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Every once in a while I post a milestone (as defined by me) number of page views that has been surpassed by readers of this blog. I guess I'm always surprised that anyone comes to look at what I write or summarize, as may be the case. But here we are -- at 150,252 and counting..........
Posted by Bruce Lehr Mar 30th 2012
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The tide has officially no turned it seems. Over the past decade (or more) Big Pharma wanted to get BIGGER and BIGGER through mergers and acquisitions. Now, as pipelines dwindle, patent cliffs are reached, and revenue holes develop --- its time to turn the ocean liner many pharma companies have become to get smaller smaller smaller and fast.
Abbott officially kicked off the activity with its break up into a diagnostic and pharma company (now called AbbVie). Reports are now circulating that Pfizer's Ian Read wants to to begin his break up plan first discussed way back in March of last year. See In the Pipeline and Bloomberg for more.
In general, the market has thus far rewarded Pfizer's stock price for this proposed move, and the closer it seems to reality the more the investors seem to like it. Analysts seem more torn on the long-term (not short term) wisdom of such a move as Pfizer's portfolio does appear to provide some diversification protection and one could argue that the non-pharma businesses are doing better than the "core pharma" property that Read wants to invest in.
Needless to say, in a monkey see monkey do world, if two very large players decide to follow this path, many more lemmings are sure to follow.
Posted by Bruce Lehr Mar 29th 2012.
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Here's a nice post from the Innovate on Purpose blog comparing senior executives feelings about innovation and Pandora's box. It's seems top execs treat Innovation as good -- only if you can control it and put it back in it's box when it is time. Otherwise, it can be a frightening prospect to release on your company if it can't be controlled. Unfortunately, most innovation only works under the latter circumstances. And if you want a culture of innovation to take root and grow -- you need to let it loose.
Posted by Bruce Lehr Mar 29th 2012.
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By now you all know that Amylin is rumored to be in play after word was leaked that the company recently turned down a $3.5 B offer from BMS to be acquired. Once word hit the market, Amylin's stock price shot up by 55% yesterday to $23.77 per share.
Will Amylin Be Acquired? W hat The Wags Say… // Pharmalot.
Now various analysts are weighing in on how an acquisition of Amylin by a member of big pharma makes ultimate sense. It is acknowledged that the BMS offer starts the floor price for bidding and a final sales price would make sense in the $25-$30 per share range (most folks tending toward low end of the range). Companies mentioned as potential suitors include AstraZeneca, Roche, Novartis, Takeda, Johnson & Johnson, and Sanofi to at least consider a bid.
AstraZeneca has also been mentioned as a possible partner who could sign up to help Amylin represent its product in the EU. If that were to occur, Amylin may not have to or choose to sell under those circumstances. See Seeking Alpha stories one and two, and Fierce Biotech.
Given the revenue gaps being experienced by some of the companies above and their strength in selling to the diabetes market, odds seems to be good that one of these companies may make a higher offer. Since, Amylin stock was at $15+ per share only a few days ago, it will be hard for their board to justifying a rejection of another offer in the mid-20's.
Posted by Bruce Lehr Mar 29th 2012.
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Pharmalot reports on the latest new bill introduced in Congress aimed at speeding the FDA approval process. This one -- called Advancing Breakthrough Therapies for Patients Act --will ask the agency to speed the approval of "breakthrough drugs".
Yet Another Bill To Speed FDA Drug Approvals // Pharmalot.
What's a breakthrough drug? One aimed at a serious or life-threatening illness that has demonstrated preliminary clinical efficacy that suggests a substantial improvment over currently available treatments. The bill would let sponsors apply for breakthrough status and the FDA would need to rule Yea or Nay in 60 days.
The drug sponsor could still also apply for fast-track designations, accelerated approval or priority review status as well. Now we have ABTPA, FAST and TREAT all sitting before various parts of the legislature looking to speed drug approvals in the FDA. And, as PDUFA legislation needs to be renewed (lest the FDA run out of its user fee funding), Congress watchers think that at least parts of any or all of these Bills may have a chance to be added to the new PDUFA reauthorization proceedings.
Charge!
Posted by Bruce Lehr Mar 27th 2012.
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As expected, the Supreme Court remanded the Myriad case back to the Federal Circuit Court for further consideration in light of the Mayo Collaborative Services v. Prometheus Laboratories case.
Supremes Remand Ruling On Cancer Genes & Patents // Pharmalot.
Patent lawyers observing the proceedings think that Myriad has cause to be worried as to the decision the Federal Circuit may make.
"Myriad must have increased concerns about the validity of its DNA fragment claims, as the Federal Circuit could find support in Mayo to invalidate them under the theory that the fragments are products of nature and that the technique to isolate them is common and conventional."
The Federal Circuit, which ruled in Myriad's favor the first time around, can issue a decision with the same or a different outcome. We will anxiously await its decision. See the Patent Docs blog for more background and analysis on these issues.
Posted by Bruce Lehr Mar 26th 2012.
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There's no doubt where the writer of the IN VIVO blog stand on the wisdom of the Supreme Court's ruling against the Prometheus' patent. The logical extension of the ruling (according to the writer) would be the denial of patent rights to a myriad (get it) of personalized diagnostic tests.
The IN VIVO Blog: Supremes' Prometheus Ruling Has Dire Consequences for Personalized Medicine.
Not only would the analysis of small differences in gene sequences (as embodied by the Myriad case) potentially be covered by this ruling, but any tests that attempt to figure out why certain individuals respond better to one drug over another and how much drug should be administered should be covered. At least, if the logic exhibited in Prometheus were extended to other cases.
But then again, who ever accused the Supreme Court or most of the legal system to actually be bound by logic? Until another case comes along that will allow a reversal, I guess we're left with hanging chad in the biotech industry.
Posted by Bruce Lehr Mar 26th 2012.
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According to Kevin Noonan, writer of the Patent Docs blog, the Supreme Court's recent decision in Mayo Collaborative Services v. Prometheus Laboratories 'ignore(s) thirty years of Federal Circuit precedent in favor of its [own] decisions from thirty, sixty or over a hundred years ago."
Noonan continues that the court is creating a problem for American innovation as it is making the granting of patents in the life sciences area uncertain -- which hurts patent holders and dissuades investors. Most observers have understood for some time the danger of "imposing horse-and-buggy thinking about technology to the 21st Century" -- everyone except the supreme Court apparently.
The Court seems to have taken more of a "we'll know it is a patent-eligible subject matter" when we see it approach. This has the danger of being both arbitrary and unpredictable -- neither of which is good for the funding environment in an industry and its ultimate success if funding is a key factor - which certainly is the case for biotechnology.
So if there weren't enough assaults on the industry's health from a regulatory perspective, we've now added legal/IP uncertainty as well to make doubly sure investors think twice before plunking their money down.
By the way, from my practical point of view, it seems to be good that Prometheus was rejected. But in reading various attorney's take on the matter, it seems the Court is not paying attention to precedent in a predictable way in the patent arena. We're going to have to watch closely where this goes and how the patent attorney's respond to the Court's less than clear meanderings on "what is patentable".
Posted by Bruce Lehr Mar 23rd 2012.
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The WSJ reports that Roche has decided to rebrand two of its popular cancer drugs for the Indian market and to reduce their prices significantly. Herceptin and Mabthera will thus be renamed and repriced in that market. The drugs will be packaged locally by India's Emcure Pharmaceuticals, the countries 10th largest pharma.
Roche hopes that rebranding will cut down the practice of having middle men buy cancer drugs in low price markets and reselling (illegally) them into higher price markets. It hopefully will also allow Roche to maintain its higher prices in markets outside of India. It may also help stave off competition from generics.
This may also be seen as a response to India's compulsory licensing laws that allow (compel) the government to allow generic producers to obtain a license to patented drugs if they are too expensive for the domestic market and therefore unavailable to those patients who need them. This controversial practice was used recently to grant Natco a compulsory license to make Bayer's Nexavar in India. See post. Roche appears to be trying to avoid a similar fate.
In an effort to work and play well with Indian authorities, Roche has cut its prices and also allowed and Indian company to do its final packaging. It has done its best to protect future revenue flow in India without a compulsory license being granted, and tried to protect its brand and pricing outside of India through rebranding. This is the logical proactive approach at deal-making that I expected drug companies to take after the Bayer license was compelled.
Posted by Bruce Lehr Mar 22nd 2012.
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Nothing like a good patent cat-fight.
You have to love Supreme Court patent decisions as they make one side so clearly euphoric and the other completely disgusted. The recent Mayo Collaborative Sciences v. Prometheus Laboratories happily is no exception to this principle.
In brief, the case involves a method of determining the proper drug dosage for administering 6-thioguanine to treat patients for Crohn's disease. In this instance, the high court ruled the method as patent ineligible largely for running afoul of the "laws of nature" test and "machine or transformation" test.
Now the fun begins. In his blog, Derek Lowe, hails the decision by the Court as the best thing since sliced bread and can barely contain his glee -- in fact the post is entitled - "The Supreme Court Makes Me Smile." His comments on Prometheus trying to "patent the practice of medicine" are quite amusing and you shoud read for yourself. He concludes that he hopes we don't see any more of this "nonsense" -- refering to the Prometheus patents.
In Xconomy this afternoon, Robert Sachs (IP attorney) takes the Court to task for handing down a ruling that will likely kill innovation in the diagnostic testing field, will hurt all of life sciences and biotechnology and will have far-reaching unintended consequences for untold industries. Basically, the patent world will spin off its axis. My favorite quote, "the Court spliced together a legal virus that will undoubtedly be used to challenge and ultimately invalidate patents in a wide range of technologies....the law of unintended consequences will be tested -- and confirmed -- once again."
The Patent Doc blog does its usual fine job of just summarizing the Court's decision and reasoning ... though it is evident throught that presentation in spots that the writer (Kevin Noonan) doesn't agree with the reasoning and that is further clarified in the blog's comments sections. Normal practice will be for Kevin to discuss and analyze the Court's reasoning while supplying his assessment of its merits or lack thereof in an upcoming post -- likely to appear at a Patent Doc blog page near you.
My take thus far is that patent attorneys are disdainful of the Court's ruling as a matter of law (and legal reasoning) and are also put off that the Court did nothing to clarify the standard for patent eligibility of these life science type inventions. "Common sense" commentators seem to embrace the ruling as keeping another stupid patent off the books that would allow an obvious process to be patented, and one that would encumber further development in the field.
Let the games begin.
Posted by Bruce Lehr Mar 22nd 2012.
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Earlier this week, I made a post based on an Xconomy article covering the FAST and TREAT bills in the congress presently aimed at speeding up the drug approval process. In a nutshell, these bills would create a pathway for drugs for to be approved more quickly (after small phase II studies) for serious conditions without better treatment options. It is essentially taking the idea of the AIDs drug approval model and applying it more widely. Companies would have to do serious post-market follow up as well and drugs could be pulled from the market if they didn't live up to their pre-approval billing.
Now BIO has come out for the bills, but PhRMA has NOT. Some observers and analysts are viewing this very cynically with regard to Big Pharma behaviour and are essentially accusing them of scuttling the bill for their own purposes. Namely? Big Pharma wants to keep Biotechs as a novel drug producing farm system from which they can acquire new drugs, rather than give the Bio's the possible ability to launch drugs on their own.
"Sen. Hagan's proposal would have been devastating to the big pharma R&D oligopoly," writes Roy. "If small biotech companies could get their drugs tentatively approved after inexpensive phase II studies, they would have far less need to partner those drugs with big pharma. They could keep the upside themselves and attract far more interest from investors. Big pharma, on the other hand, would be without its largest source for innovative new medicines: the small biotech farm team."
Pretty strong words and sounds a bit too true to just dismiss doesn't it? Let's hope not. I hope that Big Pharma can stand on its own two feet to develop its own products if it has to do so. If not, they should become investment bankers not drug developers. See Fierce Biotech and In the Pipeline.
Posted by Bruce Lehr Mar 16th 2012.
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Fabry patients got more bad news yesterday -- as if it weren't bad enough already, given shortages of Genzyme's Fabrazyme in the US due to that company's well chronicled manufacturing problems. In fact, last week an Idaho woman filed a lawsuit against Genzyme, charging that a long-standing shortage of its Fabrazyme treatment for Fabry disease led to the death of her husband two years ago. He would still be living, she claims, if the biotech had not experienced severe and persistent quality control problems that led to a subsequent rationing program.
On the heels of this, Shire had been encouraged by patients and the FDA itelf to file a BLA to get its Fabry drug Replagel approved in the US. Now, Shire says that the FDA has told them they will require more clinical data despite the fact that Replagal has been on the European market for more than 10 years.
However, Shire says that recent meetings with the FDA indicated additional controlled trials will be required for approval, although safety was not an issue. This comes after the drugmaker last November filed its application with the agency, anticipating a speedy review. However, the added trials will cause “a significant delay” and approval would not occur until “the distant future.”
Analysts called the move "a surprise setback for Shire," according to Bloomberg. A new trial, they added, "would take at least two years and is probably not economically justifiable." All in all, not good news for Fabry patients. See Fierce Biotech, Pharmalot, and PharmaGossip.
The only one who may be cheered by this news is Genzyme and its investors as its new US manufacturing facility to produce Fabrazyme was recently approved. The company can now go back into large scale production. One might wonder about the timing of the FDA decision given that set of circumstances.
Posted by Bruce Lehr Mar 16th 2012.
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This from the PharmTech blog. I want to focus on cooments by the first speaker in the post, Neil Mahoney, President & CEO of Global Pharma Alliance. His talk indicated that it would be much more difficult to produce a biosimilar than for a generic small molecule - which is clearly true -- but he also cited a cost of $100-$200 M to develop a follow on biologic. Wow!
PharmTech Talk » Biosimilars—It’s the Differences That Really Matter.
I think that figure has to be looked at with skepticism and if true would only apply to a US market. But we have a GLOBAL pharma industry now. Estimates from Dr. Reddy's lab indicate that a western company could expect to spend $50-$100 M to develop a biosimilar (half the figure cited above) -- but also than an Indian company could expect to do this for only $10-$20 M. Additionally, India can be expected to offer the products at 25-40% less.
Dr. Mahoney also trots out data that says the initial biosimilars lanched in Europe did not exactly take the market by storn in terms of share -- also true. But to suggest that this trend will hold up going forward is folly I think. The first round of biosimilars were drugs like EPO which were not nearly as costly to use as the next round of mAbs to treat things like RA or cancer. Given the current health crisis, and government austerity programs, I cannot doubt that there will be incentives in place to encourage development and approval of biosimilars throughout the world -- yes -- even in the US. Moreover, as more of the mainline pharma companies like Pfizer, Merck, Novartis (Sandoz) etc start pushing biosimilars, I expect the adoption rates to increase and the price erosion to accelerate.
While biosimilars will require more investment and skill than small molecule generics, I don't think that is insurmountable. Economics and healthcare policy will drive their existence. It is only a matter of time in miy mind and that time will be quicker than a lot of naysayers believe. I think any thought to the contrary is wishful thinking and amounts to "whistling past the graveyard".
Posted by Bruce Lehr Mar 16th 2012.
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From the PharmaGossip blog via Bloomberg's, retiring J&J CEO William C. Weldon will receive a retirement package worth $143.5 M -- yes -- that's GREENBACKS.
And that's why this man is smiling today. That's a long way from the pay he received as a sales rep back in 1971 when he joined the company. Wow! Just think what he might have earned if J&J had been able to make artificial hips, otc medicines and vaginal mesh products over the past couple years.
Then we might have been talking some real money.
Posted by Bruce Lehr Mar 14th 2012.
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A cute and perceptive poem from Xconomy's Stewart Lyman on the state of the pharmaceutical industry in the style of who else -- but the good Dr. Seuss.
How can you not like Dr. Seuss? Kudos Stewart. Kudos.
Posted by Bruce Lehr Mar 13th 2012
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Xconomy's Luke Timmerman wrote a post today in his blog about the FAST (Faster Access to Specialized Treatments) legislation that is currently in the House. Advocates of FAST are pushing for more drugs to be approved sooner by FDA for serious diseases -- that is after they've been shown to be safe and likely with some sort of surrogate endpoint data pointing to their possible effectiveness. Proponents liken this to speedier approvals given to AIDs drugs during the early days of that crisis.
The conundrum for regulators of course is if they approve drugs more rapidly without as much efficacy data, there is a possibility that the drugs may not perform as advertised in real (and usually larger) patients populations (ala Avastin for breast cancer). The quid quo pro for this type of program therefore has to be the industry's diligence in doing and reporting post-market follow up. Less than sterling drugs could then have their approval revoked.
The post also quotes people like Alnylam's CEO, John Maraganore, as being an advocate as it may offer his company a way of getting drugs to market faster and at less expense in more abbreviated clinical trials. Maraganore argues this in turn woudl make investing in smaller and mid-sized biotech's more attractive -- due to lower costs and heightened regulatory predictability.
An In the Pipeline piece this week, points out the problems the drug industry has had with it's productivity as fewer and fewr drugs are introduced at greater and greater expense -- a sort of reverse Moore's law or Eroom's Law as th epost explains.
In addition to FAST in the House, the Senate has its version too, known as TREAT (Transforming the Regulatory Environment to Accelerate Access to Treatments). It looks like this idea's time may have come - and with desires to reduce health care costs, and boost the health of the US Biotech industry momentum is building to give this idea a try.
Posted by Bruce Lehr Mar 12th 2012.
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India's Patent office has issued the first compulsory license to allow a generic manufacturer, Natco, to sell Bayer's cancer medication Nexavar in India. The potentially revolutionary move can be expected to stimulate more such requests from other generic manufacturers.
Game Changer: India Issues 1st Compulsory License // Pharmalot.
Natco was awarded the right to sell its version of Nexavar in India only, and will pay Bayer a 6% royalty. Natco plans to drop the price of Nexavar in India from $5500 per person to only $175! -- a 97% price reduction. WOW!
The India Patent office explained its move in following India's law to "make drugs available in a manner that a substantial portion of the public is able to reap the benefits..." Nexavar is barely sold in India, presumably due to its price, and the Patent Office called the situation "neglectful".
The dynamics that will now emerge will be interesting. India Law allows the grant of a compulsory license only after the brand name innovator rejects a suitor's request to receive a license. Given the government's decision in this case, it will be very interesting to see how company's react in the future when approached for a license. My guess is that they will try to cut the best deal they can on their own rather than risk a compulsory grant.
Bayer will appeal the decision to the Indian Supreme Court. You can bet innovators will be watching and may chip in for appeal costs......
Posted by Bruce Lehr Mar 12th 2012
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This is an interesting post from Fierce Biotech this morning. It seems investigators tested the Novartis cancer drugs Gleevec and Tasigna against Ebola virus. Surprisingly (perhaps -- this must have chosen to test for some reason), the drugs did show some effectiveness against the virus. Tasigna slowed viral reproduction by 10,000 fold.
Both drugs block the activity of the Bcr-Abl protein (tyrosine kinase) in cancers which seems to slow spreading of the disease. In the case of Ebola, the drugs block the c-Abl1 tyr kinase and thus blocked the spread of viral particles.
The hope is that new similar drugs can be made to more specifically target c-Abl1 to further slow the disease and perhaps give the body's immune response a chance to stave off the infection enough to prevent death. Currently 9 of 10 Ebola victims succumb.
I think it is another interesting example of how know medicines might be repurposed to treat diseases that they were not orginally intended to battle. With enhanced screening capabilities - real and virtual - we may be able to conitnue to find existing medicines that can be applied to the treatment of diseases without good alternatives.
Posted by Bruce Lehr Mar 5th 2012
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A colleague gave me the following article this morning, and I'm beginning to think there was a method to his generosity. Apparently, a new study shows incompetent people don't recognize their own incompetence, dumb people are too dumb to notice and unfunny people don't understand that they AREN'T funny.
That explains a lot in terms of this blog. More incompetent than I think, dumber than dumb and about as unfunny as can be imagined. Maybe this also explains some of what we see going on in the industry, with our political candidates and process, and in society in general.
Everybody now.
If you're stupid and you know it clap your hands. If you're stupid and you know it clap your hands. If you're stupid and you know it, your work will clearly show it. If you're stupid and you know it clap your hands.
Posted by Bruce Lehr Mar 5th 2012
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I found these comments (as reported In the Pipeline and by Pharmalot below) by Sanofi's CEO Chris Viehbacher downright hilarious -- but probably should be read as very sad. Viehbacher was commenting on his company's revised R&D strategy and had this to say.
Sanofi CEO: Who Needs Big Pharma Scientists? // Pharmalot.
The upshot? Big Pharma should just stick to being an investment banking house capable of funding projects that they've validated by paying VC consultants. Leave the science and innovation to someone talented. But, they don't work here and don't want to : )
Posted by Bruce Lehr Mar 1st 2012.
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