At Jeffries 2014, Roche CFO calls for innovative access.
This year's program reflected trends in the industry: the ongoing popularity of mergers and acquisitions, particularly tax inversions, in which a U.S.-based company buys a firm outside of the U.S., moves headquarters to that country, and reaps the tax benefits. Many presentations emphasized oncology R&D, and breakthroughs in cancer treatment, some of which had been revealed the previous week at the ASCO meeting in Chicago. Treatments for neurological and psychiatric conditions were a secondary theme. Also notable was the move of some off-patent former name-brand blockbusters to over-the-counter approaches. This is happening with Nexium and corticosteroids, and is expected to happen with statins.
This writeup summarizes highlights from Monday, June 2, the first day of the meeting. One of the most interesting presentations was given by Alan Hippe, CFO of The Roche Group. He talked about Roche's focus on immuno-oncology, and recapped some of the breakthroughs that the company has made in cancer therapies, particularly in potential bladder cancer treatments. Along the way, Hippe mentioned the fact that the use of biomarkers and companion diagnostics is a key strategy. "The vast majority of compounds in our pipeline come with companion diagnostics," he said.
For years, we've heard about how expensive and unwieldy some personalized therapies can be. This conference offered a very different view, and a sign that personalized medicine is no longer the stuff of science fiction, but is even becoming, as some analysts commented "an efficiency play," at least on the clinical side.
Mr. Hippe also touched on the need to make drugs more affordable to more of the world's potential patients, an important message given continuing outcry, six months later, after Bayer's CEO's comments on pharma"developing drugs for rich westerners," and ongoing debate over Gilead's pricing for its Hepatitis C drug, Sovaldi.
Innovation not just for R&D, but access
As Hippe put it, "We want to be innovative with our pipeline but also innovative with access." Affordability will be especially important in emerging markets, he said. Hippe mentioned a patient assistance program that the company participates in, in China, where individual patients pay out of pocket for a few months of a year's treatment, the government pays for a few months, and the rest is donated by the manufacturer. Such models will be important, but challenging to run.
What is clear, he said, is that the industry is moving to "indication-based pricing" rather than the traditional "price per vial" approach.
Shire's CEO Flemming Ornskov, discussed the company's new emphasis on rare diseases and ongoing efforts in neuroscience. He projects that sales of SHP465 will double by 2020, and touched its potential for treating ADHD in adults.
On the pipeline, he mentioned that the company expects to submit an NDA for a "binge eating disorder" therapy during the second half of this year, and a treatment for "dry eye disease" is expected to be launched in 2016.
Shire's was one of very few to mention operational excellence, which takes the form of the company's "One Shire" program, which aims to improve R&D and manufacturing, and is expected to save $150 million in 2015.
Solving OTC Drug Supply Issues
Perrigo Co.'s CEO Joe Papa, whose tenure has reportedly seen the company's stock value increase by 800%, described a difficult second quarter. Despite one of the most challenging winters in recent history, he said that flu sales were weak, and due inventories down.
The company's flagship product, Mucinex, faced supply problems, with raw material suppliers failing to meet specs. Long term, Papa says, the company will refile product and will step up activities with existing raw material suppliers.
He also commented on the acquisition of Elan, including its MS treatment, Tysabri, and tax advantages, and mentioned the fact that the company's management is considering other potential targets in opthalmics and diabetes treatments.
Stryker Corp's VP of Strategy and IR, Katherine Owen, discussed news of its bid for Smith & Nephew, based in the UK and other projects in pharma and devices.
Alkermes' CFO Jim Frates described progress in the company's CNS drug pipeline, which he said that much of pharma had abandoned. Included are a treatment for schizophrenia and another for depression. Delivery-wise, the company is responding to a strong preference for long-acting injectables, he said.
Offering the contract service provider perspective, West Pharmaceutical Services' CEO Donald Morel discussed business trends. The company currently provides packaging and filling services for the top 35 injectable biologies, he said, and as the trend to patient auto-dosing continues.
West is focusing on dosing accuracy and ease of patient use, he said. However, West is also building its own portfolio of proprietary technologies, which is expected to grow in importance over the next few years, he said.
Some of the technologies that West now offers includes Mix2vial, and Crystal Zenith, an alternative to glass, designed for proteins that are sensitive to the effects of silicone oil tungsten or glue.
Edward Hu, COO and CFO of WuXi PharmaTech Inc, discussed the company's overall growth in both small molecules and biopharma.
The company is building a manufacturing center in Changzhu, due to start up in 2015 for small molecules, and is also building a materials characterization lab in St. Paul, MN, a high-potency API facility in Shanghai, and cell therapy manufacturing capacity in Philadelphia.
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|Date:||Jul 1, 2014|
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