News on trends and issues in the biopharm and pharmaceutical industry. Commentary on current events,clinical pipelines, facility expansions, competition, technology, legal and economic matters. M&A and licensing activity across the globe.
I am a Director of Research and Devopment for a leading supplier to biopharmaceutical producers. The views expressed are mine. I do not speak for any company or corporation.
"A Man of true science uses but a few hard words, and those only when none other will answer his purposes; whereas the smatterer in science thinks that by mouthing hard words he proves that he understands hard things" -- Herman Melville
The ball started rolling with Valeant's and Activist Investor Bill Ackerman's (his given name, his parents call him A.I. ) now-hostile attempt to buy Allergan. Allergan is perfect for Valeant with its low investment cash cow Botox property. It is further stocked with low-hanging fruit for cost-cutting by having a substantial R&D effort. Again, perfect for Valeant's penchant of taking a knife to costs of acquired victims.
Allergan management is no doubt in panic mode now. They have two choices --- become part of Valeant or do ANYTHING else. In addition to enacting a posion pill to slow Valeant and A.I. down, they are beating the bushes for an acquisition or an acquirer.
On the acquisition front, they have made two now rebuffed offers to Shire. Shire being attractive as a growing provider of orphan drugs -- i.e. a comer with a future, and as a company located in a low rate tax haven. A purchase of Shire will allow Allergan to relocate its headquarters to the friendly confines of the Emerald Isle with its 12.5% rates (vs. 35% US rate). Unfortunately, Shire has a brand new CEO and he hasn't finished building his own legacy so Shire at the moment has spurned Allergan overtures.
Not to worry, Allergan can sell itself to the highest bidder (corporate prostitution?) -- as long as that company has no penchant for taking the long-knives to the R&D department or sales and marketing staff. Better to lose one's independence to a friendlier buyer. Thus we have today's rumors that Allergan is also shopping itself to the likes of Sanofi, J&J or even perhaps Bayer (if it can sell off its plastics division). Pharma companies being more used to carrying high costs of R&D and other overhead.
This must come as big news to Sanofi's CEO Chris Viehbacher as he is splashed all over the news today as marvelling at Pfizer's chutzpah in offering over $100 B to acquire AstraZeneca in the latest mega-megamerger proposal. Viehabacher at the same time says he is not interested in such transactions and you can count him (and Sanofi) out. He will stick with bolt-ons in emerging markets and in consumer healthcare -- does Allergan's Botox fit that description?
Pfizer for its part is said to be pressing ahead with a potential hostile takeover attempt with AZ. Analysts seem to agree that AZ --- on balance -- is a mediocre target for Pfizer. Except, that AZ does have some level of pipeline product complementariness and AZ is also attractive due to is location in a lower rate tax locale. There's that T Word again. It would likely serve Pfizer's purposes to have a UK address so it could repatriate some of its $70 B in foreign profits and maybe put it to good use. Though with its usual sterling lack of imagination, we have CEO Ian Read talking about stock buy backs and increased dividends. Yawn.
It used to be that companies went after one another to build something -- i.e. increase market share, acquire technology/IP, increase low cost of manufactuirng positions, etc. Now we have "tax rate arbitration" as the driving force behind some of the industry's biggest mergers? Yes, they help pay the bills in the short term. But what value is really created? Isn't this just another form of cost cutting? You are doing nothing to make your company inherently more competitive. That's sad.
What's sadder is the spectacle of governments competing against one another to give away the goodies to draw companies to their shores. Wonderful if you get one, until you learn that the same company who is going to snarf up all those tax breaks is also going to eliminate manufacturing and R&D jobs from your shores to "save costs". But don't worry. The shareholders may end up with $0.25 more/share in their dividend.
Ooooh! I was so close to making some posts on all the buy out, merger, and divestiture activity that was the biotech and pharma market yesterday! So close, yet so far as I was denied access to my blogging platform due to nefarious sources that were attacking the Typepad site and making my access impossible. The horrors. Fie! On those villains who temporarily shut down the free exchange of news and ideas. Likewise, three huzzahs for th ebrave men and women of typepad who battled against the evil cyborgs to restore order to the blogging universe and make this post possible again.
It's official (sort of), Teva is on the public's short list of companies that are likely to be acquired. Rumors to this effect have driven the laggard stock up by more than 10% in the past few days. This comes on the heels of its rival Actavis buying up Forest Labs and amongst murmuring that Valeant is in the market to buy more assets on its way to a hoped for $150 B market capitalization. This is heady stuff.
For now, all we can really say about Teva is that it has a new turnaround CEO, it's talked about cost cutting to boost profitability, and obviously there are those in the investment and analyst community who are looking for it to be sold. So will it? See Fierce Pharma.
Now that Actavis has hit the mark with its acquisition of Forest Labs, analysts have turned their attention to others in the generic space to see how they might respond. That means Mylan, Teva and Valeant come under more scrutiny -- and are subject to rumor.
Valeant in particular has a stated goal to grow from its current, roughly $49 B value, to a top 5 spot at $150 B or more in the next few years. It is known that Valeant has had Actavis in its sights in the recent past. Now, it might just wait for the Actavis-Forest deal to complete and then go after Actavis in its new bigger and better form? That's one scenorio. See Bloomberg.
Other analysts have a different scenario in mind. They say that Teva would make a much better target for Valeant's affection. Teva, at $39 B itself, would effectively double Valeant's size if it were to be acquired. Teva's biggest investor, Soros Fund Management, recently upped its holdings in the firm by 5.7 M shares at a cost $373 M. Teva hasn't been a particularly good performer in the past several years -- is Soros looking for a payout from a purchase of the company versus organic growth? That's a possibility isn't it? See Fierce Pharma.
Instead of Sanofi simply relying on Regeneron and its pipeline to provide the behemoth a source of new drugs through collaboration over the next several years, let's just say they will buy out Regeneron (similar to Genzyme deal) and see what happens? No reason to wait until the last minute. See Fierce Biotech,
Sorry, I've been distracted this week and haven't made even a single post. I did see a couple of items that are interesting to me though and I will be adding them to the blog today or tomorrow -- or heaven forbid even during the weekend. They may not be as timely or newsy as they should but will be documented for future reference here if you ever search the blog for past topics as I often do -- that's part of why I do this just to have a permanent record so to speak that I can search as needs be. Anyway I will try to get back to work.
I started doing this blog a little under 3 years ago. At that time, I mostly wanted to see what doing a blog was all about. I was curious if anyone would find anything I wrote interesting, and if so, if there were obvious topics that woud draw more interest than others. I don't know that I had any expectations for doing it a prolonged period of time. I don't know that I thought anyone would necessarily read it. To a large degree I was just writing for myself as a kind of experiment.
Well, here we are 3 years later and I still enjoy writing a bit most days. And it turns out that at least enough people choose to read some of the posts that I've now reached a point where I have more than 250,000 page views. I can't say I ever expected that would be possible. Certainly, there are many other blogs out there with hit rates and readership that are way higher -- 10-fold, 100-fold -- but I'm amazed to a degree that people bothered to look at that many pages. It would seem that at least some of the time there is content that is interesting to a persistent few. So I'm grateful to have that level of company -- and I guess I'll keep writing until I stop.
Don't know how I missed this post by Luke Timmerman yesterday, but he was highlighting an upcoming Xconomy sponsored conference called "Building Biotechs to Last". But the best part is that he used my home team Cardinals as the example for the principle -- which is basically having a sustainable model -- in the Cards case being able to constantly develop new talent and/or finding low priced players to augment the team. That way there never seem to be too many periods of drought where the team is not successful -- no matter which players are los to free agency, retirement or injury.
Of course, you know by now that the Cards were bested last night by the Boston Red Sox (congrats to Sox) -- but it was the Cards 4th appearance in the past 10 years -- winning twice -- and many of the other years were spiced with playoff appearances too. I'm sure "Building Biotechs to Last" will be a good conference -- but mainly this afords me the opportunity to plug the Cards (and their model) one last time this year. Thanks for an exciting season.
Here's the latest from Stewart Lyman from Xconomy. In today's piece, he discusses what BIg Pharma often says in their press releases and what that really should mean to us as readers of this tripe. Here goes without further commentary:
Says: "All forward looking statements are based on the company's current assumptions and expectations and involve risks, uncertainties and other important factors"
Means: "We don't know what will happen so don't sue us if the drug fails in the clinic"
Says: "We don't permit our reps to sell drugs via off-label promotion"
Means: "Dang, we got nailed." or "Off-label drug promotion is free speech and shall not be infringed"
Says: "Our drugs are made in the most modern, up-to-date facilities"
Means: "If this was public housing, people would accuse us of being slumlords"
Says: "We were forced to raise drug prices due to increased costs"
Means: "We hope nobody noticed that our price increase was seven times the rate of inflation"
Says: "These marketing problems were all in the past"
Means: "It'll be much harder to catch us in the future."
Says: "The FDA is just playing politics" or "the FDA didn't understand our data"
Means: "We were praying for a miracle approval" or "we know the drug doesn't work but needed time to inflate the stock price so we could exercise options"
Says: "The deal is worth $650M if the milestones are met"
Means: "We'll be lucky to meet one milestone at a fifth the value" or "Welcome to Fantasy Island"
Says: "Small gifts to doctors do not influence their prescribing patterns"
Means: "Do you think we'd waste the money if this didn't work?"
Says: "We neither admit or deny these charges"
Means: "We are as guilty as heck but will never say so publicly"
Says: "We don't think ghost writing is problematic"
Means: "Most of our publications are written by someone not listed on the paper"
Says: "Our stock buy-back program enhances the value of the company for our investors"
Means: "We have no innovative ideas on which to spend the money"
Says: "Any suggestion that we misled the public about the risks and benefits of our drug is a gross misrepresentation of the facts"
Means: "We made a boatload of money while turning a blind eye to the data"
A few of my own.
Says: "We recognize that access to healthcare is a major challenge in many countries"
Means: "We have no intention of lowering prices in developing nations"
Says: "We maintain our belief in the inventiveness of our product"
Means: "We evergreened the living crap out of it and got caught"
Says: "Intellectual property protection is an important aspect of ensuring that innovation is encouraged"
Means: "Protection of our intellectual property and revenue is important to earning my annual bonus"
Says: "We are currently reviewing the notice from the Patent Review Board and evaluating our options"
Means: "We're screwed"
Include more of your own in the comments section, if you so choose.
I just returned from an exciting trip to Atlanta to see the Final Four. Unfortunately, my Orangemen didn't win but all 3 games were very competitive, the people were nice, and I had a wonderful time. I even fit in a Braves-Cubs game on the off-day Sunday before seeing Sting and Dave Matthews. Really good stuff. Congratulations to Louisville.
Regardless, good season for the Cuse and Let's Go Orange!
I love baseball. The actual game really and discussions around it. I'm less into the statistics but they are a usual part of baseball discussions. I'm even less into sabermetrics though I do acknowledge they provide another interesting way to look at the stats of the game and do have merit in potential decision making in the game.
So I was really happy to see this morning's Xconomy post that compared evaluating baseball with the evaluating a drug development pipeline. I thought many of the analogis held up pretty well -- you'll have to read it and decide for yourself. But one thing is correct in my view, we should continue to strive to find the best metrics to look at the success of drug development and open our minds toward doing this and operating in a fashion different than our historic past. It is well pas that time.
Preheat oven to 400 degrees F. Lightly butter baking dish or dishes. This recipe will make enough for 10 1/2 cup ramekins.
Line a large, shallow baking sheet with aluminum foil. Place the bacon side-by-side on the baking pan. Bake in oven until crispy, about 20 minutes for thick-cut bacon. Remove from oven and place on several layers of paper towels to drain. (Do not turn off oven!) Chop bacon into smallish pieces and set aside.
Pour 8 cups of water into a 3-quart saucepot. Salt water according to macaroni package. Bring the salted water to a boil and carefully add the macaroni to the water. Cook only until macaroni is at a slightly firm al dente (approximately seven minutes, but depending on the quality of the macaroni, cooking times may vary). DO NOT over-cook the pasta. It is necessary for the macaroni to be a bit undercooked because it is going to absorb additional liquid from the sauce.
Drain cooked macaroni in a strainer/colander and rinse under cool water to stop the cooking process. Drain well, then set aside while the sauce is prepared.
In a 3-quart saucepot, add the half and half (it's ok to use the same saucepot the macaroni was cooked in). Whisk in the 2 tablespoons flour until smooth. Add the white truffle butter and the smoked paprika to the half and half mixture. Heat over medium or medium-low heat until hot and beginning to thicken, whisking constantly.
When the sauce is hot, stir in the cheese. Continue to stir until cheese is melted and sauce is smooth. Turn off heat. Reserve about 1/4 cup of the chopped bacon, set aside. Stir the remaining bacon into the sauce. Taste and add salt, if needed.
Fold the macaroni and the sauce together. Pour macaroni into the ramekins or casserole dish. To help catch potential spills, place baking dish or dishes on a baking pan. Top with reserved bacon.
Bake for approximately 10-20 minutes, depending on the size of the container, until hot and bubbly. Serve immediately.
Trenel Sanit-Veran 2010
Pale gold in color, this Saint-Veran offers up an intense and complex combination of white flowers, green apple, and ripe peach aromas. The palate is soft on the entry with lemony apple flavors and a clean, crisp finish.
Saint-Veran is an appellation of dry white wines produced in the southern half of the Maconnais sub-region of Burgundy. This clean and crisp 100% Chardonnay is a perfect compliment to the rich and creamy mac and cheese.
Recipe courtesy of Terri at That's Some Good Cookin' Blog.
Several commentators have recently mentioned all the new drugs with odd syllables and letter combinations -- often centering on the use of X's and Z's. This is supposedly due to these types of names being "memorable" for prescribing MDs and to the public -- and due to regulatory requirements that names not be "confusing" with those of other drugs.
Although this might sound sensible -- I think on closer inspection it may not be when you consider how some of these names can be confused with other similar more popular names. Zelboraf for instance, may be a drug, but is also a prison in Afghanistan. Xalkori? Best known as being the consort of Xena, Warrior Princess. Jakafi is of course a new blend at Starbucks, while Xeljanz is a popular flavor of Gelato.
I found this in Parade magazine and made it for my kids and me when they were visiting over Christmas break. It was delicious and we decided it was definitely "a keeper".
Cranberry Upside-Down Cake
1 1/2 cups fresh cranberries (I used canned whole because I had them)
2 Tbsp chopped walnuts
1 tsp grated orange rind
1/2 cup butter, softened and divided
1/2 cup packed brown sugar
2 Tbsp freshly squeezed orange juice (I used a blood orange that I had)
1/4 tsp cinnamon
1 1/2 cups all-purpose flour
1/2 tsp salt
1 tsp baking powder
1 cup granulated sugar
1 tsp vanilla extract (used some from Madagasscar that was on hand)
1/2 cup fat-free buttermilk (I used regular 2% milk)
For the glaze
1 cup confectioner's sugar
1 tsp melted butter
2 Tbsp freshly squeezed orange juice
How do we make this classic?
Preheat oven to 350 F. Coat a 9-inch square or a 9- or 10-inch round baking pan with cooking spray and dust with flour
Combine cranberries, walnuts and orange rind in a small bowl. In a saucepan, melt 2 Tbsp butter over medium. Stir in brown sugar, orange juice and cinnamon. Cook for 3 minutes, stirring constantly. Pour into your pan. Sprinkle cranberry mixture on top.
Whisk flour, salt and baking powder in a medium bowl.
In a large mixing bowl, with an electric mixer (I did by hand and it worked fine) set on medium, beat granulated sugar and remaining butter until creamy. Add vanilla, egg, buttermilk to the flour mixture. Spoon over the cranberries.
Bake 40 minutes or until a toothpick inserted in center of the cake comes out clean. Cool in pan for 5 minutes. Invert onto a (plate) on rack to finish cooling. Beat glaze ingredients. Drizzle over cake and serve.
It was very rich and sweet. But very good. Cranberries help temper sweetness of other ingredients. Serves 4-5.
Takeda has decided to become a global player in vaccines challenging some of the biggest names out there like Sanofi, Merck, GSK, Pfizer and Novartis. They've hired Tadataka Yamada, GSK's former R&D chairman to spearhead the effort. He previously also worked at the Bill Gates' foundation and gained a global view of the vaccine world in that position.
The strategy at Takeda's new unit is to advance vaccines that combat bugs for which there are no vaccines. Last month they bought LigoCyte ($60 M) and its lead vaccine aimed at treating norovirus gastroenteritis. Approximately 21 million Americans are afflicted by this disease annually and there is currently no vaccine. Takeda notes that vaccines take a long time to develop compared to many pharmaceuticals but have a higher rate of success than pharma products at each clinical stage. See Fierce Biotech.
The Bill & Melinda Gates Foundation made another equity investment ($13 M) in a startup biotech company, Visterra, aiming at a universal preventive as well as therapeutic approach to influenza. Much of that money is being earmarked to take the preclinical program for VIS410--a broad-spectrum antibody -- into the clinic in 2014. VIS410 has the potential to work against any strain of seasonal or pandemic influenza.
Visterra is taking a unique antibody approach to flu. Its scientists identified a networked cluster of amino acids on the hemagluttinin protein, which the flu virus uses to enter cells and infect the host. That target gives them a potential key to treating or preventing all flu strains, coming up with a drug that the virus won't be able to mutate away from--a key problem with today's vaccines. And Visterra emphasized that this antibody approach is not a vaccine. This is the type of novel appproach that the Gate's Foundation likes to fund. See Fierce Biotech.