Lilly's John Lechleiter says the company can't solve its upcoming revenue woes, due to expiring patents on some of its biggest sellers, by cutting staff and otherwise saving costs. He says that Lilly has no plans to follow companies like Pfizer in cutting $1B from operations in 2012.
Lechleiter continues to state his mantra that Lilly has to develop its way of its problem by bringing winners from its pipeline to market. The next candidate is solanezumab -- a putative Alzheimer's treatment in phase III -- one that some analysts indicate could be worth as much as $9 B in peak sales. But, he is also quick to point out that solanezumab is high risk and it is NOT a make or break proposition for Lilly. Nevertheless, the pressure is on to bring home some winners soon from Lilly's pipeline.
AZ's chief, David Brennan, on the other hand is following a plan of reduced spending on internal R&D and is hoping to boost that company's flagging pipeline in the near term by acquiring smaller bolt on acquisitions (can anybody say "string of pearls"). They've also struck a recent deal with Amgen to help take some of the latter's Mab drugs through the pipeline. However, AZ still needs more to right its ship -- given its patent cliff and dreadful recent record in developing drugs in its own R&D groups. Can they find enough "bolt-ons" to buy their way out of trouble appears to be the salient question? See Fierce Biotech.
Will either strategy work? Both appear to be tenuous at best.
Posted by Bruce Lehr Apr 13 2012.