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Tag Archives: Pfizer

Biotech Trends Update — Biosimilars Blur IP Constituencies: Novartis and Pfizer-Biocon are Featured in the Economist

Two 9-figure announcements this week mark a turning point for the biosimilars market, and one highlights the increasingly important role India plays in innovation.

  1. Pfizer linked up with India’s Biocon in a deal that will see Biocon take the lead in development of four biosimilar insulin products that gives Biocon $200 million up front. Coverage of the deal in the Business Standard highlights the country’s overall strength in biosimilars, which fall midway between new molecule development and small molecule generics in terms of the R&D and manufacturing sophistication required. Biocon cites the deal as proof that India can move up the value chain, doing for biosimilars what it did for generics. This is especially true if they continue to attract backing and partnerships from the Pfizers of the world.
  2. Novartis’ generics unit, Sandoz, reported Q3 revenues of $292 million from a single biosimilar product — enoxaparin, a copy of Sanofi-Aventis’ anticoagulant Lovenox — which is not expected to hit blockbuster status in its own right. As we have noted before, the high level of expertise required to make biosimilars creates a high barrier to entry and contributes to the field’s attractiveness to traditional pharmas (e.g., Pfizer, above) as well as to the major generics players. FierceBiotech notes further growth is expected as the first biosimilar antibodies hit the market in 2014-2015.

The Economist picked up the relevant trends in an article today entitled “Attack of the Biosimilars“:

1) “Innovator” pharmas are moving into the biosimilars business, reversing their recent role as the predominant plaintiffs in IP litigation:

“…it is ironic that the next great opportunity for traditional drugs firms is to do to the biotechnology interlopers exactly what the generics firms have done to them: shred their profit margins with cheaper copies…”

2) India in moving up the innovation value chain, increasing that country’s incentive to protect IP more forcefully:

“And as if to remind the world that new ideas don’t all come from America, it is the Indian firm that will design and manufacture the original drugs; Pfizer will only market them.”

Bottom line: biosimilars are at least as big a business as predicted. This success is another challenge to the concept that pharma’s patent cliff challenge will be met by more in-licensing from small biotechs or by increased R&D spending. Revenue is revenue, and biosimilars are poised to generate lots more of it.

Patent Cliff Will Not Save Biotech: Abbott Buys Indian Generics Company Piramal Healthcare

I often hear how the upcoming loss of patent protection for current blockbusters creates an insatiable demand at pharma companies for new pipeline products from biotechs. Here’s an example from 2007. Here’s one from last week. This is not true. Upcoming loss of patent protection creates a insatiable demand for revenue, but new products are not the only source of new revenue.

Abbott’s $3.7 billion deal for a unit of India’s Piramal Healthcare last week is a perfect case in point. This deal, which follows Abbott’s license of a slew of products from Zydus Cadila, will feed the company’s new “established products division.” Abbott’s purchase of Solvay in February also built its emerging markets revenue, which now accounts for over 20% of the company’s business.

Abbott is far from alone: Sanofi is the biggest generics manufacturer in Latin America, Pfizer also has an established products division, Novartis is diversifying into eyecare and has long sold generics, Merck is into follow-on biologics and GSK tapped South Africa’s Aspen Pharma for emerging markets growth through branded generics. These alternatives look even better as payors worldwide are setting more demanding standards for reimbursement, the placebo effect is mysteriously strong, and personalized medicine makes clinical trials even more expensive.

My bottom line? Emerging markets and generics opportunities create plenty of growth, thank you very much, with a far lower risk profile than most product in-licenses or biotech acquisitions (even the option deals). As big pharma gets more comfortable with “established products” and biosimilars, biotechs are going to have to demonstrate even higher value. Plenty of companies are being built and funded with that in mind; but anyone counting on pharma’s desperation will be disappointed.

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Monday Biotech Deal Review: March 22, 2010

Bought deals are all the rage this week, with BioExx and Osta Biotechnologies both heading in that direction.  Also, everywhere we look, warrants are being exercised and debentures are being converted. We even noted the green shoots of a new Canadian listed biotech company poking through the ground via a CPC transaction.  Is there a Spring thaw in Canada’s biotech capital markets?  Read more of this post

Biotech Trends Update — IP Constituencies: Innovators and Generics Continue to Blur Pharma Lines

Two stories noted by the WSJ’s Health Blog highlight the trend we’ve been following of blurring lines between branded/innovator pharma and generics companies:

The biggest development I’d cite is Pfizer’s deal to sell 40 generics made by India’s Strides Arcolab and South Africa’s Aspen.  This deal seems to go a step farther than other innovator/branded deals with generics in that it treads on U.S. soil.  The Pfizer Established Products Business Unit has in-licensed more than 200 products and has an overall portfolio of approximately 600.

“Generics” companies are not sticking to their traditional role either.  Noting Teva’s projected growth and market cap, Jacob Goldstein says that “[i]t’s no longer correct to think of generics manufacturers as scrappy little competitors nipping at the heels of big pharma,” especially where 30% of their revenue comes from branded drugs. 

Add those to increasing innovation in India and China and in collaborations with companies there, and the whole global industry is starting to look a bit more homogeneous.

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Monday Biotech Deal Review: December 21, 2009

This week’s deal review shows no signs of a holiday showdown.  In Canada, BioMS’ deal with Spectral Diagnostics was interesting as a possible indicator of more to come and internationally, 5 new pharma deals were announced this morning including a $430 million deal that OncoGenex landed from Teva joining new links between Athersys and Pfizer, Lilly and Incyte, sanofi-aventis and Chattem and Seattle Genetics and GSK.  Check out the past week’s Canadian deal-making (and breaking) after the jump…

Novel Deal Structures Becoming More Common

Outside the BoxAt the RIC/OCETA talk I participated in last month, one of the trends in deal-making that I mentioned was novel structures.  At the time, examples included option deals and new ways to split rights and territories. 

More recently, we’ve seen GSK and Pfizer form a joint venture to develop HIV treatments, and two more interesting ideas came up this week:

  1. Index Ventures, a VC firm, is forming a joint venture with Amunix Inc., a biotech company.  The idea is, according to the WSJ Venture Capital Dispatch blog, to focus entirely on drug development, not research, and advance three candidates quickly through Phase I proof-of-concept.
  2. AstraZeneca and Merck are teaming up for what FierceBiotech calls an “unusual, early-stage clinical program” where each company is contributing an experimental cancer drug candidate that, in combination, should attack complementary pathways.  From the joint press release:

    Under the terms of the agreement, AstraZeneca and Merck will work together to evaluate co-administration of the compounds in a Phase I clinical trial for the treatment of solid cancer tumors. All development costs will be shared jointly. Following the Phase I trial, the companies will consider opportunities for further clinical development.

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IVB’s Great Take on the GSK-Pfizer HIV Joint Venture

The In Vivo Blog has a really interesting post by Roger Longman discussing what they view as the groundbreaking and innovative aspects of GSK and Pfizer’s HIV joint venture, announced just over a month ago

The gist is:

  1. The venture allows flexibility and accountability in an R&D operation with pharma-scale resources; and
  2. The JV has its own equity that it can use to reward employees directly and to raise new funds.

IVB’s bottom line: “whether it works or not, the drug industry should be paying close attention to this deal.” 

My bottom line:  I certainly hope it works, because it seems like it would be a bear to unwind.

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BIO 2009: Ontario Premier’s Breakfast

BIO 2009The speeches (s-peach-es?) just finished this morning at the Ontario Premier’s breakfast.

Minister of Research and Innovation John Wilkinson announced that Ontario has recently completed 2 new BIP investments:

Ontario’s Premier — Dalton McGuinty, winner of BIO’s second annual International Leadership Award — spoke next, highlighting the Ontario Innovation Agenda, including BIP, business tax reductions and recent funding in the Emerging Technologies Fund and the new $100 million for genomics research.

Dr. Nagy also spoke, emphasizing the $100 million of new funding and the value of a peer group of 95 P.I.’s in Ontario working on stem cells and regenerative medicine. Current work focuses on cell type switching without regression to pluripotency.

On to the omelet…

P.S.  First time here at the Cross-Border Biotech Blog?  Welcome! Check out who we are, check out our Trends in 2009 series, or hit the search and navigation tools on your right and see if you see anything interesting.

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Wednesday Brain Dump: Two of Everything! Edition

Two Camels!  Dolly the cloned sheep, meet Injaz the cloned camel.

Two R&D Heads!  The combined Pfizer-Wyeth will have Mikael Dolsten heading up the newly created BioTherapeutics Research Group and Martin Mackay heading up the small molecule PharmaTherapeutics Research Group.  (Two CapitalLetters!)  The In Vivo Blog has a podcast interviewing both.

Two VA Initiatives!  In addition to the electronic medical records initiative we mentioned earlier this week, the Department of Veterans Affairs is also setting up a large cohort genetic study that will establish a database of genetic information from patients that will be linked to the participants’ electronic health records.  This is great news for personalized medicine because it will ensure that the EHR standard that comes out of the VA project will accomodate and utilize individualized genotypic data.

Two R’s, Two L’s, Two B’s!  G. Steven Burrill (two r’s, two l’s, one b) says he’s confident he can raise $1 billion (there it is!) to develop the Pine Island biotechnology project and a private equity/venture capital fund, which will support development of new technologies out of the Mayo Clinic and the University of Minnesota, among others.

Two Guidance…s!  Health Canada issued a finalized version of a Guidance Document on data protection (only applicable to qualifying innovative drugs that received an NOC on or after June 17, 2006) AND a revised version of the draft Guidance Document on Subsequent Entry Biologics, (which includes a 6-year data protection period).  More to come on this.

Two Border Crossings!  Simponi, a biologic developed by Johnson & Johnson and Schering-Plough, crossed the border Northbound — gaining approval from Health Canada before the FDA; and Molecular Templates Inc. crossed the border Southbound — leaving Ontario for the Texas Life-Sciences Collaboration Center.

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Wednesday Brain Dump: Deal-O-Rama Edition

There’s still plenty of deal activity in the pharma and biotech sector this week, even outside Canada, so here’s a roundup of what’s done, what’s pending and what’s in the rumor mill:

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Trends Update: ChinaBio and Shantha Biotech

One of our Trends in 2009 posts last week talked about the increasing innovative activity in India and China and increasing generics activity among innovator pharma.  This week starts with a relevant update on each front:

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Wednesday Brain Dump: Around the World Edition

Trends in 2009: Shifting IP Constituencies as Innovator Pharma Buys Generics and Asia Turns to Innovation

Growing industrial and geopolitical realignment of economic interests has the potential to re-define intellectual property constituencies in 2009.

1.  Industrial realignment: the entry of innovator pharma companies into the generics business.

This year has already seen Merck get into follow-on biologics by buying Insimed and Pfizer build its generics business with its Aurobindo deal.  As traditional innovator pharma companies become more invested in follow-on biologics and small molecule generics, they will have a greater (self-)interest in a functioning subsequent entry pathway. 

Watch how this is playing out in the follow-on biologics arena as two competing FOB bills make their way through Congress.  Right now, the 12-year exclusivity period in the Eshoo-Barton FOB bill and the 5-year exclusivity period in Waxman’s FOB bill are duking it out, and we’re already seeing increased industry flexibility.  Innovator pharma has historically insisted on a 14-year exclusivity period to accompany follow-on biologics legislation, but BIO has already indicated some willingness to support Eshoo-Barton, as has PhRMA

Dani’s the expert, but my layman’s guess is that we get a FOB pathway this time around, and that the exclusivity number lands somewhere in the 8-10 year range.  This is consistent with a Teva-promoted analysis and it’s easy to see that it covers the arithmetic middle ground.

2.  Geopolitical realignment: increasing innovative activity in Asia, which has historically focused more on generics.

In China, a recent deal between Lotus Pharmaceuticals, Inc. (OTCBB: LTUS) and Beijing Yipuan Bio-Medical Technology Co., Ltd. (“Yipuan”) to acquire the drug Yipubishan points to China’s interest in promoting innovation.  Yipubishan, which is used to treat the symptoms of gastric ulcers and hemorrhages of the upper digestive tract, was partly funded through the use of grants from the Innovation Fund for Small – Medium Technology Based Firms of the Ministry of Science and Technology of the PRC.  Yipubishan became the first prescription drug of its kind developed in China to be included in the National Torch Project, which recognizes and promotes commercialization of high-tech discoveries and encourages companies to use high technology.  The Torch Project is one of a series of PRC Science and Technology initiatives.

In India, Wockhardt’s pioneering efforts in biotechnology are among many signs of increasing innovative activity, and have attracted interest from Pfizer and Sanofi.  Wockhardt has set up a global-scale biopharmaceuticals manufacturing powerhouse, the Wockhardt Biotech Park, in Aurangabad, India. This state-of-the-art complex comprises six dedicated, manufacturing facilities, and is designed according to US FDA and EMEA standards. It will also house new biotechnology products that are currently in various stages of development. The complex has the capacity to cater to 10-15% of global demand for major biopharmaceuticals.

India and China are in the 3rd quintile of countries in the 2009 IPRI Report, with India ranking 46/115 and China ranking 68/115 but they are steadily increasing their innovative activity. 

Within a short span, I would expect them to rank more like Israel, which has a world-class innovative industry as well as a strong generics industry (Teva), or Taiwan, which recently announced an initiative to boost cleantech and biotech.  Both Israel and Taiwan are ranked 29/115 in the 2009 IPRI Report. 

Wednesday Brain Dump: February 25, 2009

The question this week: a shot in the arm or a kick in the teeth?

A shot in the arm for:

  • Fewer shots in the arm! (har) 
    • British Columbia is the first jurisdiction in North America to offer a children’s vaccine called Infanrix-hexa™, which contains six immunizations in one, resulting in three fewer needles in the overall B.C. infant vaccine schedule, and
    • With the discovery of a constant region of flu virus protein hemagglutinin, a universal flu vaccine may be possible (no more yearly shots);
  • The Naval Surface Warfare Center in White Oak, a suburb of Washington, where the FDA is spending $1.15 billion to consolidate its offices and labs and to anchor a new biotech hub;
  • Pine Island, near Rochester, Minnesota, which could soon be the home to a new biotech research, development and manufacturing park with the help of up to $900 million in funding reportedly pledged by Steve Burrill.  Funding announcements also from Maryland and Pittsburgh;
  • Sustainable agriculture, when the White House announced its nominee for second-in-command at USDA: Kathleen Merrigan of Tufts University, who had been a top choice of the Cornucopia Institute to run USDA’s National Organic Program;
  • The National Science Foundation, from the stimulus (a $3 billion boost) and the budget (a 6.7% increase, to $6.49 billion);
  • Multiple Sclerosis, with Merck, Novartis, Teva, Biogen Idec and Sanofi Aventis all planning to release new oral therapeutics between now and 2012;
  • Conflict of interest disclosure, with a new editorial in PLoS Medicine;
  • Deterrence, with the arrest of four animal-rights extremists;
  • Organ failure biomarkers,
    • with the discovery of liver toxicity-associated MicroRNAs, and
    • with the injection by Pfizer Canada of $1 million to the PROOF Centre to fund research into vital organ failure biomarkers; and
  • Aliens.

A kick in the teeth for:

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Personalized Medicine: The “SNP Doctor”

BIO SmartBrief picked up a story today about a device being tested called the mohel Snip Doctor, a hand-held diagnostic device that:

looks for known single nucleotide polymorphisms (SNPs) – single letter changes in the genetic code – that can affect an individual’s response to medical treatment.

While most current approaches to personalized medicine are mechanistic (e.g., HercepTest), this device raises the possibility of a correlative approach.  Of course, it’s only a temporary measure to hold us over until our full genomes are a normal part of our electronic medical records.

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It’s Raining M&A: Update

Canadian developments first:

The committee is comprised of William Anderson, Robert Luba, James MacDonald and Gregory Spivy, each of whom is independent of management. James MacDonald will act as Chair of the committee. Goldman, Sachs & Co and RBC Capital Markets are assisting the Company and the Board of Directors as financial advisors.

More news on Pfizer-Wyeth, NitroMed, Sanofi, Crucell and Amylin after the jump…

It’s Raining M&A

Pfizer-Wyeth in Canada

Following today’s developments, some Canadian stats from the Pfizer Canada and Wyeth Canada web sites:

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