The Big Red Biotech Blog

The Outcomes Era

Here's another post on the importance of "outcomes" research in gaining acceptance for a new drug.  It quotes results from a new Camelot Management Consultants study -- where 60% of US and European companies agree outcomes research to show the effectiveness of a new drug is important in gaining acceptance --- yet disturbingly 30% say they don't plan to change the way the go about launching their products.

The Outcomes Era .

Camelot says new launches will have to have the following features:

• Aim at expanding the market not just take share
• Re-define therapy guidelines
• Develop smarter pre-launch activities, with more investment in early phases
• Have stakeholders awaiting product and its differentiating features at launch
• Win recognition for creating multi-shareholder value (i.e. patients, prescribers, payers)
• Adapt to changes in the environment during and after the launch

Posted by Bruce Lehr May 16th 2013.

 

Pharma Need for Adapting to Change

When I was a youngster, my father used to ask us kids in the family a question: Why did the dinosaurs go extinct?  It was an interesting question to us as we all loved dinosaurs and knew a lot about them.  Not long after the question was posed, possible answers started flying around -- an asteroid collision, more volcanic activity, disease, ice age (climate change), movement of tectonic plates, etc.  My father's response no matter the proffered answer was No, no, no, no and no. 

The RIGHT answer was -- Dinosaurs became extinct because they couldn't adapt to changing conditions.

PharmTech Talk » Adapting to Change.

I thought of that when I saw this post this morning.  It deals with the need of pharma and biotech companies to be able to adapt to the changing healthcare climate in order to survive.  The post points out that increasingly, it is not enough to get a drug approved by regulators. To thrive, you need to get the drug accepted by payers. 

As such, companies need to be attuned to Changing Conditions. What is the competitive standard of care out there at any moment in time?  If it changes, can you adapt your clinical trials in progress to examine relevant endpoints to the new standard?  Can you add a drug to a study in oncology, for example, if a new therapy is demonstrated using two or more drugs?

Bascially, you need to think about how to differentiate yourself from competitors.  Can you show enhanced safety, fewer side effects, greater efficacy, lower toxicity, or identify a patient niche where your drug outpeforms?  You need to be able to adapt on the run. 

If you can, you will be set up to thrive under the new conditions.  If not, you (or your therapy) may be the one who next goes extinct.

Posted by Bruce Lehr May 14th 2013.

Biotech Needs to Focus on Demonstrating Product Value

According to a recent Ernst & Young study, future success in launching and selling new drugs will increasing depend upon the Company's ability to "show value" for its product -- i.e. comparative effectiveness.  This recognizes the increasing reality that to be successful -- you don't only need regulatory approval (FDA, EMEA, etc) but also it is critical that you get 3rd party payer approval in a timely manner to support launch.  Otherwise, you can look forward to lagging sales -- which can lead to a dramatic collapse in stock price and threaten a "one-hit" wonder Company's very existence.  See Dendreon's Provenge as a poster child for this effect -- though there are others like HGS' Benlysta.

PharmTech Talk » Biotech Needs to Focus on Demonstrating Product Value.

Curiously, the E&Y study found that small and mid-size biotech's in particular seemed blind to this possibility.  While 94% agreed that it is “important” or “very important” for biotech companies to have a strategic focus on matters of evidence. most companies indicated that they are unlikely to undertake specific evidence-focused initiatives. Of the respondents who rated evidence measures as “important” or “very important,” 11% have added payer/reimbursement expertise to their management teams, 13% have brought such expertise to their clinical development teams and only 4% have included people with such expertise in their boards of directors. 

E&Y advised biotech companies to debunk any myths that are holding them back, stressing that the shift to evidence is happening faster than anticipated, and it will affect companies regardless of their size, maturity or disease focus

You know what they say about failure to learn from history and impending doom to repeat it? 

Posted by Bruce Lehr Apr 26th 2013.

Obama Budget May Cause Big Pharma to Take Its Own Pain Meds

PharmaTech Talk reports what's in the new FY 2014 budget proposal that's in favor of Big Pharma?  Not much apparently.  First off, it appears FDA will be losing more money for drug oversight.  Any added resources they will get will have to come from pharma user fees, i.e. they will pay as they go.

Pharma will also be asked to pay for more of the Medicare drug benefits, especially to help the government close the Medicare Part D "donut hole".  The proposal is for pharma to increase discounts from 50% to 75% in this category -- which should cost them about $11 B over 10 years.

What else is in the grab bag?  Well, under Medicare Part B pharma will be asked to to accept a reimbursement rate of ASP plus 3% instead of the current 6%.  This will cost them another $9 B over 10 years.

Obama also proposes to extend Medicaid drug rebates to Medicare dual eligibles.  This should cost pharma $3 B more next year and a tidy $142 B over 10 years.  Couple this to a ban on pay-for-delay and ring the cash register to the tune of another $740 M next year and $11 B over 10 years. This is suppposed to increase generic drug use.

Further, there is a proposal to cut the exclusivity period for biosimilars from 12 years to 7 years.  That's expected to be worth $3 B in savings.

Add it all up.  Looks like potentially $176 B over 10 years.  Put that in your patent cliff and smoke it! Then take 2 aspirin and call me in the morning.

Posted by Bruce Lehr Apr 17th 2013.

India May Drop Compulsory Licenses Based On Price

Does it really matter?  It appears that India will no longer issue compulsory licenses to generic or biosimilar manufacturers to make a patented drug based solely on whether that patented drug's price is perceived to be too high.  Good news for the multi-nationals right?  They seem to think so.

India May Drop Compulsory Licenses Based On Price // Pharmalot.

Instead India has set up a new Committee to set pricing for patented drugs by comparing to prices negotiated between manufacturers and governments in US, Canada, France, Australia and New Zealand.  The thought seems to be this comparison will lead to higher prices than what consumer advocates in India would like to see but less than what pharma companies would charge on their own, but woud still be acceptable to these same companies.

But....the Committee would take per capita gross national income (GNI) and purchasing power parity in these countries into account.  The ratio of GNI in comparison country/GNI in Indiawould be calculated and used to adjust the price of the medicine for India from that of the comparison country.  This adjusted price would also serve potentially as the starting point for future reductions.

Ok. No compulsory licensing. Yes to a Pricing Committee.  What if they price products lower that what pharma is expecting?  Are we back where we were?

Posted by Bruce Lehr Mar 1st 2013.

High Drug Pricing Next Industry Challenge?

The good news from 2012 might be that more drugs were actually approved (39) than in the very recent past -- but the bad news is that many were VERY expensive.  Xconomy's Luke Timmerman did a nice piece summarizing this a couple of days ago.  It seems that many of the very high priced drugs are coming into the oncology and "rare disease" or orphan arenas.  Many of these drugs carry price tags into the serious 6 digits and are $300K or more annually.  Is this sustainable?  Are any of these products worth it?

Those are questions that the industry must face as healthcare systems around the world struggle with costs.  Individual patients oft times may have to struggle as well depending on what type of insurance coverage they carry.  And even in the industry, some players must worry that the action of their peers might be in danger of killing a golden goose if these prices are perceived publicly -- even by physicians -- as being out of line with reality. 

What's a drug worth?  One answer might be what the market is willing to pay.  But will that number change as government and other third party payers become budget constricted. Yes, is the obvious answer.  From a payers perspective, they want a price that they feel is commeasurate with the benefits that are received.  Same from a patient's perspective, I hope.  Do I feel I got my money's worth in terms of improved health or quality of life? 

There is no doubt that this issue will not go away. 

Posted by Bruce Lehr Feb 13th 2013.

Price 'Em High Boys. We Need the Profits

In case you think Big Pharma is completely powerless against the patent cliff and the forces of generics, we have ths new study from Express Scripps with some counter data.  It seems generics have made a whopping impact on drug prices in 2012 -- as prices for these drugs dropped by an amazing 21.9% since last September.  Markedly different from the meager 2.9% decrease seen for the same drugs in 2011.

Brand-Name Drug Prices Rose How High? Look Up… // Pharmalot.

On the other hand, a "market basket" of widely used brnad name drugs was able to command a 13.3% increase in price during that same time period -- in a time when inflation was only 2%.  Clearly, with loss of revenue facing them from drugs that have gone "over the cliff", Big Pharma has been able to counter by some degree with substantial price increases on brand name drugs.  Biologics in fact were able to up their prices by 22.6%.  Still these types of branded "specialty meds" represent only about 21% of the total market with generics making up the rest. So Big Pharma has to work hard to squeeze profits out of the existing pie.

Generics are making there impact clearly.  Anyone doubt that pay for delay may actually prevent this from being worse (from Big Pharma point of view)?  And Express Scripts uses the generic price drop coupled with the big biologics increase to lobby for more emphasis on getting a biosimilar pathway in place so it can start profting from big drops in the biologicals arena too when the first biosimilar drugs are approved.  Not such a rosy profit picture for Big Pharma unless they have the ability to get new brand products on the market and extend the indications for the existing brand drugs -- before either generics or biosimilars start eating their lunch.

Posted by Bruce Lehr Nov 28th 2012.

Gang of 31 AG's Takes Pay-to-Delay to Supremes

Thirty-one State AG's have filed an amicus brief with the US Supreme Court in favor of ending pay-for-delay delas between pharma innovators and generic producers.  The AG's are backing the US Federal Trade Commission position that says these deals cost States and consumers dearly in increased healthcare costs. The FTC estimates the increased cost at approximately $3.5 B per year. The AMA has also come aroudn to support the FTC position.

31 States Urge Supremes To End Pay-To-Delay // Pharmalot.

Drug manufacturers say the deals are legal and that they actually get generic drugs to market faster than might be possible otherwise. In fact the GMA (generics trade group), says the deals have never stopped a drug getting to market beyond a product's patent expiration date -- and in many cases months or years sooner.

Opponents counter that the deals prevent patent challenges and thereby weaken the patent system by allowing marginal patents to stand.  This in turn allows holders of those patents to maintain a monopoly position witha drug longer than they might otherwise -- and this is anticompetitive.

So far, lower courts have sided both ways.  The 3rd, 6th and DC Circuits have generally ruled to make pay-for-delay harder, and the 2nd, 11th and Federal Circuits have made rulings more likely to allow pay-for-delay. Normally, the USD prefers to have law that is a bit more consistent across the land, so the Supreme court is being asked to review the issue. But will they hear the case and break the ties?  Hard to say.

Posted by Bruce Lehr Nov 15th 2012.

 

India Bringing Drug Price Controls to the Plant Level

The Indian Government seems to be going overboard in its efforts to control drug prices.  They are apparently not content with only compulsory licenses, patent rejections, biosimilars incentives, anti-gouging measures, abolishing brand names and even arm-twisting by their Supreme Court -- now they want to have inspectors visit manufacturing plant to assess production costs.

NPPA to inspect Indian drug plants as part of pricing role.

Drug marketers must be pulling out their hair there.  Marketing 101 says you should price your product or service based on its value to the market -- not on production costs. Egads!

Instead, the National Pharmaceutical Pricing Authority (NPPA) will visit manufacturing facilities to look at things like yields, capacity utilization, maintenance of plant and machinery, cost of raw materials, R&D expenses, plant expansion and machinery replacement. The NPAA will up its oversight from 74 bulk pharmaceuticals to 348 bulk drugs.

The underlying motivation seems to be an "effort to get drugmakers to justify the prices they charge for products based on production costs." Double Egads! Wonder what drug company investors and shareholders think of that?

Anyone still think India is really lucrative new drug market for the MNCs to enter? Volume basis maybe, but what about margins?

Posted by Bruce Lehr Nov 8th 2012

Rep. Eshoo Calls Abbott on its Biosimilars Citizen Petition to FDA

Abbott may now claim that the BPCIA will induce the FDA to run afoul of the takings clause in the Fifth Amendment but revealing its trade secrets to competitors without compensation, but Rep Eshoo, one of the Bill's authors, says Abbott never said a word when the bill was being drafted. 

Further she says, it was Congressional intent to apply BPCIA to all biologics -- both prior and after the Bill's March 23, 2010 passage.  And the Bill was specifically designed to allow competitors to go after big multi-billion biologics that would be coming off patent soon -- so the Government and patients could realize savings.  She says, Abbott was privy to all this information in real-time and never raised an objection in conference.  See Patent Docs blog.

One must conclude that Abbott likely had its legal strategy in its pocket and planned to spring it whenever the time seemed opportune.  Now, we'll have to see how the FDA responds -- for or against the Citizen Petition  Will that depend on who wins the next Presidential Election?

Posted by Bruce Lehr Oct 26th 2012.

Latest Shot in Comparative Effectiveness Battle

Memorial Sloan Kettering has announced that it will choose NOT to use one of the latest cancer treatments for colorectal cancer.  The drug?  Zaltrap.  Rejected because of the funky name? No.  Eschewed due to its cost? Yes, wholeheartedy says center representatives.

Rational Or Rationing? Saying No To A Cancer Med // Pharmalot.

Zaltrap costs on average $11,063 per month of treatment or about twice as much as the older drug, Avastin.  And, it has not proven to be any better than Avastin either. Doctors at Sloan argue that drugs need to prove themselves and they feel responsible for taking the financial consequences into account as well. Neither drug really knocks your socks off as they extend median life expectancy by a mere 1.4 months over standard chemotherapy.

So you can have Avastin for half the cost, with slightly fewer side effects and the clinical effect is very similar in terms of life extension.  Sounds rational to skip its use then, eh? 

No doubt this is the latest salvo in a battle that will rage on for some time -- especially if the Presidential race latches on to this issue.

Posted by Bruce Lehr Oct 15th 2012.

Compounding Errors Strike a Chord with Mike

Pharma Reform has something to say about pharma regulation or lack thereof, spurred by the continuing issues raised by the meningitis outbreak fueled by a compounded (and less regulated) steroid formulation that has been sold inter-state.  Who's responsible?  Should there be more regulation? 

Pharma Reform takes a stand.

Posted by Bruce Lehr Oct 10th 2012.

 

A White House White Paper On Drug Approvals - Helpful?

It's Election time.  Time for another terrific "white paper" from a Blue Ribbon panel of experts outlining several recommendations as to how the federal Government (e.g. FDA and others) can speed drug approvals.

A White House White Paper On Drug Approvals // Pharmalot.

Like most such august panels, their recommendations in a robust 110 page report is long on advice and short on specifics. Some of these include:

• More funding for National Center for Advancing Translational Sciences (Francis should be happy)
• Create "broad-based" partnership to improve clinical trials and provide the FDA with more input on developing a pathway for "innovative medicines"
• Have the FDA do more to grant accelerated approval for drugs meeting the standard for addressing an "unmet need" for a serious life threatening condition
• Create a new pathwy for initial approval of drugs aimed at specific subgroups, dubbed Special Medical Use approvals
• Have the FDA run pilot studies to look at "adaptive approval mechanisms".  Congress should pony up $40 million annually to pay for this
• FDA should enact a "range of reforms', including the use of pre-market review leaders to oversee drug applications from investigative stages to final approval
• USDHHS should commission a study of economic incentives to promote innovation, i.e stimulate companies to chase drugs like treatments for Alzheimer's or antibiotics

So all we have to do is follow the advice -- blah blah blah blah -- and figure out how to put it into concrete actions. 

White paper + Blue Ribbon panel = Red Herring.  Will it get the Green light?

Posted by Bruce Lehr Sep 29th 2012.

 

Emerging Markets Are No Panacea

This from Pharmalot.  Former Pfizer executive, Amal Naj, explains that multi-nationals likely can't rely on going to pharmerging markets to bail them out from their current revenue gaps. MNC's, he says, "have overestimated their ability to sell branded products in these markets" -- particularly at a price/profit premium.  

Emerging Markets Are No Panacea: Naj Explains // Pharmalot.

Factors cited by Naj that mitigate against MNCs making good profits include:

• Local generics producers selling at less than 50% of MNC prices in these markets
• MNCs and generics often use the exact same manufacturers in emerging markets which blunts any "increased quality" claims that MNCs can make
• MNCs competing with each other in these markets with generics
• Brand power is dissipating from factors cited above. Products are becoming commodities
• Government controls to force lower prices (and margins)
• Greater difficulty than expected in getting products registered in these markets
• Quality from local companies is gettig better and they are getting more efficient

The upshot?  Expect more and more competition from local competitors.  Even some big MNCs to withdraw from some markets due to depresssed prices and profit potentials.

I think that once competition for generics begins to be widespread -- there is a greater drive toward commoditization (which payers and consumers want).  That means not everyone will be able to compete profitably in every market and there will be withdrawal and consolidation.  It may also mean that a generic producer business model won't favor everyone.  Clearly, low cost producers are favored in such environments -- and not everyone can be THE low cost producer.

Posted by Bruce Lehr Aug 14th 2012

 

Towards Pharmageddon?

More salvo's in the battle over whether the "innovation crisis" in pharma is due to inherent difficulties and costs in bringing new drugs to market or whether it is caused by pharma companies choosing to pursue more "sure thing" me-too products. 

The pharma shoots-too-low crowd, Donald Light from the University of Medicine of New Jersey and Joel Lexchin from York University in Toronto, opines in the most recent British Medical Journal that the situation has remained the same for 50 years. The incentives for drug development are wrong and have skewed the behaviour of the industry.

They claim more is spent on marketing (25 per cent of revenues) than on discovering new molecules (1.3 per cent). Drug industry claims that the cost of bringing a new drug to market is £1bn and is unsustainable are exaggerated, they claim. Research and development costs did rise substantially between 1995 and 2010 by $34.2bn (£21.9bn), they concluded, but revenues increased six times faster – by $200.4bn.

Towards Pharmageddon? The last (lost) decade .

They add that up to 80 per cent of drug spending is used by the industry on promotion. The authors call for licensing authorities around the world to stop approving new drugs of little therapeutic value. They suggest large cash prizes should be awarded for genuinely new therapeutic agents in lieu of patent protection.

In a second paper, researchers from the London School of Economics in the UK argue that drug manufacturers should be made to demonstrate that their products are superior to existing treatments before being granted a licence, rather than, as now, superior only to a placebo.  In other words, comparative effectiveness should be used to justify adding new drugs to the approved menu. 

With regard to magnitude of costs/profits, I believe the truth lies somewhere in between.  Drugs do cost a lot to discover and bring to market.  But drugmakers do spend on lot on marketing to justify me-too drugs -- and could channel some of this toward developing more novel therapies with better patient benefits. 

I suspect we will see a coorection as more regulatory and 3rd party payer incentives are put in place toward getting novel drugs to treat unserved diseases.  Economics is going to prevent us from continuing down the me-too route as these drugs increasingly will find it toughter to gain approval and to get reimbursement consideration. 

Do we really need 17 beta blockers or just one new Alzheimer's drug that actually works?

Posted by Bruce Lehr Aug 8th 2012.

Supreme Court Ruling Generally Provides Clarity for Biosimilars

Lost in all the initial misreporting of the Supreme Court decision and even in the correct subsequent reporting was the positive impact the ruling had for Pharma and Biotech companies pursuing biosimilars. There had been fear that if the Court had struck down mandatory purchase of insurance provision portions of the law that the whole house would come tumbling down.  And with the fall of the Patient Protection and Affordable Care Act (PPACA) law, the the Biologics Price Competition and Innovation Act (BPCIA) would go too!

Fortunately for the biotech industry, that did not happen.  We still have a pathway in place to get to biosimilars filed and hopefully someday approved in the US.  Biologic drugs totaled $112.93 billion in worldwide sales in 2011, which constituted a $5 billion, or 4.6 percent, increase over 2010 sales.  Europe, in particular, has had a biosimilar pathway in place for nine years (since 2003), and has approved at least fourteen biosimilar products so far. The US needs to get it in gear.

The European biosimilars market generated is expected to reach almost $4 billion by 2017. Despite these profit incentives, and despite the framework being in force for over two years already, no biosimilars have been approved in the U.S., and most indications are that none are close (as of February, the FDA had yet to receive its first ABLA application).  BIO has been advocating that the new biosims that will compete with branded products should be put through a rigorous clinical trial program, avoiding the onslaught of cheap copycats that has blighted traditional small molecule treatments

The Supreme Court decision erases any hesitation biosimilar producers may have had in using the BPCIA due to the uncertainty of its survival.  Biosimilar producers can now move forward full steam with their biosimilar products without fear of legislative overhaul and potential disruption of their FDA approval progress. Pioneer biosimilar producers such as Sandoz and Hospira are already in Phase III human testing, and they have relied on the BPCIA to provide some clarity as to how biosimilars will be regulated in the U.S. Some of the biggest companies, like Merck, Amgen and BiogenIdec, have also set up biosimilar initiatives too.

The survival of the BPCIA is welcome news for biologics patient consumers as well, who hope to see lower prices in the near future on these important and typically costly drugs.  See Patent Docs blog, In the Pipeline, and Fierce Biotech.

Posted by Bruce Lehr Jun 30th 2012.

Berwick: Cost Effectiveness is Permanent Condition

Here is an Xconomy post from yesterday that highlights remarks made by Dr. Donald Berwick, the former administrator of the Center for Medicare and Medicaid Services.  He spoke last week in California at an invitation-only conference of healthcare executives and investors sponsored by the private equity firm Health Evolution Partners. He spoke about our health care system and health care reform. 

Dr. Berwick said that it would be a tragedy for America should the Supreme Court strike down the Obama Administration’s Affordable Care Act. Yet his primary theme was that it was getting very late in the game to slow the aggregate cost of health care as the baby boomers come into retirement. Citing his recent article in JAMA, Berwick noted that the sum of the lowest available estimates indicate that in excess of 20 percent of total health care expenditures is wasted. Berwick suspects we are really wasting one of every three dollars that we spend. This seems consistent with the oft-cited disparity between total US health care spending and outcomes in this country. 

The urgency of cost control is now such that, he said, there will be big reductions. The only question is whether we will do it in a good way or a bad way.  As to the future impact of all this on innovative life sciences companies, Berwick sounded an unmistakable warning. “If your products are expensive, it will be challenging; if yours is a firm focused on controlling costs, then your time has come.” In other words, biotech and medical device companies had better develop their case for cost effectiveness as their products enter into clinical development, because mere efficacy and safety may not get you paid in this brave new world.

What do you think his position would be relative to Abbott's strategy below to challenge the validity of biosimilars?

Posted by Bruce Lehr May 1st 2012.

 

 

Faster FDA Go Faster to Approve New Drugs

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.

Big Pharma Blocks Accelerated Approval Pathway?

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.

Biosimilars— Big Pharma Whistling Past Graveyards?

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.

Is it Safe to go FAST with Drug Approvals?

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.

GSK's Witty Fires Salvo at British Government Drug Policies

Among other things, GSK's CEO Andrew Witty says the British goverment is "systematically delaying" the introduction of new cancer drugs, making "false economies", not buying "the next round of innovation", treating drugs as a "simple procurement business" and in general lacking "any kind of strategic thoughtfulness."

Other than that, he thinks the Government is doing a great job in setting UK drug approval and reimbursement policy. He further implies if GSK keeps losing its abiilty to earn a better return that the UK ministers may face a choice between health budgets and drug industry employment. See PharmaGossip and Pharmalot blogs.

Posted by Bruce Lehr Feb 27th 2012.

Biosimilar Guidance Is A Pandora’s Box: Pan Explains

This is a really interesting short interview from Pharmalot with Jonathan Pan, a manager at the Scientia Advisors consulting firm on his view of what the FDA draft guidelines on biosimilars could mean.

Biosimilar Guidance Is A Pandora’s Box: Pan Explains // Pharmalot.

I excerpted a part I found very interesting concering how the FDA is [apparently] setting up to judge biosimilarity. And how this might open up opportuntities for pharma to get drugs to market as "biosimilars" instead of new entities.

Pharmalot: So was there anything surprising here?
Pan: The major surprise I see here is that FDA is creating a path of similarity versus a path of replication. Effectively, what they’re doing, because of the complex nature of these products, is they’re saying that, for any biologic agent, anybody can create a biosimilar, but that it may not be an identical product. At the end of the day, it’s creating a great way of making a ton of non-inferior products to a particular reference product.

Pharmalot: Aren’t they going go to go on a case-by-case, though?
Pan: Obviously, they leave that language open and, of course, no guidance from FDA is set in stone, but at the end of the day, it’s interesting how they worded this to mitigate the fact that compounds are very complex and because of that, there’s more opportunity for companies to move their products to market. I think if a drugmaker wanted to pursue a biosimilar path versus the new molecular entity, they make take the biosimilar path, because it’s a quicker route to market.

Look, take the rheumatoid arthritis market. If we have one anti-TNF inhibitor, all I have to do is show it’s equivalent to how one of them works… I just have to make a decision to make a biosimilar and go to FDA and say I’ll run a trial to show that it’s safe and my antibody is going to be non-inferior. The FDA, according to the guidance, would say the product is non-inferior and, therefore, it will be approved as a biosimilar.

That’s versus going through a Phase I trial and recruiting patients, and a Phase II trial and recruiting patients, and a Phase III showing superiority for standard of care… They won’t have to go through the regimented process. It’ll be more abridged. As long as they can show in standard pharmacokinetic and pharmacodynamics tests that the product is non-inferior to the reference products. They’ll be going head to head. They’ll still have to go through safety checks and efficacy checks through clinical development plan, but what most pharmaceutical companies do is cherry pick… in this process, they’ll simply try to compare to reference products.

Pharmalot: What, if anything do you see as potentially troubling?
Pan: There is a Pandora’s box here. If implemented in its current state, I imagine there will be some interesting maneuvering. If I’m a pharmaceutical company and any product is at Phase I, I may not want to go through the full development process and instead say that I have a biosimilar and get to market as fast as possible. It’s a new thought process pharma may or may not want to embrace. It’s good for the pharmaceutical industry as a whole because it allows them to get products on the market that may not get on there otherwise.

OK do we have a new way to get similar biologic products to a licensed drug to market?  Or do we have a way to get a new entity to market faster by calling it biosimilar?  Or do we have both?

Posted by Bruce Lehr Feb 10th 2012.

PhRMA backs FDA plans for biosimilar fees

 Biosimilars are coming! Biosimilars are coming! in the USA and the FDA is planning to seek pharma industry input to design a set of users fees to defray costs and help expedite review of these new class of medicines.

PhRMA backs FDA plans for biosimilar fees discussion.

PhRMA says it is on board with this proposal and is eager to provide input at the hearings.  It is also in favor of a "science-based, separately funded regulatory program for biosimilars that is supported by appropriate dollars and user fees."

We're getting closer all the time.  Now if the FDA can just issue their guidelines.

Posted by Bruce Lehr Dec 12th 2011

The Cost Of Treating Cancer Is ‘Unsustainable’

The crux of this one?  New cancer treatments cost too much, address too few patients and provide too little benefit (in terms of survival) to be sustainable in the future -- given the economic drag developing in the system.

The Cost Of Treating Cancer Is ‘Unsustainable’ // Pharmalot.

The Lancet Oncology says we need to wave a magic wand to create a radical shift in policy to stop tolerance of "unfairness in access to affordable cancer treatment" and to deliver "fair prices and real value from new technologies."

Oh! Is that all?

Posted by Bruce Lehr Sep 26th 2011.