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The Blog of Drug Discovery News

Did President Reagan suffer from Alzheimer’s disease while in office?

ddn has written countless stories about drug discovery and research efforts in the critical area of Alzheimer’s disease, and one area that researchers, clinics and drug manufacturers seem to be focusing on lately is pinpointing the onset of the debilitating disease. For example, in October, we reported on efforts by the Alzheimer’s Prevention Initiative (API) to test potential Alzheimer’s treatments and identify new biomarkers that could lead to earlier and more accurate diagnoses for Alzheimer’s patients. Researchers at the API told us that although there are many promising treatments being studied in Alzheimer’s symptomatic patients, by the time most people begin to show symptoms of the disease, it has already ravaged the brain, rendering these treatments ineffective.

This cold, hard reality has been making headlines lately with the release of a new book, “My Father at 100: A Memoir,” a close-up account of the life of President Ronald Reagan as seen through the eyes of his son, Ron Reagan. The book, which came out a few weeks shy of what would have been the former president’s 100th birthday on Feb. 6, is “an exploration of his character,” Ron Reagan says, but addresses the ongoing question of whether his father suffered with Alzheimer’s while in office.

President Reagan was diagnosed with Alzheimer’s in August 1994 at the age of 83, and he informed the nation about his diagnosis in a handwritten letter later that year. Although President Reagan’s White House doctors said they saw no evidence of Alzheimer’s while he was president, there was during his time in office widespread speculation that he demonstrated symptoms of mental degeneration. For example, former CBS White House correspondent Lesley Stahl wrote in her own memoir that at her final meeting with President Reagan in 1986, “Reagan didn’t seem to know who I was.” The president regained his alertness at the end of the meeting, Stahl wrote, adding, “I had come that close to reporting that Reagan was senile.”

Ron Reagan writes that that he noticed evidence of dementia as early as President Reagan’s first term. “I felt the first shivers of concern” during the 1984 reelection campaign, he writes, “that something beyond mellowing was affecting my father. My heart sank as he floundered his way through his responses. He looked tired and bewildered.” By 1986, President Reagan “had been alarmed to discover, while flying over the familiar canyons north of Los Angeles, that he could no longer summon their names,” his son writes.

Still, as he hits the press junket, Ron Reagan is careful to say that we cannot know for certain whether President Reagan exhibited signs of Alzheimer’s during his presidency. He also asserts that he believes if Reagan had gotten the diagnosis during his two terms, he would have stepped down.

In this video with TV personality Joy Behar, Ron Reagan clarifies his characterization of his father’s illness in his book.

“One can deduce that the disease must have been present, but I say specifically that I saw no dementia-like signs when he was in office,” he tells Behar. “Let’s recall that this was the oldest president ever elected (President Reagan was in his 70s). By the time he’s reaching his mid-70s, he’s losing his hearing, he’s been shot and nearly killed—which will take a little of the wind out of your sails—and of course I am worried about him all the time, because it’s a very tough job with a lot of stress. Every once in a while I would see—almost like when you are watching television, and it momentarily goes out of focus and snaps back. You think, ‘what did I just see?’ But I didn’t know what it was, I just knew I was concerned about him for all sorts of reasons. In retrospect, it’s possible that some of those early things were signs of Alzheimer’s, but I don’t know, and I can’t really make that claim.”

Some of the controversy, Ron Reagan tells Behar, may stem from “the confusion between Alzheimer’s the disease and dementia, which is a symptom of the disease—which usually arrives in the later stages.”

“Knowing what we know now about Alzheimer’s, that it’s a process that extends for years or even decades before symptoms arise, it’s kind of an academic question as to whether the disease was present when my father had” the debilitating disease, Ron Reagan says in this interview.

I think many of the researchers who read our publication would agree. What do you all think of Ron Reagan’s assertions? How does this “academic question” impact efforts to treat, manage or even reverse damage caused by Alzheimer’s?

January 27, 2011 Posted by | Academia & Non-Profit, Corporate, Labwork & Science | , , , , , , , , , | Leave a comment

Look out! The brand-name ground crumbles beneath you!

OK, how’s that for a dramatic headline? Perhaps somewhat more dramatic than the actual news from Datamonitor that inspired it, but I’m not above a little marketing.

Anyway, here’s the scoop from the folks at Datamonitor about the effect of brand erosion in the United States and elsewhere when products stumble (or are pushed) over the edge of the patent cliff, in their own words:

U.S. most susceptible to brand erosion post patent expiry

Small molecule brands in the US experience the greatest degree of brand erosion following patent expiry and exposure to direct generic competition, according to a new report from independent market analyst, Datamonitor.

Following the United States, brand erosion is next most severe in the United Kingdom, Germany and France, with brand erosion the lowest in Australia, Italy, Russia, Spain and Japan.

Brands tended not to experience generic erosion in China following patent expiry since they often face generic competition from the outset, and instead continue to grow both in terms of volume and value.

Maura Musciacco, healthcare analyst at Datamonitor comments: “Brands in the U.S., regarded as the most mature of all generics markets, experienced the greatest degree of brand erosion following patent expiry and exposure to direct generic competition. On average, sales and volume decline by 72% and 70%, respectively, after 6 months of generic competition.

“The key driver for the uptake of generics drugs is the cost-savings they bring, a quality that is undoubtedly even more in demand as the U.S. contemplates adoption of universal healthcare.”

Brand erosion was greater in terms of speed and severity in the hospital setting, most likely reflecting the greater brand loyalty among patients in the retail setting. While in terms of erosion by therapy areas, sales and volume erosion was the greatest among infectious disease, oncology, and cardiovascular small molecule brands.

“Pharma is facing slowing sales growth in the developed pharmaceutical markets, driven by increasing generic competition leading to sales erosion of branded small molecule drugs post patent expiry. However, the speed and severity of brand erosion is by no means equal across countries, prescribing setting, therapy area and formulation type; factors which are of key importance when managing and forecasting branded drug sales,” concludes Maura.

January 12, 2011 Posted by | Corporate | , , , , , | Leave a comment

Leaders, layoffs and losses

It’s been an interesting month in the pharmaceutical industry, with a few of the top pharma’s leaders leaving, more pink slips piling up and stocks morphing in the face of all of the change.

On Nov. 30, Merck & Co. Inc. announced its appointment of President Kenneth Frazier, who as Merck’s former chief counsel was instrumental in helping the pharma overcome its Vioxx litigation, as its new CEO. Frazier will succeed current CEO Richard Clark, who will reach Merck’s mandatory retirement age next year. Clark will continue as chairman of the board. Although analysts are optimistic that Frazier will see Merck through its next big challenge—the expiration of the Singulair patent, which accounts for 11 percent of the company’s sales—and continue Clark’s work on investing in the next generation of blockbusters, the announcement prompted a 4 percent drop in Merck’s shares to $34.64.

Recently retired Pfizer CEO Jeffrey Kindler speaks at the Reuters Health Summit in New York

Days later came the news that Pfizer Inc. Chairman and CEO Jeffrey Kindler abruptly announced his resignation after four years of leadership at the company. Although Kindler said he needed to “recharge my batteries,” analysts have speculated that he was forced out by a board and investors who are unhappy with Pfizer’s languishing stock price, late-stage clinical failures and a strategy emphasizing repeated acquisitions to boost revenue and cut costs as a way to improve the bottom line. The appointment of Ian Reid, Pfizer’s head of global pharmaceuticals, as Kindler’s replacement has also raised analyst concerns about Pfizer’s long-term performance and leadership. With Pfizer’s shares down 9.6 percent over the last year of Kindler’s tenure, shares rebounded on the resignation news, gaining 20 cents to $16.92.

With the holidays upon us, and many analysts taking a look at the highlights of 2010, layoffs are also making headlines. Fierce Pharma recently unveiled its annual top 10 layoffs list, highlighting the 10 largest job cut announcements by company. Counting the year’s total pink slips at more than 50,000 jobs, the list begins with AstraZeneca, which let 8,550 employees go this year, and counts job losses in the thousands at Pfizer, GlaxoSmithKline, Roche, Bayer, Abbott Labs, sanofi-aventis, Takeda, Novartis and Bristol Myers-Squibb. Given how often these companies made the front page of ddn this year with their merger and acquisition activity, these cuts are no surprise, as all of these transactions inevitably mean consolidation of resources.

With new leadership, more modest operations and the pressure of patent expirations, all of this should make for a very interesting 2011 in Big Pharma. As the Yieldpig blog notes, “with the dicey situation in Europe, stubborn domestic unemployment, a housing market that’s bottoming at best, and the great unknown of interest rates, equity portfolios should probably continue to play defense. Big, cheap, pharmas with sick dividend yields should help.”

December 10, 2010 Posted by | Corporate | , , , , , , , , , , , , , , | Leave a comment

Social butterflies

Corporations are sometimes a bit slow to pick up on technological trends, particularly when it comes to information technology. They might be somewhat behind the curve on their IT systems, and it is not uncommon for them to be really behind when it comes to an online presence. Even though so many have websites, many companies often don’t put much thought into how those site can help them and help clients, customers, partners and investors (or media, for that matter).

I’d say most of the Big Pharma and even mid-sized companies I’ve run across pretty much “get it” in terms of websites (and many smaller companies, too, though I’m shocked to find every few months a young biotech that seeks media and investor attention yet fails to have at least a rudimentary website). Well, aside from photos archives. As a member of the media, I urge more pharmas and biotechs to take good headshots, facility shots and candid shots of employees (lab workers, for example) and have them easily downloadable online in high-resolution formats. I’ll never understand why so many huge companies fail to offer that.

But I digress.

What I wanted to get at was the social media options, an area in which so many companies just miss the boat entirely, both inside and outside of pharma. With Twitter, Facebook and LinkedIn, just to name three biggies, there is no excuse for a company not to at least try to make good use of at least one, and ideally more than one. To not use social media in some way seems a sure way to show that you are behind the times. Blogs, too, are an important area to consider, either separate from or integrated into the company website.

Not everyone will use social media to the best of their potential, but then again, they don’t need to get it perfect. Not everyone nails it with marketing/advertising, employee communications, project management or public relations, either. We can’t all be good at everything.

But every company should be somewhere in terms of social media, and in that vein, I wanted to share a roundup with you of some “top 10” efforts by pharmas in the realm of social media posted on slideshare.net. It shows some notable example of what has been done by Johnson & Johnson, Glaxo-Smith-Kline, Bayer, sanofi-aventis, Novartis, AstraZeneca, Bristol-Myers Squibb, Roche, Pfizer  and Boehringer Ingelheim.

Sure, the original post was put up two years ago, but it still serves as a good example of what pharmas can do with social media, when they put their minds (and sometimes hearts) into the effort:

Click here to see the slideshow.

November 15, 2010 Posted by | Corporate | , , , , , , | Leave a comment

For stem cell case plaintiff, faith and science go hand-in-hand

Yesterday, we shared a Q&A with the lead plaintiffs in the controversial federal lawsuit challenging federal funding for embryonic stem cell (eSC) research, Dr. James L. Sherley, a biological engineer at Boston Biomedical Research Institute, and Dr. Theresa Deisher, research and development director at AVM Biotechnology LLC in Seattle.

Both researchers agreed to field questions about their beliefs regarding eSC research. Deisher, who has been especially vocal about her Catholic faith and how it informs her research, also agreed to take a few questions about the connection she sees between her beliefs and science.

According to Deisher’s bio, she has 17 years of experience in scientific and corporate leadership positions involving research, discovery, production and commercialization of human therapeutics. She obtained her Ph.D. in molecular and cellular physiology from Stanford University. Prior to founding AVM Biotechnology in 2007, Deisher held positions at Repligen Corp. in Cambridge, Mass., ZymoGenetics Inc., Immunex and Amgen in Seattle and CellCyte Genetics Corp. in Bellevue, Wash. She has had 23 patents issued and has published numerous scientific manuscripts.

ddn: Do you find any conflict between your faith and the scientific research you engage in?

Deisher: I do not find any conflict between my faith, which is Catholic, and my research. My faith enhances my work. My Christian faith calls me to focus on drugs and treatments that are affordable so that the greatest number of people will benefit. My faith calls me to use reason and the order of natural law to determine, for instance, the stem cell most optimal for clinical use. My faith calls me to focus only on those treatments that will be effective. My faith also calls me to respect the intrinsic dignity of human life in my work.

ddn: How does your faith impact your research approach?

Deisher: My faith is completely complementary to my research, which focuses currently on stem cells for regenerative medicine and alternative vaccines.

Adult “self” stem cells, meaning a patient’s own stem cells, are affordable, compared to all other stem cell therapies. For the most part, therapies using adult stem cells will cost about $25,000 compared to Geron’s projected $500,000 for embryonic stem cell-based therapies. Adult “self” stem cells are found naturally in every organ, in each of us, and they are “preprogrammed’” to perform the functional regeneration that patients require. They also lack the issues of immune rejection or tumor formation that plague pluripotent stem cells such as embryonic stem cells. Adult “self” stem cells are far advanced in clinical trials, and in comparison to “patented” stem cell lines, they show more effectiveness in patients. Whether one believes in God or Darwin, one can arrive at an optimal stem cell for patients using objective measures, common sense and business criteria to generate the greatest good for the most people.

I would apply these same criteria to any type of treatment that I would work on, including biologics and small molecules: Will the therapy be affordable, or will only the very few benefit? Will the therapy be effective or merely enhance my stock price or financing temporarily? Will the therapy be undermined by adverse side effects? These criteria are sound business objectives and compatible with my faith.

November 11, 2010 Posted by | Academia & Non-Profit, Corporate, Government, Labwork & Science, Uncategorized | , , , , , , , , , , , , | Leave a comment

Q+A with the stem cell case plaintiffs

On the cover of our November issue (which you can download here), you can read about a controversial lawsuit that is at the center of one of our nation’s hottest current debates: embryonic stem cell (eSC) research. (See the story here.)

The lawsuit, Sherley, et al., v. Sebelius, et al., alleges that the order signed by President Barack Obama in March 2009 lifting a previous ban on federal funding for eSC research violates the Dickey-Wicker amendment, a 1995 law prohibiting the government from appropriating funds for research that involves the creation or destruction of human embryos for research purposes. The lawsuit also contends that President Obama’s order has intensified competition for government research funds—which are already in short supply—for researchers engaged in other kinds of stem cell research.

The case has been making its way through the courts for a while, but it made headlines in August when the U.S. District Court for the District of Columbia issued a preliminary injunction in the case, essentially bringing funding for embryo-destructive research to a screeching halt while the case is under consideration.

With the research community in uproar over the decision, less than a month later, the U.S. Court of Appeals temporarily suspended the injunction, arguing that it would cause irreparable harm to researchers, taxpayers and scientific progress while the case is appealed.

While Sherley v. Sebelius concerns the interpretation of law and competitive issues, the case has renewed the debate over the practice of stem cell research in the United States, a political and moral tug-of-war that has been waged for decades.

The debate centers on the creation of a human embryonic stem cell (eSC) line, which requires the destruction of a human embryo. Advocates of the pro-life movement are concerned with the rights and status of an embryo as an early-aged human life and equate eSC research with murder. Those opposing this view argue that these embryos are to be destroyed or stored for long periods of time past their viable storage life, and point out that stem cell research has the potential to dramatically alter approaches to understanding and treating diseases, and to alleviate suffering.

Science holds pros and cons for both sides of the moral debate. Adult stem cell research has achieved great levels of success and potential, but these stem cells are generally limited to differentiating into different cell types of their tissue of origin. Although some researchers are of the opinion that the differentiation potential of eSCs is broader than most adult stem cells, they may be rejected by the immune system—a problem that would not occur if a patient received his or her own stem cells.

Dr. James Sherley

As the case continues to play out in court, media attention is turning to the lead plaintiffs in the case, Dr. James L. Sherley, a biological engineer at Boston Biomedical Research Institute, and Dr. Theresa Deisher, research and development director at AVM Biotechnology LLC in Seattle. Although the pair admit they did not know each other prior to the case unfolding—they were reportedly “recruited” by attorneys seeking to challenge President Obama’s order—they both have certain beliefs about the ethics involved in eSC research, and strongly support a focus on adult stem cells.

Sherley, whose research focuses on the molecular and biochemical mechanisms of adult stem cells, has long been vocal about his opposition to human eSC research. He has described the position that eSCs hold the promise to cure or treat debilitating diseases “misinformation,” maintaining that adult stem cell research is “a viable and vibrant path to new medical therapies.” Sherley also once made headlines for protesting a decision by the Massachusetts Institute of Technology (MIT) to deny him tenure by going on a 12-day hunger strike. Sherley, who is African-American, has also publicly said he believes that MIT did not give him the freedom to challenge scientific orthodoxy the way the institution would have for a white colleague.

Dr. Theresa Deisher

Deisher, who works exclusively with adult stem cells, founded AVM Biotechnology “in response to growing concerns about the need for safe, effective, affordable and ethical medicines and therapeutic treatments,” with help from private donors. According to the company’s website, “The use of aborted fetal tissue and embryonic cells in the discovery, development and production of vaccines and pharmaceuticals … make it difficult for many physicians, pharmacists, scientists and healthcare professionals to navigate their fields of expertise without sacrificing their consciences.” You can see some of Deisher’s writing on the subject here.

As media scrutiny has intensified in the wake of the case, Sherley and Deisher have backed away from many interviews, but were gracious enough to take questions from ddn regarding their views about eSC research. Here are their responses:

ddn: What should the goal of stem cell research be?

Sherley: Like other NIH-funded research, the goal should be to increase our scientific knowledge about the natural world through the conduct of ethical scientific research towards the goal of improving human health.

Deisher: The goal should be to develop safe, effective and affordable therapies for human disease, adhering to the highest scientific ethical standards.

ddn: Are you against embryonic stem cell research as a practice, or the federal funding of it, or both? Why?

Sherley: Specifically, I wish to educate and alert the public that, first and foremost, human embryonic stem cell research is unethical according to pre-existing NIH guidelines for human subjects research; that its funding by NIH is illegal according to U.S. law as articulated by the Dickey-Wicker amendment; and that it continues to be misrepresented by many of its proponents who misstate its potential for providing medical advances and present it as if there were no alternatives, when if fact both adult stem cell research and traditional disease research are not only effective alternatives, but better ones in many respects.

Deisher: Human embryonic stem cell research does not meet the high ethical standards test. A human being is necessarily destroyed in the process of obtaining human embryonic stem cells, which is not an acceptable outcome according to U.S. human subjects guidelines. Additionally, the research is not necessary, another requirement of our human subjects guidelines, as superior alternatives are available using adult stem cells. According to human subjects research guidelines, even if parents give consent, research cannot be done if it is not necessary. Human subjects guidelines should be applied to all research, regardless of funding source, and should be applied to regulate research on human embryos.

ddn: What are viable alternatives to embryonic stem cells? How soon will they bring about therapies? What is their commercial potential?

Sherley: The viable alternatives are both adult stem cell research and traditional disease research. In particular, adult stem cell research addresses the development of new therapies based on repairing tissues or replacing tissues with regenerative cells. Such therapies based on adult stem cells are already a part of standard clinical practice. Bone marrow reconstitution with blood stem cells is one of the best known examples, but there is a large body of clinical research underway both to make blood stem cell treatments even more effective and to develop new therapies based on other types of adult stem cells. This clinical research includes commercial development of therapies for diseases like diabetes based on developing adult stem cells that renew the cells that make insulin. It is important that the public understands that proposed treatments based on human embryonic stem cells invariably require that they be converted into either adult cells or adult stem cells, which are ultimately required for any therapy that will repair, replace, or treat tissues in children and adults. When the public knows this, it then becomes imperative for it to ask proponents of human embryonic stem cell research, “What is your motivation?”

Deisher: Adult stem cell therapies are in late-stage clinical trials, having advanced extremely rapidly since their discovery in the late 1990s, entering clinical trials by 2002.  Prior to the late 1990s, scientific dogma held that adult stem cells did not exist outside of the blood system. These novel discoveries have brought promise to many patients suffering from grievous illness; unfortunately, the United States lags behind the rest of the first world in advancing these therapies because our academic scientists and elected officials have preferentially advanced human embryonic stem cell research, which is currently helping no one. Other alternatives include therapies that block tissue destructive pathways. For instance, Enbrel is a drug for rheumatoid arthritis that blocks the joint destroying action of a molecule called TNF. Once the destructive pathway is blocked, naturally present regenerative processes are able to replace the damaged joints.

ddn: Describe some of your current work in this area.

Sherley: My laboratory’s research is focused on developing methods for production of adult stem cells, discovering biomarkers that can be used to quantify adult stem cells, and elucidating cellular mechanisms that are important for adult stem cell function, health and longevity.

Deisher: My research focuses on the efficient delivery and retention of stem cells in diseased organs.

ddn: What should the government’s role be in stem cell research being done in the United States?

Sherley: Through its agent the NIH, its role should be the same as for other areas of research: Adhering to U.S. law, foster and fund ethical, high-quality research that has potential to positively impact human health.

Deisher: (References the NIH’s mission statement, which states, “NIH’s mission is to seek fundamental knowledge about the nature and behavior of living systems and the application of that knowledge to enhance health, lengthen life and reduce the burdens of illness and disability. The goals of the agency are: To foster fundamental creative discoveries, innovative research strategies, and their applications as a basis for ultimately protecting and improving health; To develop, maintain and renew scientific human and physical resources that will ensure the nation’s capability to prevent disease; To expand the knowledge base in medical and associated sciences in order to enhance the nation’s economic well-being and ensure a continued high return on the public investment in research; and to exemplify and promote the highest level of scientific integrity, public accountability and social responsibility in the conduct of science.”)

Highlighted in red are NIH mandates that are not met by NIH funding of human embryonic stem cell research. The government’s role should be to actively promote research and clinical trials in areas that would not be adequately advanced by private industry. Adult stem cells from a patient’s own blood, bone marrow or other organs are not patentable, and therefore, absolutely require federal funding to bring these remarkable treatments to U.S. citizens. As taxpayer funds are used by the government for these purposes, one would hope that affordability would also be an important criterion for federal funding of clinical trials. Adult stem cell therapies are affordable, and will cost on average about $25,000, while embryonic stem cell therapies, if ever available, will be expensive and beyond the means of almost all U.S. taxpayers. Geron Corp. issued public statements in January 2009 estimating the cost of human embryonic stem cell-based therapies for spinal cord injury to be just under $500,000. Geron received significant NIH funding for this work.

ddn: How does the 2009 executive order from President Obama impact your access to research funds?

Sherley: Because the president’s order led to NIH instituting the illegal funding of human embryonic stem cell research, it injures all U.S. scientists working in other fields who compete for the same limited NIH resources. However, the greater injury is sustained by scientists whose research focuses on the recognized alternative to human embryonic stem cells, adult stem cells, because of the juxtaposition of all stem cell research applications in the NIH review process. At each phase of the NIH review process, bias and contempt, inspired by an illegal implementation of the president’s order, can occur against their research applications, even though they may be of the highest quality.

Deisher: The executive order initiated a process where preference in NIH requests for grant proposals and ultimate grant funding is now directed towards embryonic stem cell research. The 2009 executive order amplified congressional obsession with funding embryonic stem cell research, apparent since 2006. Every adult stem cell scientist and clinician is injured by the preferential emphasis and funding of embryonic stem cell research. Most egregiously, U.S. citizens are being denied adult stem cell therapies that are in development in Europe and other countries for heart attack, blindness, paralysis, stroke, diabetes, multiple sclerosis, lupus and other grievous human illness.

ddn: What can Americans do to get past the moral arguments in favor of or against embryonic stem cell research, in order to make sure that we are still working toward finding cures for devastating diseases and conditions?

Sherley: Americans would have no dilemma to ponder, if they were better informed that human embryonic stem cells have very little potential to lead to cures for devastating diseases and conditions. The No. 1 sales pitch pushed for these cells, the “ability to make any cell in the body,” is their fatal flaw for providing new medical therapies. For effective tissue and organ therapies, regenerative cells are needed that can continuously replace the mature cells found in just the sick or ailing tissue or organ. Human embryonic stem cells cannot do this. Adult stem cells can. Since human embryonic stem cells make other cells that are not needed, if they were used, they would give the patient another well-known, very difficult-to-treat disease.

Deisher: Science should never be above moral scrutiny and one only needs a brief history lesson to know this. On another note, I hear arguments regularly that we should not deter human embryonic stem cell research because of the moral objections of a minority. This is absurd, as our entire scientific research ethical oversight is predicated on respect for the moral objections of a minority in our country. Respect for animal rights and concern for ethical research conduct using animals in experiments regularly deters experiments that are scientifically and economically expedient. Respect for ethical concerns as they relate to human subjects research should receive no less deference. However, Americans do not need moral arguments to oppose embryonic stem cell research; embryonic stem cells are known to form tumors, they would require lifelong immune suppression that itself can cause hypertension, osteoporosis and other nasty side-effects, and human embryonic stem cell products would be too expensive for Americans to afford.

Deisher was also kind enough to field questions about how her Catholic faith informs her approach to stem cell research. We’ll bring you that Q&A very soon.

November 10, 2010 Posted by | Academia & Non-Profit, Government, Labwork & Science, Uncategorized | , , , , , , , , , , , , , | Leave a comment

Genzyme and sanofi continue on…and on…and

There is a good reason why professional arm wrestling isn’t a major television draw. For all the complaints of how boring baseball or golf is to watch, things do change and tides turn in dramatic fashion amid the slow portions. But watching two people with interlocked hands staring each other down while muscles bulge…until finally one opponent just loses the will or strength to continue?

No, not interesting to most people.

In many respects, the sanofi-aventis attempt to acquire Genzyme (whether by willing merger or takeover) is beginning to feel like arm wrestling. It’s only interesting if you’re one of the competitors. Or you have a bet placed.

So, in recent days, sanofi has once again invited Genzyme to come to the table and talk (see this story coming out of Boston, for example, or this one from the Wall Street Journal). Genzyme, in turn, has said “There’s not enough money on the table yet to convince us show up!” (I paraphrase wildly, of course). We’ve been held at a $69 per share offer so long, and the back-and-forth repetition from both sides as to why they won’t budge that…Zzzzzzz

Wha….! Huh?!!!!

Seriously, though, as repetitious as this is seeming, there are little gems of information and insight to be gleaned.

For one thing, despite inviting Genzyme to come back to the table after threatening to take them over, sanofi is still showing its assertive streak by warning the Cambridge, Mass.-based company not to turn to its state’s takeover protections and swallow the proverbial “poison pill” to fend off a hostile acquisition (see this Bloomberg story).

At one website where the latest overtures and refusals had been aired as news, a comment was posted that said, essentially: “Maybe it’s time for sanofi to walk away long enough for Genzyme’s shares to drop back into the 40s and then let Genzyme’s top brass explain the real value of their shares to the stockholders.”

I don’t know that I agree Genzyme isn’t worth more than $69 per share. Maybe it is, maybe it isn’t. But it is certain that the stock rose on the news of a sanofi merger (or takeover). The continued presence of sanofi as an eager suitor (or conqueror) doesn’t seem likely to drive down stock prices. One can only wonder whether with no rival suitors sanofi might be better off stepping away for a time. But then again, with the pressures Big Pharma is facing right now with patents expiring and pipelines being sluggish, perhaps sanofi can’t afford to do that.

It’s also worth putting the current situation into perspective relative to sanofi’s third-quarter earning report in late October. Commenting on those earnings, which were up 13 percent, analyst Simon King of Datamonitor wrote:

“Sanofi-Aventis’s increasing diversified business model is reaping rewards as growth across consumer, generic and vaccine divisions has helped to compensate for generic competition within the branded pharmaceutical segment. However, generic erosion continues to impact performance, driven in part by the somewhat unexpected approval of a generic Lovenox product. With Plavix sales also in decline due to loss of European patent exclusivity, Sanofi-Aventis’s anti-thrombotic empire is in collapse.

“These results occur against a backdrop of continued negotiation regarding Sanofi’s proposed acquisition of Genzyme. Sanofi has used its results announcement to launch its latest salvo towards Genzyme shareholders by suggesting that nothing has been said that will change its current offer. Genzyme though is now being very bullish in terms of sales forecasts – which will be heavily dependent on reversing the loss of sales to Shire in specialist markets and the success of Campath in multiple sclerosis.”

King notes that Genzyme’s stance could backfire, particularly if sanofi does decide to walk away and no other bidders emerge. However, he remains convinced that the Genzyme acquisition “fits the sanofi model.”

For now, it’s still an arm wrestling match. We’ll keep our eyes on it, and let you know who wins in the end…or if we get a draw.

(By the way, sanofi’s public announcement about the latest back and forth is here and Genzyme’s official take is here.)

November 9, 2010 Posted by | Corporate, M&A activity | , , , , , , | 1 Comment

Pink slips pile up in Big Pharma

We here at ddn are in the business of covering the business side of Big Pharma. But behind every headline touting million- or billion-dollar price tags for mergers, acquisitions and partnership deals, there are the untold stories of collateral damage.

Those stories are coming to the forefront lately as headlines are taking note of the number of pink slips piling up in the pharmaceutical and biotech industries.

According to the U.S. Bureau of Labor Statistics, unemployment in the United States was 9.6 percent in September. The unemployment rate has hovered around that figure for most of this year, but it’s about to gain a few percentage points, thanks to recently announced layoffs in Big Pharma.

According to PharmaManufacturing.com, the unemployment rate in pharmaceuticals and life sciences is estimated at 16 percent. Market research firm Reportlinker attributes pharma job losses to several factors. Besides the obvious ones—the economic downturn, the rising number of uninsured Americans and the impending 2011 patent cliff—the firm notes that action taken by the U.S. government as part of healthcare reform legislation will also impact Big Pharma.

“U.S. healthcare reform is set to improve coverage but this will be at the expense of containing healthcare costs,” Reportlinker says. “Although the pharma industry will benefit from the rise in insured individuals, measures such as the increased Medicaid drug rebate and Medicare donut hole discount will have an immediate negative impact on revenues out to 2014.”

Ed Silver, editor of Pharmalot, points out that these numbers may not tell the whole story, since not all job cuts are disclosed: “Some companies cut staff in dribs and drabs, and therefore are not required to file notices with their state governments. The implication is that job losses are greater than the survey implies.”

It can be argued that many of the layoffs are part of the life cycle of merger and acquisition activity. Consider the following:

  • Last year, Abbott Labs purchased Solvay’s drug business for $6.2 billion. Abbott is now cutting about 3,000 jobs in commercial, R&D, manufacturing and staff operations. The company will also close Solvay’s U.S. headquarters in Marietta, Ga.
  • Bristol-Myers Squibb Co., which recently acquired ZymoGenetics Inc. for about $885 million, plans to eliminate 3 percent of its headcount—or about 840 jobs—in the next few months.
  • After signing an agreement reportedly worth $1 million with the J. David Gladstone Institutes aimed at identifying treatments for multiple sclerosis, Alzheimer’s and other neurological diseases, Danish drugmaker H. Lundbeck A/S said it will cut 50 people from its R&D operations in the United States and Europe.
  • Just one month after agreeing to buy Penwest Pharmaceuticals for $144 million, Endo Pharmaceuticals is said to be in the process of laying off an unspecified number of sales managers and sales reps.
  • And most recently, sanofi-aventis—which in recent months has dominated our headlines with its many multimillion- and billion-dollar deals and plans to bring more companies into its fold—announced it will eliminate about 1,700 job in the United States, or about 25 percent of the company’s U.S. pharmaceutical operations division.

In announcing its recent agreement to acquire King Pharmaceuticals Inc., Pfizer Inc. focused on the “cost synergies” it expects to see from the $3.6 billion deal. According to Pfizer, it will take only three years for the dust to settle on the consolidation involved in the bolt-on acquisition. By then, it will have cleared a substantial patent expiration hurdle.

We’ll bring you the details of that acquisition in our November issue, but until then, what is your opinion of the mounting job losses we are seeing in Big Pharma?

October 15, 2010 Posted by | M&A activity | , , , , , | 1 Comment