Bienvenue

Generics outfit Sandoz has achieved another milestone with the approval of Omnitrope in Canada. On April 20th 2009, Health Canada granted a Notice of Compliance for Omnitrope, making it the first Subsequent Entry Biologic (SEB) to be approved for sale in Canada. For those unfamiliar with the lingo, SEB is the regulatory term used by Health Canada equivalent to "Biosimilars" in Europe or "Follow on Biologics" in the USA.

Omnitrope, a somatropin (rDNA origin) for injection, is approved for the long-term treatment of children with growth failure due to an inadequate secretion of endogenous growth hormone, and long-term replacement therapy in adults with growth hormone deficiency due to an underlying hypothalamic or pituitary disease or who were growth deficient during childhood. With this authorization, Omnitrope carries the reputation of becoming the first biogeneric product to be approved in Europe, USA & Canada. The market authorization was based on quality, non-clinical, and clinical information submitted. Details about the studies found here.

Whilst the debate over cost savings versus quality continues to intensify between regulatory bodies and law makers, it is encouraging to see products trickling through a system whose effectiveness cannot be evaluated unless it is put into practice. , the current system (however skeletal it may be) needs to be tested in order to:
1)Define the parameters of substitution of biosimilars for innovator products;

2)Determine the extent of pre-clinical studies & clinical trials required to demonstrate safety and comparability;

3)See whether true copies of biologics can be made despite the original products being covered by extensive trade secrets, patents and proprietary technologies;

4) Test the financial sustainability of biogeneric manufacturers. The development of each biogeneric product will be a lengthy, complex process, and is projected to cost about $200 million, compared to approximately $30 million for a traditional generic drug;

5) Quantify the extent of cost savings and the impact of competition on cost reduction;

6) Gauge consumer confidence and acceptance.

It is clear that regulations for biosimilars or follow-on biologics will be implemented in the near future. However, What remains to be seen is whether political pressure from influential groups and an extremely cautious approach on the part of the legislators can be balanced out to develop a functional pathway to approval.

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Innovation Update

A Boost for Protein Expression:

Invitrogen has launched its GIBCO®OptiCHO Protein Expression Kit - the first kit of its kind to provide cells banked under cGMP conditions, enabling biotherapeutics manufacturers to speed regulatory submissions and time to market. The cell line development kit will provide not only the cGMP parental cells but also the components and all the protocols needed to engineer and select producing clones in a completely serum-free system. Amongst other things, cGMP requirements for production cell lines derived from parental cells include source verification, testing, history, control over cell production documentation, and ability to demonstrate chain of custody for the cells from creation through use in biotherapeutic production. Costs for testing & project management to meet these GMP guidelines can range from $30K to $50K - a significant amount for research labs.

The real kicker in this story, however, is the potentially game changing move of providing a single-fee commercial license with no royalties. Taking into account that current procurement costs for a research or commercial use license have been reported to range from $7,000 to $50,000 per year for research use licenses, and up to $500,000 per year (plus royalties on the therapeutic product) for commercial use licenses, Invitrogen’s attempt at market penetration may have a big effect on the balance sheets of cash strapped start-ups. In addition to the cost savings on licenses, royalties, documentation, & regulatory activities the GIBCO kit may also reduce productivity problems. In order to improve biosafety & regulatory approval timeline, many researchers have been removing serum and products of animal origin from cell-culture media during production of therapeutic proteins from CHO cells & using plant hydrolysates as nutrients. The drawback of using plant hydrolysates is that they often contain undefined levels of nutrients and can result in lot-to-lot variation in fed-batch performance and purification inefficiency, which are disadvantages when consistent protein yields are required. To solve this problem, the new kit makes use of chemically defined feeds which apparently not only eliminates the variability associated with using plant hydrolysates, but could also improve the productivity of biopharmaceutical protein manufacture and help move therapeutic proteins into clinical trials more rapidly.

Efficient Eye-Screening:

Using a technology originally developed at the Department of Energy's Oak Ridge National Laboratory to understand semiconductor defects, people at risk of becoming blind can now be screened for eye diseases such as diabetic retinopathy and age-related macular degeneration. The technology involves taking pictures of the retina and relaying them back to a database for comparison. Comparison with thousands of images of known retinal diseases, will determine if the patient passes the screening or is in need of follow-up care.

Manufacturers of semiconductors have used this technology for over a decade, to rapidly scan hundreds of thousands of tiny semiconductors to learn quickly about problems in the manufacturing process. "Right now, with 21 million diabetics in the United States, we need to be screening 400,000 patients for diabetic eye disease every week. Less than half of these diabetics receive the recommended annual eye exam, which is absolutely essential to minimize serious eye complications and potential blindness." says Edward Chaum, who is leading the medical portion of the project. Utilizing an automated process of this kind has the potential to not only improve ophthalmic care in rural areas but also reduce the burden on outpatient clinics & primary care physician offices in urban centre’s. The goal is to have hundreds of cameras installed in the US and beyond, for early detection of disease in a cost effective manner.

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Pfizer-Wyeth: Why nobody wins

In an otherwise headline sluggish industry (lawsuits apart), the Pfizer-Wyeth deal certainly has lit up the newswires and sparked some much needed debate. The announcement of the $68 billion dollar deal was as much of a shock to some as it was the culmination of months of predictions for others in the industry. The merger is being touted as an “ideal marriage”, with the potential to save billions for both companies, as their most profitable products face patent expiration from 2011 onwards. They may have others buying into this hogwash, but I see this deal for being what it actually is – Twisted. The formation of Pfyeth benefits nobody- not the stockholders, not the employees, not consumer sentiment, definitely not drug development, and even misles the common tax-payer! Actually that is not completely true. It does benefit one person – Pfizer CEO Jeffrey Kindler. Kindler played his cards well and the announcement formed a welcome distraction from the news that Pfizer was also paying a $2.3 billion settlement to make the Department of Justice stop investigating the company’s illegal promotion of discontinued Cox-2 painkiller Bextra, and a 90% drop in income.

Kindler: "We're in a much better position to bring on board the scientists and programs and projects that Wyeth has"
The last couple of times Pfizer went appliance shopping, buying Warner –Lambert in 2000 and swallowing Pharmacia-Upjohn in 2003, it was faced with serious alignment and integration issues. Pfizer's "big corporation" image was at definite odds against Warner’s consumer health focus and there was a serious culture clash that was eventually only solved by new management. While corporate image may not be the issue at hand in this case, Pfizer thinks they can swiftly integrate an entirely new field of therapeutics! Wyeth alone with its expertise in biologics barely made it past facility inspections and product safety audits. One can only imagine the tensions in the hallways as Pfizer deploys its managers to oversee and “align” operations. Kindler mentions bringing aboard scientists, programs, and projects, he will also be bringing aboard the many lawsuits against Wyeth for the Hormone Replacement Therapy debacle.

Kindler: "In one single transaction, the combination with Wyeth advances every single one of (our) strategies,"
Really? Like the halving of stock dividend? Probably the only reason investors would consider having Pfizer stock in their nest egg post Lipitor. What about manufacturing capacity? Oh that’s right, you are shutting down 5 plants. Or maybe you are referring to sales? Together, the two companies will have 17 products with annual sales of $70 billion or more. Reasonable, but that’s only until 2012. This purchase is not transformational and as much as Pfizer would like to think that this will solve their pipeline problems, it is simply not acquiring a robust R&D model. As Derek Lowe of In the Pipeline fame says “as a research-driven company grows larger, everything scales except research productivity”.

Behind the Scenes
Despite all the above grievances with respect to this merger, there is one poorly publicized issue that troubles me the most. The deal is being financed by five banks: Bank of America Merrill Lynch, Barclays, Citigroup, Goldman Sachs and J.P. Morgan Chase. The billions that will be lent to Pfizer are coming from the Troubled Asset Relief Program (TARP) program- set up by the US government to purchase assets and equity from financial institutions in order to strengthen the financial sector. It is the largest component of the government's measures in 2008 to address the subprime financial crisis. That’s right. The money for this deal is coming from the American taxpayer! The money that will eventually be used to eliminate 20,000 jobs! So not only does Pfizer jip you on meds, but they take your money and punish you for helping? How is this right? Although meant to increase lending by banks, the only restrictions set on TARP money are that participating banks can't increase their dividends without Treasury's approval and must agree to certain limits on executive compensation. Few other strings are attached.

I am however hopeful. Hopeful that the Obama administration takes some steps in ensuring public rescue funds are used ethically, that the FTC investigates this deal closely, that Wyeth shareholders vote against this offer, and that the creation of Pfyeth does not send the industry into a desperate feeding frenzy.

UPDATE:
Pfizer currently has six Alzheimer drugs under development and one on the market, while Wyeth has four of Elan’s Alzheimer drugs and five Alzheimer drugs of its own in development. Pfizer will now control 16 Alzheimer drugs, which represents a majority of all Alzheimer drugs currently in clinical development and on the market, creating a virtual monopoly for itself.

If allowed to control all these drugs, Pfizer would undoubtedly be forced to determine which of these compounds would receive priority in clinical development and which would be slowed down. As a result, Pfizer will likely favor those drugs in which it holds a 100% interest. Ultimately, the biggest loser in this situation would be Alzheimer patients, along with their caregivers and physicians, who may have fewer treatment options available to them.

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