Pullan Consulting
Biotech Business Development Consulting
www.pullanconsulting.com and www.lindapullan.com
email: lpullan@msn.com 805-558-0361
Issue #19
Pullan's Pieces
Commentary on Science & Business of Drug Development
For Business Development & Others
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Top biotech and pharma stories and trends of 2007
Looking back at 2007, my selection of some of the top trends and news in 2007 includes:
· Changes in US Patent rules and the definition of obviousness changes
In August, the US patent rules were changed to restrict the number of times patent applications can be re-evaluated and to limit the number of claims contained in any one application (as briefly discussed in Pullan’s Pieces #15). For a full review, check out the article in Bio-Pharma Partnering.
In April (discussed in Pullan’s Pieces #13), the Supreme Court decided (in the KSR and Teleflex case) that to be unobvious and therefore patentable, an invention must do more than combine predictable results of prior art; there must be an element of unpredictability.
· Deal values grow rapidly
Lehman’s analysis (discussed in Pullan’s Pieces #17) showed that total deal value grew by 45% annually from 2004 to 2007. The deal averages by stage of development were highlighted in Pullan’s Pieces #16.
· Layoffs in big pharma and big biotech
Restructuring after integrations of acquisitions, and the challenges of product stumbles contributed to a year of big layoffs. Pfizer, after the Phase III failure of trocetrapib, the replacement for Lipitor, announced 10,000 layoffs. AstraZeneca cut 7600, mainly in European sales and marketing organizations, after the MedImmune acquisition for proteins. Bayer cut 6100 jobs as it integrated Schering AG. J&J (5000 layoffs) and Amgen (2600 layoffs) were hit by the changes in reimbursement for anemia agents. Glaxo will cut 5000 over 4 years, after the bad news of diabetes drug Avadia’s cardiovascular risks. 4800 jobs, mostly in operations and manufacturing, will be lost at BMS. Novartis was the last to announce, with 2500 jobs to be cut; earnings estimates dropped after its diabetes drug Galvus showed liver enzyme elevations at the highest doses. (Thanks to the WSJ blog http://blogs.wsj.com/health/2007/12/11/health-blog-scorecard-drug-industry-layoffs/trackback/ and Fierce Biotech http://www.fiercebiotech.com/special-reports/top-5-layoffs-2007 ).
· India innovates
The movement of India’s generic companies into innovative therapeutics (highlighted in Pullan’s Pieces # 15) is part of the bigger trend of the rapidly developing economies of India and China. A nice review was recently published in Bio-Pharma Partnering by the EBD Group and Scrip.
· Cancer vaccines continue to struggle
Provenge, the prostate cancer vaccine from Dendreon, failed to get FDA approval this year (after a positive recommendation by the advisory committee as discussed in Pullan’s Pieces #10) but is conducting another trial. More recently, Genitope’s cancer vaccine for NHL failed to meet its primary endpoint in its Phase III trial (http://ir.genitope.com/phoenix.zhtml?c=142124&p=irol-newsArticle&ID=1089374&highlight= ). Favrille continues in its Phase III trial in NHL, with results expected in July 2008 (http://ir.favrille.com/phoenix.zhtml?c=178404&p=irol-newsArticle&ID=1084696&highlight=).
· Acquisitions instead of IPOs as exits for VCs
The poor returns on IPOs drive private companies to try to get acquired; the valuations are driven by pharma’s needs. Check out Recap’s presentation (http://www.recap.com/consulting.nsf/0/373942C1F40414E088257330006F97AE/$FILE/McCully_DDT%202007%20Final.pdf ).
· PDUFA renewal
In September, Congress passed the renewal of the PDUFA act, providing user fees to fund the FDA. New measures include a requirement for drug developers to publish all clinical trial results used for FDA approval, and giving the FDA the power to fine companies that do not conduct the post-approval studies mandated on approval. (http://www.clinicaltrialstoday.com/centerwatch_clinical_tria/2007/09/congress-passes.html )
· Increasing emphasis on safety at the FDA and CMS
The FDA has rejected or delayed approval of quite a number of drugs recently (Arcoxia, Acomplia, Pristiq, Vivian, bifeprunox, Trexina, Gepirone ER, Prexige, Galvus) and changed the labels on others (Aranesp, Epogen, Procrit, Zyprexa, Symbyax, Definity). The CMS, which decides on Medicare reimbursement, changed its coverage of anemia drugs based on the FDA safety concerns. http://www.morganlewis.com/pubs/Mahinka_SafetyConcernsAffectingFDA_Nov07.pdf
· A guarantee of efficacy for reimbursement for Velcade in the UK
In a precedent-setting move, J&J got reimbursement for Velcade in multiple myeloma by offering the UK’s National Health Service a money-back guarantee on the costs of Velcade for patients who respond only minimally or not at all (http://www.fiercepharma.com/story/uk-accepts-j-js-money-back-guarantee/2007-10-25 ).
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Wishing you all the best in 2008!
Linda
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Pullan Consulting
Linda M. Pullan, Ph.D.
Biotech Business Development
www.pullanconsulting.com and www.lindapullan.com
e-mail: lpullan@msn.com
805-558-0361
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