tl; dr July
This post is a new initiative, a try out if you will, which would lead to a regular monthly release summarizing the most important happenings (from my point of view) in the world of pharma.
Although summer is supposed to be a more relaxed season for most industries, surprisingly a lot has happened here, which I’m trying to give you a quick overview about. Just like in the case of my other posts it is largely mirroring my personal view of things, but as always I am curious what you think of the topic so do comment. This is a quick overview, but if I catch your attention you can find more detailed descriptions via the references.
#1 What else could it be other than Perrigo Co., the largest generic drug maker for U.S. retail chains (Walgreens and Wal-Mart) headquartered in Allegan, MI, acquiring Elan from Ireland for $8.6B. As growing its non-U.S. sales and because of the very attractive corporation taxing rate of Ireland (one of the smallest in Europe) this move would allow Perrigo to significantly cut its tax liabilities and should produce more than $150M annual net profit. We’re supposed to see this deal through by the end of 2013.
#2 The ongoing hassle around GSK’s Chinese operation deserves position #2 on the list. In brief, China’s Public Security Bureau has started an investigation on GSK’s sales practices with some serious allegations that the company has been paying Chinese doctors to prescribe its medicines to patients. As a result of the ongoing investigation so far 22 employees, including senior executives, have been arrested allegedly.[2,3] As the bribery investigation goes ahead, other international firms are getting into the focus as well. The whole industry is paying attention to the Chinese authorities now, who take this case very seriously to prevent such things from happening again.
#3 It is a slightly more delightful topic. It is becoming, I believe, a positive trend that drug companies form strategic alliances and high value collaborations with academia. AstraZeneca just signed a research deal with the University of Cambridge and the Cancer Research UK to accelerate the discovery and development of oncology drugs in 3 major projects. Forma Therapeutics also teamed up with Cancer Research Technology to develop tools, discover new drug candidates and technologies for cancer research. The fact behind this increasing trend is that company leaders recognized the possibilities lying in the untapped resources of non-profit organizations including multidisciplinary skills and well-funded research. Evotec is another good example here. They are also in the process of increasing the efficacy of their discovery research via teaming up with institutes, such as Harvard University and Belfer Institute for Applied Cancer Science. Although, in their case, it happens at the expense of closing down the company’s laboratories in Thane, India, announced earlier this month.
#4 I think the proposal draft made by the European Medicines Agency to make clinical trial data public deserves this noble place in my monthly list. Although the EMA’s aim was to “balance out the commitment to give widest possible access to data for independent scrutiny with the need to protect personal data as well as legitimate commercially confidential information”, the draft, and several European drug makers think this will jeopardize investments in discovery. The idea though is nothing new, not even in Europe and perfectly fits in the ambitious imagination of innovative thinkers to make all data public. GSK, for instance, has thousands of clinical trial summaries published on their website. Also Food & Drug Administration (FDA) in the U.S. is working on how to make these sorts of data available to the public. If it is done cleverly, always putting the protection of all personal data up front, this action would open tremendous scope for the future. I think we all are all interested in the conclusions of the 3 month consultation period which ends in September.
#5 Also in July there was a large investment made by Pfizer to increase its drug production capacity for both biological and small molecules at its two sites in Ireland. The company has invested $130 million into improving the sites, at Ringaskiddy and Grange Castle. however, and unfortunately for the country, no new pharma jobs are expected to come. With this move Ireland is becoming one of the most attractive destinations for pharma companies to invest. Is it because of the rich history, cultural diversity, maybe Guinness? Certainly these too can be important factors, but another side of the story is that the insanely low corporation taxing rate enables Ireland to attract so many international investments (“12.5% as opposed to the US rate of 35%”). Something similar happened to Perrigo Co, shown above (#1).
#6 I had to include this in the list as well because I think it is funny. The Food and Drug Administration (FDA) has announced a rule a couple weeks ago that bisphenol A (BPA) is to be banned from epoxy resins that coat infant formula cans. It’s all fine, finally, but what took them so long. Manufacturers, prompted by huge pressure from consumers long ago abandoned BPA for such uses, viz. exposure to BPA-based epoxy resins are believed to cause health problems including cancer. But the kicker is that the FDA still says BPA is safe to use in (not baby) food packaging.
#7 Dupont is considering reducing its assets in its industrial chemical business. Having lost the company’s automotive coating division in January this year they are divesting their performance chemicals division also, so that they can focus more on other segments of their business closer to home , such as agro and bio-based chemicals, seeds and advanced materials. Besides making the well-known brand materials, such as Teflon (coating), Nafion (membrane), Suva (refrigerant), the division under sale is also responsible for producing sulfuric acid and aniline, to name a few. It is going to be interesting to hear about the deal when it goes through, to say the least.
1) http://www.usatoday.com/story/money/business/2013/07/29/perrigo-to-buy-elan/2595385/ 2) http://www.guardian.co.uk/business/2013/jul/24/gsk-china-crisis-questions 3) http://www.theguardian.com/business/2013/jul/27/glaxosmithkline-china-scandal-18-arrested 4) http://www.reuters.com/article/2013/07/24/us-china-pharmaceutical-idUSBRE96N0EA20130724 5) http://www.bloomberg.com/news/2013-07-09/astrazeneca-signs-cambridge-based-cancer-research-deals.html 6) http://formatherapeutics.com/news_events/forma-therapeutics-and-cancer-research-technology-to-discover-cancer-drugs-targeting-deubiquitinating-enzymes-dubs/ 7) http://www.evotec.com/article/en/Press-releases/Evotec-to-realign-Discovery-Chemistry-Operations/2417 8) http://www.ema.europa.eu/ema/index.jsp?curl=pages/includes/document/document_detail.jsp?webContentId=WC500144730&mid=WC0b01ac058009a3dc 9) http://www.irishtimes.com/business/sectors/health-pharma/pfizer-to-invest-130m-in-two-irish-plants-1.1460313 10) http://cen.acs.org/articles/91/i29/FDA-Bans-Bisphenol-Infant-Formula.html 11) http://www.bloomberg.com/news/2013-07-23/dupont-exploring-options-for-its-performance-chemicals-segment.html