the “very York had upheld Teva’s contention that pursues a partnership-based model. bright” next generation of leaders in Natco’s ANDA for a generic version “The regulatory regime there [in Brazil] the Indian industry. Shanghvi has since of Copaxone infringes all its asserted mirrors the US but the marketing acquired about 3% of the company, claims. Teva had then said that it set-up mirrors that of India. We will in what Sun described as a passive believes that the defendants would be manufacture our products in India,’’ investment. Nannapaneni doesn’t see enjoined from selling their products Nannapaneni confirmed. Natco has any cause for concern and brushes until the process patent expires on set up a small distribution business aside any suggestion of a potential exit 1 September 2015. “Furthermore, in Brazil via a subsidiary to handle at the right valuation. any purported generic version of product registrations and sell the “A lot of things we’re doing now will Copaxone would need to obtain company’s products in the region. take five to seven years to pan out,” he FDA approval prior to being made said, asserting that Natco is looking at available to the public. At this point, biotech and friends the long term and is most certainly not it is unclear what the requirements Natco has forayed into the biosimilars for sale. would be for approval of a purported space via an alliance with Chemo generic synthetic peptide,” Teva had Sa Lugano of Switzerland. It has said. Natco has filed about 24 ANDAs purchased four monoclonal antibodies in the US so far including about six (mAb) drug substances under an potential first-to-file and paragraph IV exclusive agreement with Chemo’s opportunities that include a generic biosimilars arm, Mabxience, and will version of Celgene’s multiple myeloma manufacture the finished dosage treatment, Revlimid (lenalidomide). formulations. The products covered Not everyone is convinced about are trastuzumab, bevacizumab Natco’s strategy. The head of a and rituximab, biosimilar versions leading corporate advisory, who did of Roche’s anticancers Herceptin, not want to be identified, said that Avastin and Rituxan respectively Natco was following a “contrarian” and etanercept (Amgen’s Enbrel) for strategy, which offers the promise of autoimmune diseases. windfall gains but also comes with Though modest about the its own set of challenges. “As in any immediate prospects of this business, strategy, success lies in the ability to Nannapaneni appears unperturbed be differentiated over a reasonably long about reports suggesting an period of time. Natco is still relatively unprecedented level of interest in the mid-sized and would need to build biosimilars space, with an estimated adequate reserves to withstand a 277 firms at various stages of series of set-backs. Building a strategy developing products and imminent around compulsory licensing is not downward pricing pressures. “All sustainable,” the official said. those guys can’t churn out products The official also added that from like in the case of organic chemistry a “fairly precarious financial position” generics. Many won’t deliver. The risk caused by large debt, Natco had been of failure is high, including for us,” he able to steady the ship. “It should guard noted. He, though, underscored the against reckless adventurism,” he importance of Roche’s tie-up with cautioned, but added that Natco has India’s Emcure to launch cut-price the potential to grow to a larger size, versions of Herceptin (trastuzumab) provided it remains focused. “There and MabThera (rituximab) in India and scrip100.com SCRIP 100 67 emerging markets Revolution may spring pharma
Dr Sukaina Virji opportunity in MENA News Editor, Scrip Intelligence Dr Sukaina Virji delves into the Middle East and North Africa, one of the fastest growing areas for pharmaceutical sales. What she found was a region Healthcare expenditure per still uncertain in the wake of new governments, but full of hope for the future. capita in MENA is very low When Mohamed Bouazizi, a 26-year- population living below the poverty young. This has proved successful and compared with old Tunisian fruit-and-vegetable seller, line. Here, it all came to a head in the medical need is shifting as lifestyles more developed set himself alight almost two years February 2011, when President change and the populations age, regions ago, starting what has become known Mubarak was ousted by the Supreme with a need for medicines for chronic as The Arab Spring, few could have Council of Armed Forces. diseases such as diabetes, oncology predicted that long-standing regimes and heart disease. would start toppling like dominoes. Top 10 pharma players Egypt spent 5.0% of its GDP on To date, rulers have been forced in the MENA region healthcare in 2009. This is comparable from power in Tunisia, Egypt, Libya to other countries in the region, but 1 Sanofi and Yemen; while civil uprisings 2 GSK well below developed countries. On have erupted in Bahrain and Syria. 3 Novartis a per capita basis, spending was just In addition, there have been major 4 Pfizer $113 in 2009. Only 41.7% of Egypt’s protests in Algeria, Jordan, Kuwait, 5 Hikma (Jordan) healthcare expenditure in 2009 was Morocco and Sudan. The major 6 Merck & Co from public funding. Pharmaceutical oil rich nations (Saudi Arabia, UAE, 7 Spimaco (Saudia Arabia) sales reached $2.9 billion in 2009/10, Qatar, Kuwait and Oman) have largely 8 AstraZeneca up from $2.5 billion the previous year. escaped unscathed. 9 Bayer The Egyptian pharmaceutical Numerous factors led to the 10 Novo Nordisk market is focused on generics. The protests, including issues such as Source: Hikma IP regulation situation means that dictatorship or absolute monarchy, companies have been slow to introduce human rights abuses, government The elections in June 2012 saw the new products, even for those Egyptians corruption, economic decline, Muslim Brotherhood enter power. They who could afford them. Regulation unemployment, poverty, and a large have been quick to put healthcare near is carried out by the Egyptian Drug percentage of educated but dissatisfied the top of the agenda. While nothing Authority. The data protection period youth within the population. concrete has changed, “We are hopeful is five years from when the drug However, the changes are largely of a positive impact on the pharma registration application is filed. This is being seen as positive by the pharma industry,” said Nabilsi. different from most countries, where the industry. So says Jordanian company Healthcare expenditure per capita in data protection period is from the date Hikma, the fifth largest pharmaceutical MENA is very low compared with more of market authorization. company operating in the MENA developed regions. In the US in 2010, Of the products registered in (Middle East/North Africa) region. The for example, the figure stood at $8,362 September 2011, 62.5% were local four companies ranked above it are (Europe: $3,799; Japan: 4,065). In the registrations, 9.7% were for toll all multinationals. MENA region, $526 was spent. Several manufacturing in Egypt, and 9.3% “While it is too early to say exactly factors are driving the growth of the produced in Egypt under license. Only what will happen, we hope the new healthcare market in the MENA region. 14.4% of registrations were for imports regimes will increase government Increased life expectancy (71 years in in number terms. However, local spending on healthcare and education 2009 compared with 59 years in 1980) products tend to be of lower value. as part of their focus on gaining public and lower mortality rates have led to Pricing is a political issue, with support,” Khalid Nabilsi, Hikma’s chief high population growth in the region, pressure on the one hand to keep financial officer, told Scrip. see graph. Estimates suggest that the drugs affordable, and on the other from Egypt. The most populist population in the region could reach 233 pharmaceutical companies to raise country in the MENA region with an million by 2015 and 272 million by 2025. prices. Following a long tussle in the estimated 83.7 million people. The Historically, pharma spend has been courts, in May 2011, a ruling approved global economic crisis in 2008 saw on acute anti-infective medicines and a decree to link new non-generic drugs food prices soar, with 22% of the immunization, aimed at treating the to international prices, but excluded
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generic drugs. to the dollar have caused volatility, served population. And as healthcare Egypt is seen as Egypt is seen as the gateway to the particularly in our North African markets. awareness increases, governments the gateway to the lucrative Gulf lucrative Gulf countries, which has led In Sudan for example, the currency has old and new are putting it at the top of countries to some international pharmaceutical devalued by more than 80% this year. their agendas, making these markets companies shifting their production As we increase local manufacturing in highly attractive. base to there. AstraZeneca, Eli Lilly, these markets, we increasingly have a GSK, Novartis, Otsuka, Pfizer, Sanofi natural hedge for some of our exposure Khalid Nabilsi, and Servier all manufacture in Egypt. to those currencies.” Hikma CFO GSK is the leading company by The ongoing upheaval in the MENA turnover, while EIPICO is the leading region over the last two years has local company. had the world on the edge of their “Egypt is a relatively new market for seats. But as the dust settles in us,” admits Nabilsi. “There are a lot most of these countries, the pharma of local players. It is very competitive. industry is getting on with its day job However, it is a fast growing market of supplying medicines to an under- and we see a lot of potential.” Wages historically have been very low in MENA region, one of the root causes of the Arab Spring it has been said, and Hikma’s response has been to increase wages in some markets by 10-15% in 2011. “We have made important investments in our people,” says Nabilsi. Retaining its talented sales force was also likely a key driver. Around 40% of its sales in the region are from in-licensed products from international companies such as Astellas and Takeda. However, with the huge step change in wage inflation, improving margins becomes crucial. “We’ve had to make important business decisions. We’re gradually moving from being A protester in Egypt an anti-infective focused company to selling higher value products in growing therapeutic categories such MENA market life expectancy in 1990 and 2011 as oncology. We’ve increased our investment in R&D to ensure a stream 1990* 2011** of new products. We need to continue 85 registering new products at today’s 80 prices to drive revenue growth and 75 margin improvement.” In 2011, Hikma launched 40 new 70 products. In the first half of 2012 alone, 65
Hikma launched 30 products. Hikma is 60 also cutting its “tail-end”, less profitable 55 products, and is reorganizing its sales teams so that efforts are skewed 50 towards these newer products. 45
Multinational companies have had 40 a presence in the MENA region since Iraq emen Syria Libya UAE Egypt Y Oman Qatar the 1970s, well before local companies SudanAlgeria Tunisia Jordan KuwaitBahrain Morocco Lebanon such as Hikma emerged. Saudi Arabia “It can be tough,” notes Nabilsi. *Source: WHO World Health Statistics 2011 for 1990 data “Movements in currencies not pegged **Source: CIA, The World Fact Book 2011 scrip100.com SCRIP 100 69 emerging markets New money for old china?
Wang Fangqing met with Dr Yehong Zhang to discover the strategy behind Wang Fangqing the new JV set up by Merck & Co and Simcere. China Healthcare Reporter Joint ventures are often used by be repacked or renamed, although in with measures including making the foreign companies to quickly reach the the future SMSD will develop its own essential drug list (EDL), increasing aid SMSD is neither growing, yet highly fragmented Chinese drugs with a new brand name. in medical insurance in rural areas and a JV for a foreign market, or as a low cost manufacturing “The six drugs are only for us to get cutting drug prices. company to base to supply other markets. started. As our business grows, we The recent price cut by China’s boost its sales in China, nor a Such examples include DSM will develop our own drugs, choose national development and reform supplier for other Sinochem Pharmaceuticals, the our own business partners, as well as commission took effect on 8 October, markets Changchun-based JV between DSM select drugs from other companies,” affecting 95 specific medicines, more and Sinochem that manufactures Dr Zhang said. than 200 formulations, including antibiotics and intermediates SMSD, he emphasized, is a oncology, immune and blood-related for clients worldwide, as well as company to manufacture and sell products. It was the 30th cut in the Hangzhou Sanofi Minsheng Consumer non-patented brand name drugs. past 14 years. Healthcare, a JV between Sanofi and “Innovation will be an important part Also, the ministry of health is drafting Minsheng Pharmaceutical to supply in our company, and for us it will a new version of the EDL, aiming to supplements to Chinese consumers. focus on commercial model, access increase the drugs from the current But neither of these models is what parade and payer enabling,” he said, 307 to 700. All the measures led to a SMSD, the 49-51 JV between Simcere adding that an SMSD manufacturing “significant result”, according to Lan and Merck China (MSD), plans to facility, which will be located in Genbo, a World Bank economist. follow, said SMSD CEO Dr Yehong Jiangsu province, is expected to start “The Chinese government has Zhang, pictured below. “SMSD is construction next year. invested over $125 billion in the reform neither a JV for a foreign company to since 2009 and now 95% of the boost its sales in China, nor a supplier Reform-driven strategy country’s population is covered by the for other markets. Our mission is to While SMSD will share Simcere’s healthcare system,” he wrote in a recent provide high quality, affordable drugs extensive sales network, which covers report. However, he notes it is still a long to Chinese patients in both urban and more than 4,000 hospitals and 70,000 way to go until China can build a system rural areas,” he told Scrip. retailers nationwide, it will also develop to achieve full coverage backed by Shanghai-based SMSD, established its own network, Dr Zhang said. strong government financial aids. in September 2012, will initially In fact, the company is now hiring In 2011, China’s gross domestic focus on “branded pharmaceutical people in sales and marketing across product was up 9.2% year-on-year to products for cardiovascular and the country, covering not only first Yuan4715.6 billion ($745.04 billion), but metabolic diseases” for China’s rapidly tier cities like Shanghai and Beijing, only spent Yuan642.9 billion, or 1.36% aging population. Chinese state- but also remote areas such as Qujng, of GDP, on healthcare, which already run media Xinhua has reported that Yunnan province, and Kashgar was a record high. Now facing the fact cardiovascular diseases, especially Prefecture, Xinjiang. strokes, have become the number one “While big hospitals in major cities cause of death in China. will always be important, as they The current six drugs that SMSD influence prescriptions, we will pay markets, all non-patented, come more attention to hospitals in rural from the two parent companies. areas and lower tier cities, where Among them are MSD’s hypertension patients have limited access to high treatments – Cozaar (losartan), Hyzaar quality drugs compared with their (hydrochlorothiazide and losartan), peers in big cities. I think meeting their and Renitec (enalapril), as well as medical demand is the key to improve high cholesterol treatment Zocor China’s healthcare system,” Dr Zhang (simvastatin), while Simcere offers Xin said, referring to thousands of small Ta (levamlodipine), also a hypertension hospitals and community hospitals in drug, and Shufutan (rosuvastatin), the country. which lowers cholesterol. The Chinese government has been Dr Zhang said these drugs will not pushing healthcare reform for years,
70 SCRIP 100 scrip100.com EMERGING MARKETS
Surprisingly, intellectual property Dr Zhang has issues, which are often sensitive to JVs served as president in both in China, has never crossed Dr Zhang’s MSD China and mind. “It’s not an issue at all. Simcere Simcere is known as an innovative Chinese company with many IPs, and respect for IP is a premise to collaborate with multinationals,” he said. Aside from MSD, Simcere also has established a partnership with Bristol-Myers Squibb and Epitomics, developing innovative drugs in oncology.
A road less travelled Dr Zhang is confident that the JV will have a material impact in meeting the demand in the Chinese drug market in the future. “As long as we stay true to our values and steadfast Ancient wonder: the new JV will allow China to in executing our strategy, which is in maintain its aging population as it does its treasures line with China’s healthcare reform, this company will bring us some real that China’s economy is slowing down, “I have a good understanding of both impressive performances,” he said, it is likely the aid will not be increasing sides, which helps me a great deal joking that sales and investment are the substantially, which leaves SMSD more when comes to build a complete least of his worries. opportunities in the market. organization that seeks to be a Right now, Zocor and Renitec are “The future pharmaceutical market premier innovator in the industry in an already included in China’s EDL, and in China will be constrained by environment of uncertainty and rapid there will be more in the future, Dr people’s ability to finance healthcare change,” he said. Zhang assured. “Getting into the EDL needs, and people are expecting But still, many challenges remain. is essential for us to cover the whole quality drugs with reasonable prices. One is to anchor the strategic value nation, but entering a price war is not Patented drugs are necessary, but and mission of the JV while dealing what we intend to do, because I believe their prices are beyond most patients’ with daily operational and short- there will be a better model than Anhui reach,” Dr Zhang said. He added it is term issues. And that requires a model,” he said. also part of the reason that Simcere huge amount of communication and In 2010, Anhui province initiated a eventually chose MSD as a partner. patience from both parent companies, lowest-price-win model, known as the “Aside from the two companies Dr Zhang said. Anhui model, to choose ED suppliers, sharing the same value and goals in As many other executives in China, and it has now been adopted by other China, MSD offers a rich product line Dr Zhang is facing the difficulty to find regions including Jiangsu province and of mature drugs that are no longer the right people for the company, which Zhejiang province. under patent protection. The JV is an now is home to about 500 people. The purpose of Anhui model is to cut ideal platform to extend the life cycle “I’m not looking for talent in a general drug prices to the extent that everyone of these drugs,” Dr Zhang said. sense, but people who have the same can afford, but a serious side effect values as ours. And foremost among is the poor drug quality. An infamous Meeting the challenges these values are commitment and example is in April, a major ED supplier, Coincidently, Dr Zhang has served ambition,” he explained. Sichuan Shuzhong Pharmaceutical, as president in both MSD China Although he spent decades in the was found to manufacture chromium- and Simcere. Now, as CEO of US and has degrees from Harvard contaminated capsules. SMSD, he said the experience and Wharton, Dr Zhang is not that “Some of the regional models in both companies provides him demanding on background when it are irresponsible, so they cannot unique perspective. For example, as comes to recruiting. “I don’t care if be sustainable. I believe China will president in historical MSD his priority this person studied abroad, as long eventually develop a system that is was to make sure of sales growth in as he fits in. Actually I would love to well balanced between cost, quality China, while in young Simcere, the explore more in the domestic talent and access, although it takes a while,” main focus was on communication. pool,” he said. Dr Zhang said. scrip100.com SCRIP 100 71 Sponsored by:
Tectonic transformations: the future of biopharmaceuticals in Asia
As the world stands at a crossroads with respect to the global economy, geopolitical power shifts and climate change, so too is the biopharmaceutical industry approaching its own moment of truth. Dr Amar Kureishi, chief medical officer and head of drug development for Quintiles Asia, examines the re-emergence of Asia in the industry.
While the fundamental problems of low R&D productivity, rising R&D pharma is forced to predict the market a decade or more into the costs, price cuts and patent expiration remain, the pharmaceutical future, which is virtually impossible. The world can and often does industry is actively, if somewhat desperately, trying to reinvent itself. change radically in 10 years. It is using a variety of strategies ranging from branded generics and With such long development times, the cost of bringing a new fixed-dose combinations in emerging markets, to global biosimilar drug to market is extraordinarily high. Various estimates place this programs that aspire to capture a piece of the $50 billion opportunity cost between $500 million and more than $1 billion. However, a arising from a handful of blockbuster biologics that come off patent more accurate estimate is undoubtedly the total R&D expenditure of in the next five years. a company divided by the successful number of products launched. There are almost daily announcements of mergers and Using this measure over the time period 1997–2011, the cost of acquisitions, of new partnerships and alliances. It is said that each new drug brought to market for the top 12 pharma companies innovation is being stifled by ultra-conservative and bureaucratic is staggering, ranging from a low of $3.7 billion to a high of $11.8 approval processes, and there is discourse everywhere on different billion per molecule developed, according to the Forbes February and often wondrous in silico and open innovation models of virtual 2012 article: The Truly Staggering Cost of Inventing New Drugs. drug development. There are overwhelming marketing ambiguities as well. When The celebration that 2011—with its bumper crop of 35 NDA a drug is launched, who is the customer? Is it the physician who approvals in the US— heralds a turnaround for the industry is decides on the one drug among many to prescribe? Or is it the tempered by the observation that pipeline drugs in Phase I and II are insurance company or public provider that pays for the drug? Or at an all-time low, leading at least one commentator to observe that is it the patient, for whom the drug was ostensibly developed, the turnaround was perhaps in FDA regulations, rather than in R&D but is the passive recipient of the product? Whichever way one productivity. views these dilemmas, the existential pressures to commercialize All this activity leads one to ask: Is the industry breathing new life biopharmaceutical products successfully are enormous and often or experiencing agonal gasps? lead to aggressive marketing practices that damage the reputation of the industry and result in massive fines from the regulators. On shaky ground: the case for change Suffice it to say, with the biopharmaceutical industry undergoing Those who dismiss the troubles of the biopharmaceutical industry rocky times, one cannot ignore the shaky ground on which the fail to appreciate its complexity and the unique challenges of R&D in industry stands. biopharma. To begin, the product development cycle from discovery to market launch for new drugs is much longer than the product Asia rising… again development time in other complex industries such as aerospace Despite the global economic crisis, with double-dip recession in the and electronics. US and a currency crisis in Europe, the economies of Asia continue It takes eight to 12 years for biopharmaceuticals to transition from to grow steadily. discovery, through the clinical development stages to regulatory Although news of China and India dominates the headlines, other approval and launch. By contrast, the Airbus 380 took less than six countries in Asia are also rapidly emerging. Indonesia, the fourth years from drawing board to delivery of the first aircraft. The iPod most populous country in the world after China, India and the United took even less time, with launch of the product less than a year States, is projected to become the seventh largest economy by after Apple conceived the idea. The longer development times in year 2050, eclipsing the UK, Germany and Japan. Vietnam, with biopharma add complexity, increase cost and compound the risk a population rivaling that of Germany with 85 million people, has a of future uncertainty. This protracted development timeline means growth rate equivalent to that of China.
72 SCRIP 100 scrip100.com Although Asia is indeed modernizing, it would be a mistake to Companies should ‘think think the continent is Westernizing. Asians may have acquired a global, act local’ in Asia taste for Western food, culture and lifestyle, but there is unmistakably a reassertion of local culture and identity. This is a fundamental point that global multinationals need to understand. It is no longer sufficient for companies to “think global, act local”. Rather, companies must “think global, be local” and to “be local”, companies must understand what it truly means. First, Asia is not a single entity, just as Africa is not a single country. It is not a story of rags to riches but of an Asia returning. This is not a romantic notion, but an extremely important distinction because it will guide the behavior of companies with a mid- and long-term view of establishing themselves in Asia. And for companies wishing to build significant inroads and establish relationships with these emerging nations, the most sensible time to enter is when they are still pre-emerging and need the support of Western companies to make important investments into their emerging infrastructure. the healthcare needs of society. No longer will it suffice to develop an Second, there is a tendency to consider “country” synonymous expensive new medicine which is accessible to only a small minority with “market.” Hence we use the term “emerging markets” as of patients, at a cost that siphons resources and leaves even larger a narrow synecdoche for nations and entire societies that are healthcare issues unaddressed. undergoing rapid development. As Asia develops and modernizes, We have previously asserted that fundamental to this new model the countries of Asia will manifest more clearly their distinct cultural will be partnerships. A single person or entity can neither hope to identities. Multinational companies in all industries that wish to comprehend the problem of healthcare in its entirety, nor possess all succeed in Asia will need to learn to “be local” in order to recognize the pieces to the solution. In the old model of drug development, a and leverage value-creating local opportunities. biopharmaceutical company retained the entire drug discovery and Finally, while the initial growth of Asia has been fueled by a cost- clinical development process. This linear, monolithic “go-it-alone” arbitrage of low-skilled products and labor, there is now a reverse model is giving way to the “wheel-and-spoke” model of multiple flow of intellectual capital back to China and India, and the science partnerships and strategic alliances (see Asia: A New Frontier for and technological skills acquired at MIT and Stanford are being firmly Strategic Drug Development, published by Quintiles, for more planted in Wuhan and Bangalore. Those who think China and India information). will not be able to compete with quality biopharmaceutical products Growth in Asia is central to the survival of the biopharmaceutical must consider how Korean cars were scoffed at in the 1990s, industry. Indeed, it is difficult to find a biopharmaceutical company in or Japanese electronics were ridiculed a generation before that. the US or Europe that does not have an emerging market strategy. Asia’s rise will not only be as a market, but also as diverse group of Even so, the opportunity in Asia is still being viewed too narrowly— economically developed and technologically advanced nations taking the current tendency of global biopharmaceutical companies to their place in a multi-polar world. see emerging countries as extensions or expansions of Western markets, rather than the unique transformations they are. The way forward: transformation, not The biggest challenge for the service sector is to transform its self- incremental innovation perception from the hand-maiden of the biopharmaceutical industry Innovation and change occur at two levels. First-order change to an advocate for better processes in a re-emerging Asia, investing refers to solutions that restore equilibrium without altering the in training people and building infrastructure. underlying state, the systems and structures from which the For the CRO industry to see themselves as solution providers problems arose remain unchanged. Second-order change, rather than service providers is a mere first-order change. The on the other hand, is a change of the state itself—a shifting or second-order transformational change is for CROs to see transformation of the entire framework. themselves as the midwives of a New Health in Asia, bringing clinical It has been stated with increasing frequency that the salvation research expertise and investments to tertiary care hospitals, crafting of the biopharmaceutical industry lies in innovation. One can argue clinical development plans that address Asian medical needs, and that while new medicines have been discovered and developed with nudging the evolving regulatory landscape in Asia in a direction regular frequency, there has been very little innovation in the industry that benefits those most in need of healthcare. For this, the service itself over the last few decades. Moreover, one wonders whether industry itself must think Asia and be Asia, and in doing so, restore any incremental innovation can be sufficient to overcome the patients to the center of the healthcare system. fundamental structural flaws in the existing biopharmaceutical model, Viewed through this prism, absorbed through a mantra of and whether a complete transformation of our thinking and approach “understand local, think local, be local,” the sliding tectonic plates to developing new medicines is needed. upon which pharma sits become less foreboding. And perhaps, it’s A key element of the new model will be a renewed focus on no coincidence that the Chinese term for crisis—(危机) weiji—is the healthcare, both in alleviating individual suffering and in addressing juxtaposed characters for danger and opportunity. scrip100.com SCRIP 100 73 policy & regulation In conversation: Guido Rasi
Neena Brizmohun As his first year as executive director of the EMA ends, Guido Rasi tells Deputy Editor, Neena Brizmohun about his challenges and achievements. Scrip Regulatory Affairs My interview with European Medicines a statement on the matter; but Prof problem”. He then implies, however, Agency executive director Guido Rasi manages to squeeze me into his that the EMA is prepared to use “all Rasi gets off to an ominous start. It increasingly hectic day. the tools we have” to tackle such So far, Prof is 26 October and France has just This situation is just a snapshot of the problems, whether old, current or new. Rasi has made announced it is suspending sales of life the head of the EMA leads. Since Also on the topic of post-market drug progress in a Novartis’ Agrippal flu vaccine as a taking the helm of the EMA in November surveillance, the new pharmacovigilance number of areas precautionary measure, after potential 2011, as well as dealing with the legislation brings a whole raft of new quality defects were found in batches responsibility of running an agency that safety measures that the EMA must put of the drug. The EMA is busy preparing regulates medicines for over 500 million in place to handle complex information citizens in the EU, he has been busy on around half a million drugs. The EMA with the colossal job of implementing is of course not the only one struggling; the new pharmacovigilance legislation. the legislation introduces many new The complexity of this legislation, obligations for national competent coupled with having to administer authorities and industry too. it without the additional funding One requirement that industry necessary (pharmacovigilance fees expected to struggle over has, as it payable by industry are not expected turns out, run smoothly. The EMA to be introduced until 2014), poses is “very satisfied” with how industry a challenge of a magnitude “never has fulfilled the requirement to submit experienced” before by the agency, product records for uploading into he says. the EudraVigilance medicinal product So far, Prof Rasi has made progress dictionary (XEVMPD) and with how in a number of areas. In other areas, the agency’s “unknown” system has however, things appear to be responded to this “massive upload”, moving slowly. Prof Rasi reveals. The agency achieved its target of receiving records for 50% Penalties Regulation and of the estimated 500,000 products pharmacovigilance authorized in the EU. I ask Prof Rasi about the EMA’s There are some outliers, however. recent decision to use the penalties The EMA does not yet have the full regulation as a tool to launch picture on the level of compliance by infringement proceedings against small- and medium-sized enterprises. Roche for alleged non-compliance Prof Rasi urges those companies that with pharmacovigilance obligations. are experiencing problems to discuss The regulation, which had never their concerns with the EMA. “We been used in such a way before, had have a team continuously available” for been amended only a few months support that is working on identifying earlier to cover a wider range of and addressing any problems, he pharmacovigilance rules; penalties says. “We are learning by experience could be as high as 5% of a company’s on both sides.” annual turnover in the EU. The EMA has not yet, however, Should companies be worried that begun validating the content of the this might be the start of a trend for the records that industry has gone to a lot agency and when might the EMA use of trouble to provide. Companies are the regulation again? The executive concerned that the effort they have put director appears initially to give little in is being wasted because the data away. This is “unforeseeable”, he says, are not being maintained and are not adding that the Roche case was “the being used. A team is hard at work on first time we have come across this a pilot to determine the most effective
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method for validating the content on a that introducing public hearings in improving co-ordination between its The EMA large scale and on a routine basis, he committees other than the PRAC various scientific committees. It is no predicts that it says, adding that the agency wants to might only happen “in the long term”. secret that the system of committees may be ready to develop a methodology that is as close First, it is important to see how much was becoming increasingly complex start publishing to perfect the first time around. value is gained from hearings in the and unfit for purpose. Better co- clinical trial data Handling and processing adverse PRAC setting. ordination is expected to help the proactively in reports and signals from a range of Prof Rasi concedes that the EMA still committees set standards for the January 2014 heterogeneous sources and from 27 has work to do to make sure its policy development of medicines that EU member states might be a problem on providing access to documents are consistent across the whole for the EMA, Prof Rasi admits. “We on medicinal products is used as product lifecycle, thereby increasing don’t know yet how much duplication intended. A report has indicated that robustness and predictability of we will have and how many false most requests for information do not benefit-risk assessment. negatives and false positives [will be come from scientists motivated by Prof Rasi reveals that the board has generated].” The agency has “allocated public health needs, but rather from now identified a group of experts in resources specifically to monitor this industry with a commercial motivation. one therapeutic area that will sit on the potential problem”. He is keen to point out another different committees and deliberate problem related to this policy which on a product throughout its lifecycle. Transparency is that the agency is spending The agency plans to start using this Rebuilding the reputation of the a phenomenal amount of effort expert group in January. A system agency is another top priority for Prof redacting information (such as of therapeutic expert groups is also Rasi. Under his watch, the EMA has personal data) in documents because expected to help the agency cope managed to convince the European companies are putting information in with the shortage of available experts Parliament that it has taken the steps the wrong parts of dossiers. For those it has to choose from as a result of needed to address questions over the companies that might purposely be having to compete with industry for transparency and conflicts of interest completing their dossiers incorrectly the same experts. While one group of its drug evaluators and other staff to slow down the agency’s release of of experts may, on the face of it, not that have continued to plague the the information, the executive director appear to be much progress, Prof agency over the past few years. As has a warning: “It’s not going to stop Rasi is clearly pleased to be the one such, parliament recently approved us releasing… so work with us… and who is finally tackling this important the agency’s 2010 accounts. The EMA whatever is a cost for us is a cost for co-ordination issue. has, among other things, announced the [entire pharma] system.” In 2012, On the question of how the EU drug plans to introduce an ex ante and ex the EMA had by 26 October released licensing procedure might develop, post screening system for experts’ around 700,000 pages of information Prof Rasi reveals that the agency is declarations of interest, including in response to requests. ready to test an adaptive licensing random comparisons with CVs and Prof Rasi is now grappling with the procedure for encouraging the information provided by experts at task of determining how the agency will development of products for unmet national level. begin to proactively publish clinical trial medical needs. Regarding decisions made by the data for drugs – once the marketing The adaptive approach, which would agency’s seven scientific committees, authorization process has ended – and be used for drugs for severe diseases the EMA this year began publishing enable access to full data sets. As well “where you can accept more risk”, the agendas and minutes for the as having to figure out how to provide could enable a product to reach the Pharmacovigilance Risk Assessment such complex data sets in a manner market as early as before Phase III Committee and also for its Committee that is useful, he must deal with an development; further evidence would be for Orphan Medicinal Products and industry that is reluctant to make its gathered in the post-market phase. “We Paediatric Committee. It plans to do the clinical study reports freely available. are at this point waiting for a company same for its remaining four committees, Resolving these issues will take some to come to us [to test this procedure].” but not until the end of 2013. time. The EMA predicts that it may be My interview is interrupted as the Opening up all EMA scientific ready to start publishing clinical trial EMA chief is called on to attend committees to public hearings might data proactively in January 2014. to another important matter. As also be on the cards – but not any time for the Agrippal issue, it turns out soon. Not only is the PRAC currently Better co-ordination there was no major cause for alarm. the only committee authorized to hold and faster approvals The agency decided not to take a public hearings, the definition of a The EMA chief provides a progress lead in investigations because the public hearing still has to be finalized, report on the much-vaunted scientific vaccine was authorized by national he admits. co-ordination board he set up in April governments; the French ban was Prof Rasi realistically accepts to boost the agency’s efficiency by later lifted following further tests. scrip100.com SCRIP 100 75 policy & regulation Implementing the ACA: let the wild
Donna Young rumpus begin Washington Editor, Scrip Now the confetti has been swept away the hard work really begins, Intelligence implementing ObamaCare. Donna Young reports from Washington.
While the Patient Protection and Two days after the 6 November fear of change. But much of that has Solving the dilemmas of Affordable Care Act (ACA) and US 2012 elections, President Obama been removed.” ensuring a Medicare and Medicaid may have vowed he would work with both But BPC co-founder, former senator sustainable US been spared a complete topsy-turvy parties to find more ways to cut Tom Daschle (Democrat-South health care system set of events with President Barack spending, which he said “includes Dakota), who also previously reigned is an “engineering Obama’s 332-206 electoral vote win making reforms that will bring down as Senate chief, argued the federal problem” of the “highest over former Massachusetts governor the cost of health care so we can government would still be the best complexity,” Mitt Romney, there’s no doubt knotty strengthen programs like Medicaid option for creating the “innovative new challenges – financial and otherwise and Medicare for the long haul”. infrastructure” necessary for the US – lie ahead, not only for all agencies PhRMA senior vice-president health care market to work as intended within the Department of Health and Matthew Bennett urged Congress under the ACA. Human Services (HHS), but for the 50 and the Obama administration to “I don’t know that the private sector US states and industry as the law is “preserve and sustain continued has the capacity to create an innovative further implemented. medical progress,” which he argued new infrastructure, a new paradigm, “improves lives and is an engine of for health in this country,” he said. economic development”. “There’s a tremendous amount of “Maintaining leadership in inefficiency in the private sector,” which R&D-intensive sectors like the Senator Daschle said has not yet found biopharmaceutical sector is critical to the right balance between pursing winning the fight against the human innovation and being risk averse. and economic costs of disease and Nonetheless, Daschle said he growing the US economy over the long expects to see an “extraordinary term,” Bennett said. explosion of innovation” coming from Solving the dilemmas of ensuring a the private sector and states with new sustainable US health care system is an models in services and delivery as the “engineering problem” of the “highest ACA moves forward. complexity,” Dr Donald Berwick, Both former Senate leaders the former head of the Centers for conceded the focus of the ACA has Medicare & Medicaid Services and the shifted to the states as they move co-founder of the non-profit Institute for forward with implementing the law’s Healthcare Improvement, said during insurance exchanges, which were an 8 November forum in Washington. mandated to serve as a marketplace At that same gathering, former for reasonably priced health plans for US Senate Majority Leader Bill Frist individuals and small businesses. (Republican-Tennessee), a physician, The exchanges will be run as Just about everyone in Washington contended much of the “disruptive government agencies or non-profits, has acknowledged the reality that innovation” that will address those with the federal government stepping in some spending cuts or changes in problems will come from the private to set them up if a state fails to do so. beneficiary criteria would need to be sector and states, not the For drug makers, the exchanges made to Medicare and Medicaid to federal government. mean potentially millions of new sustain the programs, with all HHS “Very little in terms of innovation customers whose prescriptions for agencies expected to take a significant comes out of Washington,” said Dr medicines might otherwise go unfilled haircut in their budgets, including the Frist, who is now part of a think tank due to lack of insurance coverage. National Institutes of Health and the US of former lawmakers, known as the But Dr Mark McClellan, director of FDA – all outcomes that will affect the Bipartisan Policy Center (BPC). “All the the Engelberg Center for Health Care biopharmaceutical industry in one way private sector wants is certainty,” he Reform at the Washington think tank or the other. said. “Ideas have been locked up for Brookings Institute, and a former head
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of the FDA and the Center for Medicare Medicare cost growth and making held in 2009 with various health & Medicaid Services, warned not to recommendations to Congress care stakeholders, one of the expect all to go smoothly with the on policies to curb spending – the concessions the hospital industry exchanges – especially in the first year. Independent Payment Advisory Board was made to give in to the idea that, For drug makers, “There will be bumps,” Dr McClellan (IPAB), a measure which already has as more and more individuals are the exchanges declared during a 13 November forum had votes in the House for repeal. insured under the health reform law mean potentially in Washington. Critics have asserted that IPAB is through the exchanges, subsidies millions of new Nonetheless, said Chris Jennings, an unelected board of bureaucrats provided to help individuals buy customers president of Washington-based empowered to make budgetary and insurance coverage or the Medicaid consulting firm Jennings Policy reimbursement decisions for Medicare expansion, the enhanced government Strategies and a former senior health without congressional oversight. reimbursements DSHs receive under care adviser to President Bill Clinton, While there’s been bipartisan Medicaid would be eliminated over the Obama win was a “relief” for the agreement by some members of time, Feigin Harris told Scrip. future of health care, “in the sense Congress from both sides of the But if that foundational basis for that there was not a desire to reopen aisle that IPAB is “not a good way the hospital agreement is chipped every single element of the health care to proceed”, Representative Donna away by not having fully operational discussion again, in what would have Christensen (Democrat- US Virgin exchanges, smaller individual inevitably been a very polarizing debate Islands) acknowledged “that’s where a subsidies or states that opt out of the with a very destructive outcome”. lot of savings are” that were included in Medicaid expansion – leaving DSHs From health care stakeholders’ the ACA. less compensated for the care they political, policy and positioning No matter what legislators may do in provide – the “fundamental bargain, in perspective, “it’s far less challenging the future to amend the ACA, industry some ways, has been undermined,” than it otherwise would have been” already has been “consolidating, she said, noting that such an outcome with a Romney win, Jennings said squeezing the inefficiencies out and wasn’t foreseen. during the 8 November Washington becoming leaner and better” former “So have we so fundamentally gathering of health care stakeholders. Representative Bart Stupak (Democrat- undercut, in essence, the financial “I personally think that underneath all Michigan), a partner in the legislative underpinnings of some of these the politics and the polarization around and government affairs group at the safety net institutions that we are healthcare, people fundamentally Washington law firm Venable, told Scrip. jeopardizing those institutions?” Feigin understand that the policy that For the hospital and health system Harris asked. emerged is a uniquely American, community, the lead up to the 2012 She pointed out that the DSH safety centrist-approach,” Jennings said, elections meant some “cautious fence- net hospitals include many of the top adding that he is optimistic about the sitting” Chas Roades, chief research “most prestigious” large academic ACA’s future. officer at the Advisory Board Company, medical centers in the US, such as While healthcare really wasn’t the a Washington-based global research, Johns Hopkins in Baltimore and Texas driving issue for the 2012 elections, technology and consulting firm, said Children’s Hospital in Houston, which “there was no issue that was at the 8 November forum. But as with Feigin Harris noted are involved in impacted more by it” he said. Indeed, others, Roades said he expected the “groundbreaking” research. Senator Daschle declared that after election outcome to have an “unlocking But Chris Coburn, executive withstanding the Supreme Court and effect” on that industry, too. director of Cleveland Clinic the presidential challenges, the ACA is But as the ACA is further Innovations (CCI), the health system’s “now in the books permanently”. implemented, Houston lawyer corporate venture arm, expressed Both Senators Frist and Daschle Susan Feigin Harris, a partner at hopefulness over the changes coming agreed that repeal of the ACA is BakerHostetler, warned that one due to the ACA. likely a dead effort following Obama’s issue confronting the health system While the election may have looked second-term decisive victory. But, community is the potential negative like a status quo outcome – with Senator Daschle added, “that doesn’t impact on the so-called disproportionate Democrats retaining control of the mean it is not subject to amendment, share hospitals (DSHs) – facilities whose White House and the Senate and subject to change or subject of a lot patients disproportionately are poor or Republicans keeping the House – of evolution over the course of next uninsured – of the Supreme Court’s 28 “from our perspective, change and couple of years”. June ruling, which, although upholding restructuring is underway in almost One target under fire by many the individual mandate, made the law’s every conceivable fashion” in health Republicans and some Democrats is expansion of the Medicaid program care, Coburn said. the ACA’s 15-member independent optional for states. Nonetheless, he acknowledged that commission charged with analyzing the During the negotiations the the broad change underway is “going drivers of excessive and unnecessary White House and lawmakers to be messy”. scrip100.com SCRIP 100 77 policy & regulation Biosimilars: boom or bust?
Despite the best intentions of legislators, biosimilar medicines are still struggling Ian Schofield Principal Analyst, to make their mark on the global scene. Ian Schofield takes a closer look. Scrip Intelligence Regulatory activity for biosimilars to billion by 2017, on the assumption that the regulatory machinery is currently date has been mainly in the EU, which biological products worth some $70 geared to implement them effectively. A number of established a formal pathway back billion will have lost patent protection In two landmark developments, top-selling in 2005 and now accounts for more by then. Pfizer has predicted biosimilar the European Medicines Agency MAbs are than half of global biosimilar sales. sales of around $40 billion by 2024. (EMA) announced that it would begin among those But European sales in 2011 were just Bullish forecasts indeed. And accepting batches of reference drugs that will $400 million, according to Datamonitor, probably not far off the mark, given products sourced from outside soon be exposed and only a dozen products have been the growing number of companies the European Economic Area, and to competition approved so far, containing just three developing biosimilars or looking to published its own long-awaited substances – somatropin, epoetin and do so, the numerous biological patent guidelines on biosimilar MAbs, a filgrastim. More than 50% of sales are expiries in the works, and healthcare product class that is widely expected in just one market, Germany. payers’ growing need to keep drug to be in the vanguard of the next wave The US, the world’s largest costs down. of biosimilars. The EMA also received pharmaceutical market, belatedly has Moreover, the biosimilars segment its first application for a biosimilar MAb, a legal pathway for biosimilars, thanks saw a number of key developments in Celltrion’s version of J&J/Merck & Co’s to the Biologics Price and Competition 2012, a year that in retrospect could Remicade (infliximab). Innovation Act (BPCIA), part of the well come to be seen as something of Patient Protection and Affordable a turning point for the sector. Market set to surge Care Act (ACA) that was signed into In February, the FDA issued More than 550 biosimilars are now in law in March 2010. Yet no biosimilars for consultation its long-awaited development worldwide, 75 of them in have been approved or even filed biosimilar guidelines, which outline the the EU, according to Datamonitor. And under the new pathway, and as of requirements for showing biosimilarity. demand for biosimilars is set to surge early December the FDA had still not Although they are still in draft form, the as a result of patent expiries on major finalized its biosimilar guidelines. FDA told Scrip it was reviewing all the biologics starting in 2013. In the EU China has many domestic versions of comments it had received and was alone, Datamonitor says, patents on branded biological drugs on the market, working to finalize the guidelines and biologics worth $16 billion will expire but as there is no dedicated biosimilar “determining plans for development of in the 2013-17 period, and for 99% approval pathway or formal guidelines, future policies regarding biosimilars”. of these products, there are already they have been developed using July saw the passage of the Biosimilar biosimilars in the pipeline. different standards from the EU and US User Fee Act, which authorizes the A number of top-selling MAbs are and are approved as new drugs. FDA to collect industry fees and will among those drugs that will soon be While countries like Japan, Australia, help to fund the review and approval exposed to competition. And it was in India and Brazil have guidelines of biosimilars. 2012 that the first real signs of the MAb and legislation in place, biosimilar The Supreme Court upheld the incursion became apparent. penetration remains modest. Japan’s constitutionality of the ACA against a In July, the South Korean authorities guidelines were introduced in 2009, challenge from Republicans that had approved Celltrion’s Remsima, the first but only three products have been temporarily cast doubt on the future biosimilar infliximab to be approved and approved so far: Sandoz’ Omnitrope of the law – and indeed the biosimilar also the first approval for a biosimilar (somatropin, 2009) Japan Chemical provisions. The re-election of Barack MAb under formal guidelines anywhere Research’s epoetin product (2010) Obama as President of the United States in the world. and Mochida/Fuji Pharma’s filgrastim in November all but guaranteed the law Another top monoclonal – Roche’s (2012). Few applications are thought against any further attempts at repeal. Rituxan/MabThera (rituximab) – is to have been received in Canada since August saw India’s guidelines on facing competition from a host of guidelines were published in 2010. biosimilars formally come into effect. biosimilar companies including Teva/ But all this is set to change. IMS Aligned with those of the EMA, they Lonza, Samsung/Quintiles, Sandoz, Health forecasts that by 2015, global outline the data requirements for Pfizer, Celltrion/Hospira and Boehringer biosimilar sales could reach as much the production, characterization and Ingelheim. A biosimilar rituximab is as $2.6 billion, while a report from preclinical and clinical trials of biosimilars; already available in India from Dr PharmaIntellect suggests sales of $14 although doubts remain as to whether Reddy’s, although this was not approved
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under formal biosimilar guidelines. that the provisions of the BPCIA processes to review biosimilars, Expect more Rituximab biosimilars, though, are not were not retroactive. It said the FDA and in 2013 and 2014 it expects to biosimilar drug having a smooth passage. In October, should not accept, or even discuss, be reviewing 70% of applications development, Teva suspended a planned Phase III any biosimilar applications that cite within 10 months. It told Scrip that filing and European trial of its product to discuss reference products (including its own as of mid-November it had not yet approval activity the trial program with regulators, citing Humira) whose BLA was filed before received any biosimilar applications, in countries like “the latest changes in the regulatory the act came into force on 23 March but that it had held meetings with India and South environment”; Samsung too temporarily 2010. As of early December the FDA many potential biosimilar sponsors Korea halted its rituximab studies. was still examining the numerous and received some INDs for biosimilar Biosimilar companies have a third issues raised by the petition. development programs. major MAb in their sights: Humira Whether any of these relate to (adalimumab), Abbott Laboratories’ Prospects in 2013 versions of Abbott’s Humira or other top selling drug, which had first-half With biosimilars legislation and guidelines pre-BPCIA products is not clear: the 2012 sales of more than $4 billion, now in place in most of the major FDA said it could not disclose the and whose US and European patents markets, several hundred products names of products that were the expire in 2017 and 2018 respectively. in development, and a raft of patent subject of INDs or being discussed Two European companies, AET expiries in prospect, the scene is set with companies. BioTech and BioXpress Therapeutics, for a major expansion of the biosimilars Nor can be it be predicted with any announced in early November they market. 2013 should see substantial certainty whether Abbott will succeed in would co-develop a version of progress in a number of areas. opposing the retroactivity of the BPCIA. Humira, with their sights apparently The EMA’s CHMP should decide In an interim response at the beginning set not only on Europe but the rest whether to recommend approval for of October, the agency told Abbott it of the world as well. BioXpress is the six biosimilars currently under had not been able to make a decision working on a total of 18 biosimilar evaluation, and they could even because the petition raised “complex MAbs, including versions of Sanofi/ receive final approval decisions; issues requiring extensive review and Genzyme’s Campath (alemtuzumab) many more filings can be expected analysis by Agency officials”. for leukaemia and Roche’s Avastin too. The agency is also expected to If it does succeed, it would have the (bevacizumab) for cancers. publish revised versions of its guideline effect of preventing the approval of on biosimilar quality issues and the versions of any originator biologic filed Innovators jump in early overarching biosimilars guideline. Once before March 2010, thereby giving all An interesting feature of the biosimilars the latter is published, probably in those drugs an everlasting monopoly landscape is that while innovators early 2013, the new policy on non-EU and postponing any biosimilar stayed clear in the early days of sourced reference products will come competition until at least 2023. generics, seeing them as a threat to into effect. That this was clearly not the R&D rather than an opportunity, now Expect more biosimilar drug intention of the legislator, as has brand companies are quickly getting development, filing and approval been pointed out by Representative in on the act. Some major companies activity in countries like India and Anna Eshoo, who originally co- have begun working in collaboration South Korea, which now have formal introduced the biosimilars legislation. with those already involved in the area. guidelines in place. Immediately after Abbott issued its 2012 saw a number of such deals, China has been working on formal petition, she wrote to the FDA saying including Biogen Idec and Samsung biosimilar guidelines for some time now, it was “Congressional intent for the (Samsung Bioepis, a $300m joint and is hoping to release them in the new pathway to apply to biologics venture), Amgen and the CRO, PRA near future. The guidelines are expected approved before and after the (working on Amgen’s biosimilar to be in line with those of the EU and passage of the Affordable Care Act”. portfolio, Kyowa Hakko Kirin and Fujifilm US, and will help to lower the cost of If, on the other hand, the petition is (initially targeting Avastin then Humira), developing biosimilars by requiring a denied, the matter could well end up in and Merck Serono and Dr Reddy’s reduced clinical data package. court, raising the prospect of a lengthy (mainly for MAb oncology biosimilars). Currently bringing up the rear, legal battle and throwing the whole Daiichi Sankyo teamed up with a new but expected eventually to become biosimilar framework into doubt. company, Coherus BioSciences, to the biggest biosimilars market, the Either way, following the jitters develop versions of rituximab and Pfizer/ US should see the finalization of its over the constitutionality issue at the Amgen’s Enbrel/etanercept. biosimilar guidelines, and perhaps Supreme Court, and with huge savings Notably absent from the big even the first biosimilar applications. at stake and hundreds of biosimilars in pharmas boarding the biosimilars The FDA says the user fee act the pipeline, the last thing that anyone bus is Abbott Laboratories. In fact, in passed in 2012 will allow it to wants is more uncertainty over the US April it filed a Citizen Petition claiming hire new staff and implement new biosimilars pathway. scrip100.com SCRIP 100 79 policy & regulation
US PDUFA action date Calendar 2013 expected date company drug Indication catalyst title range
04/01/2013 GlaxoSmithKline Prepandrix influenza PDUFA for BLA - First Review
16/01/2013 Santarus Uceris ulcerative colitis PDUFA for NDA - First Review
17/01/2013 NuPathe Zecuity migraine PDUFA for NDA - Second Review
21/01/2013 Impax Laboratories Rytary Parkinson's Disease PDUFA for NDA - First Review
23/01/2013 Hyperion Therapeutics Ravicti urea cycle disorder PDUFA for NDA - First Review
25/01/2013 Takeda Pharmaceutical alogliptin/pioglitazone type 2 diabetes PDUFA for NDA - Third Review
25/01/2013 Takeda Pharmaceutical alogliptin type 2 diabetes PDUFA for NDA - Third Review
homozygous familial 29/01/2013 Sanofi Kynamro PDUFA for NDA - First Review hypercholesterolemia
30/01/2013 Raptor Pharmaceutical Procysbi cystinosis PDUFA for NDA - First Review
January Novo Nordisk Ryzodeg types 1 and 2 diabetes PDUFA for NDA - First Review
January Novo Nordisk Tresiba types 1 and 2 diabetes PDUFA for NDA - First Review
15/01/2013- BioAlliance Pharma Sitavig herpes simplex virus PDUFA for NDA - First Review 14/02/2013
01/02/2013 Hemispherx Biopharma Ampligen chronic fatigue syndrome PDUFA for NDA - Second Review
08/02/2013 Celgene pomalidomide multiple myeloma PDUFA for NDA - First Review
15/02/2013 Ipsen IB1001 hemophilia B PDUFA for BLA - First Review
24/02/2013 Dynavax Technologies Heplisav hepatitis B prevention PDUFA for BLA - First Review
19/02/2013- Agile Therapeutics Twirla contraception PDUFA for NDA - First Review 25/02/2013
26/02/2013 Roche trastuzumab emtansine HER2-positive breast cancer PDUFA for BLA - First Review
26/02/2013 Shionogi Ophena vaginal atrophy PDUFA for NDA - First Review
28/02/2013 Otsuka Pharmaceutical aripiprazole (IM depot) schizophrenia PDUFA for NDA - Second Review
01/03/2013 Zogenix Zohydro chronic pain PDUFA for NDA - First Review
04/03/2013 Covidien Pennsaid 2% arthritis pain PDUFA for NDA - First Review
stroke prevention in atrial 15/03/2013 Bristol-Myers Squibb Eliquis PDUFA for NDA - Second Review fibrillation
18/03/2013 Pharmaxis bronchitol cystic fibrosis PDUFA for NDA - First Review
27/03/2013 ARIAD Pharmaceuticals ponatinib chronic myelogenous leukemia PDUFA for NDA - First Review
27/03/2013 ARIAD Pharmaceuticals ponatinib acute lymphocytic leukemia PDUFA for NDA - First Review
27/03/2013 AP Pharma APF530 chemotherapy-induced nausea PDUFA for NDA - Second Review
28/03/2013 Biogen IDEC BG-12 multiple sclerosis PDUFA for NDA - First Review
80 SCRIP 100 scrip100.com policy & regulation
expected date company drug Indication catalyst title range
Teva Pharmaceutical 29/03/2013 Quartette contraception PDUFA for NDA - First Review Industries
29/03/2013 Johnson & Johnson canagliflozin type 2 diabetes PDUFA for NDA - First Review
First quarter Biotest Bivigam primary immunodeficiencies PDUFA for BLA - First Review
First quarter Salix Pharmaceuticals crofelemer gastroenterologic disorders PDUFA for NDA - First Review
16/04/2013 MAP Pharmaceuticals Levadex migraine PDUFA for NDA - Second Review
18/04/2013 Bausch + Lomb Prolensa ocular Inflammation PDUFA for NDA - First Review
26/04/2013 Gilead Sciences elvitegravir HIV / AIDS PDUFA for NDA - First Review
26/04/2013 Gilead Sciences cobicistat HIV / AIDS PDUFA for NDA - First Review
01/02/2013- Novartis brinzolamide/brimonidine glaucoma PDUFA for NDA - First Review 30/04/2013
chronic obstructive pulmonary 10/05/2013 GlaxoSmithKline Breo PDUFA for NDA - First Review disease
31/05/2013 Depomed Serada menopause PDUFA for NDA - First Review
15/05/2013- Valeant Pharmaceuticals efinaconazole fungal Infections PDUFA for NDA - First Review 31/05/2013
03/06/2013 GlaxoSmithKline dabrafenib melanoma PDUFA for NDA - First Review
03/06/2013 GlaxoSmithKline trametinib melanoma PDUFA for NDA - First Review
28/06/2013 Hisamitsu Pharmaceutical low-dose paroxetine mesylate menopause PDUFA for NDA - First Review
28/06/2013 Titan Pharmaceuticals probuphine drug addiction PDUFA for NDA - First Review
June Ferring Misodel labor induction PDUFA for NDA - First Review
03/07/2013 Baxter International BAX 326 hemophilia B PDUFA for BLA - First Review
05/07/2013 Orexo Zubsolv drug addiction PDUFA for NDA - First Review
25/06/2013- Merck & Co suvorexant insomnia PDUFA for NDA - First Review 24/07/2013
24/07/2013 Astellas Pharma tacrolimus XR liver transplant rejection PDUFA for NDA - First Review
24/07/2013 Astellas Pharma tacrolimus XR kidney transplant rejection PDUFA for NDA - First Review
26/07/2013 AVEO Pharmaceuticals tivozanib renal cell cancer PDUFA for NDA - First Review
26/07/2013 Forest Laboratories levomilnacipran major depressive disorder PDUFA for NDA - First Review
01/10/2013 Lundbeck vortioxetine major depressive disorder PDUFA for NDA - First Review
16/10/2013 Novo Nordisk turoctocog alfa hemophilia A PDUFA for BLA - First Review
22/10/2013 Actelion Pharmaceuticals Opsumit pulmonary arterial hypertension PDUFA for NDA - First Review
Source: Sagient Research Systems
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· Scenario Planning · Competitor and Stakeholder Simulation · Risk Mitigation market access Famine or feast as Japan debates pricing reforms Ian Haydock Asia Editor, Scrip Intelligence Recent official discussions in Japan are hinting at the shape of the revised reimbursement policies likely to be adopted at the time of the country’s next While speed may regular drug price revision in April 2014. Ian Haydock looks a little closer. not be the forte of the committee, it certainly can’t The good news is that some of the condemned the idea as making no include a larger regular cut for LLPs, be accused of not more draconian ideas about Japanese sense all round. which in last April’s revision were being thorough reimbursement policies, floated LLPs are considered to be original subject to a special additional price over the past few months, now look but patent-expired drugs with generic reduction of 0.86%. unlikely to see the light of day. But competition, and innovator industry Mid-sized companies with older with give-and-take the central tenet of groups including Japan’s main portfolios led by LLPs and dependent the long-running talks, there could be association, the JPMA, had argued on domestic sales would be particularly casualties in other areas, with patent- that the savings on original drugs – vulnerable, while larger firms reliant on expired original drugs emerging as a already subjected to multiple price cuts big-selling LLPs would also be hit. likely target. – would be insignificant for the roughly There were other indications that Deliberations at the Central Social $120 billion national drug budget. Japan’s commitment to generics Insurance Medical Council’s (Chuikyo) While LLP volumes might go up as remains solid, perhaps more so since special committee on drug pricing brand-conscious prescribers shifted to some leading players such as Sawai seem to be a virtually permanent original drugs with the same price as have said that the new incentives feature of the pharma landscape in generics, both industry sides warned introduced last April – including a fee for Japan – those now underway began they would suffer reduced sales, the use of international non-proprietary in the middle of this year and will not leading to less doctor choice and the names on prescriptions – have not had conclude until late 2013 after an interim withdrawal of unprofitable drugs. as big an impact as expected. report by the end of this year. Meanwhile generics, which have Chuikyo is mulling data showing While speed may not be the forte a starting price of 70% of the original the volume share of generics in Japan of the committee, it certainly can’t drug’s current level, would lose their was 22.8%, or 8.8% by value, in be accused of not being thorough. price advantage and uptake wouldn’t September 2011 (the volume figure is A vast amount of opinion and data is increase, going against stated now closer to 25%). But critically, only sliced, chucked into the pot, stewed, government policy. The predictions of 40% of the market for patent-expired consumed and digested, with policy doom and gloom seem to have been brands (which accounted for 34.3% revisions emerging just ahead of the taken on board – representatives of by volume and 35.2% by value of the biennial revision via a consensual insurers and hospitals indicated at overall market) has been genericized process that remains not Chuikyo’s latest meeting that they could so far, well below the 60%+ in other entirely transparent. live with at least some price difference major markets. Chuikyo – which advises the between LLPs and generics. Let’s not The obvious implication here is Ministry of Health, Labour and Welfare forget that besides reducing healthcare that there are still many original drugs – deserves credit for improving the costs, being seen to support generics that could be opened up to generic level of disclosure and public access carries political significance because competition. Given this lagging uptake, to meetings and documents over the the ministry looks likely to miss its 30% don’t be surprised to see a new volume past few years, although participants’ volume share target for such products target based on the relative measure, circumspection still makes it a challenge by the next April. and new incentives in April 2014. to infer major policy directions. So where’s the claw-back for this The ministry already has a pilot But what has emerged in the past modest bit of compromise? The program that requests manufacturers few weeks is a clear move away from signs are that Chuikyo will still look to develop new drugs for serious or the idea of reimbursing long-listed for savings from LLPs, but from neglected indications in return for products (LLPs) and generics at the one-off price cuts implemented “a the exemption of certain marketed same level, marking a victory of sorts certain period” after patent expiry products from regular price cuts. for the research-based and generic being proposed by some payers and Might the same approach work to fill industries. Both sides had roundly academics. Other ideas on the table the generics holes? scrip100.com SCRIP 100 83 market access The Brazilian biosimilar storm is brewing Francesca Bruce Senior Reporter, Scrip Intelligence
Brazilian patients have little access to biologics, especially new ones
While Teva is known as a generics giant in most markets, in Brazil things are different. Here the firm is more active as an innovator, although not for want of trying to make its mark in the Brazilian generics space. The firm talked to Francesca Bruce about its step by step approach and why this challenging market is still worth the trouble.
“Even though Teva is a generics for follow-on drugs. The Brazilian drugs. Monoclonal antibodies (MAbs) company, here in Brazil we don’t government is keen to widen access alone took 33% of the drug spending, have many generic products on the to medicines and conscious that it has even though they represented just 1% market yet, here we are an innovator to foot the bill, it is particularly keen to of the medicines available through the company,” says Andrea Montragio, push generic medicines. national health system. Teva’s legal manager in Brazil. The Similarly, there is much potential for Biosimilars (simply called biologics company’s branded generics line is biosimilars, which so far have had very in Brazil) are the big hope and the focused solely on oncology, and the low penetration. Brazilian patients have government wants to see more in firm’s main presence is in innovator little access to biologics, especially new Brazil. But it is not plain sailing for treatments for MS (Copaxone) and ones, and although keen to expand companies wanting to enter the women’s health. This was not by access, the government is also acutely market. The government particularly design, however. Tough conditions, aware of their cost. wants local firms come up with the worse for multinationals, have made it In 2011, just 2% of the drugs goods, which makes it harder for difficult for Teva to establish itself as a available through the national health foreign-owned firms like Teva to leading company. system were biologics, and these compete. Teva has launched just The opportunities in Brazil are ripe took 41% of government spending on one biosimilar, TevaGrastim. After six
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months on the market progress has interchangeable in practice and many viable option. According to Montragio, To launch a been slow, even though the product safety issues will arise. the remaining possible targets are product quickly has no direct competitors. Many industry commentators in already too big. in Brazil it is often best to “Multinationals are still from time to Brazil have long expressed concern Another option might be to buy a buy one that has time seen as young kids invading the that the government overlooks the plant so that Teva can benefit from already been country, it’s an old attitude, but it’s poor quality of generics or biosimilars its own local production line. ANVISA approved still out there,” says Benny Spiewak, produced by local companies. One site inspections are a prerequisite for one of Teva’s legal advisors from the industry source, who declined to be approval in Brazil, and having facilities law firm ZCBS Advogados. Local named, said the government was only in the country would speed the process companies have long dominated the implementing such a faulty policy to up somewhat. generics market, but the problem benefit 100% Brazilian companies. The The firm has not ruled out for the government is that local policy means they can better compete partnerships, although nothing is on companies cannot always compete in with multinationals because they do not the horizon. “There are a lot of things the biosimilar space on a level playing have to conduct expensive clinical trials we have not done because the right field with the MNCs. According to or invest large sums in R&D. opportunity has not come up,” Spiewak, they lack the experience Government preference for Brazilian she adds. and funds. companies shows in other ways too. So that is where the government Despite the big talk on expanding Worth the bother? steps in. Most recently the government access to medicines, there are many Brazil is certainly a challenging market, said it would put up R$20 billion for the obstacles for generics firms, particularly but it is worth the trouble, as long as formation of BioBrazil, a giant, 100% those that are not 100% Brazilian. For you do not expect to make a quick Brazilian pharmaceutical company, one thing, regulatory approval times are buck. Spiewak adds that Brazil is a formed of the biggest local companies, a real problem, says Montragio. market for the future. “If you want to Ache, EMS, Uniao Quimica and Interfarma, which represents come and stay for five years, don’t Hypermarcas. The government hopes pharmaceutical companies in Brazil, bother. You need to plan in Brazil, it is a it will eventually be able to produce agrees. In October it complained country of the future, you need at least biosimilars to be bought for the national that approval times were far too 10 years.” healthcare system. long for innovative medicines, Teva is taking it slowly. “We have The government has also been particularly biologics, and generics. been in the country for six years, and forming partnerships with local The association is calling for less we are going step by step to grow our companies to develop generic/ bureaucracy in the system and says business, said Montragio. biosimilar versions of drugs on that ANVISA has a shortage of staff. There is certainly potential for its priority list. The multinationals The problem is worse for growth. The government is making collaborate in terms of technology multinationals. While it can take years more medicines available and since transfer but only local companies tend for regulator ANVISA to approve 2010 the number of medicines offered to be involved in the development a marketing application from a on the national health system has of the follow-on product, not foreign multinational, it takes it just months grown by 47%. owned generics firms, like Teva. to approve a generic from a local Some 810 products are now But the perfect storm is brewing. company. One Teva generic, which on offer, says the health ministry. In Brazil there are two approaches to Montragio declined to name, took According to a Scrip Insights report, approving a biosimilar, in accordance nearly five years to get through the generic medicines were the fastest with the 2010 biologics regulations system. To launch a product quickly growing segment of the retail market, (RDC55/2010). The first is the seldom in Brazil it is often best to buy one which in 2011 was in total worth used “stand alone” approach which that has already been approved as $25.8 billion (including prescription requires companies to conduct clinical timelines can be difficult to predict, drugs and OTCs). Generics, worth trials and submit regulatory data. she says. $5.2 billion, some 25% of the total The second is the far less rigorous Meanwhile, Teva is considering prescription retail market, grew by and most frequently used “biosimilar how to pursue growth and get its 43%. Although similares (which are approach”, which allows companies medicines to patients. Other foreign- effectively branded generics) took to rely on the innovator’s paperwork, owned firms have achieved success a bigger share of the market (34%), rather than any tests carried out by in Brazil through acquisition. Most they grew at the comparatively lower the company. notably, Sanofi rose to the top of rate of 19%. Branded drugs, worth The concern is that when the the market when in 2009 it bought 41% of the market saw the slowest government starts approving Medley, the biggest local firm. But growth at 8%, according to Scrip biosimilar versions of the the pool of acquisition possibilities is Insights. Figures for biosimilars were blockbusters, they will not actually be getting smaller and this is not always a not available. scrip100.com SCRIP 100 85 market access Evidence, more evidence! How companies are getting and keeping Francesca Bruce Senior Reporter, Scrip Intelligence market access Companies may well opt for Pharmaceutical companies are having to get to grips with generating more agreements that real life data, not only to satisfy regulators, but payers too. Pay-for-performance make the price agreements between payers and companies are on the rise as cash-strapped more obscure health systems become more risk averse. Francesca Bruce investigates.
Different types of agreements aimed at and simple, but the majority of new benefit assessments are made public making expensive drugs more palatable schemes applications have been simple through the supply chain, and the big for hard up health systems have schemes,” confirmed NICE. worry with companies is that payers in generated interest for some time. They The ABPI agrees. “There has been other countries will use them as a basis have included financial agreements, a shift towards simpler schemes which for price negotiation. such as cost-sharing, price-volume reduces the administrative burden on Therefore companies may well agreements and straight discounts, as both the NHS and on companies ... opt for agreements that make the well as outcomes-based deals, such as Discounts are easier to set up and price more obscure. Professor Jan risk-sharing and pay-for-performance implement and faster to get approved Liliemark from the SBU, Sweden’s HTA deals, but it is the latter which seem to by the department of health and NICE, body, comments that proposals for be generating the most excitement. which helps deliver earlier patient agreements are becoming more and Price discounts have been access to the medicines included with more complicated “probably because increasingly popular in the UK. the schemes,” it said. these companies want to obscure The current Pharmaceutical Price Discounts are also popular with the price or discount”. He believes Regulation Scheme, agreed between companies because they allow them that thanks to international reference the Association of the British to appease payers who do not want to pricing, complicated agreements will Pharmaceutical Industry (ABPI) and pay a high price without sacrificing their “unfortunately become more common”. England’s department of health, makes list price. This is particularly important Until now, most proposals have provisions for a number of schemes in the context of reference pricing, involved simple discounts, he said. that might make a drug more attractive as companies are keen to prevent for NHS funding. These include discounted prices being referenced Evidence generation risk-sharing schemes, outcomes- elsewhere. Reference pricing has It is unclear how discounts will based schemes and price/volume already led to the converging of prices fare, particularly in the UK where agreements. An analysis of agreements and a decline in differential pricing in value-based pricing discussions are that form part of positive guidance from Europe, says Edith Frénoy, director of underway. According to Professor NICE, England’s health technology market access at EFPIA, the federation Toumi, there has been a rise in the appraisal institute, reveals a shift representing R&D based pharma firms number of pay-for-performance towards simple discount agreements. in Europe. agreements centered on coverage From around 2010, virtually all However, it is unclear how long or reimbursement with evidence agreements have hinged on discounts agreements involving straight discounts development, particularly in France. He and there has been just one complex will yield any benefits for firms. Payers notes that payers are increasingly keen scheme involving risk-sharing. In are already talking to their international to shift the risk of paying for expensive 2010, GlaxoSmithKline agreed to pay counterparts about the real price they medicines, particularly where there are a rebate for Votrient (pazopanib) as a are paying, says Professor Mondher uncertainties about how they work. new first-line treatment for NHS patients Toumi at the University of Lyon, chair In France, these deals see the with advanced renal cell carcinoma of public health and market access, company and payer agree an initial price depending on results of the COMPRAZ and director of the European Market that is paid directly to the company. trial. “There is a trend towards more Access University Diploma (EMAUD) A higher price is also agreed and the simple schemes. At present there is In Germany, Europe’s biggest market, difference between this and the lower almost a 50:50 split between standard discounted prices following AMNOG price is held by a third party until the
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results of a post-marketing study evaluate the patient. wayside as a more dynamic system Other markets designed to assuage payer uncertainty If the drug is deemed to be for evaluating products evolves. “There are moving is ready. If the results are good, the sufficiently effective, reimbursement will be a more continuous look at the toward balance goes to the company, and if for the drug is arranged through the product, revising the conditions of agreements they are bad, the money goes to the patient’s health insurer and treatment commercialization; it won’t just be a with evidence payer. One example is the Risperdal is continued. If not, treatment is one-off exercise,” she said. development Consta agreement. In 2005, this saw stopped and Novartis has to pay for Such an approach would fit in with agreements Johnson & Johnson carry out a trial to the first 16 weeks of treatment. The wider efforts aimed at gathering real prove that Risperadal cut hospitalization, company appears at ease with the life data. “In the regulatory area there five years on, the results were good agreement. “Novartis entered into will be more learnings on the product and J&J cashed in. Deals like this are this unique agreement to secure in the market than we have today,” she becoming more and more common, the reimbursement of Xolair in the said. Frénoy pointed to discussions says Professor Toumi, although its Netherlands, reflecting our commitment on adaptive licensing for approving exactly unclear how many there are as to working with health authorities and drugs before all Phase III data has been they are strictly confidential. physicians to ensure patients have gathered and recent pharmacovigilance Agreements including risk-sharing access to the most effective therapies,” legislation. This allows regulators to call and cost-sharing deals have been it told Scrip. It added that it has more for more data on efficacy, not just safety. popular in Italy for oncology products than 150 individual agreements with Meanwhile, initiatives like the for some time. But according to payers in place across the world. Riccardo Palmisano, vice-president Bayer and Boehringer Ingelheim, Companies will have to show of the biotechnology association both involved in the price volume performance to gain market access Assobiotec, recent agreements tend agreements, were unable to comment to be pay-for-performance deals on what those deals looked like. that hinge on patient outcomes. Nefarma expects more deals to follow, Dr Palmisano was unable to give although it is uncertain which type will much detail on these confidential take off. agreements, but commented that Managed entry agreements are the product in question must have a popular in Belgium too. Traditionally, biomarker and that companies are deals have centered on pay-for- obliged to set up registries. He believes performance and financial agreements, that that these types of agreement may says the industry association, European Network for Health catch on in other disease areas. PharmaBe. The association has Technology Assessment (EUnetHTA), Other markets are moving toward noted a shift towards deals whereby are focused on gathering more agreements with evidence development companies offer a confidential rebate information that can be shared agreements. Sweden has begun piloting on the drugs list price each time a between European Union member payment-for-performance agreements, unit is sold. However, it points out that states. Most recently the network said Professor Liliemark. And in August, nearly all deals oblige companies to launched its Evidence Database on Dutch authorities announced they keep track of real life clinical outcomes New Technologies, which allows would be piloting pay-for-performance through observational studies or EUnetHTA members to share and price-volume agreements. registries. Between February 2010 information on evidence gaps identified According to Nefarma, the Dutch and June 2012, some 37 agreements when HTA reports are produced. industry association, the pilots came in were negotiated. Of these, 18 were response to delays in getting innovative signed and finalized – the terms of the Affordability – a word of medicines to patients. Medicines in the remaining 19 were unfavorable for the warning! Netherlands must go through a cost- companies and therefore not signed. Evidence generation might help manage effectiveness evaluation, but there has The more uncertainty, the tougher the uncertainty, but it does little to tackle been something of a backlog of drugs terms, says the association. affordability of expensive drugs, an issue to get through. that is not likely to go anywhere soon. Dubbed a “no cure no pay” Long term As a word of warning, in Italy timelines agreement, the two-year pay-for- Generating real life evidence on for approving products covered by these performance pilot will see Dutch health expensive drugs will be key to securing arrangements do not get to the market authorities pay for Novartis’ Xolair and maintaining market access for any quicker. They are still subject to (omalizumab) only if it yields results. expensive drugs. However, in the the lengthy pricing and reimbursement Patients with severe allergic asthma will longer term EFPIA’s Frénoy believes processes; on average it takes 326 days be started on Xolair if certain criteria are that individual agreements, complex for a medicine to enter the Italian market met and 16 weeks later, a physician will and costly to administer, will fall by the after European approval. scrip100.com SCRIP 100 87
MANUFACTURING Indian firms try to avert impending EU API shutdown Anju Ghangurde India Editor, Scrip Intelligence Anju Ghangurde takes a closer look at what preparations the industry in India Guidelines to is making for the upcoming EU Falsified Medicines Directive. facilitate the certification are expected shortly
Even as India readies to comply applicable standards for manufacturing are expected shortly. with the EU’s Falsified Medicines of active substances are the GMP for The source said that the Indian Directive, set to become applicable active substances of the WHO 44th government also needs to determine in 2013, domestic firms are keen that technical report, No 957, 2010, annex whether the EU directive is perhaps manufacturing units approved by the 2, then these standards are considered violative of the “national treatment” European Medicines Agency (EMA) be equivalent to those required in the under the WTO regime. It’s unclear exempt from the new requirements. EU legislation. though if India will pursue the An Indian industry source told Scrip Last year the EC published the “equivalence” route, even as Switzerland that since only those companies Falsified Medicines Directive (directive recently became the first country to whose plants have been inspected 2011/62/EU) that aims to prevent receive an “equivalence” rating from and approved by the EMA can export falsified medicines from reaching the EC for its regulations on active to the EU, compliance is really not the patients by introducing harmonized, pharmaceutical ingredients (APIs). Israel, issue. “The issue is certification. Unless pan-European safety and control Australia, Singapore and Brazil have also some compromise is reached, the measures. The directive requires, applied for equivalence assessment. people of the EU will be deprived of the among other things, that by 2 competition-led lower prices of generics January 2013 all active substances shutdown and the Indian manufacturers’ access to imported into the EU must have been Even as Indian industry is concerned the EU market,” the source said. manufactured in compliance with about how things will pan out Indian pharmaceutical exports to standards of GMP at least equivalent concerning the EU’s API rules, most the EU were estimated at about $1.93 to EU GMP. experts say that Europe can ill-afford to billion in 2010-11 and about 30% of By 2 July 2013, compliance of both shut out Indian or Chinese firms. these exports could potentially be hit if the product and the plant to EU GMP “This has to evolve and people are the issue is not resolved by the time the must be confirmed in writing by working to make it happen. Even if it EU directive kicks in. the relevant authority in the doesn’t, I doubt if Europe can shut down The source said that the EU needs exporting country. overnight. I’m sure they’ll extend it. to consider a “practical approach” There are also some indications Europe and America are so dependent under which it and the Drugs Controller that the validity period of the written on India and China,” a director of an General of India (DCGI) reach an compliance by the competent authority API company told Scrip. He did not rule agreement for a “workable solution”. in India (the exporting country) could out the possibility of stock-outs if things For example, this could include depend on the validity of the WHO- don’t work out smoothly. permitting the issuing regulatory GMP compliance certificate in the Indian firms had earlier said that the authority to confirm that standards of country – say five years. However, a EU’s Falsified Medicines Directive was good manufacturing practice (GMP) copy of such a certificate should be nothing but a non-tariff barrier that will applicable to a site are compliant with attached to each consignment. not only stymie Indian supplies of APIs the World Health Organization (WHO) Indian media reports recently but also create potential shortages GMP standards. suggested that the DCGI is to be and inflate prices of medicines The European Commission has in the national authority to certify API across Europe. past clarifications on the new directive exports to the EU, while the zonal Earlier the UK’s medicines regulator, suggested that the written confirmation offices of the Central Drugs Standard the MHRA, had noted that the directive has only to confirm compliance with Control Organization (CDSCO), the did not appear to acknowledge GMP rules ‘equivalent’ to the rules apex drugs regulator in India, would the “finer structure of third country applied in the EU. It has also confirmed also be involved in the process. regulatory systems, or its potential that in a non-EU country, where the Guidelines to facilitate the certification impact on the proposed systems”. scrip100.com SCRIP 100 89 manufacturing Lack of api import guidance worries european bodies Ian Schofield Principal Analyst, Scrip Intelligence Ian Schofieldsurveys the European pharma industry to assess the readiness for new API manufacturing regulations. Many in industry blame the The deadline may be six months This will be needed for each active or potentially at risk of shortage, as Commission away, but regulators and industry are substance produced at a particular were “thousands” of drugs approved for failing to increasingly worried that new GMP manufacturing plant, with a copy of through decentralized procedures. do enough to prepare third requirements for imports of active the document to accompany each API For the industry, EFPIA said that countries for the pharmaceutical ingredients (APIs) consignment, even if the exporting while it supported the drive for adequate new regime into Europe will not be met in time, country has a mutual recognition oversight and control of API imports, potentially leading to widespread agreement with the EU. clarity was still needed in a number product shortages. Alternatively, countries can apply to of areas, for example whether there New rules brought in by the be on a list of “equivalent” countries would be scope for the EU authorities to European Commission mean that that will be established by the EC after scrutinize written confirmations issued from 2 July 2013, all third countries an assessment of the country’s API by third-country authorities. exporting APIs to the EU will have to regulatory framework. The assessment Generics companies, which declare in writing that the substances will take account of criteria such rely heavily on API imports, have have been manufactured to GMP as GMP rules, the regularity of also expressed concern. Warwick standards in line with European inspections, and the effectiveness of Smith, director of the British Generic norms, otherwise they may not be enforcement; it could also involve a Manufacturers’ Association (BGMA), allowed in. review of the relevant documentation said the new rules were “a good Alternatively, API source countries can and the regulatory system, and idea but appallingly implemented by seek inclusion on a list of “equivalent” possibly an observed plant inspection. the Commission”, which he blamed countries that is to be drawn up by the If a country is not on the list and for failing to liaise properly with EC following an assessment of their does not issue a written confirmation, the authorities in source countries. GMP regulatory framework. and there is a real risk of a product He told Scrip these countries had But regulators and industry alike shortage, the requirements can – gained the impression that these believe the timetable for the new exceptionally – be waived by an EU requirements were “an infringement of rules is too tight, and that the inability member state, provided that the plant their sovereignty”. or unwillingness of some major has an EU GMP certificate. The European Generic manufacturers’ API-supplying countries to fall into The intentions are sound, but some Association (EGA) pointed out that while line could seriously jeopardize the major issues have been raised. Among the EU’s new requirements had been pharmaceutical supply chain. Many in the first to sound the alarm was the common knowledge since mid-2011, industry blame the EC for failing to do MHRA, which in May 2012 said it the actual means for complying with enough to prepare third countries for foresaw “serious” product shortages them were only clarified in July 2012 the new regime. if regulators could not guarantee when the written confirmation template The measures that have led to equivalence by the July deadline. and an accompanying Q&A document the controversy are part of the EU’s It noted that around 940 third- were published. Falsified Medicines Directive (FMD), country sources of APIs are named As a result of the failure to whose provisions apply from 2 on UK marketing authorizations, with communicate properly, third-country January 2013. From that date, all APIs India and China the largest suppliers. regulators do not appear interested imported into the EU for formulation The two countries produce some 80% either in a listing or in providing the in to finished drugs must have been of APIs used in Europe. written confirmations, the MHRA manufactured in line with GMP rules at Its concerns were echoed by said. Indeed, as of 12 November, least equivalent to those of the EU. the European Medicines Agency just six countries had requested an From 2 July 2013, the competent (EMA), which had been asked by equivalence assessment: Switzerland, authority of the country where the the Commission to look at which Israel, Australia, Singapore, Brazil manufacturing plant is located centrally authorized drugs might be and Japan. The only assessment must attest to such compliance affected. It said in October 2012 to be completed so far is that of by way of a “written confirmation”. that 200 such products were clearly Switzerland. Notably absent from the
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list of applicants are major source in a timely manner,” it declared. of “forcing EU standards onto their Notably absent countries like India and China. The commission appears to have API manufacturers” and would take from the list of applicants are taken on board at least some of this the necessary steps. That, of course, major source Standing firm criticism. In a 26 October update to its remains to be seen. countries like Amid the storm of criticism, the Q&A document, it said that countries Certainly India’s domestic industry India and China Commission has stood its ground. wanting an “equivalence assessment” has taken exception to what it sees In July it told Scrip that it had in fact should request one as soon as as onerous and superfluous new been “engaging proactively” with all the possible and “strongly recommended” requirements. Dilip Shah, head of major exporting countries to ensure that they do so before the end of the Indian Pharmaceutical Alliance they were aware of the incoming 2012. “If the request is made late, it rules. And in a 28 September letter may be impossible to conclude the Time is of the essence for API to industry bodies, health director- equivalence-assessment before the import compliance general Paola Testori Coggi declared date of application of the rules in July that the EC had now “put everything in 2013,” it noted. place” to ensure that the rules on the As for the standards that countries written confirmation were “well known, should meet to be able to issue a understood and implementable”. written confirmation, the EC said that She made it clear the ball was now they could rely on results of previous in industry’s court: “Clearly, it is up to inspections by EU or other authorities industry to ensure compliance with the applying equivalent norms, such as the incoming rules on importation of active US FDA, rather than having to undergo substances,” she said, adding that a fresh inspection. there was no reason for companies to This is unlikely to do much to pacify wait any longer to obtain the written the critics, as developments on the confirmations and that they should do ground suggest that countries are not so “now”. exactly hurrying to comply with the new This didn’t go down too well rules. While Japan has asked for an with industry. EFPIA told Scrip that equivalence assessment, the intentions while it was aware that its member of the other key exporting countries – companies had full accountability for India, China, South Korea, Taiwan and the GMP standards applied to the Mexico – remain far from clear. APIs they used, it was “extremely concerned” with the lack of progress “A strong no” and transparency concerning key The EGA said that none of these procedural aspects of implementation. countries had expressed any BGMA’s Smith said that its member clear willingness to issue written companies had asked suppliers in confirmations or apply for a listing, third countries to ask their competent and that at a 21 October meeting (IPA), told Scrip that the EMA and authorities to issue the certificates, in the Estonian capital Tallinn, China other regulators already conducted but there was a limit to what firms “expressed a strong no”. repeated and unannounced could do. What was needed was As for India, conflicting reports are inspections of Indian plants, and now a proper dialogue between the EU emerging. Some suggest that the those regulators wanted “additional and third countries, but instead the government is considering setting inspections and certifications of the EC was “relying on third countries to up a “competent authority” to ensure shipments by Indian regulators”. implement legislation without talking that domestic API exporters comply, If countries like India and China don’t to them”. while others hold the view that ultimate play the game, what can industry do? Similarly, the EGA said that its responsibility for API quality assurance The EC has ruled out any deferral of member companies had been should lie with the importer and that the deadline, and said that companies “requesting written confirmations and India should play no role in issuing should put in place risk mitigation EU inspection slots for months without written confirmations. When asked by measures, such as changing the API success”, and that they had kept the Scrip in October about the situation in source if need be. But as industry has EC abreast of the negative feedback. these two countries, the EC replied that pointed out, alternative sources are not “Success or failure to comply with the it did not know. always available, particularly for newer upcoming legislation is solely bound to Smith said his impression was innovative drugs, and certain products the decision by sovereign API exporting that the two countries had now like anticancers are often produced at countries to implement EU requirements understood that it was not a question only one site supplying all markets. scrip100.com SCRIP 100 91 manufacturing Pressure to perform The past decade has a seen a rapid expansion of pharma contract services markets that have outpaced pharmaceutical markets, often achieving double-digit George Green Healthcare year-on-year growth. George Green takes a look at the future for the contract Analyst, drug manufacturer, and finds a scene not as settled as could be thought. Datamonitor Healthcare The financial crisis of 2008 had a The overarching long term trend modular construction are lowering cooling effect on the drug development in the industry is commoditization. barriers to entry, and allowing pharma The overarching industry, mainly through the restriction Barriers to entry are falling, and a large companies to flexibly scale their long term trend of venture capital funding for biotechs. number of new players entered the capacity. Growing process efficiencies in the industry is However, most industry observers are market to capitalize on rapid growth mean that captively-owned capacity is commoditization still forecasting continued growth on rates over the past decade. Many did also expanding. In the small molecule the basis that pharma companies are so by acquiring facilities and equipment segment, patent expiries on top-selling expected to seek further cost-savings, from the pharma industry. Competition brands are also acting to increase and continue cutting in-house capacity between providers is consequently effective capacity as sales volumes to reduce fixed costs. high, especially in the most well-served decline with generic entry. One of the obvious ways to cut segments of solid and semi-solid Divestment of in-house facilities in-house capacity is to enter into a dose forms. Declining margins are an has historically driven contract transactional or strategic agreement obvious result. manufacturing. By contrast, in recent with a contract manufacturer, research In addition, manufacturing demand years many innovators have invested organization or business development is also shifting. The pharma industry in new facilities, often spurred on organization. With this in mind, and is investing increasingly in niche by tax incentives (for example in with the breeze of outsourcing firmly therapeutic areas and orphan drugs. Singapore, Puerto Rico, and more rustling the leaves of Big Pharma, the As Figure 1 illustrates, the number recently, the UK). Meanwhile, Ireland CMO market is of increasing interest of FDA orphan designations has risen has among the lowest rates of to those looking for growth in the next markedly, although approvals have not corporation tax in Europe and has few years. yet shown a corresponding expansion. attracted several large investments. Many designations are granted up to Significant activity includes Eli Lilly’s Specialized CMO services a decade before target approval so announcement to invest €330 million a time lag in approvals is expected. in a 240,000 square foot expansion Drug delivery products Increasingly, demand will be for small- of a biopharmaceutical manufacturing batch projects. facility in Cork. In October, Genzyme High potency API (Category 3&4) The decline of the blockbuster is announced a €130 million expansion Hot melt extrusion also driving this trend. Growing wealth at its Waterford site. Inhalables Implantable dosage forms in emerging markets and increasing Much of this capacity will be taken Narcotics (DEA scheduled substances) reimbursement will extend the range of up by increasing volume demands Oligonucleotides products distributed to those markets, due to growth in biologics, generics, Process development which will add to demand for small- and emerging regions. The continuing batch manufacturing. Economies of and underlying threat to CMOs is that Solvent-based products scale are severely impacted on these due to the favorable tax conditions, Sterile products (prefilled syringes, lyophilized vials) projects creating a threat to CMOs. the pharma company’s cost-base will These factors are driving CMOs to seek be lower than that of CMO’s based in profits in more specialized manufacturing more expensive jurisdictions. Ireland a challenging outlook areas such as high potency APIs, sterile corporation tax is 12.5%, whereas in The contract manufacturing market products, and biologics. the US, and Western Europe it is likely is fragmented; the leading 10 While higher margins are available in to be 25-35%. CMOs with operations companies account for around a third the biologics space, the same forces in Switzerland such as Lonza and of the market. Thousands of small- to are at work, which will ultimately lead to Aenova have been hurt by the strength medium-sized providers comprise the commoditization of biomanufacturing. of the Swiss franc over the past two to remainder. Datamonitor has identified Yields are increasing, meaning that three years. several factors which will result in tough the same output can be achieved with Biotech funding trends also present conditions for many of these CMOs in ever smaller reactor vessels. In parallel, challenges to the industry. According to the coming five years. evolving single-use technologies and PricewaterhouseCoopers and the US
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National Venture Capital Association, have narrowed slightly, with wage much as possible out of each drug. Biotech biotech VC activity has recovered from inflation and rising property prices. Product differentiation is increasingly funding trends a six-year-low in 2009 caused by the Consequently, second-tier emerging through new delivery routes or novel also present financial crisis. Even so, funding in the economies such as Thailand, Vietnam, dosage forms. For many pharma challenges to first half of 2012 was the lowest since Cuba, and Argentina will see rapid companies and biotechs, it will be the industry 2003, see Figure 2. CMO market growth. For example, in impractical to develop the capabilities Furthermore, insiders report August 2012, Japanese CMO, Nipro in-house, making outsourcing logical that the funding is shifting to more announced construction of a new plant consequence. To summarize, these established biotechs with more in Hai Phong, Vietnam. growth drivers will act in specific advanced products. Lacking internal As mentioned above, research and segments and geographies, favoring resources, biotechs depend heavily on development is increasingly focusing specialized providers and those in outsourcing providers, so the trends on novel products which will require emerging markets. are likely to have a knock-on effect on specialist manufacturing techniques. Conditions will be toughest for CMOs. Biotechs often employ smaller Much investment is in oncologics which smaller CMOs, lacking a specialized and mid-sized CMOs, on the basis are often high-potency APIs, requiring service offering. As cost-cutting that their contract will be more valuable specialist manufacturing facilities. In continues, pharma companies are than when working with top 10 players, addition, now that the “low hanging seeking to reduce the overhead leading to better service. fruit” of drug development has been of selecting and contracting with a taken, drug candidates are increasingly large number of operators, and will A silver lining for some designed to hit targets which cannot engage in more preferred provider Various factors will act to be modulated by the most “drug- arrangements, pushing a larger counterbalance these threats. like” small molecules. Consequently, volume to a smaller group of partners. Industry R&D spending continues an increasing proportion of small- Although some observers have to grow, which will drive clinical molecule products in development predicted of a wave of consolidation supply and process development have high molecular weight and in the CMO industry, this has yet to demand. Growth in emerging greater lipophilicity. These properties occur. M&A activity will continue to be markets is another oft-quoted bring manufacturing challenges, again driven by companies’ cherry-picking reason for growth. These markets creating opportunities for CMOs with smaller players or sites to acquire a will overwhelmingly dominate the specialist capabilities. specific capability. The message for volume demand for pharmaceuticals As R&D productivity has declined, the contract manufacturing industry is for the foreseeable future, which will the industry lifecycle management clear – differentiation of services will be again, create opportunities for CMOs. strategies have come to fore as the key to success in the coming five Cost advantages of BRIC countries innovators seek to squeeze as to 10 years.
Figure 1: FDA orphan drug approvals Figure 2: Biotech VC funding 2006-H1 2012 and designations 6000 5722
200 199 Designated 187 4963 4833 4909 180 5000 Approved 160 156 150 3989 3922 4000 140 123 120 100 103 3000 2878 100 90 $million orphan indications f 80 72 60 2000 60 55 47 Number o 40 24 26 19 20 1000 20 16 13 14 12 13 14 14 6 0 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2006 2007 2008 2009 2010 2011 Q1-Q3 2012
Sources: Datamonitor Orphan Drug Trends, FDA Law Blog Source: National Venture Capital Association
scrip100.com SCRIP 100 93 Sponsored by:
Under one roof
Iris Ziegler, director of development and production at CordenPharma’s Plankstaadt plant, talks to Scrip 100 about the company’s common sense approach.
In each project team the development activities are led by an experienced senior scientist at PhD level and a dedicated project manager for each of our projects, along with representatives from all functions within CordenPharma Plankstadt including pharmaceutical development, analytical development, operations, Quality Assurance, SHE (safety, health & environment) and supply chain. We have 10 people in pharmaceutical development and 11 people in analytical development, which is a strong group and comparable to a mid-sized innovator pharmaceutical company. Within this group we have all the expertise needed to develop both the dosage forms and the analytical methods for their characterization during drug product development. This includes the full range of stability studies from early stress test investigations to full ICH stability testing for clinical trials and marketing authorization. Manufacturing of drug product for clinical trials can be done at batch sizes of 500 grams to 10 kg in one of the three GMP rooms inside the development facility building. Larger batch sizes can be manufactured in the Since CordenPharma took over the ex-AstraZeneca plant in commercial plants – this is another benefit of having development Plankstadt, Germany in 2008, it has been building up development and production under one roof. expertise to complement its existing competencies as a manufacturing plant for bulk product and packaging of solid dosage How do these development and manufacturing forms. Besides standard manufacturing technologies, the plant offers services at CordenPharma Plankstadt slot in with other distinctive competencies in the development and manufacturing services, such as packaging and logistics, to form a of high potent drug products, as well as specialized technologies complete package to the customer? such as the dual filling of tablets and granules into capsules and the CordenPharma Plankstadt is really focused on being a “one-stop- manufacturing of bi-layer tablets. shop” for our customers. We ensure that customers are given full care from early feasibility, up to formulation development, process Please summarize the activities at CordenPharma development, clinical trial manufacturing, process validation and Plankstadt since 2008 transfer to commercial scale manufacturing and packaging. We also At the time when CordenPharma acquired the German site in support our customers in the writing of the CMC parts of the dossier Plankstadt, we were initially focusing on contract manufacturing and the filing of applications for IMPDs / INDs and the marketing only, but over the course of the following few years we started to authorization of their drug products. During commercial contract build up our own development group. Now we are really focused on manufacturing we then support them in writing and filing of variations doing development for clients, starting with early-phase feasibility to their marketing authorization. screening, through clinical phase I – III development, all the way to regulatory filing and commercial-scale contract manufacturing. At CordenPharma Plankstadt, the facility has special CordenPharma Plankstadt decided to combine production and expertise in formulating highly potent products; development under one roof. That’s my role here, making sure please explain what the common difficulties are in there is a close communication and a close interaction between the manufacturing these, and what expertise you need to development groups and the manufacturing plant. formulate such products? Nowadays, more and more drug compounds need very low doses This is a very common sense approach isn’t it? of a few milligrams, sometimes only micrograms, as they are Yes and a lot of companies are starting to go this way, even Big highly potent in achieving the desired pharmacologic action. Other Pharma, because they realize there is a real benefit in having a close compounds, even if they are administered therapeutically in larger link between early development and the later scale-up. doses can also exhibit severe adverse effects in healthy people due
94 SCRIP 100 scrip100.com to their mode of action. All these compounds need to be handled company. However they also closely work with our customers to with great care. That’s why they are categorized with a system of make sure we have detailed project specifications in place which occupational exposure bands which determine the exposure level detail all the tasks, the deliverables, the time schedule, the identified per cubic meter of air in an 8-hour working day which is considered risks and which actions have been agreed on to mitigate these risks. to be safe. Thus OEB4 and OEB5, the exposure bands we handle This project specification is a controlled document which is signed in the high potent facilities at CordenPharma Plankstadt, define an by both the customer and the development team and updated acceptable exposure level of 1 – 10 µg or even less than 1 µg per m3 throughout the product’s lifecycle. Besides the project specification a in 8 hours respectively. thorough risk management process is applied to all of our projects, In order to completely protect our people we always need to have with risk assessment and updates throughout the development. a defined OEB level for each of the compounds we work with, so we can ensure via vigorous monitoring programs that these levels In your opinion, what problem or issue in R&D is are consistently met and neither our people nor the environment CordenPharma dealing with particularly well at are exposed to any risk. During development activities we protect present that the rest of the industry is struggling with? our scientists working with the compounds by the use of personal I do feel that CordenPharma as a whole has protective equipment such as air fed gowning, protecting the a distinct competitive advantage in that complete body against any contact with the compound. In routine we really provide a “one-stop-shop” manufacturing, depending on the scale and manufacturing process, for our customers. For example in we either use the same principle of protection or work in a fully Plankstadt, from just a few grams contained plant. we can start development, from the formulation and the Am I right in saying that not all manufacturers can process all the way through to offer this service? commercial-scale marketing, for First of all, only a few companies have the specific plant facility and all solid dosage forms including hardware to offer this service, and it’s all got to be validated, too. So highly potent drug products. not only is it the hardware compound which most companies cannot And we also do that via a very offer, but also the soft skills, which are the processes in place such structured and state-of-the-art as the SHE assessment, including the waste water treatment, the air development program using Quality by monitoring and the monitoring procedures that we have in place - Design (QbD) aspects wherever possible. no, not every manufacturer can do this. We will always start with a Quality Target Product Profile (QTPP) and go through defining the Critical Quality Attributes (CQAs), as What specialized packaging services do you provide in well as a technical risk analysis and mitigation plan in the project CordenPharma Plankstadt? specification. We also have appropriate Control Strategies ready During development we will investigate the best packaging material during all development stages, not just for the release of our and process for the products of our customers so we can select the investigational medicinal products. These are the basic principles optimal packaging for the intended handling and provide adequate needed for a QbD driven development. The use of development protection of the drug product at the desired storage conditions. tools such as Design of Experiments (DOEs) or Process Analytical Once we go into routine manufacturing, we can offer a wide range of Tools (PAT) during development will of course depend on whether blister materials on our modern blister lines. and to what extent our customers wish to apply these, and would We also offer complete tracking of commercial drug products via then be defined in the project specification. pack serialization. This is done through data matrix printing where Quality by Design is an ongoing trend and any pharmaceutical each pack of tablets gets a unique code – identifying where it’s been manufacturer denying that, and sticking with the old principles of manufactured, where it’s coming from, which tablets are in it, when it doing just quick trial and error development without understanding is being delivered – so that at the pharmacy, the pharmacist can then the critical attributes of the drug product, the criticality of the verify the pack being handed to the patient against the original data material attributes of the compounds and excipients, or the process fed into the system. This ensures that the pharmacist and patient parameters, is going to face problems in the future. know this pack is the original one and safe to use, thus preventing counterfeiting activities or any criminal activity within the supply Can you briefly summarize the key drug product chain. Though data matrix printing is not compulsory now, in Europe development competencies in other CordenPharma it is going to be mandatory within the next 2-3 years. facilities? CordenPharma is comprised of multiple GMP facilities across How does project management play a role in drug Europe and US, three of which have competencies in the product development? development of drug products, specifically parenterals, high potent In CordenPharma Plankstadt we have individual project managers oral and sterile products, beta lactums, and oncology. Aside from for all development projects (including technology transfer projects). CordenPharma Plankstadt these facilities include CordenPharma They co-ordinate the project team, all development or transfer Latina in Sermoneta, Italy and CordenPharma Caponago, in Monza activities, and communicate the progress of the project within the Brianza, Italy. scrip100.com SCRIP 100 95 futurology
Will it ever rain again? New
Andy Smith investment roads lead further into Contributing Editor, Scrip Intelligence the desert Andy Smith looks into the investment desert to assess the likelihood of rain. With fewer investors for If the forecast is correct, he may have a long wait. companies, there The IPO window for life science able to do so if their existing investors it’s much less likely to be able to bash may be no way back to the oasis companies is barely open on both support the transaction by buying the IPO-ready, square peg investment, sides of the Atlantic. The aftermarket public stock. Another signpost that into the pharmaceutical round hole, performance of those who do manage leads deeper into the desert is when although there have been one or to squeeze onto the public markets specialist venture capitalists (VCs) exit two examples of private companies only inspires other companies who the market. With fewer investors for that filed an S1 as a stalking horse have no choice but to IPO after companies, there may be no way back to a (probably already proposed) exhausting either their cash, their to the oasis. pharmaceutical acquisition. former investor’s patience, or had their Another recent sign that we are in For the rest of the venture universe products returned to them by their big the desert is the trend for VCs to retain that had been groomed for IPO, they pharmaceutical partner. their investments in their portfolios for are set to linger in VC portfolios where What would happen to the life much longer than was historically the the appetite and ability for their existing science universe if public market case. A trickle of IPO exits means that investors to continue funding them investors’ appetite for early-stage risky most of the portfolio of investments looks reduced. As this scenario of assets never returns? in a VC’s portfolio will now be built longer vintage VC portfolios containing One of the ways we can tell that to be sold to a big pharmaceutical, older investments persists, the old we’re already in this desert in the diagnostic or medical device company. chestnut of valuation comes into play first place is because most of those Unfortunately, if that was not the aim and further hinders realizations. companies completing an IPO are only when the investment was first made, Private life science companies
96 SCRIP 100 scrip100.com futurology
that have missed an IPO window are Indeed, this would be The Hunger its grants, charitable and government Traditionally, traditionally drip-fed cash as either loans Games for life science companies, funding before they came in and diluted most VC funds have a life of 10 or debt that converts up at the IPO perhaps not with just one winner out the existing investors by leading years which used or next private round. In either event, a year, able to survive by stabbing and setting the terms for the first to give them long bridge financing keeps the valuation of everyone else in the back, but there venture round. With matched funding, enough to show many of these private companies stuck would certainly be more attrition charities and governments have wised a return back when they may have last raised amongst companies and VCs that up to this dilution effect by trying to money and would be much higher than can’t raise money than there is today. get VCs to invest at the same time if they were raising money today. This But even The Hunger Games (and hopefully on the same terms) as then prevents either an exit to the public scenario has structural issues since government and charities. markets, or a funding round led by a private investments are syndicated. If government funding is not the new investor because the existing VCs A failure at one company means a answer, then perhaps the corporate are unwilling to take a write-down to write-down or a write-off in a number venture funds of large profitable life this high valuation. of VCs’ portfolios damaging the returns science companies will provide life Traditionally, most VC funds have a of many and hindering the ability science VCs with the lifeline they are life of 10 years which used to give them of anyone in the syndicate to raise looking for. In days gone by, when the long enough to show a return. The another fund. earliest funds at Johnson & Johnson partnerships can then raise the next The Hunger Games scenario means (JJDC) and SmithKline Beecham fund on the back of their previous fund’s the virtual failure for the life science VC (SROne) were trying to edge into the performance, long before the fees from sector as no exits at IPO and write- VC world, they would have been less that earlier fund start drying up. downs in unfundable investments sophisticated about the terms under One important bearish marker prevents further fundraising and which they invested and even the type is that many, or even most, of the relegates many VC firms to the same of company as long as they could previous vintage of VC funds apply sort of zombie life of Resolution Life syndicate with a good investor that led to their limited partner (LP) investors Group. Resolution was formed to to a better quality deal flow in the future. for multiple extensions to this 10 year consolidate life insurance funds that Fast forward to today, when lifespan in the hope that they can eke were unable to take on new business corporate venture funds are now out a better return record so that it can and, like VC portfolios, have funding staffed by former financial VCs who then be used to raise another fund. liabilities extending for many years. have been attracted to investing The counter argument against this However, there are two alternatives without the distraction of the fund- is that if an investment hasn’t exited for traditional life science VCs. The raising cycle, and the corporate VCs the portfolio in 10 years, what is the first is government money, while the now know all about dictating stringent probability that it will in years 11, 12 or second is the rise of the corporate terms and excluding syndicate partners 13 and return an integer (rather than venture fund. Typically, government on the basis that they may be unable to fractional) multiple on cost? In part, intervention by funding life science fund the life of the investment. many LPs have responded to this companies is not designed to It appears that all roads lead further extension in the time to return capital generate a financial return, but its into the desert as corporate VCs are by reducing their commitments to the main purpose is to generate jobs in now more sophisticated and more sector until their VCs prove themselves, a region, country or economic area. discerning than they ever were, and although this reduced appetite may There is often the hope that self- while they are taking up the slack left also be due to the same flight from risk sustaining businesses will emerge as by financial VCs who can’t raise a new that puts off public market investors a result of the funding, however the fund, they are doing so under their own from IPOs. failures of Germany’s Neuer Markt and attractive terms. the French government’s investment Public markets are lukewarm to A decade of drought in NiCox, as well as the historical early-stage life science IPOs and So, let’s say the there is no appreciable success of the US life sciences pharmaceutical companies looking to IPO activity, and in consequence market without much government acquire or license private biotechnology reduced returns for life science VCs for intervention, will hardly engender assets are increasingly looking for later the 10 years from 2008 to 2018. How further such job creation schemes. and later stage validating data from does that scenario shape the industry? There is the added complexity that their potential partners. It would be a world where a few lucky many government funding initiatives Funding looks likely to be in short privileged VCs who raised a fund in like the seed-stage Biomedical Catalyst supply for some time yet and if it the last few years, control the market Fund in the UK, and the proposed Life takes another six years to rain again, for venture funding rounds and preside Science Fund in Wales, are matched there will be fewer VCs and far fewer over many seed-stage to public, loss- funded. Traditionally, VCs would wait private companies by the time there is making companies desperate for cash. for an academic spin-out to spend all another downpour. scrip100.com SCRIP 100 97 futurology My message to the pharma industry
Dr Ben Goldacre Ben Goldacre is an outspoken campaigner for greater access to clinical trial Author, Bad Pharma data and author of Bad Pharma. Here, he gives the pharmaceutical industry his alternative New Year message.
I don’t think you are bad people. Much of what pharma does is Criticizing the pharmaceutical industry, Collaboration. And yet this information second rate drug does patients some good, of course, I’ve recently discovered, is a little is vitally important, because we are good, undeniably. And so perhaps but for all of like questioning a cult: there are increasingly seeing that brief academic we all allow ourselves to become too us in medicine outlandish smears, lurid denunciations, journal articles can give a very relaxed about these problems. this is both a and implausible outright denials. misleading picture about what actually But bad practices have also blessing and a People within the community award happened in a study. Finally, despite persisted through lack of vision. When curse themselves a point for this behavior, several well-received promises for the unflattering trial data is glossed over, an while outsiders look on in amazement. future, so far almost no company has individual company can be rewarded I’d like to speak with those of you who ever shared one single file of individual with higher sales. This short-term gain are able to step outside of this game. patient data from a clinical trial. If this comes at the expense of everyone’s Firstly, while everyone is entitled was all news to you, I hope you now collective reputation: and it is amazing, to their own opinions, we all have to accept that important information on since you save lives, that your work with the same facts. The problem clinical trials continues to be withheld reputation is so poor. If you advocated of missing data is real, and ongoing. from doctors and patients. strongly for more transparency, for The best current evidence shows There are plenty of swivel-eyed you and your competitors, universally that around half of all trials are never quacks and conspiracy theorists out and internationally, in law, then all published, in industry and in academia. there, who hate everything we both companies would compete on an equal Industry’s first response is always: stand for (especially you). But people footing, ethically and transparently. “this has been fixed”. But all these like me only care about bad behavior This will come to your industry, supposed fixes have been incomplete in industry for one reason: we want whether you like it or not. Transparency by design, and failed in practice. evidence-based medicine to be as is an unstoppable tide, throughout The best published evidence good as it can be. This means good society, as we enter the era of big data, shows that ICMJE rules on registering quality trials – fair tests – conducted as and it’s not always comfortable. The trials before they begin have been frequently and efficiently as possible, US and UK governments now release widely ignored, years after they were with all the results reported, and terabytes, knowing some of it may supposedly implemented. Research in accurate summaries of all the evidence embarrass them, but also knowing that the BMJ from 2012 shows that the laws put into practice. “many eyes” can find patterns - and on posting trial results at clinicaltrials. Where industry has resisted this – spot problems - better than a few, gov within one year have been ignored against its own interests, in my view behind closed doors. by four out of five trials, and it’s now four – we need to understand why. I don’t In the worst scenario, for you, we will years since those rules were passed. think you are bad people. Much of all get a sharper sense of what works Even if these rules had been enforced, what pharma does is good, of course, and what doesn’t. Success will be they still don’t get access to trials but for all of us in medicine this is both rewarded more; second-best drugs, less conducted before 2009. a blessing and a curse. For example: so. This sharpening of rewards might be Doctors cannot practice evidence- bad trials, missing data, and biased uncomfortable, and it might accelerate based medicine if half the information dissemination of evidence through innovation. But it will come, and I’ll from before 2009 is still missing, and marketing, might all mislead doctors happily help you to stop fighting it. much of it is withheld on direct request. into wrongly believing that a new drug is But this is what happens, and quite better than an older, cheaper one. Any legally. Roche, for example, are still drug that is wrongly believed to be the refusing to hand over Clinical Study best, when it’s actually only mediocre, Ben Goldacre is a doctor and the Reports on Tamiflu to the independent harms patients, because it deprives author of Bad Pharma. He can be academics at the Cochrane them of better treatments. But even a contacted at [email protected].
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