Bayer's 2018 Financial Forecast Hit by Manufacturing Woes
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9 March 2018 No. 3895 Scripscrip.pharmaintelligence.informa.com Pharma intelligence | informa its specifications, whether or not the batch has already been distributed.” Among the other charges is that Bayer’s quality control unit did not sufficiently oversee adequacy of procedures at the facility to assure drug product quality. During the company’s 2017 full year financial results presentation on Feb. 28, the company highlighted that it was expect- ing temporary supply interruptions due to remediation measures in production. Bayer expects the impact on adjusted EBITDA to be about €300m. The largest proportion of this amount is related to the pharmaceuti- cals division and a minor part to the con- sumer health business unit. Weinand, who is also a member of Bay- Dieter Weinand er’s management board, told Scrip after the company’s earnings presentation in Leverkusen, “Our biggest challenge is to get the supply chain running… bringing the Bayer’s 2018 Financial Forecast warning letter to a conclusion as quickly as possible because that is a limitation.” Weinand added that while in-market per- Hit By Manufacturing Woes formance was good the company needed LUCIE ELLIS [email protected] to quickly make adjustments at its Leverku- sen plant to answer the FDA’s qualms. “We etting its German manufacturing is- Bayer received a lengthy warning letter are working diligently with the FDA to re- sues sorted as quickly as possible will from the US FDA in November last year, solve the warning letter as fast as possible,” Gbe the biggest challenge for Bayer which was published in February 2018, he said. “We hope to do this by the end of AG in 2018, according to the company’s about significant manufacturing violations the year… We have hired external support.” head of pharmaceuticals Dieter Weinand. at the German group’s Leverkusen facility. The FDA’s warning letter relates to an in- Until good manufacturing practice (GMP) The warning letter stated that Bayer’s “meth- spection of the Leverkusen plant in January violations at one of its sites in Germany are ods, facilities, or controls for manufactur- 2017. Products affected include some big- corrected, Bayer will only be able to run lim- ing, processing, packing, or holding do not earners, such as the blood pressure treat- ited services. This situation is expected to set conform to current good manufacturing ment Adalat (nifedipine) and the erectile Bayer back by around €300m in 2018. practice (CGMP).” And the list of violations is dysfunction drug Levitra (vardenafil). a long one. Bayer has forecast sales of €16.5bn for 2017 FULL YEAR RESULTS Bayer stands accused of failing to establish the pharma unit in 2018, falling short of the AT A GLANCE and follow adequate written procedures for €17.6bn previously predicted by analysts. • Group sales for FY 2017: €35bn cleaning and maintenance of equipment, This corresponds to a low-single-digit per- • EBITDA before special items: €9.3bn and not thoroughly investigating “any un- centage increase on a currency- and portfo- • Net income: €7.3bn explained discrepancy or failure of a batch lio-adjusted basis. • Core EPS: €6.74 or any of its components to meet any of Published online 1 March 2018 BROUGHT TO YOU BY THE EDITORS OF PHARMASIA NEWS, START-UP AND SCRIP INTELLIGENCE Celgene MS Setback Amgen’s Investment Strategy Artificial Intelligence FDA delay for ozanimod R&D Head Harper plays the Who’s doing what with whom? (p4) long game (p6) (p10-11) IN THIS ISSUE from the editor [email protected] This week’s edition of Scrip paints a rather gloomy pic- That attention to how one seeks the needle in the ture of the industry. While Bayer faces a €300m earn- haystack is also in evidence in Mandy’s report from ings hit this year because of manufacturing compliance Biocom’s Global Life Science Partnering Conference violations in Germany, Celgene suffered yet another (p10), where big pharma business development heads setback when the FDA sent back for more work its highlighted their growing interest in partnering with new drug application for the multiple sclerosis candi- those who can help them crunch data better, or who of- date ozanimod, which has been earmarked as a multi- fer new approaches to drugging difficult targets. Lucie billion dollar revenue generator (see p4). At Daiichi Ellis delves further into how artificial intelligence com- Sankyo there are job cuts (p5) and Biogen and AbbVie panies are expanding into drug discovery and develop- have pulled their MS drug Zinbryta from the market on ment on p11. safety grounds less than two years after its launch (p8). Elsewhere in the issue we have interviews with exec- It’s not all doom and gloom. Mandy Jackson’s inter- utives from Merck KGaA (p18), Sanofi (p19) and the view with Amgen’s R&D chief Sean Harper reveals how new AstraZeneca spinout Viela Bio (p20). Their focus looking for a needle in a haystack need not be a thank- on exciting areas of R&D innovation reminds us of less task when you commit to refining your methods the huge opportunities this industry enjoys – despite and pick your needle carefully (p6). its setbacks. 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ISSN 0143 7690. 2 | Scrip | 9 March 2018 © Informa UK Ltd 2018 Oncology Lift Off Digital Health Pact AstraZeneca Spin Out 20 14 16 20 exclusive online content inside: Pfizer Japan Cautious Over New Policies As Sales Slip COVER / Bayer’s 2018 Financial Forecast Hit By Manufacturing Woes http://bit.ly/2D5oTBS Despite a fall in local revenues, Pfizer remains bullish on its 4 Celgene Reveals Refuse-To-File Letter For Ozanimod newer products and pipeline in Japan but is cautious about this year’s planned price reforms in the country. 5 More US Positions Go As Daiichi Sankyo Refocuses 6 R&D Head Sean Harper On Amgen’s Long-Term Turkish Pharma Outlook 2018: Growth Tempered By Lira Devaluation And Pricing Policies Investment View http://bit.ly/2oMK5bG 8 Biogen, AbbVie Withdraw Struggling MS Drug Zinbryta Turkey’s pharmaceutical market is likely to grow by around 12- Due To Safety Issues 15% this year, but tight pricing policies and a low fixed exchange rate for the euro at a time when the Turkish lira is volatile and weak 9 Valeant Claims Progress, Asks Investors For Patience against both the euro and US dollar spell trouble for the industry. 10 Biopharma Investing In Better Success Rates Via AI, Dermira Ends Acne Program After Phase III Failure, Data And New Modalities Tries To Keep Focus On Hyperhidrosis Drug 11 Who’s Who In Artificial Intelligence Drug Development http://bit.ly/2I7cLny FDA approval for DRM04 in hyperhidrosis is expected at the 14 The Most Successful Oncology Launches Of A Decade end of June, but Phase III data for DRM01 in acne was the main event for investors. 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Aldeyra is working with J&J on novel immune-modulating drugs for systemic inflammatory conditions. @PharmaScrip /scripintelligence /scripintelligence /scripintelligence scrip.pharmaintelligence.informa.com 9 March 2018 | Scrip | 3 HEADLINE NEWS Celgene Reveals Refuse-To-File Letter For Ozanimod MANDY JACKSON [email protected] elgene Corp.