NGPEU 11 by GDS International

www.ngpharma.eu.com â&#x20AC;˘ Q1 2011

Why sailing into the eye of social media could prove pivotal for the future of the pharmaceutical industry

THE PERFECT STORM? TOP TRUMPS How Amgen has broken the mould to produce a new gold standard Final Cover.indd 1

HEADS UP Joe Jimenez opens the lid on the future of Novartis

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EDITORS NOTE 7

Push the button How the mineﬁeld that is social media could actually prove beneﬁcial for the world of pharma.

ith looming patent cliffs, drying pipelines and the need for open collaboration hot on the heels of the pharmaceutical industry, you could be excused for thinking that trying to set foot into the regulatory nightmare of social media would be, at best, adding fuel to the fi re. Indeed, the FDA and EMA have set down overly stringent and seemingly unfair regulations governing pharma activity in the world of binary that would suggest precisely that. But the message coming through loud and clear for the industry is thus: jump in at the deep end and fight every step of the way. In 2008, there were only two big pharma fi rms toying with social media – and they mainly focused on, rather uninspiringly, distributing press releases. Fast-forward to 2011 and, without fail, you’ll fi nd every discernable pharma firm with at least one finger in the social media pie. Unfortunately, mere presence isn’t enough. And, as this edition’s cover story shows – content truly does reign as king. Or, as our guest writer Phil Baumann puts it, the pharma industry is fighting with its “social media anxiety order – and it’s about time somebody assessed the proverbial patient”. After all, by immersing itself in the world of social media, it’s not just the industry that will benefit. Th ink of the immediacy of interaction with patients and customers, real-time customer service and unfettered access to social capital – let alone the potential to combine with person-

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alised healthcare and the emergence of tele-medicine. But this isn’t some attempt at white-washing the industry with ineffective technology and algorithms to catch up with the rest of the world – it’s about nurturing a fundamental understanding of the uses and implications of social media from the top down. In order for social media to open the door to success for the industry, its decision makers must first grasp the key to unlocking it. The arguments both for and against social media in the pharma industry almost always return full circle with little more than the conclusion of confusion. So, with this edition’s cover story, we’ve ensured that both sides of the coin are polished and ready to unveil the truth behind the arguments. Whatever the perspective, the real question will be whether the industry is prepared to put all it knows about risk into practice once more and sail into the eye of the social media storm.

“Don’t aim for marketing gold – you’ll not only miss the pot, you’ll ruin your reputation forever because the web is your last hope, even if it’s your biggest fear. It’s that simple. But like life itself, simple is rarely easy.” Phil Baumann, Board of Advisors for Mayo Clinic Centre for Social Media (Page 36)

Nick Pryke Editor

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CONTENTS 9

The eye of the social storm Nick Pryke takes a look at why sailing into the eye of the social media storm could be a recipe for success for the pharma industry.

Setting a new course NGP speaks to Joe Jimenez about life as CEO and his plans for the future of the Novartis

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Innovation and collaboration Ted Torphy examines the need for greater collaboration to boost innovation in R&D

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CONTENTS 11

Industry Insight

Sectional Features

44 George Henderson, Navigator Consulting 52 Steve Delity, Rapid Micro Biosystems 68 Rebecca Vangenechten and Sivarama Nalluri, Siemens 104 Guy-Charles Fanneau de la Horie, Neovacs 108 James Drinkwater, Bioquell

48 How much is enough? Lundbeck’s Jørn Mayntzhusen on the challenges of regulatory compliance and introducing Lean to the pharmaceutical supply chain

62 Supply chain analytics: pharma has to do better By Eugene Jones

92 Casting a wider net How Eli Lilly’s move towards a networking structure could serve them well at the innovation table

100 Open for business With open innovation and unblocking pipelines top of the agenda for the industry, NGP talks to two leading heads to find out their recipes for success

82 Facing the future How thinking ahead could pay dividends for a certain Swiss-based pharma firm

86 Adapt or perish What the pharmaceutical industry needs to do to avoid the fate of the dinosaurs, according to Les Hughes

Morna White, Quintiles

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114 The new gold standard Amgen unveils its newly approved breakthrough therapy for the prevention of skeletalrelated events

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Executive Interview

Details

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54 Joseph Sarret, Codexis 60 Raghunathan Ananthanarayan, Dr. Reddys 78 Ali. S. Faqi, MPI Research 110 Mike Butler, Xceleron 112 Leslie Morgan, Durbin PLC 120 Chris Nickum, IMS Management Consulting

Ask the Expert 66 Manfred Zurkirch, Dividella 90 Nico Scheer, Taconic

Next Big Thing 46 Mark Selker and Barb Paldus, Finesse Solutions, LLC 70 Martin Svantesson, Geodis Wilson 106 Mike Benevento, GE Healthcare

124 Travel: Las Vegas 126 Gadgets 128 Photo finish

Troubleshooter 76 Morna White, Quintiles 96 Jozsef Repasi, Ubichem

Project Focus 118 Gitte Nomanni Holm, MKS Umetrics AB

Roundtable 56 Surface technology, with Lester Mills of Bachem Holding AG and Jeffrey L Mooney of Corning Life Sciences 80 Trends in outsourcing support, with David Beyerlein of MicroConstants Inc. and Dominic Moore of Waters Corporation

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The NGP Europe Summit 5 – 7 April 2011 The Park Hotel Bremen, Germany The NGP Summit is a three-day critical information gathering of the most influential and important executives from across Europe. The NGP Summit is an opportunity to debate, benchmark and learn from other industry leaders.

A Controlled, Professional and Focused Environment It is a C-level event reserved for 100 participants that includes expert workshops, facilitated roundtables, peer-to-peer networking, and coordinated technology meetings.

A Proven Format This inspired and professional format has been used by over 100 executives as a rewarding platform for discussion and learning.

Next Generation Pharmaceutical Europe GDS Publishing, Queen Square House 18-21 Queen Square, Bristol, BS1 4NH Tel: +44 117 9214000 E-mail: info@gdsinternational.com Legal Information The advertising and articles appearing within this publication reﬂect the opinions and attitudes of their respective authors and not necessarily those of the publisher or editors. We are not to be held accountable for unsolicited manuscripts, transparencies or photographs. All material within this magazine is ©2011 NGP.

Chairman/Publisher Spencer Green Worldwide Sales Director Oliver Smart Finance Director Jamie Cantillon Content Director Kelly Grant Design Director James West Editor Nicholas Pryke Contributors Ian Clover, Lorna Davies, Lucy Douglas, Sharon Stephenson, Ben Thompson Print Director Andrew Hobson Associate Designers Dan Clayton, Élise Gilbert, Michael Hall, Crystal Mather, Cliff Newman, Catherine Wilson Online Editor Jana Grune Project Director Pramel Shah Sales Executives Nick Black, Nick Ancell, Nick Roberts, Vicki Pointer, Tom Craner Production Director Lauren Heal Production Coordinators Renata Okrajni, Aimee Whitehead VP North America Jason Green Operations Director Ben Kelly IT Director Karen Boparoy Marketing Director John Funnell

Subscription Enquiries +44 117 9214000, www.ngpharma.eu.com General Enquiries info@gdsinternational.com (Please put the magazine name in the subject line) Letters to the Editor letters@gdspublishing.com

Find Out More – Contact NGP +44 (0)117 921 4000

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GDS International GDS Publishing, Queen Square House 18-21 QueenSquare, Bristol, BS1 4NH Tel: +44 117 9214000 E-mail: info@gdsinternational.com

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THE BRIEF 17

G AKIN BRE the bad news

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THE BRIEF

9. Novartis Layoffs: 1400 After much concern that Novartis would release Roche-esque layoffs, the company ended the year announcing 1400 cuts from the sales department, all of which would be effective starting January 1 2010. The layoffs come primarily from the company’s General Medicines sales force, as it prepares for the effects of numerous patent expirations. Instead, the company will focus its sales efforts on specialty drugs, according to a statement. Novartis is still assessing its efﬁciency in sales, marketing and manufacturing, which could lead to more extensive job cuts in the coming years.

8. Takeda Layoffs: 1400 As Takeda prepares for diabetes drug Actos’ patent expiration, it announced 1400 jobs cut within the US. “The business environment for the pharmaceutical industry is changing dramatically,” the company says in a statement, “with the pharmaceutical industry as a whole facing barriers to technological innovation that have halted progress in breakthrough novel drugs, stricter approval processes for new drugs in advanced nations, and radical upheaval in healthcare systems.” The cuts came primarily from Takeda’s US headquarters in Deerﬁeld, IL and the Takeda Global Research and Development Center.

7. Sanofi-Aventis

Top 10 pharma layoffs of 2010 10. Bristol-Myers Squibb Layoffs: 840 After cutting out 7000 employees last year, BMS only just made this year’s cut with its September layoffs. The company continues to prepare for the Plavix patent cliff, as generic counterparts take over a larger portion of the market. BMS was posting higherthan-expected proﬁts when the layoffs occurred. But although the company’s other drugs, including the antipsychotic Abilify continue to do well, Plavix’s US$6.5 billion is hard to replace. As Edward Jones analyst Linda Bannister says, “With the patent cliff all these companies are facing, they need to reduce costs as quickly as possible to navigate what is going to be a very challenging couple of years for the industry.”

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Layoffs: 2500 The cuts included shuttering its Great Valley, PA facility and shaving 400 from its sales force, but the largest cuts came in October. The company cut out 25 percent of its Pharmaceutical Operations division, more sales reps and eliminated 300 more from its Bridgewater, NJ facility. “Given the serious challenges facing our organisation and the healthcare industry, it is important to act decisively now so that our organisation has greater stability moving forward and that our resources are allocated to our strategic growth priorities,” says Gregory Irace, CEO of Sanofi-Aventis US/ Canada Pharmaceutical Operations. Recently, sources told Pharmalot that Sanofi sales reps would find out their fate via conference calls: one for those retained and one for those laid off. According to the company, the latest layoffs will keep the sales force at a manageable size until 2013.

6. Abbott Labs Layoffs: 3000 After purchasing Solvay Pharmaceuticals, Abbott found the need to eliminate 3000 jobs, the largest layoff in the company’s history, with the majority of those hitting its European operations. “The restructuring will streamline our operations and improve efﬁciencies across the pharma business as we said we’d look to do at the time we announced the acquisition,”

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THE BRIEF

sales and marketing division. GSK believes the future is in emerging markets, particularly in Asia and South America, and is transferring much of its muster into those areas with numerous deals. But beyond layoffs, Witty looked at other failing strategies, including spending GBP£3 billion in nine years on research that found no new products.

2. Pfizer Abbott spokeswoman Melissa Brotz said to the Wall Street Journal. As part of the restructuring, Abbott closed Solvay’s Marietta, GA ofﬁces and cut staff from Hannover, Germany and Weesp, Netherlands. But the layoffs aren’t over; PharmaTimes expects more layoffs over the next two years as the company continues the Solvay integration.

5. Bayer Layoffs: 4500 Bayer’s layoffs came with the company’s new strategy to focus on emerging markets. While 4500 will lose their jobs, the company plans to create another 2500, particularly in Asia. Emerging markets have been a determining factor in many companies’ layoffs as they search for new lines of revenue in an increasingly difficult economy. For Bayer, it’s the price of doing business. “To finance the expansion of our growth activities,” CEO Marijn Dekkers said in the statement, “we therefore need to redirect resources, improve efficiencies and cut costs.”

4. Roche Layoffs: 4800 Roche came back in force, laying off 4800 workers in one fell swoop this November. Those cuts will take place over the next two years, along with another 800 transfers in-company and 700 to third parties. According to the company’s release, 2650 of those cuts will come from sales and marketing. The company cited taspoglutide’s poor results as one of the factors in the layoffs. “This is a comprehensive, focused initiative to reinforce Roche’s long-term innovation capability in the face of increased price pressures and a more challenging market environment. We will continue to drive our highly promising product pipeline to help seriously ill patients and contribute to more efﬁcient healthcare systems,” Roche CEO Severin Schwan said in a statement. The cuts should save Roche US$2.7 billion through 2012, and another US$2.4 billion after 2012.

Layoffs: 8480 Pfizer has dropped to number two with over 10,000 fewer job cuts announced this year. It announced the total 8480 layoffs in relatively smaller batches: 1080 in two January announcements, and 7400 in separate May releases. After merging with Wyeth, the company found redundancies as it accumulated Wyeth’s three dozen sites into the fold with its previous 40. “We have a complex network of manufacturing plants,” said President of Manufacturing Nat Ricciardi, “with excess capacity that is not good for costs.” And Pfizer found places to cut in New Jersey, Pennsylvania, New York, Puerto Rico, Ireland, the UK and Germany. The process isn’t nearly completed yet; the layoffs will take effect over the next five years.

1. AstraZeneca Layoffs: 8550 AstraZeneca started off the new year with 8000 job cuts announced on top of the 15,000 from 2009. The company wasn’t shy; it reduced staff in virtually every area of the company, from chain operation to R&D, sales, marketing and admin. And a month later, it cut another 550, shutting its doors in Wilmington, DE as well as UK and Swedish facilities. AstraZeneca has been cost cutting since 2007, originally planning on eliminating 7400 positions by 2013. Three years later and the total is up to 23,550. Source: fiercepharma.com

3. GlaxoSmithKline Layoffs: 5201 CEO Andrew Witty spent the year ﬁnding costsaving options for the company, including laying off workers in Europe and the US, including 700 from the

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HR 20

The human resource factor in process optimisation From experience, for many medium-sized companies, it is an enormous challenge to set up, coordinate and carry out process optimisation in a unified enterprise resource planning system. Some main aspects have potentially high risks in a company-wide process and data harmonisation together with the aligned ERP implementation. An underestimated or unrecognised risk leads to project delays, cost overruns and leaving compliance status.

irstly, absent business goals reduce the pressure to succeed and the readiness in the specialist departments to support the project. The consequences are that process and data harmonisation are pursued and driven by the IT department – not by the divisions. An institution is often missing that can reach company-wide decisions. In the areas of finance and controlling there are company-wide, valid guidelines and unified processes. All other business areas consist generally of their own processes, which are consistent only with their individual requirements. The identification and the resulting determination of the required changes are not possible, because the key users often do not have the required mandate within the organisation. Additionally, the personnel involvement within the project is considered a parttime job for these employees and the effort required completely

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underestimated. This results in neglect of daily work or expensive delays in the project. As a consequence, resource and time bottlenecks are ﬁrst recognised when they appear and the quality of the project results is not regularly checked and controlled. There is not a prescribed recipe for reducing risks, as the initial situation is different in each individual company. The risks can, however, be reduced, if they are recognised early and taken seriously by the responsible management. Fundamentally the installation of a continuous risk management in the project organisation is recommended and, for validated environment, a compulsory. In doing this, it is important that these projects are accompanied by a corresponding project management methodology, so that the risks’ recognised can be escalated and appropriate measures introduced. www.yaveon.com/en

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INTERNATIONAL NEWS

Prescription drugs switched In the US, up to 70 percent of prescription medicines are changed by health insurers in order to save money, a new survey has found. This is not a simple case of switching a brand-name drug for a generic, which is “a common and generally-accepted practice,” but of switching one brand-name drug for another simply because one drug is cheaper, says the Global Healthy Living Foundation (GHLF), a patient advocacy group which conducted the survey. “If the drugs are identical, physicians generally have no objection, the survey found, but national medical groups have said most drugs are not identical,” says GHLF executive director Louis Tharp. “Switching can cause adverse reactions and poor recovery rates,” he added. The survey also found instances of patients with chronic conditions who were responding well to a particular drug but relapsed after being switched to a cheaper drug. “When patients are switched so the health insurance company can save a few pennies and then the patient’s chronic condition worsens, not just the patient, but the entire economy suffers when these people miss work, are admitted to hospitals or can’t take care of their families,” said Tharp.

Deal or no deal There has been a major leap in the number of deals big pharma has made in the last year as drugmakers look to boost their pipelines and expand into other business areas, such as generics. The industry has had an active 2010, with a 20 percent increase in transactions concluded compared to last year according to figures released by MedTRACK, the biomedical database from Life Science Analytics. The latter’s president, Sarah Terry, noted that the huge surge in deals concluded this year has been driven by “continued backfilling of pipelines”, expansion into emerging markets and further diversification into generics and biologics. Unsurprisingly, Pfizer tops the list, with 51 deals as of October 2010, followed by Sanofi-Aventis (50), Novartis (49), Roche (46) and GlaxoSmithKline (44). In sixth place is Bayer with 31 deals, then comes Teva Pharmaceutical Industries (30), AstraZeneca (25) and Abbott Laboratories (20). In joint tenth, with 18 agreements, are Eli Lilly, Johnson & Johnson and Merck & Co.

Diabetes solution The Middle East and Northern Africa (MENA) region is facing one of the greatest healthcare challenges of our time: the diabetes pandemic. It is estimated that 26.6 million people in the region have diabetes and this number is set to double to 51.7 million by 2030. To help find solutions to this challenge, Novo Nordisk is sponsoring a Diabetes Leadership Forum on 12-13 December in Dubai. At the Forum, a group of over 600 regional and international experts and decision-makers from 22 countries and territories in the MENA region will participate. The aim of the Forum is that all participating nations will adopt the Dubai Diabetes Declaration, featuring countryspecific action plans designed to turn the trend in diabetes, which is imposing overwhelming demands on the region’s healthcare systems and financial burdens on its governments. Ultimately, the hope is to contribute to changing behaviours in the entire MENA region when dealing with diabetes.

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Asthma market growing India’s asthma drug market is set to grow from a value of US$246 million in 2009 to US$403 million in 2014, representing an annual growth rate of 10 percent, according to a new study. This increase will be fuelled by improved access to medical care, a growing drug-treated population and a rising number of higher-income, brand-conscious asthma patients demanding more efficacious agents, says the report, from research firm Decision Resources. Last month, the Indian Council of Medical Research (ICMR) reported that 13 million people in India over the age of 15 suffer from asthma, or around two percent of this total age group. Nearly 7 million of sufferers are men and just over six million women, while the worstaffected age group is the 15-35-year-olds, it added. Decision Resources analyst Manashi Sherawat points out that, at US$246 million, India’s asthma market is close to some European Union countries in dollar terms. “In 2009, multinational pharmaceutical companies accounted for five percent of total sales in the Indian asthma market and, while uptake of western-branded asthma drugs will increase by 2014, these drugs will face fierce competition from lessexpensive Indian brands and generics,” adds Sherawat.

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Sources: pharmatimes.com and worldpharmanews.com

New Zealand challenge New Zealand has issued a proposal to its trading partners which constitutes “a direct challenge to the monopoly interests of major pharmaceutical corporations,” says a leading advocacy group. In a paper presented at the fourth negotiating round of the Trans Pacific Partnership (TPP) free trade agreement (FTA) involving eight Asia-Pacific nations and the US, being held in Auckland, New Zealand, this week, New Zealand has urged caution in moving beyond the intellectual property (IP) standards required by the World Trade Organization (WTO) Trade Related Aspects of Intellectual Property (TRIPS) agreement. The confidential paper, which has been seen by the US advocacy group Public Citizen, warns that there is “a tendency towards overprotection of IP in all our societies, particularly in the areas of copyright and patents.” New Zealand proposes an alternative “TRIPs-aligned” structure, which would not require data exclusivity provisions, for example, but would focus on operational coherence and enforcement and capacity-building in developing countries.

INTERNATIONAL NEWS

Drug price cuts China announced that it has reduced the retail prices of 174 medicines produced by more than 60 drugmakers from December 12, in a move that it says will save consumers around 2 billion yuan a year. Drugmakers had been permitted higher prices for certain products before 2005 in order to encourage technological upgrades, but the costs of production have declined considerably in recent years as a result of such upgrades and market expansion, according to a statement issued by the National Development and Reform Commission (NDRC). Therefore, as part of ofﬁcial moves to curb healthcare spending, it has been decided to set lower caps for the maximum retail prices of these widely-used products, added the NDRC, which is China’s supreme economic planning body.

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APPOINTMENTS

Top appointments

Olivier Charmeil

Kevin Buchi

As Wayne Pisano retires from his position as Senior Vice President of Vaccines at Sanofi Pasteur, the vaccines division of sanofi-aventis, his successor Olivier Charmeil takes the reins. Charmeil joined Sanofi Pharma in 1994 as head of business development and has held a number of key positions since, including CFO Asia and CEO of the French affiliate, taking up his current role as SVP of Global Operations Asia/Pacific and Japan in February 2006. “Olivier’s wealth of experience in both commercial operations and business strategy combined with his expertise in emerging markets are core strengths required in the future development of the vaccines division,” says Christopher Viehbacher, CEO of sanofi-aventis. “I am confident that with Olivier’s track record, he will lead the division to further growth in the future.”

Frank Baldino Jr, chairman and CEO of Cephalon, is to remain on a medical leave of absence indeﬁnitely and will not resume his duties in 2010. In the absence of the CEO Kevin Buchi, Chief Operating Ofﬁcer at Cephalon, will perform Baldino’s day-today responsibilities.

Robert Ingram Robert Ingram will succeed Kyran McLaughlin as Chairman of the board of directors at Elan. The former CEO of Glaxo Wellcome starts in January 2011. Elan’s shareholders are hoping that the arrival of a veteran pharma executive will bring stability to the Irish drug group. Ingram is no stranger to tough corporate situations, overseeing turnaround and M&A deals in his previous roles at Merck and Glaxo.

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Christopher Viehbacher Christopher Viehbacher, CEO of sanoﬁ-aventis, is now Chairman of the Pharmaceutical Research and Manufacturers of America (PhRMA) board of directors. Viehbacher took the role following the resignation of Jeffrey Kindler. In assuming the chairmanship Viehbacher outlined priorities for the industry. “As an industry, we will continue putting patients ﬁrst by delivering innovative, difference-making medicines that address unmet medical needs. Given the increased prevalence and costs of chronic disease, our industry needs to work with other healthcare stakeholders to encourage the prevention and better management of chronic disease.”

David Weber Two-year old startup Otonomy has named David Weber as President, CEO and member of the board of directors, replacing Jay Lichter who will continue as a member of the board of directors. Weber was the founding CEO of MacuSight, a venture-backed startup in Union City, CA, developing treatments for ocular disorders, and he is a director at On Demand Therapeutics, a Menlo Park, CA, venture developing implantable drug delivery technology for use in ophthalmology.

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WikiLeaks releases list of pharma sites vital to US security

WikiLeaks founder Julian Assange

NEWS IN BRIEF

WikiLeaks has published a list of overseas biopharmaceutical facilities considered vital to US national security as part of its release of leaked diplomatic cables. The release lists overseas facilities whose loss would have a “debilitating impact” on US national security. Included on the list are biopharm production facilities, for products such as vaccines and insulin, located in Europe, Latin America, Australia and Canada. Publication of the list is among the most controversial aspects of the WikiLeaks release of leaked diplomatic cables. Malcolm Rifkind, former UK Foreign Secretary, said the leak is “bordering on criminal”, adding it contains “the kind of information terrorists are interested in knowing”. The leaked cable lists by geography overseas infrastructure the US considers vital to its security. This includes communication hubs, gas pipelines and mines, as well as biopharm sites manufacturing insulin, vaccines, anti-venoms and other products. Biopharm companies listed in the cable include: Baxter AG, GlaxoSmithKline, Novo Nordisk, Sanoﬁ-Aventis, Genzyme, Novartis, IDT Biologika, Vetter Pharma, Hoffman-La Roche, CSL Behring and Grifols.

EMA increases public access

Opportunities in Russia

COMPANY INDEX Q4 2010

As part of its response to increasing public demand for more openness and transparency, the European Medicines Agency (EMA) has published its new policy on access to documents related to medicines for human and veterinary use. The new policy will give wider access to documents held by the agency, while ensuring that personal data and commercial confidential information remain protected. It gives access to all business-related documents unless there is a need to respect arrangements with non-EU regulators or international organisations, or to protect the privacy and integrity of a natural or legal person. Documents submitted to the agency as part of a marketing authorisation application, such as clinical trial reports, can now also be released, provided the decision-making process for the application in question is finalised. Where only parts of a document contain information that cannot be disclosed, the agency will edit the document to protect personal data and commercial confidential information, and release the nonconfidential parts.

The Russian pharmaceutical market is one of the largest in the world, with total revenues of $15.3 billion in 2009, according to new analysis from m Frost & Sullivan. The Strategic Analysis of Russian Pharmaceutical Market estimates that revenues will reach $37.15 billion in 2016. “The Russian state’s policy of improving the demographic situation in the country and providing adequate healthcare services to its population is projected to be one of the main pillars for the expansion of the pharmaceutical market,” notes Frost & Sullivan Research Analyst Dominika Grzywinska. “Multiple initiatives undertaken by the government aim to enhance pharmaceutical provision in Russia. Through amending the law and declaring its support for the domestic industry, the Russian government appears to be a guarantor of pharmaceutical market growth.” As one example, the 2020 Pharmaceutical Development Programme (Pharma 2020) aims to strengthen the domestic manufacture of pharmaceuticals by madndating that by 2020, at least 50 5 per cent of pharmaceuticals (in value terms) circulated in Russia will be of domestic origin. c The research anticipates that the market will remain on a path of dynamic growth from 2010 to 2016. However, implementing legislative changes could slightly restrain the market’s development in the short term.

Accenture 62 Amgen 114 Bachem Holding AG 57, 59 Bioquell 108, 109 Bio Rad 15, 89 Brass and Ivory 32 Cellular Technologies 85, 117 Christian Burket 30 Codexis 54, 55 Colorcon 29 Corning Life Sciences 56, 57 Dividella 66, 67 Dr Reddys 60, 61, 75 Durbin PLC 99, 112, OBC Eli Lilly 32, 92 FDA 40 Finesee Solutions, LLC 46, 47 GE Healthcare 106, 107 Geodis Wilson 70, 71 Grace 2 Headshift.com 32 IMS Management Consulting 120 Johnson & Johnson 72 Kinomescan 64 Lundbeck 48 MKS Umetrics AB 8, 118 MPI Research 78, 79 Navigator Consulting 44, 45 Neovacs 104 NNIT 4 98 Novartis 32, 40 Nycomed 82 Pﬁzer 32 PRA 12, 39 Private Access 32 Quintiles 76, 77, IBC Rapid Micro Biosystem 6, 52, 53 Roche 32 Siemens 68, 69 Siena Biotech 100 Taconic 90, 91 UCB 100 Ubichem IFC, 96 Umetrics 8, 118 Waters 10, 80 Xceleron 110 Yaveon 20, 21

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Innovation inspiration With pipelines drying up and companies looking outside their traditional areas to conjure up new innovation ideas, NGP thought it would be a good idea to inspire you with some of the best innovations and inventions of the 20th century.

The pill

INNOVATIONS

Currently used by more than 100 million women worldwide, the combined oral contraceptive pill, or COCP, was originally approved for public use in 1957 by the Food and Drug Administration (FDA) under the name Envoid. Despite this approval, contraceptives were not available to married women until 1965 – with unmarried women having to wait a further seven years before they were able to use it – as the original Envoid had not been marketed as a contraceptive. Today’s standard dose ‘pill’ contains a third less estrogen than its rudimentary counterpart and has revolutionised choices for women worldwide.

The polio vaccine There are in fact two polio vaccines used ed throughout the world ld to combat poliovirus. The ﬁrst was announced to the world by Jonas Salk in 1955 and consisted of an injected dose of the dead poliovirus, followed closely by an oral vaccine tested by Albert Sabin and approved in 1962. The key to stamping out polio, as was realised soon after the vaccines were created, was to interrupt the person-to-person transmission of the virus through vaccination, as its chances of survival outside of non-primate environments was found to be remote. With the help of Salk and Sabin, poliovirus has been reduced from an estimated 350,000 cases worldwide in 1988 to roughly 1600 in 2007. Good job gentlemen.

E=mc2

Automated sequencing machine Perhaps one of the more difficult innovations to pin down in terms of credit, the first fully automated sequencing machine was produced by Applied Biosystems in 1987 in collaboration with Leroy Hood and Lloyd Smith – who had also pioneered the first semi-automated sequencing machine the previous year. For the first time ever, it allowed for DNA sequencing to be performed with both speed and accuracy on a commercial scale. scal Where a person could produce a finished sequence se of around 20,000 to 50,000 bases in roughly a year by hand, the new sequencing machines could reproduce the same results in a few hours – even the technique for sequencing stayed largely the same. It mapped the future for genome research and allowed scientists into a areas previously thought to be untouchable.

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If E is energy, m is mass and c is the speed of light in a vacuum – then Albert Einstein is a very clever man. And while he may not have been the first person to propose a mass – energy relationship, he was indeed the first scientist to interpret the mass – energy equivalence as a fundamental principle that follows from the symmetries of space and time. Essentially, the equation indicates that energy will always exhibit mass in whatever form the energy takes. Einstein proposed his equation in 1905, and modern theory theor holds true to the cause by stating tthat from this, neither mass nor e energy can be destroyed, only moved from one location to another. It has served the progression of countless theopro ries and provided practical applications that will continue pli to fuel the fires of innovation for years to come.

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The World Wide Web What has now become the standardised entrance portal into the alternate reality we call the internet, started life as a proposal by Sir Tim Berners Lee in 1989. A few years later, and with all the necessary programmes up to speed with Lee’s intentions, the World Wide Web was ﬂoated into the public domain in 1991. It is of interest to note here that while the terms World Wide Web and Internet are bandied around in everyday speech without much distinction, they are in fact completely separate in deﬁnition. The internet refers to a global system of interconnected computer networks, while the Web is an application that runs on the Internet. Remember that next time you’re rummaging through one of the 109.5 million currently operating websites.

Widely used in commercial circles, but perhaps best-known for its use by NASA’s aerogel is a manufactured material with several remarkable properties: most notably as a thermal insulator and as the world’s lowest bulk density material of any known porous solid. Born out of a bet between Samuel Kistler and Charles Learned in 1931 to see who could replace the liquid in ‘jellies’ with gas without causing shrinkage, aerogels today are used for a variety of appliacations throughout many industries. NASA, for example, uses aerogels to trap spacedust particles aboard the Stardust spacecraft and also as a thermal insulator for the Mars Rover and their spacesuits. The material is produced by extracting the liquid component of a gel through supercritical drying, allowing the liquid to be slowly drawn off without causing the solid matrix in the gel to collapse. Simple.

Bionic contacts Still in the development stage, the extremely sci-ﬁ ‘bionic contacts’ hope to provide a virtual display that could one day be used for any number of uses – from helping the visually impaired to working within the video game industry. The lenses require organic materials that are biologically safe, while the electronic circuits are built from a layer of metal a few nanometers thick and light-emitting diodes a third of a millimeter across. Babak Parviz, Assistant Professor of Electrical Engineering at the University of Washington, said: “Looking through a completed lens, you would see what the display is generating superimposed on the world outside.” Indeed, wireless communication, radio frequency power transmission and solar cells are all expected to be seen in future developments – quite literally.

INNOVATIONS

Aerogel

GPS Established in 1973 to overcome the limitations of previous navigation systems, the Global Positioning System (GPS) was created by the American Department of Defence. The system works through a space-based, global system of satellites that, provided there is an unobstructed line of sight to four or more GPS satellites, can transmit reliable time and location information in all weather conditions and at any time to a remote GPS device anywhere in the world. While the majority of us now use GPS in our cars to avoid having to wrestle with road maps, the original inspiration was – believe it or not – the Sputnik launch in 1957. A team of US scientists realised that the frequency of the signal being transmitted by Sputnik adhered to the Doppler effect, allowing them to pinpoint where the satellite was along its orbit by measuring the Doppler distortion. Makes pushing that button on your sat-nav seem that much easier.

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News in brief

NEWS IN BRIEF

IF SANOFI-AVENTIS manages to persuade Genzyme Corp to sell, at least the takeover will get the go-ahead from competition regulators in Europe. The French drugmaker has revealed that the European Commission has cleared its proposed acquisition of Genzyme unconditionally under the continent’s merger control rules. Sanoﬁ said it welcomes this decision, “which is a requisite step in satisfaction of the condition to the tender offer relating to antitrust approvals”. In addition, it says the deal does not raise concerns in the area of multiple sclerosis, “where both parties are developing treatments, and in all cases there will remain a sufﬁcient number of other credible competitors.”

MERCK BIOVENTURES, a unit of Merck & Co, is tapping into Parexel’s expertise in the biosimilars arena – entering into a strategic alliance with the contract research organisation to develop new candidates and speed their path to market. While the company were reluctant to go into speciﬁcs, under the terms disclosed, Parexel will provide Merck Bioventures with strategic access to its clinical development services for certain broad classes of biosimilars in various therapeutic areas, including exclusivity for some.

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1 HARVARD UNIVERSITY 2 CALIFORNIA INSTITUTE OF TECHNOLOGY 3 MASSACHUSETTS INSTITUTE OF TECHNOLOGY

THE UK DEPARTMENT OF HEALTH has pledged £750 million to shake up cancer services and secure earlier disgnosis rates in a move it hopes will save 5000 lives by 2015 and place England on a more level footing with many of its European peers. While aspects of the cancer plan – such as the £200 million a year Cancer Drugs Fund, which aims to improve access to novel therapies whether they have been approved by an NHS cost regulator or not – have trickled into the public domain over the last few months, there are new elements to the strategy which have, on the whole, been positively received.

US universities dominate an international league table of the best education institutions, accounting for 72 of the world’s 200 best universities. The Times Higher Education magazine’s table, based on a number of criteria including teaching, research and staff and student mix, has Harvard top.

4 STANFORD UNIVERSITY 5 PRINCETON UNIVERSITY 6= UNIVERSITY OF CAMBRIDGE 6= UNIVERSITY OF OXFORD ACCORDING TO IMS HEALTH, the value of the global pharma market is expected to grow by ﬁve to seven percent in 2011, to US$880 billion, compared with the four to ﬁve percent pace of 2010. The forecast, included in the latest release of IMS Market Prognosis, is the leading annual industry indicator of market dynamics and therapy performance. “While the overall market will appear to rebound somewhat in 2011, the underlying constraints to growth in developed markets are stronger than ever,” said IMS Senior VP, Murray Aitken.

8 UNIVERSITY OF CALIFORNIA, BERKELEY 9 IMPERIAL COLLEGE LONDON 10 YALE UNIVERSITY

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H Health at a Glance: Europe 2010: additional findings additio Life expectancy at birth in the EU increased from 72 years in 1980 80 to 78 years.

Heart disease is still of deaths in the ill the biggest cause o EU, accounting ng for 40% of all deaths.

Obesity growing in the EU

The he number of people aged over 65 is expected to double between 1995 19 and 2050, increasing the prevalence of dementia. de

Direct to Market with Direct Compression

n today’s environment, the pharmaceutical formulator is increasingly challenged to deliver innovative medicines faster in spite of shorter timelines, fewer resources and increasing quality demands. At the same time, ‘evergreening’ existing products by innovator companies has increased due to the patent cliff. Generic companies are also seeking to improve their position and expand indications. Drug delivery is playing a key role in meeting these challenges. Finding simpler ways to produce robust formulations such as use of fewer excipients and processing steps can reduce the number of variables, therefore reducing scale-up risk and development time. New presentations and/or new applications of existing products are therefore needed to reduce variability, improve quality and increase throughput. Using controlled release polymers that facilitate direct compression (DC) is an attractive proposition particularly for water sensitive actives.

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The shortage of doctors is a cause for concern in many European countries.

Health spending has risen in all EU member states to, on average, 8.3% of their GDP on health, up from 7.3% in 1998

Developing effective DC polymers requires balancing several, sometimes conflicting, features such as powder flow, compressibility, segregation, and controlled drug release. Present in 80 percent of new matrix formulations licensed by the FDA since 2007, hydroxypropyl methylcellulose (HPMC) shows poor flow and limits its use in DC applications, forcing manufactures to move to granulation operations. Previous solutions were co-formulated with other excipients or used novel materials which complicated, rather than simplified, development. METHOCELTM DC was recently launched as an alternative for DC applications using a trusted CR polymer and meeting the monograph requirements for HPMC 2208. Good flow and compressibility combine to provide controlled release equivalent to standard HPMC grades, and allow processes and development programmes to be significantly simplified. Conversion to METHOCEL DC for matrix formulations has high potential to reduce the development time and overall costs for the pharmaceutical formulator. METHOCEL is a trademark of the Dow Chemical Company.,

NEWS IN BRIEF

According to the ‘Health at a Glance: Europe 2010’ report published by the European Commission and the OECD, over half of the EU adult population is now overweight or obese. The rate of obesity has more than doubled over the past 20 years in most EU member states, with considerable implications for health systems and the wider economy. The report shows that prevalence of obesity alone ranges from less than 10 percent in Romania and Italy to over 20 percent in the UK, Ireland and Malta. On average, just over 15 percent of the EU adult population is obese. Children who are obese or overweight are more likely to suffer from poor health later in life, with a greater risk of developing heart disease, diabetes, some forms of cancer, arthritis, asthma, a reduced quality of life and even premature death. Currently, one in seven children in the EU are overweight or obese.

Authors: David Bain, General Manager – Formulation Technologies (Colorcon) and Tina Dasbach, Global Product Development Manager (Dow Wolf Cellulosics )

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13/01/2011 13:32

A cancer-beating alliance Why three of pharma’s biggest companies are heading to Asia to join forces for the greater good.

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NEWS IN BRIEF

his February was witness to three of pharma’s biggest players, Pfizer, Merck and Eli Lilly, as they collaborated to form the Asian Cancer Research Group, Inc. (ACRG). The fully independent, not-for-profit company was established to accelerate research and ultimately improve treatment for patients affected with the most commonly diagnosed cancers in Asia. With a growing trend in pre-competitive collaborations between pharmaceutical companies being noted in recent months, the ACRG’s formation is a prime example of how companies are combining their resources and expertise to rapidly increase their knowledge base of disease and diseases processes. The heart of the ACRG is to improve the available knowledge of cancers prevalent in Asia and to accelerate drug discovery efforts by freely sharing the resulting data with the scientific community. Gary Gilliland, SVP and Franchise Head for Oncology at Merck, confirmed: “Through its work and the subsequent sharing of information, the ACRG hopes to empower researchers, foster innovation and improve the prognosis and treatment of patients with cancer.” Initially, the ACRG will focus on the two most common cancers in Asia – lung and gastric cancers. As many as 40 percent of patients with lung cancer in Asia demonstrate a mutation known as an epidermal growth factor receptor, or EGFR, that seems to remain relatively uncommon in the Western population. However, while it’s clear that EGFR mutations are indeed a larger concern for Asian patients, it is of specific interest to note that they are not ‘rare’ in Western patients, and as such should be part of a paradigm shift to change the mentality and understanding of the patient pharmacogenomics in order for clinicians to be able to treat each patient appropriately based on their mutation status in both Eastern and Western populations. In addition, the mutation responds differently to certain types of agents, suggesting that an alternative approach is needed in developing treatments for certain patient populations. The flipside of the coin will see the ACRG dealing with gastric cancer, which has reached near epidemic proportions in China, Japan and Korea, making it the second

largest cause of cancer death worldwide, killing more than 630,000 patients per year – more people than all cancers combined in the US. Neil Gibson, Chief Scientific Officer of Pfizer’s Oncology Research Unit, stated: “Environmental and genetic factors are believed to underlie the dramatic differences in the molecular subtypes and incidence of cancer in Asia and other parts of the world. Although some progress has been achieved in the last few years in understanding and treating these cancers, they remain a huge unmet need and a disproportionate health burden to Asian patients.” Over the next two years, the three pharmaceutical giants have committed to create one of the most extensive pharmacogenomic cancer databases ever witnessed. It will be composed of data from approximately 2000 tissue samples from patients with lung and gastric cancers, which will be made publicly available to researchers and, over time, further populated with clinical data from analysis of patient data. It is hoped that conducting such comparisons of the contrasting genomic signatures of these cancers could inform new approaches to treatment that are sorely needed. In terms of dividing up responsibility, Eli Lilly has dedicated itself to taking on providing the data to the research public through an open-source concept managed by its Singapore research site, with all three companies throwing all they have in terms of technical and intellectual expertise into the project. Kerry Blanchard, VP and Leader of Drug Development in China for Eli Lilly, was extremely positive about the project, saying: “The ACRG is about sharing information for the common good. This company will aid researchers around the world to develop diagnostics, tailor current treatments and develop novel therapies to imGASTRIC prove outcomes for affected CANCER KILLS patients with lung, gastric and perhaps other forms of cancer.” A YEAR For the pharmaceutical industry and healthcare alike, the ACRG could `prove to be the ignition point in combating cancers in the Asia-Pacific region; WHO considering the current state of PREDICTS the pharmaceutical pipeline, it could also turn out to be some good reconnaissance for the DEATHS IN future of emerging markets 2030 within the industry.

630,000

12 MILLION

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COVER STORY

The eye of the social

As the social media revolution continues its surge of success in the realms of digital marketing and communications, Nick Pryke takes a look at why sailing into the eye of its storm could be the best tactic for the pharma industry.

here was a time when your identity was defi ned by little more than your physical actions and statements. First impressions, demeanour and social astuteness counted for everything in a world that functioned on varying levels of networking, trust and smoke screens. For the social chameleons of both business and pleasure, this meant unbounded opportunities to succeed in almost every context – and for the most part that’s exactly what they did. But then came the internet, and with it ventured the complexity of multiple identities. If you were character-savvy, the chances were you could slip under the radar of being caught out as a master of identity juggling; anything less and your online profi le was likely to be cast out and fed to the wolves of binary as a fake. Either way, the world of social media had arrived and brought with it a third dimension of social interaction. No longer did

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people need to leave their houses to speak to friends or peers; no more was your ‘real life’ considered as relevant in a world that functioned on a placebo of online associates helping you carve out who you always wanted to be. Companies could reach new audiences with such relentless immediacy and clarity that it was a wonder how they’d coped in the days pre-web. Fortunately for consumers and industries alike, social media has evolved exponentially since the beginning of its internet inception – and for all its subjective misgivings, it’s allowed the entire human spectrum to communicate on a level platform previously deemed unfathomable. From individuals to Fortune 500 companies, social media has enabled the world’s population to be heard en masse and on par, picking up armies of devout followers that can, quite literally, turn you from zero to hero in a matter of hours. Moreover, its levels of transparency have only served to

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storm

up the ante once again as the business world enters its age of new media and digital marketing. But for all those who have taken that step, many are left wondering why it’s taken pharma so long to grab onto the coattails of the phenomenon and join almost every other industry in the online revolution. Well, to put it simply, the pharma industry has – traditionally, at least – contained almost every attribute that goes against the grain of stepping foot into the world of social media. With extremely expensive sales and marketing departments, an intense regulatory environment and companies being overly protective of their intellectual property (IP), the notion that the industry should enter an arena that would perceivably only work to further complicate matters was deemed ridiculous – until now. In 2008, Novartis stood tall as the only Top 10 company flying the flag for the pharma industry in the world’s second largest social media site, Twitter. Fast forward to 2010 and, without fail, you’ll fi nd every one of the Top 10 on Twitter – from Pfi zer to Johnson & Johnson, Bayer to Merck – all have jumped on the bandwagon in an attempt to open up their online profi le to the watching world.

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Amongst them, Pfizer has ventured down the right avenue by teaming up with Private Access – a fi rm committed to developing platforms that permit internet searches for private information – to create their own social networking site intended to bring together patients and clinical trial researchers. Patients have the opportunity to confidentially post personal health information that will only be available to researchers studying their particular condition, in turn offering a reciprocal relationship in which tailored information is currency establishing deeper bonds. And with just over 10,500 followers currently on Twitter, Pfi zer seems to be leading the way. But it’s not just on Twitter that they’ve taken the lead, with Facebook, YouTube and LinkedIn all also getting the Pfi zer treatment. So good job well done then? Well, not quite. For the problem with Pfi zer – as well as the industry as a generalisation – is that whilst they have ticked the social media boxes in terms of presence, they still haven’t understood that in this new world of marketing and social representation, content is king. Indeed, instead of focusing on customer communications on the most basic of levels, many firms – including Pfi zer – use their new-found social

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COVER STORY

platforms for little more than distributing press releases; hardly the most innovative tool for securing better customer relations and inducing engaging debate. In fact, the only company that seems to have its fi nger on the Twitter pulse is Eli Lilly, who prides itself on “An official Twitter feed of Eli Lilly & Co.,” where “Any O’connor, Greg Lueterman and Rob Smith tweet on public policy, life at Lilly and corporate responsibility.” What Lilly has very astutely realised is that people make connections with people using social media – the company name remains more of a beacon to those looking for the mouth of that company. That’s not to say that the company doesn’t matter, as after all that’s the sole reason they’re online, but by putting people at the forefront of their Twitter feed, talking about what they and their company do in real time, they’ve successfully lifted the veil on a traditionally closed industry. Unfortunately for pharma firms worldwide, let alone in the European market, this is about the best they’ll get until the overly intense regulatory environment currently being employed loosens its grip around the industry. Anything above implementing staff to update fluff y pieces with PR-related statements is a serious no-go area, as bodies like the FDA and EMEA continue to patrol the hardest hurdle to social media implementation for pharma: Adverse Event (AE) reactions. Officially defi ned as “any adverse change in health or side effect that occurs in a person who participates in a clinical trial while the patient is receiving treatment, or within a pre-specified period of time after their treatment has been completed,” companies looking to sink their teeth into product-centric social media will have to contend with incessant reports back to the FDA and EMEA every time a self-identified patient tweets/ blogs/comments about an AE – even if the AE isn’t published online. In this context, pharma’s obligation to its regulatory bodies has, without doubt, stifled its progression into the nucleus of social media. In the ongoing debate about who owns what when it comes to information and the passing on of AEs in the online social realm, a patient – in discussing the merits of a recent and prominent case – put forward the main crux of the problem for pharma companies. He said: “As a patient, I can choose to disclose my medical records or history to anyone, essentially setting aside the HIPPA security rights that providers and payers must follow. Why can’t I similarly, as a patient, waive my right to have a pharma company comply with AE rules before posting to a public pharma sponsored social network? It surely still requires some judgement by patients to understand that wisdom of non-medical crowds gathering regarding pharma issues may be wrong more often than right.” And while in an ideal world, the above statement would reign true – the reality of the retort proves that it’s anything but. In essence, the problems stem from two overlapping areas. First off is understanding who owns the responsibility to report an AE. Any pharma company, in getting permission to market an Rx drug, incurs the responsibility to keep its information reasonably up to date. It therefore makes it irrelevant whether a patient wants to “waive” the responsibility to report an AE – as much as it would be beneficial for both patient and company alike. Thus, it’s understandably not best business practice to invite casual, anonymous complaints that will only lead to vast amounts of man-hours being spent on researching potential updates on a product gripe. The bottom line: the benefit of social media has to outweigh the expense. Conflating this is the bigger picture of marketing practices pertaining to labelling. Posts of comments in any blog or twitter feed that end up having a product mentioned or discussed causes that blog, or at least that post, to be a form of labelling for the product. And, as a form of labelling, it means that all content has to pass through a medical, legal and regulatory review before dissemination.

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Furthermore, promotional labelling and advertising must be submitted to the FDA and EMEA on a “2253 form…at the time of initial dissemination”. Th is requirement alone makes it nigh on impossible for companies to do any real-time social blogging relating to any of their products. As if that wasn’t already enough, pharma companies have to maintain processes to ensure that the content is submitted to the necessary regulatory body at least simultaneously with the posting, if not before. But it’s not just within the confi nes of regulation that pharma faces problems with its social media anxiety. In having to adhere to the FDA and EMEA, expectations have to be set with relative audiences that are sure to disappoint. Patients and readers will both want to engage in discussions – such as asking for medical advice or making outlandish statements about a product – that simply cannot be upheld in the context of a pharma blog or Twitter feed. Even if patients are considering doing something good for the product in question, such as submitting positive testaments on the product, the regulatory bodies could construe that as an unsubstantiated claim – resulting in a warning letter. Hardly an easy sail for pharma fi rms floating themselves out of port and into the open ocean that is social media. When it comes to the crunch, there’s no doubting that big pharma is attempting to break free from its regulatory shackles – ‘attempting’ being the operative word. For all that pharma is currently doing, there’s no doubt from both marketing and social media experts that the industry has only taken a few baby steps towards where it needs to be. Daniel Siddle, writing for headshift.com back in early 2010, said: “When the industry is still fearful of adverse event reporting, which should be a simple automated process, they’ll fi nd it very tough to deal with any of the much bigger issues: the breakdown of organisational silos to enable sales and marketing to be something the whole company can do; the decisions around intellectual property and what is more valuable inside the company versus outside; and how to deal with the privacy and protection of

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Setting standards Roche has recently upped the pharma social media standards by publishing its ‘7 Social Media Principles’ to all relevant employees. In doing so, it’s facilitated an environment in which employees explicitly understand the do’s and dont’s of social media, from both a professional and personal perspective. With such a simple yet effective framework in place to minimise risks for both the company and individuals, it’s surely only a matter of time before the rest of the industry follows suit. Seven rules for personal online activities speaking ‘about’ Roche: • Be conscious about mixing your personal and business lives • You are responsible for your actions • Follow the Roche Group Code of Conduct • Mind the global audience • Be careful if talking about Roche. Only share publicly available information • Be transparent about your afﬁliation with Roche and that opinions raised are your own • Be a “scout” for sentiment and critical issues.

their employees in the new era. These are all logarithmically more difficult to solve than AE reporting.” What Siddle highlights is the importance of looking beyond social media merely as a tool to boost product sales. Instead, view it as a forum to interact, for the fi rst time, with patients and end-users. Use it as a free marketing tool. Employ it to do the groundwork in fi nding out how products are really being received. Whether it’s brand sponsored or not, build a patient community. Build a healthcare community. Go viral and intrigue a new generation of consumers. The possibilities outside the realms of regulatory burden are practically endless. Whatever the end goal, one thing is certain: a one-size-fits-all approach is not the answer the industry is looking for. Lisa Emrich, from the well-respected Multiple Sclerosis (MS) blog site Brass and Ivory, describes the MS social media community as: “…Like blood cells which flow through the human body. If we all congregated around one hand within the body…the rest of the body would die. And if we isolate ourselves and never venture back to the lungs where we fi nd personal nourishment and rest, we would individually die off. Although my travels online may never take me to the left foot, I am comforted to know that others feed that community and it thrives.” While to some this may seem like an overly self-indulgent and unnecessary metaphor, Brass’ underlying message reigns true for all healthcare social media and networking initiatives: depending on the communities being engaged, activities could be welcomed or rejected by the communities “anti-bodies”. Thus, the industry as a whole has to be very clear which parts of the ‘body’ it wants to engage with, how it should engage with them and on which topics. But for all the inherent risks needing to be taken, having a social network that functions as a real-time, open network will serve to expand and integrate the social media approach that the industry has been yearning for.

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Seven rules for professional online activities speaking ‘on behalf of’ Roche: • Follow the Roche Group Code of Conduct and Communications Policy • Follow approval processes for publications and communication • Mind copyrights and give credit to the owners • Use special care if talking about Roche products or ﬁnancial data • Identify yourself as a representative of Roche • Monitor your relevant social media channels • Know and follow Record Management Practices Source: Roche

And, in relation to the groundwork that has already been done by the industry, social media is revealing some interesting truths to pharma companies both already involved and waiting in the proverbial wings. For starters, process designs need to be radically reviewed and rebuilt as traditional communications continue to lose their value. Secondly, social media and networking sites have proven time and time again that people are far more willing to share their stories now than they were a decade ago. Finally, and perhaps most glaringly obvious, – regulatory promulgations need a complete overhaul to allow companies to begin ticking the above boxes. In spite of all the realities of today’s communicative mediums, it’s more important than ever for pharmaceutical organisations to develop their internal framework if they are to become remarkable externally. Having better ways for life scientists, biologists, nurses, doctors and engineers to network and research will go a long way in creating the pipelines of products needed to sustain the industry. The social media storm has been brewing on the horizon for a while now, and for the pharma industry sailing around it isn’t an option. The only way to fully understand how important social media is for the industry is to sail directly into the eye of its storm. Only then will potential routes towards a safe harbour for the industry be realised and mapped out accordingly. That is, after all, what makes the best captains.

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COVER STORY

Social media W anxiety order Phil Baumann outlines why the pharma industry needs to submerge itself into the binary world of social media.

ith a multitude of industry-altering challenges already in the pipeline, pharmaceutical companies also now have to contend with breaking the world of social media. Phil Baumann outlines how – and why – companies should be doing precisely that. There’s been an ongoing discussion about how the life sciences industry can face and integrate recently evolving media, which the web has been and continues to sprout. Remarkable as they are, the discussions are endless and most loop back into themselves without generating sufficient voltage to power an army of macrophages. Pharmaceutical companies, beset by a myriad of constraints, are anxious about flipping on social connection switches which the web furiously creates every day. We could say that pharma has a ‘social media anxiety disorder’. The question is – how can it be remedied? The answer isn’t in social media. It’s not in what the US-focused FDA or its European equivalent decides to do. It’s not in echo chambers found within Twitter, blogs or conferences. It lies in simple, basic economic truths. It lies in radical acceptance and in brave recreation. It lies beneath the proverbial nose of obviousness. It lies far beyond any discussion about the meanings, promises and purposes of new media on the web. Pharma’s social media anxiety disorder is merely a peripheral symptom of deeper pathologies – so it’s about time someone assessed the patient.

Deep concerns and peripheral risks Social media is nothing – an oxymoron at best: media are simply media, incapable of being at all social. People are social. Information isn’t social either – but it is everything. With that in mind, it’s important to talk about information and why it matters to the life sciences’ media challenges and wider business fundamentals. Nobody doubts that the ultimate concern surrounding the development, production and marketing of molecules and medical devices is their safety, efficacy and effectiveness. From production and marketing to administration and application, every step of the way involves risks. Tiny flaws in R&D methodologies; overlooked nuances of human physiological processes; genetic mechanisms and anatomical structures; manufacturing and engineering oversights; misinforming marketing messages (unintended or otherwise); and administration error (provider or patient related) all contribute to this cauldron of risk. At the core of all these risks lies information, which is the coherence of relevant data that helps to make decisions in light of risks. Any information indicating danger during any point of the entire pipeline can retard or terminate production, marketing or dispensation of a product. Furthermore, the media through which information conveys its meaning determines its interpretation. Therefore, any discussion concerning the proper delivery of product information must base itself upon the most complete understanding of media possible. Few media are alike in properties, possibilities, limits and pliancy of re-purposing. Not all media can be used for the same purposes as other

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media. Twitter may help Dunkin’ Donuts move sales, but that doesn’t mean it will work for the world of pharma. The order of complexity that arises out of the tasks involved in creating and cultivating safe and engaging environments for patients, doctors, pharmacists, employees and all other publics grows with every added layer of interaction. It’s one thing to say ‘let’s start a blog, tweet like sparrows, set up Facebook pages and create forums’. It’s quite another to do so remarkably without addressing both the deeper nuances of human communication, social interaction, individual psychological responses and their peripheral risks. It sounds hopeless – in fact it’s anxiety provoking. But it isn’t hopeless and it doesn’t need to be an unstoppable source of anxiety. But the reality is this: life sciences has far too many variables and concerns to tie together to ever completely satisfy everyone and everything when it comes to social media – certainly not right out of the gate. The enterprise considerations alone are almost impossibly daunting.

Natural versus unhealthy rates of return Let’s take a quick pan-back for a moment from social media to mention something about capitalism and economic fundamentals, as it’s the central economic context in which modern pharmaceutical marketing arose. An inquiry into the economic ramifications of a fast-changing world must be the foundation for any exploration into the role of media. And this will lead us to why simplicity is pharma’s best prospect for long-term viability. Bear with me on this excursion. Why? Because if there’s no industry, who cares about social media? The rates of return for the pharmaceutical industry over the last 20 years have been quite remarkable. After the industry radically transformed itself decades ago from a primarily scientific endeavor into a marketing juggernaut, the stock prices of publicly traded life sciences companies soared. Blockbusters made careers. Fortunes bloomed. Investors beamed. We could say that co-morbid with pharma’s social media anxiety disorder is an addiction to quick hits of Blockbusters and above-average rates of return. As we know, co-morbid conditions are often the hardest to treat. But the fact is, these rates of return were not natural rates of return. A sustainable long-term rate of return for industries in their natural states is on the order of a paltry two to three percent. Why? Because the resource-inflationary pressure of high returns inevitably leads to downward pressures on sustainability. When rates of return exceed rates of regeneration, eventually capital systems collapse in on themselves. Sooner or later, pendulums swing back – the higher the summit, the more momentous the tumult. To most pharmaceutical executives, the very thought of rates of return that low could cause chuckles amongst other side-effects, but eventually pharma will face major reversals of fortune in the coming years for a number of reasons. Firstly, the disruption of traditional marketing, coupled with the infi ltration of the web into consumers’

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lives will dilute their effectiveness. Secondly, the miscoordination amongst the various international regulatory agencies and the industry will hamper innovation in customer outreach. Finally, the pool of bright, young talent will flow to technology and other sectors while flowing away from an industry whose public reputation has suffered years of traumatic wounds. Therefore, the industry must undergo a radical realisation and acceptance that their fundamentals need serious attention. A critical dissection of assumptions and traditional business thinking will need to take place. The harsh realities of the 21st century’s upending nature must be faced without fear. The marketing models that were coopted from the cereal and automotive industries will be tough to break down and replaced with fresh perspectives on the ever-shift ing ways in which people consume their information. Meanwhile, the social engineering foundation of modern marketing will continue to falter. Unless, of course, a few geniuses emerge who will discover some magical formula to mechanise social media into standard operating algorithms – as was done with traditional media. Not impossible, but it was much easier to do with unilateral oligopolies of mass communication. There are times in our lives when incredibly hard and frightening decisions must be made. The same applies to companies and industries – entire countries in fact. And it’s always those simple decisions that must be made and are most often the most difficult to execute. The pharmaceutical industry’s simple way out of its coming dark age is nothing less than the task of utterly re-vamping itself into an entirely new industry – one which will be supple, clever and ethical enough to win the attention and social capital so critically necessary to hold sway in the coming world.

The simple truth Of course, maybe it’s already too late for the large pharmaceutical companies. If that’s the case, then the smaller enterprises have an open opportunity to gun for the future – especially if they refuse to be subsumed into the juggernauts. If 20th century capitalism taught us anything, it’s this: Juggernauts often jeopardise their long-term sustainability by assuming their ways of doing business are eternally solvent. They aren’t. Technology brings forth into the world both opportunity and obsolescence. It reveals the status quo while it destroys it. If the industry is to be what it aught to be – a leading creator of technological solutions to biological problems – then it will have to abandon the now false hope of generating unnatural rates of return via outmoded mechanisms, processes, strategies and tactics. Because if it continues to believe its industry is exempt from the eternal laws of supply and demand, of resource and allocation, and of creativity and innovation, then it will perpetuate a belief system that will continue to funnel its efforts into practices that forgo richer long-term prospects. This is not only a matter of industrial health – it’s a public health urgency. A bankruptcy of novel bio-molecular advancement would be catastrophic for health care.

14/01/2011 10:04

COVER STORY

Returning to the web of connections, it’s not that the web doesn’t matter – far from it. But the basic economic principles outlined above are the priority for all companies curious about how to integrate web media into their enterprises. There are places for new media within life sciences but the industry needs to be very basic in its approach. For one, companies won’t get very far with ‘social marketing’ efforts until executive leadership has hands-on experience with new media and a working comprehension of their properties. The only way things will move is when middle and executive managers start using these media personally. They need to go through this process before clear-headed strategies can be well formulated. To do this, they need to imagine the re-purposing possibilities of various media and then put together small teams of champions who, with permission, can go forth and lead the way with small steps. Finally, they will have to initiate the systemdeep integration of social design into their companies – and enterprise versions of Facebook aren’t the solution. Once they understand how to use these media themselves, only then will they see the potential and pitfalls. They will realise the importance of accumulating social capital and will see more clearly what it takes to create content and communities and the safe connections that engender markets where information can be safe and effective. The economics of life science products and the realities of emerging shifts in the properties of adopted media dovetail each other over time. Perhaps not immediately, but it won’t be too long before the industry sees the need to change, which is why the previous discussion about capitalism is so important and relevant to any discussion on social technologies. The pharmaceutical industry will have to get back to fundamentals in economic design and collaborative networks. It needs to bring the life scientists back to frontand-center as pioneers of not only innovation but also creativity. It will have to develop new ways to work with doctors and nurses, patients and the public. The imperative for leaders in life sciences businesses to understand the emerging roles of emerging media has never been more important. Moreover, the enframing of these media must line up with a fresh perspective on the nature of capitalism in an age where social currencies emerge as substantive elements in the capital system at large. It’s time to get back to the science of life and the art of being a hero. Re-examine the fundamental meaning of marketing. Remember that marketing is about presence. Realise the costly long-term error in mistaking messaging for marketing. If you’re going to integrate rapidly shift ing new media into your efforts, keep things simple. Don’t aim for marketing gold – you’ll not only miss the pot, you’ll ruin your reputation forever because the Web is your last hope, even if it’s your biggest fear. It’s that simple. But like life itself, simple is rarely easy. This article was reprinted with permission from Phil Baumann. For more information, visit: www.philbaumann.com/2010/03/22/overcomingpharmas-social-media-anxiety-disorder/

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“The only way things will move is when middle dle and executive ve managers start using these media personally. ”

The social injection

Baumann outlines a few simple tasks that could change everything for the world of social-pharma marketing. Invest in education: Where will the next generation of molecular biologists, geneticists and engineers come from? Set up a consortium of education that extensively funds captivating educational programmes that spark the attention of a youth easily distracted by the temptations of the web by using those temptations to your advantage. Shift capital-ﬂows from over-marketing back to R&D: The future of traditional marketing is bleak. Accept the losses now. A robust portfolio of novel pipelines for products – in conjunction with re-designing public relations with valuable social propositions – will lead to healthier long-term prospects for capital accumulation. Re-design infrastructure and process from an assembly-line basis into infosocial ecosystems: As the cost of technologies shrink while their powers expand, the opportunities to more fully realise the power of ideas and experiences expand. How many more discoveries and advances in molecular genetics can be made if businesses were based upon social designs instead of mechanical rigors? Extract value from the innate experiences of human capital within the enterprise: Entrenched stiff organisational structures have buried the collective values that can be derived from the vast array of product and service ideas inherent in these collective talents. Investing in redesigning business towards info-social ecosystems will develop the platforms necessary to yield the potency of human creativity and innovation.

14/01/2011 10:04

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13/01/2011 13:37

BIG INTERVIEW

Setting a new course

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As the industry prepares to tack for its biggest change in course to date, new ideas and leaders will inevitably prevail – but few will match the talent of the man Novartis is counting on to take the company through the challenging waters ahead.

hen Daniel Vasella announced in January of last year that he was stepping down after 14 years as CEO of Novartis, all eyes were glued to then COO Jörg Reinhardt, who was tipped as hot favorite to ascend to the top job. Had those eyes been fi xed elsewhere, they might have noticed the company’s Pharmaceuticals Division Head, Joe Jimenez, working away in the background with his usual sagacity and passion – giving no indication he was about to take the helm of the company. For the successful former Head of Novartis Consumer Health, and former Head of North American Business for H.J. Heinz Co., life had just cranked up yet another gear. Indeed, the choice of Jimenez as CEO also cranked up Novartis shares, as analysts reacted positively to the unexpected appointment. Share closed the eventful day 2.06 percent up on the Swiss Stock Exchange – with the board later proudly stating that they selected Jimenez on his “outstanding performance track record, broad international business experience and ability to provide direction, align and engage people”, with Vasella also quick to note that: “It’s not a decision against anybody; it is a decision for somebody”. With the rate of change crashing through pharma’s business models, Jimenez certainly has past experience on his side. “In consumer packaged goods,” he begins, “you learn early on how important it is pay attention to how your external environment is changing because it changes very rapidly. That same lesson is absolutely applicable to the healthcare industry, particularly now as the industry is going through so many changes. You need to be able to look externally and see how regulators are changing, how payers are changing and how physicians are changing the way that they practice – that is without a doubt applicable across both industries. Another area is around the importance of innovation. Innovation drives consumer packaged goods’ growth, which is true in healthcare too.” Of course, we’re all explicitly aware of the need to foster new and open innovation in the life sciences sector, so it would make sense to appoint someone who spent their younger years learning precisely how to do just that. “Healthcare is going to be a place where innovation will be critical for the next 10 years. Th is is an industry that has fundamentals that are going to lead to increased demand for healthcare,” continues Jimenez. “If you look at the ageing population and chronic illness increasing around the world – even in the emerging markets – there’s going

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to be an increased demand that will require innovation to deliver on those needs.”

Branching out On the discussion of innovation in healthcare, Jimenez has an avid interest in one of the more transparent and technological innovations lapping at the shores of the life sciences sector – the infant world of telehealth. After all the debates, testing and calls for funding – especially since the beginning of health reform – the Obama administration has fi nally sat up and taken notice of its potential, pumping $795 million into broadband implementation and the progression of telehealth technologies throughout the nation. With a further $200 million coming from private investment, there’s no doubt that the rules of attraction for both healthcare providers and pharma companies will change – a point Jimenez agrees with whole-heartedly. “There are trends that are converging in healthcare today that are going to make telehealth a new growth area in the next five to 10 years,” he says. “Specifically, if you look at the increasing demand for healthcare – it has to be delivered somehow, but governments are strapped due to the fi nancial crisis. Everybody’s looking for ways to improve patient care but at the same time lower total cost, because you’ve got governments around the world that are looking for ways to reduce costs, and that’s an incentive to invest in telehealth. At the same time new technologies are emerging that are going to better enable telehealth. “When you look at some of the pilots that are starting around the world on remote patient monitoring and you see how keeping patients out of the hospital and reducing visits can lower total healthcare costs, there is no escaping that this is going to be a new growth area in the future. At Novartis, we are looking at ways that we can bring new technologies in to help lower total cost and improve patient outcomes.” One of the technologies Jimenez talks of is a new iPhone app called Vax Trak, developed to help families track routine immunizations for their children. “If you think about that in terms of helping ensure compliance with vaccination regimens,” reveals Jimenez, “that’s one way that you can use technology to help improve overall patient outcomes.” It’s clear from the interests and attitude of the new CEO that he is comfortable stepping out of his comfort zone and experimenting with the new and innovative. But it’s not only in his professional life that this rule of thumb pervades. Having moved from the US to the UK to serve as President and CEO of Heinz in Europe in 2002, and then to the Novartis HQ in Basel, Switzerland in 2007, he has had to learn the intricacies of adapting to new cultures – a seeming talent for the Californian graduate.

Adapt to change “Growing up in the US, you don’t appreciate the differences within Europe. In fact, there is no ‘Europe’. Every country is different in terms of the culture. It’s different in terms of practices, consumer behaviour and patient behaviour. One of the adjustments that my family and I

14/01/2011 15:20

BIG INTERVIEW

had to make was to get into the local level and understand the traditions and customs and how either business is done or how people behave. It as quite an interesting experience and I think it’s one that many Americans don’t appreciate until they live in Europe.” Of course, the same can often be said for Europeans in the context of American culture – a sentiment that Jimenez is too much of a gentleman to admit. Yet the point remains that the transition to a different culture can be a shock to the system regardless of the context – so how did he cope with ensuring a smooth transition from head of pharmaceuticals to CEO of a whole company? A calm and collected Jimenez insists that is has been “a very natural transition”. “I feel like my time running the pharmaceutical division helped me create a very clear picture of how we want to move Novartis forward,” he says. “I came into the pharmaceutical division at a time when the industry was changing very rapidly. We had to modify both our approach to developing new drugs, and also our commercial approach – that helped me get grounded in what has to happen over the next five years to enable Novartis to become the most successful and respected healthcare company in the world.” That statement alone is enough to give you a taste of where Novartis wants to go and what is expected of Jimenez. But where most would wince under the pressure, the former US collegiate swimmer takes it in his stride, drawing on the discipline he learnt through hours of laps and shaving milliseconds of his personal best at swimming meets. “All of those years of training really shaped my view of how you should run a business and how you should set a goal,” reminisces Jimenez. “Work very hard to deliver on

that goal and then celebrate the success by the time you’re done. Hard work is defi nitely part of competitive swimming and that’s carried through.” And while his days of competitive swimming have been replaced by competition in the business world, the taste for hard work and dedication to succeed certainly haven’t left him – and neither has his ability to adapt. “My management style did have to change when I moved from division head to CEO, primarily because as CEO you are implementing and executing change through the division heads as opposed to doing it yourself with your functional leaders such as marketing, sales or human resources,” he explains. “The style that I have adopted as CEO is, number one, to set the long-term vision. That includes where we are trying to take Novartis and what our strategy should be for continuing to extend our lead in innovation to drive growth and improve productivity. The question that remains is how we’re going to execute that: set the picture and then make sure that the rank and file in the organisation understand that and what their role is in helping us to deliver that future; so it’s quite a different management style.” “I like to listen to a lot of our people up and down the organisation, so I frequently pull together groups of managers at all different levels and we’ll undertake a session where we talk about what’s working, what’s not working and what’s on their minds. It also gives me a chance to articulate my vision for where I want to take the company and then they can go off and talk to their associates in the company and help spread the word that way.” Which is precisely what happened back in 2008 with

“The style that I have adopted as CEO is, number one, to set the long-term vision. That includes where we are trying to take Novartis and what our strategy should be for continuing to extend our lead in innovation to drive growth and improve productivity”

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14/01/2011 13:31

BIG INTERVIEW 43

Project Forward – an initiative to cut back on costs while pushing the company forward. Not only did the fi nances of the company need to shift to accommodate this, but so too did its culture and attitudes. With the success box ticked ahead of schedule for that initiative in 2008, Novartis has continued to stride forward, hitting metrics and improving the fi nancial climate for Novartis. But as Jimenez points out, it was never just about cost savings. “It was also about changing the way we operate. One of the things that I did in the pharmaceutical division was streamline decision-making to eliminate a number of committees and layers of decision-making, which helped accelerate some of the key decisions that had to be made to move the business ahead. We also changed our commercial model in a number of countries away from the old pharmaceutical model, which was mirrored field forces that called on physicians, to more of a geographical approach that was consistent with where physicians and payers wanted us to go.”

Watch and learn But as anyone with a knack for recollection can track back, 2008 was the year of regulatory bombardment: the economic downturn, further confi rmation that the pipelines were indeed drying up and the sound of purse strings being tightened all enticed an excessive amount of regulation to enter the industry. Fortunately, Jimenez reckons the upturn is on its way, with the regulatory environment taking more of a positive outlook on the industry and all it guides. “If you look at what’s happened with the FDA, Peggy Hamburg coming in as FDA Commissioner has had a significant effect on drug evaluation. It’s less of a political process than it used to be and is now more based on science and the facts. The FDA is still very tough on new drug approvals, but the rules are now clearer than they were a few years ago with the new leadership, so I’m rather encouraged by the trends that I see in the regulatory environment. It doesn’t mean that it will be easier to get new drugs approved, but it does mean that the rules of engagement are transparent – and that’s a far better environment than if the rules were not clear. Th is idea of transparency is certainly being taken on board by the pharma world at large – no doubt through necessity above all else – as innovation moves off the horizon and into the proverbial foreground, so it comes as little surprise that the FDA is taking steps to ensure it mirrors the change in environment. “I do feel that the FDA believes that innovation is key to driving the overall industry,” asserts Jimenez. “Once the patents have expired, generics play a very important role and I think the FDA has realised that. They have also realised that biosimilars are going to be an important part of the future as the biologics that are currently marketed start to lose patent protection. We’re starting to see a clearer pathway to get biosimilars approved and launched, particularly in the US. That’s extremely important for Novartis as our Sandoz division,

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which is our generics division, is a leader in biosimiliars around the world.” The potential worry for the Sandoz division, however, is that the competition for the generics market is becoming far more aggressive – especially for research-based companies – forcing uncharacteristically tactical moves for some of the smaller, less competitive R&D fi rms. But for Novartis, Jimenez stands firm on how to grasp security for the long term – and as usual, it all comes back to the basics. “The key to continuing to build on innovation is to invest heavily in R&D and to fi nd the right scientists to ensure that your pipeline is strong,” offers Jimenez. “If we can deliver medicines that provide more than just a small incremental benefit, that really deliver on unmet medical need and allow us to protect those with intellectual property, that’s our best defense against generics”. It’s safe to say that Novartis has one of the strongest pipelines in the industry, but for Jimenez that doesn’t prove anything when it comes to research. “I’ve also made the commitment to keep our spending in R&D at the high end of the industry. Today, we spend about 17 percent of total sales in R&D across the whole company; if you look at just the pharma division, that number is 20 percent of sales, so we really are leaders in the industry in R&D, and that’s the way we’ll continue to innovate.” But in order to do that, the multinational company will need to keep an eye on downward pricing pressures and a change in customer base – another flashback to the environment in the 2008 market, which Jimenez believes has intensified since. “If you look at the debt crisis, governments in Europe have recently initiated significant price reductions on pharmaceuticals because they are debt strapped. They are looking for ways to lower the total healthcare burden. I continue to believe that the ‘old days’ in pharmaceuticals – where virtually everything was automatically reimbursed – are gone. “We now have to take a different approach to pricing. We have to take more of an outcomes-based approach and help governments and payers around the world to pay for those drugs and new medicines that are going to deliver on unmet medical need. Right now, we’ve entered into a number of agreements with payers that are what we describe as ‘innovative pricing mechanisms’, where the payer is starting to pay on the positive outcome as opposed to paying on the transaction of purchasing just the pill. That’s going to be one of the biggest trends over the next 10 to 20 years, so we’re making sure Novartis is ahead of it.” And for the time being, it’s a case of so far, so good. Collaborating with the Swiss Tropical and Public Health Institute, The Scripps Research Institute and the Genomics Institute of the Novartis Research Foundation, Novartis announced back in September that it had discovered a novel compound that shows significant promise as a next generation treatment for drug-resistant malaria – and that’s just the tip of the iceberg. For the new CEO, the times they are a changing; and Jimenez couldn’t be happier about it.

14/01/2011 13:31

INDUSTRY INSIGHT

What’s your company’s Innovation Quotient? By George Henderson

he pharmaceutical industry is changing. There are enormous pressures to develop new drugs, cut costs, re-engineer processes and segment the value and supply chains based upon complex and sustainable customer and supplier relationships. Success in the past is no guarantee of success in the future. Considering these developments, do associates view innovation and change as a source of job security or a reason for mutiny? Innovation (as discussed here) does not refer to research and development. It refers to the cultural ability to align associates and draw from their diverse views to form creative concepts and solutions. It refers to those associates’ willingness to participate in and support those solutions. Th is competence can be defi ned and measured as a company’s Innovation Quotient (IQ). The ‘Innovation Gap’ occurs when some are making bold and necessary choices while others are protecting fiefdoms or clinging to the past. Th is cultural clash creates delays and waste, erodes value and threatens survival. An organisation’s ‘IQ’ has four perspectives that can be remembered by the acronym IDEA:

“Understanding your company’s Innovation Quotient and identifying its Innovation Gap is critical to success and growth” Insight refers to the company’s internal and external scanning skills. Decision-making: speed and accuracy depends upon people’s knowledge and empowerment. Engagement and execution is best accomplished by enrolling people in their own solutions. Alignment with strategy is achieved through cascaded objectives, measures and initiatives aligning four functions of performance: strategy, fi nancial planning, business execution and operational excellence. Based on these perspectives, if we were to measure where a company fell on the spectrum of innovation, it could be described by one of four innovation profi les: Ships adrift float on past success and are poorly positioned to respond to threats or opportunities. Cruise ships have a few individuals setting direction and making course adjustments. The remainder are ‘intellectual passengers’. Change

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is presented like a destination brochure rather than a roadmap for associates to follow. Merchant marine empower associates to effectively and efficiently deliver existing services to existing customers, having ownership and making course corrections. Navigators are those innovating new products, markets, and ways of doing business. The Innovation Gap gap accounts for the resistance that causes many change initiatives to fail. Closing the gap is more than a feel-good experience. When a company is changing its business model, survival can depend upon it. Apply the Six Sigma DMAIC method to close the Innovation Gap. Define: Defi ne the attributes of the four IDEA perspectives: insight, decision-making, engagement and execution, and alignment with strategy. Measure: Set specific examples of each attribute that might represent the behavior expected from a ship adrift, a cruise ship, the merchant marine, and from navigators. Th ink of specific examples from the four functions of performance: strategy, fi nancial planning, business execution and operational excellence. Assess and compare senior executives, middle management, and line supervisors and their organisations. Analyse: Compare the three groups, noting gaps and exploring root causes. Th ink in terms of the impact a specific change initiative may have and what corrective actions are appropriate. Improve: Set objectives, measures and performance scorecards to address and close gaps. Control: Set acceptable standards of behaviour for each of the attributes. Using working teams from strategy, fi nancial planning, business execution and operational excellence, along with the internal customers of these groups, develop specific examples for each attribute that represents unacceptable, acceptable but average, and exemplary performance. Also, defi ne response plans for attributes that are out of control. Understanding your company’s Innovation Quotient and identifying its Innovation Gap is critical to success and growth. The process of defi ning its attributes, setting standards and establishing controls has enormous cultural impact. Associates themselves are setting the standards and determining how they will be enforced. By identifying the affected areas before a change initiative gaps in understanding, incentives and alignment can be isolated and corrected before the ship is in the storm.

George Henderson, Senior Partner with Navigator Consulting, has helped clients save more than US$150 million since 2002. He has led tough business transformations including M&A, restructuring, outsourcing, shared services and business process re-engineering. Formerly a nationally recognised rugby coach, Henderson has 25 years of experience in consulting, activity-based costing, Lean Six Sigma, balanced scorecard and change management.

14/01/2011 14:40

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13/01/2011 13:36

NEXT BIG THING

Deciphering the Burgess Shale of single-use bioreactors By Mark Selker and Barb Paldus

ne of the most famous of the Beatitudes, “The meek shall inherit the earth” (Matthew 5:5), has been likened by Darwinists to the ascendance of little furry mammals after a meteorite hit the Earth, initiated the Ice Age, and damned the almighty dinosaurs. In the bioprocessing industry, single-use enthusiasts would claim that the dinosaurs are really large-scale stainless steel infrastructure, the furry mammals are disposables, the housing market/stock exchange collapse in 2009 is the meteorite, and the current recession is the Ice Age. Market drivers – the natural selection criteria in this case – such as lower capital, skilled operator labour and validation costs, biosimilars price erosion and time to market, are accelerating the adoption of the single-use paradigm. An interesting question, drawn from evolutionary biology, therefore emerges: How will the ‘survival of the fittest’ principle apply to designs and vendors of single-use equipment? The recent proliferation of mid- to large-scale (25L to 2000L) single-use bioreactor designs has focused primarily on aeration and agitation methods. Agitator types include single to multi-impeller configurations with different blade geometries (Thermo Scientific and Sartorius-Stedim), magnetic motors (XCellerex), paddles (ATMI), rotating wheels (PBS Biosystems) and even two- (GE Healthcare/ Wave) and three-dimensional (Cellution BioSystems) rockers. Aeration methods range from traditional frit and open pipe spargers (Thermo, Sartorius, and XCellerex) to air-lift designs for more efficient oxygen transfer with lower shear stress (XCellegene and PBS). Bioreactor geometries either mimic typical cylindrical stainless steel vessels, or present a radical departure, with shapes such as rectangular prisms (ATMI), pillow bags (Wave), cones (XCellgene) or U’s (PBS). In the lab-scale arena (0.5 L to 50L) new disposable vessel designs are also becoming more and more numerous (e.g. Millipore’s Mobius, New Brunswick’s CelliGen, and Artellis’ iCELLis). In essence, single-use upstream bioprocessing equipment is experiencing the equivalent of the Cambrian explosion, with many diverse species trying to survive and thrive. As Stephen J. Gould so aptly described in his book A Wonderful Life: The Burgess Shale and Nature of History

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(1989), the “history of life is a story of massive removal followed by differentiation within a few surviving stocks”. A common need, however, has clearly emerged for single-use sensors and easy-to-use process automation, and efficient validation of both. There are many operations, even in single-use bioprocesses, that can be improved to reduce burden and time load to ensure end-user success. As many of the vendors have focused exclusively on disposable bags and bioreactors, if one vendor can indeed provide an intelligent, self-calibrated measurement and automated solution, it will carve out a unique and lucrative niche. Th is provider could symbiotically exist with all bioreactor manufacturers, providing a unique service to the entire bioprocessing industry. To extend the evolutionary biology analogy, this vendor would resemble homo sapiens, both from the ability to problem-solve, and also to use, and eventually even create, tools.

“How will the ‘survival of the fittest’ principle apply to designs and vendors of single-use equipment?” If we follow Gould’s train of thought, such a creature with intelligence and self-awareness would surely have evolved. However, Gould himself concluded that evolution was “not the conventional tale of steadily increasing excellence, complexity and diversity”. He based this argument on the fossil fauna records from 530 million years ago that are found in the Burgess Shale. He argued that chance played a central role in the selection of the survivors, and that given the chance to “rewind the universe”, the outcome could have been altogether different, even for the homo sapiens species. In other words, our planet could just as well be ruled today by intelligent gecko lizards, using genetically modified canaries in their drug development trials. If we return to the original question: which companies will win the ‘survival of the fittest’ game to become the dominant players in single-use bioprocessing? What will happen to XCellerex, Artellis, PBS Biosytems, Sartorius and Finesse? Only the future fossil record will tell, and for now, the universe is mum, but continues to roll the dice.

Barb Paldus was most recently the CTO of Picarro, a company she founded in 1998. Her efforts there culminated in solid-state Cyan laser products in 2003 and cavity ring-down spectroscopy products in 2004. Barb received both her PhD (1998) and MSEE (1994) degrees in electrical engineering from Stanford University. Mark Selker has worked and published in various areas within the optics industry. He has worked for NASA, Coherent Laser Group, Harmonic, and most recently has been a visiting scholar at Stanford University. Mark received his ScB and PhD in electrical engineering from Brown University in 1986 and 1990 respectively.

14/01/2011 15:21

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10/06/2010 14:38

SUPPLY CHAIN

tzhusen n y a M ulatory k’s JØrn c g e e r b f d o n Lu es halleng c e h t t Lean looks a w o h d n a nce a ensure p l e complia h n a logies c o d o h t hain. c y me l p p u s timised p o y l l u f

W O HUCH IS

M H G U ENO

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SUPPLY CHAIN 49

s any experienced pharmaceutical manufacturer knows, ensuring an efficient and effective supply chain is critical to the success of the business; yet this area is just as likely to experience challenges as any other. According to JØrn Mayntzhusen, Senior Manager for Supply Optimisation and Launches for Lundbeck, the main challenges currently facing the pharmaceutical supply chain include a combination of patents expiring, therefore future lowering margins, and on the other hand, increasing demands on compliance. “Increasing compliance is, of course, by defi nition positive,” Mayntzhusen stresses, “but price pressure from patent expiry means that all parts of the supply chain are under heavy pressure to optimise and fi nd cost savings. So these two trends with lowering margins on the one hand and increasing compliance and flexibility on the other hand are heading in colliding directions. “If you were to take ambient temperature products, previously there was not much attention on monitoring and control because everybody more or less expected they would stay within the temperature range of room temperature. But over the years compliance demands have continued to increase, and the transport industry has not necessarily followed these developments. “If you’re just going to send a few pallets here and there and the demands for monitoring stress that you have to prove the goods have been within the temperature range all the time, then you have a challenge. How should you do it? Of course you may order a temperaturecontrolled truck for transport, but goods can be reloaded several times during transport, so you will still need a monitoring device on the goods to prove the goods were transported within the allowed temperature range. But what should the level of monitoring be? Should that be one or more monitoring devices per pallet or per shipment, for example? “How far do you want to go in that direction? It gets more and more specific. Everything comes at a cost and with patent expiries coming up the volumes and compliance demands are going to be the same, however with margins significantly reduced.” Th is increase in demand for compliance comes with a cost and ultimately, it will be consumers who pay for it either directly or through taxes. “It’s easy to say, ‘We want cheaper medicine,’” Mayntzhusen points out, “but ultimately somebody has to pay.”

Less and more Unlike compliance, most other optimisation trends go to the opposite direction with smaller and smaller batches and demands of shorter lead time on the one hand, and then ever increasing demands on flexibilities following sales fluctuations the other. For off patent products, generic competition means that some months companies sell close to nothing and other months they sell 50 times more than usual.

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“Either you are on the price list or you are not on the price list and when you are on the list you basically get the whole market demand,” Mayntzhusen says. “When you’re not on the list because your offering price to the health authorities was too high you sell nothing. Luckily Lundbeck only has a small part of its turnover from off patent products, but clearly that kind of sales patterns create a challenge to any supply chain when faced with sales variations of that scale.” Two tools now used by many pharma companies to reduce waste and create efficiency and transparency throughout their supply chains are Lean and Six Sigma. Mayntzhusen believes transparency is essential: making it plain how do you do things and what are the goals and when should you meet the goals. “KPIs should be reviewed regularly to see if we are doing well or not,” he says. “KPIs are visualised on boards on a wall. Each employee or team can have their own KPIs. A KPI could be throughput or it could be lead time; how many items have you produced or how fast did you do it, so the team can see whether they are doing well or not. “Some of the advantages of Lean/Six Sigma is that stock levels decrease and lead times may get shorter. Thereby money is saved. But there are some risks inherent to Lean/Six Sigma. I believe that we can get much lower on stock levels from an operational point of view than we actually want to, if you look at the whole supply chain and remember to consider your contingency strategy as well. “Because even if your lead times on the production processes are getting ever shorter, there are other inputs to the production process such as equipment, facilities and human resources. Even if you have a very short production lead time, if one of the other three of equipment, facilities and human resource fail, then what? You may have a lead time on, let’s say, bulk tablets, of three days – but what is the lead time on your business critical equipment? “Of course you can not set your stock level so high that you can cover any situation. But if you have a three month lead time for the tablet coating equipment, then you should either have a combined stock level of three months for bulk tablets and fi nished goods, a backup supplier of tablets, or another backup measure in place to cover a possible breakdown on your coating equipment. So you need to think about that when you set your stock levels.” Mayntzhusen thereby praises Lean as giving companies the opportunity from an operational perspective to shorten lead times and to bring the possibility to have very low stock levels, although he points out that it’s also important to remember there are other production inputs, such as business critical equipment. You have to also consider the lead times for these when trying to fi nd the optimum level.

“Increasing compliance is, of course, by definition positive, but price pressure from patent expiry means that all parts of the supply chain are under heavy pressure to optimise and find cost savings”

Sizing “The challenge is also to understand when you have obtained the optimised combination of stock levels and lead times and lot sizes,” he says. “Lean envisions one piece flow, meaning one pack at a time or one bottle at a time. In

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pharma terminology you can’t produce exactly one pack at a time because there is a lot of analysis and documentation every time you have made a production batch. So at least in Lundbeck terminology “one piece flow” means “one batch flow”. But how big should the batch be? What determines the right number of packs to produce every time an item is produced? “Stock levels in the pharma industry are generally quite high compared to other industries. So let’s assume they should go one way, which is down. But even if there is a lot of stock reduction potential, apply the parameters with care when you set your stock levels.” Because stock levels consist in raw terms of two things, which are stocks to cover sales variations (“safety stocks”) and cyclical stocks, which relate to the lot size. Your average stock level will always be your safety stock and then half a lot size. “You’ll always have your safety stock on hand, which should be your theoretical bottom level. Then when you fi ll up with, let’s say, 10,000 units, you sell that over time and then you fi ll it up again. So your average cyclical stock during the selling period will always be half a lot size-in this case meaning 5000. “With a given safety stock level, which could be 3000 units and a lot size at 10,000 units, you would always have 3000 plus 5000 on average of that item on hand. If you want to reduce these levels you should determine which of them to reduce. Safety stocks relate to your lead times, i.e. how fast can you fi ll up again, whereas the optimal lot size relates to operational efficiency. “But what is the right lot size? You can compare setting the right lot size with your personal shopping behaviour for bread. You don’t buy one slice of bread every time you’re hungry. On the other hand you don’t buy enough bread for a month for obvious reasons. So where’s the balance? “Right now, we in the pharma industry are at the point where we buy bread for a month. We’re working hard to decrease it. But when should we stop? Is it when we buy bread for a week, for a day, for an hour? That all depends on the underlying circumstances or assumptions, such as how far is it to the baker? Do I have a bike? Do I have a car? What does petrol for the car cost? Your lot size, meaning the amount of bread you buy, relates to your company’s underlying prerequisites. So for every company the optimal lot size would vary for the same item.” Lundbeck has initiated a project to maximise gains from its Lean efforts and to align its daily continuous improvement activity with the overall strategy. Th is will also involve linking the efforts to a more scientific or theorybased approach, to fi nd the right balance for the optimal lot size.

Bottlenecks Other methods being used to identify areas for optimisation, are Value Stream Analysis and Theory of Constraints (TOC). Both methods look at areas for optimisation although from different angles. The latter take a wider look on the supply chain, says Mayntzhusen. “It

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asks, ‘What is our main bottleneck right now? What is hindering all the other resources that we have in operating at full capacity?’ Then you focus on your weakest link, fi xing that. When you’ve fi xed one you’ll have another weakest link and then you continue to look at that. “There are a vast number of companies that applied Lean and Six Sigma across the different parts of the organisation and they achieved great results. I believe the main test of your company application of Lean, though, is the way the principles are applied at the shop floor. It means if you want to test whether you are applying them the right way or not you’ll see whether the KPIs and visual boards are supportive of their every day work. “You may have your daily meetings or bi-daily meetings or weekly meetings with your teams but there can be a risk that these will be management driven, whereas if you really achieve the idea behind Lean, the team itself should deeply feel that the board makes their work life easier.” As part of its pursuit of Lean, Lundbeck is working towards receiving a recognition from the Shingo Prize organisation, which promotes the use of high level operational excellence strategies and practices to achieve world-class results. “Robert Miller from Jon M. Huntsman School of Business at Utah State University administering the Shingo Price, have told us about companies that received a Shingo recognition for their Lean efforts and then left the Lean initiative at that – saying now we are Lean. And then a few years later there’ll be nothing left of it,” says Mayntzhusen. “Th is can happen because you go to a certain stage and then you think, ‘Yes we did it. We received a bronze or silver Shingo recognition,’ and then leaves it at that. “But this is the time when your Lean efforts are really tested because no one is pushing any more. If the people on the shop floor do not see all the boards and all the KPIs

The Shingo Prize The Shingo Prize for Operational Excellence is named for Japanese industrial engineer Shigeo Shingo, one of the world’s leading experts in improving manufacturing processes. Shingo has been described as an ‘engineering genius’ who helped create and write about many aspects of the revolutionary manufacturing practices which comprise the renowned Toyota Production System. The mission of The Shingo Prize is to create excellence in organisations through the application of universally accepted principles of operational excellence, alignment of management systems and the wise application of improvement techniques across the entire organisational enterprise. The Shingo Prize was established in 1988 as the standard of excellence to educate, assess and recognise organisations that achieve the highest level of world-class operational excellence around the globe. The prize is administered by the Jon M. Huntsman School of Business at Utah State University.

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as supportive in their daily work they’ll stop using them, whereas if you have identified the right parameters for them also to see, ‘Where are we going; what are our goals and what should we achieve,’ then they’ll do it on their own. They maintain it on their own because it helps them and they can see the benefit of it. So that’s the ultimate test: whether you have found the right KPIs to look at.”

Compliance Returning to the subject of compliance, Mayntzhusen identifies two challenges within it: the fact that increased compliance requirements are uncoordinated; for example, there are currently serialisation requirements coming from a number of countries and each country has its own format and way of doing it. Manufacturers have to comply with all these requirements. “Anyone who has tried to install a production line in a pharmaceutical company knows that it takes quite a long time to do and there is a fairly heavy documentation of processes,” says Mayntzhusen. “With the ever-increasing number of requirements uncoordinated, that puts a heavy burden on production technology. My hope would be that for the future there would be more unified standards.” The other challenge is that there can be a limited effect of an increased compliance requirement. Mayntzhusen gives as an example the European requirement that Braille must be on every pharmaceutical pack. “There’s an extra cost to stamping this into the carton, and if you multiply that extra cost with the millions and millions, probably billions of cartons that are produced every year and sold within Europe you are looking at a considerable amount of money. If you look then on the other hand at the number of blind people it’s fairly small, and the number of blind people who read Braille is, again, a fraction of that. “Of course we must ensure blind people are aided, but the question is whether that money could be spent more wisely in order to benefit all blind people so that you could have a higher effect with a less effort or with less cost. It’s just one example of something that has a good intention but the question is whether the effort required actually stands up to the benefit or the value adding of it. “With regard to regulatory development, I personally hope for an adaptation of models as smart as the Australian model where the patient insert leaflet is printed at the pharmacy level. “With the current model here, we spend a lot of time and effort on changing the user leaflets and sometimes we repack batches with the new leaflet. Sometimes you’re not even through repacking before a new requirement necessitates that you start repacking again or throws out the products. “Probably about 20 percent of our items are in this process of changing packaging materials at any point in time. So we have to stop production with the old leaflet or carton. We then have to take into consideration what we should do with current stocks. Should they be repacked or should they just be thrown out because the manpower and the complexity of repacking and the administrative work

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combined with it sometimes is too much compared to the effort it takes to produce new goods? So there’s a terrible waste in this as well.”

Counterfeit Looking to the future, Mayntzhusen foresees increased use of technological possibilities, as well as the advent of serialisation is defi nitely also coming and greater sales variations due to the large amount of products that are going off patent. He also fears that we will see increasing amounts of counterfeit products, and says that one way to combat this is through serialisation, because by making each product unique you can keep a closer eye on how much has been sold. “Currently counterfeit is not much of an issue within Europe for any company and in Lundbeck we have recorded very few cases with counterfeit on our products. But theoretically when we currently produce a batch of 30,000 packs and they’re sold at a batch level, it is not recorded anywhere whether 30,000 are sold or whether actually 60,000 were sold because some counterfeiter took your original product and made an exact copy of it using talcum or something else instead of the active ingredient. “If I could be a bit wild in my wishes I would have a global database where all the manufacturers would report what they have produced and every time someone does a parallel import or export or repacking of the product, every time they change the batch they should record it, too. Because if we then have the reporting at batch level into a central database then we would be able to see that that batch had been served more than the numbers that were produced. “As the originator we live with the fact of parallel trade and the free flow of goods across the boundaries of Europe, but it’s the rework of original products that is the biggest threat because it vanishes the trail. With the free flow in effect, this global database would be the best way to fi x that.”

“You don’t buy one slice of bread every time you’re hungry. On the other hand, you don’t buy enough bread for a month”

14/01/2011 14:38

INDUSTRY INSIGHT

Increasing inventory turns – the role of Lean in the micro QC lab

How pharmaceutical companies can use Lean to realise beneﬁts in the micro QC lab. By Steve Delity “Automation of the micro QC lab takes rapid detection to the next level, allowing the lab to benefit from automation much like their counterparts in the analytical chemistry QC labs and in manufacturing”

taying competitive in this challenging economic climate is on top of the priority list for most CEOs and top business leadership. They no longer accept large inventories to compensate for manufacturing inefficiencies and are looking at every aspect of the production process to drive out waste. To address the inventory issue, most manufacturers have embraced the concepts of Lean manufacturing made famous by Toyota and the auto industry in the 1980s. Manufacturers across industries have squeezed almost every penny possible from their manufacturing process to ensure little to no waste in materials or manpower. The results have been significant. In highly regulated industries such as pharmaceutical and personal care products, the manufacturing process includes rigorous product testing for quality. Traditionally, these tests required long lead times and significant resources to perform the steps. Companies in these types of industries have started to bring the concept of Lean specifically to their laboratories with an eye to increase the speed and reduce the cost of lab quality control functions. The micro QC lab is an area that can realise substantial benefits from the implementation of the Lean process. In most micro QC labs, the quality testing has not varied from the traditional culture method established over 100 years ago. The test is inexpensive, but requires time for the contaminating microorganism to grow enough to be seen by the human eye. During this time, products could be waiting in quarantine, or production could be stopped, waiting for a batch to pass inspection. Th is idle time in manufacturing can cost millions of dollars, and requires manufacturing to increase levels of inventory, reducing inventory turns.

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When measured against Lean concepts, the classic culture method falls short. Specifically, the manual culture test includes repetitive protocol steps, long incubation times prior to results, a volatile workload, manual counting and data entry steps, all of which create an opportunity for test leveling and improvement in productivity. New technologies in the area of rapid detection in the micro QC lab exist today to help companies realise their Lean initiatives. These technologies play a strategic role in reducing the time to results, allowing product to pass quality control sooner, which reduces raw materials and in-process inventory and increases lab productivity. Rapid detection alone solves just part of the problem. The manual process drives highly educated microbiologists to become bogged down by running tests versus focusing their data analysis and problem solving skills on more value added activities to drive business productivity. Automation of the micro QC lab takes rapid detection to the next level, allowing the lab to benefit from automation much like their counterparts in the analytical chemistry QC labs and in manufacturing. Automated rapid detection removes cumbersome steps in the testing process driving efficiency and productivity. Lean processes are helping manufacturers push the envelope in an already dynamic and progressive industry by utilising new and rapid technologies. The benefits of Lean philosophies in the lab are significant. Shorter quality control cycles mean faster product release, creating the need for fewer inventories and higher inventory turns. For more information, please visit: www.rapidmicrobio.com

Steve Delity is CEO of Rapid Micro Biosystems, a leading provider of technologies that automate and accelerate detection of microbial contamination in the manufacture of pharmaceutical, biotechnology and personal care products.

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Save time, Save money, Increase productivity. The Growth Direct™ System delivers: • Non-destructive testing with results in half the time • Automated incubation, enumeration and reporting • Integration to laboratory information systems (LIMS) • Streamlined validation • Applications and throughput to support routine testing

Learn more about the beneﬁts of Automated Microbial Testing. Listen to the webcast, “Bringing to Micro QC Lab into the 21st Century” http://tinyurl.com/27toyjw

Rapid Micro Biosystems, Inc. Bedford, MA 01730 Phone: 781-271-1444 www.rapidmicrobio.com

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13/01/2011 13:37

EXECUTIVE INTERVIEW

Sustainability and cost-effectiveness Why green technology makes good business sense. By Joseph Sarret As a relatively new discipline within the pharmaceutical industry, what are the main challenges currently facing green technology? Joseph Sarret. The ACS Green Chemistry Institute has said that one of the main barriers to adoption of green chemistry – a core green technology – is lack of awareness of its potential. Some in the industry may still believe that green technology does not make sound business sense. However, major pharmaceutical companies are disproving this outdated notion, showing that green technology is good environmental and business practice. Why? Because green technology, at its core, is about efficiency. It means smarter use of fewer resources – raw materials, energy, equipment, facilities and time – as well as less waste. All this means lower cost. At Codexis, we enable faster, cleaner and cheaper manufacturing for many of the largest drug manufacturers in the world – companies such as Pfizer, Merck, Roche and Teva. We succeeded in reducing the cost of manufacturing and waste production for key intermediates for atorvastatin, the API in Lipitor. At Merck, Codexis technology is enabling a new faster, more efficient manufacturing process for sitagliptin, the API in Januvia and Janumet for diabetes – two of their fastest growing products. Our green-by-design technology is being used with more than 30 products in pharma companies’ development pipelines.

ingredient in Januvia and Janumet for diabetes. The two companies also won the US EPA Presidential Green Chemistry award for this work. The paper concluded that the new process may offer a 10-13 percent overall increase in yield over the current process, a 53 percent increase in productivity, a 19 percent decrease in total waste, elimination of all heavy metals and a reduction in total manufacturing cost. As the paper said, “This work underscores the maturation of biocatalysis to enable efficient, economical and environmentally benign processes for the manufacture of pharmaceuticals.”

Joseph Sarret, MD, JD, has served as Chief Business Ofﬁcer and President, Pharmaceutical Services and Enzyme Products for Codexis Pharmaceutical Services & Enzyme Products since 2009. He joined Codexis in 2005. Sarret is a graduate of both the University of California, San Francisco School of Medicine and Stanford Law School, and holds a BA in human biology from Stanford University.

What are the advantages for pharmaceutical companies looking to start working with green technology and its inherently alternative processes? JS. The ultimate advantages are better product and process economics. Codexis enzyme-enabled processes, which run on standard equipment, have reduced costs by requiring less extreme temperature and pressure, fewer process steps, less reagent and solvent, less capital for equipment and generating less process waste, while at the same time producing higher quality product, with fewer impurities. How does your enzyme-based process compare to conventional processes in terms of efﬁciency and ﬁnancial impact? JS. It compares very favourably. In Science1, Merck and Codexis jointly published a paper on a new manufacturing process for sitagliptin, the active

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What speciﬁc tools/technologies/methodologies have proved most valuable within your experiences of green manufacturing? JS. Our technology enables us to take a natural enzyme that is not sufficiently active and stable for use at commercial scale and optimise (evolve) it into a commercially useful catalyst for economic and green manufacturing of the molecule of interest. The ability to directly make a chiral amine from the corresponding ketone was identified as one of the key green research areas by the Green Chemistry Institute Pharmaceutical Roundtable2. Through our sitagliptin work, this area is now a commercial reality with the launch of our evolved transaminase enzymes. The ability to reduce chemical steps by avoiding protection/deprotection can significantly reduce the cost for any given process. Codexis was able to eliminate two steps in the production of simvastatin with an enzyme that distinguishes three hydroxyl groups to acylate the desired position. There is no chemical equivalent for this reaction regioselectively. With the industry going through its current evolution, what direction do you see green technology heading over the next few years? JS. ACS Green Chemistry Institute has provided leadership for the industry through wide dissemination of 12 principles of green chemistry3. These characterise the practice of sustainable chemistry, and include the use of catalysts, renewable feedstocks, biodegradable chemicals and safer solvents. The first principle sets the standard: prevent waste. Green chemistry processes capture both the economic and environmental benefits of green technology for the pharmaceutical company, continuing to drive adoption. For references related to this article, please see www.ngpharma.eu.com

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ROUNDTABLE 57

Beneath the surface NGP talks to two industry experts about the challenges facing manufacturers of surface technologies. From your perspective, what are the current hurdles being faced by the surface technology and manufacturing sectors, and how can they be overcome? Lester Mills. The manufacturing industry is faced with increasingly stronger competition and the need to increase efficiency and reduce costs. At the same time over the last two years, many customers have been significantly affected by the fi nancial crisis. Both these effects have come together and resulted in a very severe business climate for many manufacturers. Nevertheless, there are also opportunities in such an environment, as only stronger players are likely to survive. Also, there remains strong growth in markets outside of Western Europe and the US, namely in the BRIC countries. Manufacturers and suppliers with differentiated products and technologies may be better aligned to prevail and certain therapeutic drug categories such as oncology, for example, will remain attractive for innovation and growth – especially in the next few years. The dramatic increase in the use of generic drugs will be a necessary part of managing healthcare for an ageing population in many countries. However, this is an

opportunity also, and as Bachem has a significant business in generic peptides and small molecules, there are defi nitely also some positive perspectives to this dynamic.

Lester Mills is currently Chief Marketing Ofﬁcer with Bachem Holding AG. He studied chemistry at Cambridge University (UK), gained a PhD at the UEA (UK) and received an MBA from SUNY (US, 2001). His earlier career was in R&D with Lonza Ltd, Visp (1987) and later with Roche Vitamins Ltd as Sales Director.

Jeffrey L Mooney. With the increase in more stringent government regulations and heightened competitive pressures, gone are the days of spending hundreds of millions of dollars on state-of-the-art facilities. Pharmaceutical companies are passing on these large capital expenditures and, instead, opting to focus on manufacturing processes by, in part, identifying and utilising scalable products and technologies that allow for smaller projects that are highly targeted. This move to more scalable technologies, such as disposable bioreactors and synthetic, non-biological cell culture surfaces, allows pharma companies to explore many different options simultaneously while minimising costs, improving results and decreasing the effects of biological influences. Stem cell research continues to advance and is playing the role of ‘game changer’. Many clinical trials today use stem cells, especially in CNS, heart conditions and diabetes, and as these clinical trials become successful companies will need technical solutions that allow for ease in scale-up of cells from the lab through to production. Furthermore, the use of contract manufacturing organisations (CMO) to meet economic cost targets is also playing a role and shaping the industry. The question becomes whether pharma and biotech companies will continually move to CMOs or if the fi nal solution will be a CMO with all forms of scale-up handled in-house. The answer is still being determined as the industry continues to make adjustments. Regardless, the need for scalable solutions and technologies will remain paramount. With the industry looking to streamline its manufacturing processes to become more cost-effective, what technologies do you have in your armoury to ensure you continue to remain competitive as the industry evolves? JM. Corning Life Sciences places an emphasis on investment in R&D and product and technology innovation and also has a fi rm understanding of market and customer needs – three key components to helping pharmas compete and succeed in today’s market environment. Corning’s Life Sciences business brings to pharma companies a unique combination of core capabilities in materials, surfaces and biophotonics to deliver high value products for both research and drug discovery and development, including cell culture/cell scale-up technologies and high throughput label-free detection and screening.

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14/01/2011 14:38

ROUNDTABLE

Most recently, Corning introduced the first synthetic surface, Synthema, for xeno-free growth of both primary cells and stem cells, and Corning also provides pharmas with a wide range of cell biology products, which allows for ‘cells to assays’ solutions – enabling growth and scaleup of cells for assays and protein expression. Corning has commercialised numerous technologies for scale-up and production including HYPERFlask Vessels, CellSTACK Culture Chambers and CellCube Systems. Corning also offers a full line of 96, 384 and 1536 well microplates for assays, storage, drug transport and protein crystallography. Additionally, its Epic technology provides pharmas with a leading high throughput label free detection system. Corning continues to advance its position in label-free detection by providing protocols for biochemical and cellbased assays as well as providing enabling methodologies for drug repositioning and early toxicology profi ling. is clear is that a one-size-fits-all approach will not work. The key will be close working relationships between pharmas and vendors based upon open and frequent dialogue that breaks down silos and drives product and technology innovation to meet researchers’ needs and maximise results.

LM. Bachem is a specialist supplier for complex substances and challenging synthetic molecules. We are particularly strong with hard-to-make products with very high quality requirements. This requires many years of know-how and many years of building a quality mentality and infrastructure. We often say at Bachem “quality matters” and it is a mindset that pervades everything we do and is reflected in everything we make. The combination of this and special technological expertise is already a very good differentiator. Additionally, we have streamlined our internal processes, structures and investments to adjust for the period of weaker demand to ensure we still remain fi nancially healthy. A mid-size and agile company can do this often better than some other types of organisation. Where we have, however, intensified our efforts and resources is in marketing and sales. In such a challenging market environment, it makes sense to maximise activities to fi ll the pipeline with new projects. As pharma firms look to head into more complex compounds dealing with higher levels of unmet medical need, how does the dynamic change between yourselves and your clients – especially considering the need for open collaboration within the industry? LM. The trend you mention is certainly taking place and is in fact very well aligned for Bachem. I have previously mentioned oncology as an example but there is also the same evident trend for anti-diabetics and anti-viral drugs. This alignment to peptides and other Bachem technologies is very positive. As we also serve the research ingredient market with our peptide catalogue and we observe the trends carefully here too in order to optimise our new product selections and our services. As an example, we recently added a very exciting new selection of fractionated venom lead-finding kits (Melusine) to our portfolio. We have already seen that this was much appreciated by our customers. JM. In an industry where there is presently a lot of rapid change taking place, specifically regarding the complexity of research to meet advanced medical needs, one thing that

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Where do you see the world of surface technology manufacturing heading in the next few years? JM. Based on our existing relationships with many of the world’s top pharma companies and our own 95-year heritage manufacturing leading technologies for the pharma and life sciences market, the future of surface technologies and manufacturing is moving more and more towards surfaces that enable close in vivo cell environments, synthetic surfaces that are scalable in formats, and xeno-free surfaces. Additionally, because research and the technologies that support it are progressing so rapidly, a solid understanding of both current technology and new technologies will be paramount – this further emphasises the need for open, close, working relationships to ensure emerging needs and the rate of innovation are in lock-step.

Dr Jeffrey L Mooney is the Commercial Technology Director at Corning Life Sciences and is responsible for assessing and developing product concepts and technologies for genomics, proteomics, and advanced life sciences. Mooney has bachelors and masters degrees in biology from Gettysburg College and Villanova University respectively and a Master of Arts Doctorate in biology from Temple University. He has more than 50 patents and 15 publications relating to genes essential for growth, microarrays, high throughput cDNA cloning and sequencing.

LM. Specifically for our business, the development of special resins will always be important for the manufacture of peptides. Solid phase peptide synthesis will continue to dominate as a technology versus older, conventional solution phase technologies, as more complicated peptides require the use of this preferred methodology. Additionally, for simpler cost-sensitive structures, micro-reactor technology is clearly having an impact. So the technology will follow the market needs both on the need to produce more complicated structures but also to reduce costs at the same time. Th is is actually a very exciting time on the pharmaceutical research front where some newer drugs are emerging to break though the long impenetrable therapeutic barriers related to cancer. I am hopeful for much more medical progress in this field in the coming years. If further improvements can be made in drug delivery systems as well as reducing the cost to produce these complex molecules, we can all be part of something great.

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13/01/2011 13:27

EXECUTIVE INTERVIEW

The source is out As outsourcing evolves once again to accommodate the shift in industry perspective, Dr. Reddys continues to place itself on the leading edge. What is your outlook for the global pharma outsourcing industry and how is CPS – the pharma outsourcing business unit of Dr Reddy’s, positioned? R Ananthanarayanan. There is an imminent need to enhancing innovation and R&D productivity. In addition, there is the diminishing blockbuster product model and ever more complicated lifecycle management programmes – these are just some of the new and ever-changing issues that form the broader challenge faced by innovative pharmaceutical companies in today’s environment. Th is is amplified by increasing cost pressures from healthcare payers whether they are governments or institutional healthcare providers. In view of these changes, pharma outsourcing is no longer an option but has become a strategic imperative for global pharma companies. Our Custom Pharmaceutical Services (CPS) business offers speed, f lexibility and cost efficiency. We have the capability to develop and supply both small-scale clinical quantities as well as commercial-scale requirements. Our end-to-end services from clinical stage intermediates/APIs to formulation development and manufacturing services including some niche technology offerings, competitive pricing and global presence makes a compelling value proposition to our global ‘innovator’ customers. CPS is thus uniquely positioned to become the preferred partner for innovators.

Dr. R Ananthanarayanan has over 20 years of experience in the pharmaceutical industry with specialisation in research & development, manufacturing operations, regulatory affairs, quality assurance, business development, global strategic sourcing, mergers & acquisitions. Ananthanarayanan was a key leadership member on the Executive Management Committee at Piramal Healthcare Ltd and was the President & Head of Pharma Solutions business. He worked with Piramal Healthcare for over seven years and was involved since the inception of Pharma Solutions business. Prior to joining Piramal Healthcare, Ananthanarayanan was Managing Director – Asia & Head of Global Sourcing for Galpharm International Ltd, a UK based manufacturer/distributor of specialty pharmaceuticals and baby products. He led strategic outsourcing of product development, launch product manufacturing, and management of late lifecycle products.

Can you give us an overview of CPS and its operations? RA. CPS has emerged as one of the largest pharma outsourcing businesses from India. Our dedicated R&D facilities – one in Cambridge, UK and three in Hyderabad, India; one in Cuarnevaca, Mexico is supported by pilot plants in UK and India. For high volume manufacturing, we have plants in the UK, Mexico and India. We have sales and marketing offices in Europe (UK, France and Switzerland), North America (USA), and Asia Pacific (India and Japan). This network provides an ideal platform to serve global pharma outsourcing demand. We are a select few pharma outsourcing companies that can offer end-to-end capabilities. On the API side, services offered by CPS include process development, scale-up and commercial manufacture including highly potent APIs. On the formulation side, there is formulation development, clinical trial manufacturing and commercial scale manufacturing of finished dosages including oral solids and fill-finish for highly potent compounds. In addition we provide CMC support for

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IND, NDA and DMF filings. Compliance with global quality standards of cGMP, USFDA and European regulatory authorities reiterates our emphasis on quality as a key Dr. Reddy’s value. Does the acquisition of Chirotech bring something new to the table for your customers? RA. Chirotech has more than 20 years of experience in Chemo catalysis as well as Biocatalysis and has a vast library of enzymes. This gives us an edge to provide cost effective solutions for chiral intermediates and commercialise a number of projects. We have an extremely efficient enzyme production system based on pseudomonas expression technology. We have expertise in asymmetric hydrogenation with a portfolio of proprietary catalysts and experience in producing commercial quantities of pharmaceutical intermediates. The catalysts can selectively reduce a broad range of substrates very selectively and are complementary to biocatalysis. Another interesting addition to our toolbox is hydroformylation in both achiral and asymmetric variance. This technology has proven to be readily scalable in a cost efficient way, giving access to some unique intermediates. Other catalytic technology used by the team includes the asymmetric alkylation technology developed by Prof Trost, for which we have an exclusive license. In the last six years, Chirotech has offered activated mPEG material for the conjugation of proteins, antibody fragments and peptides to enhance stability and pharmaco-kinetic properties of biologic drugs. We can readily tailor this product to meet our customer’s requirements. All of these technologies have enabled us to differentiate our offerings to innovator companies and provide technology enabled manufacturing services. Are there any other technology service offerings you would like to talk about? RA. CPS is one of the few service providers to offer a complete solution for high containment and cytotoxic compounds from API development and manufacturing to development and commercial manufacturing of the finished product. Dr Reddy’s has developed a large number of high potency APIs that are available for sale to pharma companies. We have the right skills and infrastructure to manufacture these APIs. We offer a full range of reactor capacities. We have a strong quality and safety culture. For example, we practice containment through air handling, pressure zoning, and isolation. There are a large number of oncology products in various stages of development and we are very well positioned to offer development services to innovators. In addition, we have a strong value proposition in Steroid, female hormonal products, Prostaglandin chemistry, and carbohydrate chemistry apart from chiral capabilities. We also offer a differentiated product services offering integrating our APIs to fi nished dosage forms.

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SUPPLY CHAIN

Supply chain analytics: pharma has to do better By Eugene Jones

he global pharma industry is currently weathering a storm of unprecedented market conditions. Accenture research has found that over the past five years, patent protection has expired on products accounting for more than US$80 billion (€60 billion) in annual sales, and in spite of steadily rising R&D costs, pipelines have failed to deliver replacements. Against this background of looming competition from generics, the industry is also holding as much as US$46 billion (€35 billion) in excess inventory, according to a recent Accenture study. In this environment, it is no surprise that

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companies are hungry for opportunities to improve the efficiency of their operations, better understand their customers’ demands, and devise more creative responses to the marketplace’s challenges. Supply chain analytics provide a key means to make progress in each of these areas. Analytics, in this sense, is best understood to mean fact-based decision-making that incorporates statistical and predictive techniques to explain and forecast trends. The facts and trends in question may certainly be related to supply chain metrics, but analytics go beyond simple measurement of past performance to provide insight into what may lie in wait. Analytics are of critical importance for making and sustaining both operational and strategic improvements across the functional areas of the supply chain. Accenture’s Global Pharma Industry Supply Chain & Tech Ops study – completed in May 2010 – provides a compelling perspective on the industry’s progress and challenges with respect to supply chain analytics. Involving 25 pharma and biotech companies from around the globe and across industry segments, the study covers a wide range of topics, from supply chain strategy and organisational design to planning, fulfi llment and compliance. It offers an excellent vantage point from which to observe the impact of analytical capabilities on supply chain performance. While most study participants would agree with the statement that, “supply chain analytics are a crucial part of our strategic priorities,” their efforts are largely focused on a single dimension: developing greater visibility into supply chain performance. There is certainly room to improve in this area, but the true value of analytics goes far beyond simple performance management. Indeed, participants who indicated stronger analytical capabilities (e.g. closer integration with customers on demand forecasting) also consistently demonstrated higher margins. Even beyond these quantitative benefits, analytics offer the keys to identifying and building on competitive strengths which will become increasingly important as pharma companies are forced to operate in a less blockbuster-driven model. Data availability is the most fundamental requirement for strong analytic capabilities. Th is is an area in which the pharma industry continues to struggle. Supply chain data are typically scattered throughout a fragmented landscape of manufacturing, enterprise resource planning (ERP), and laboratory information management (LIM) systems that do not exchange information. Frequently, multiple instances or platforms for each type of system are running within the same company, further complicating the data landscape. Pharma companies’ ability to pull information from outside the organisation is not much better. Few have

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been able to develop tight links with customers, and even where these links are in place, the companies fi nd themselves challenged by the fact that their customers’ data are often of less than sterling quality.

Obstacles But having the data, while necessary, is far from sufficient to develop strong analytics. Learning where the organisation can produce reliable data (or perhaps more importantly, where it cannot) is a problem that can only be solved through experience and experimentation. Companies that have advanced analytical capabilities typically developed them by focusing first on using the best data they had, and working to increase the quantity and quality of data only after building an ability to make meaningful data-based decisions. In fact, organisational factors that break the link between data and decisions are often the biggest obstacles to overcome. Too often, supply chain organisations in the pharma industry operate in disconnected functional silos, which encourage decision-making based on tradition, rather than data. Perhaps the most critical first step toward better analytics is to develop a focus on facts and a willingness to challenge assumptions. Traditional thinking, for example, might dictate a decision like the following: We manufacture life-saving drugs. Stock-outs are intolerable, and we will work to maximise our delivery to customers’ requested dates and quantities, building inventory if necessary to ensure that all orders are fulfi lled.

“If the challenges facing the pharma industry are large, so are the opportunities. For companies wondering how to begin building analytics capabilities, taking a closer look at working capital can be an excellent place to start” Analytical thinking might suggest a very different approach: Pharmacies and distributors both retain some stock level of our products. Given their inventory levels and patient demand, what level of order performance must we achieve to ensure patients have the drug when they need it? As organisational capabilities mature and data quality improves, focus will shift from using analytics to enhance the effectiveness of traditional processes to building new ways of operating. In the consumer goods industry, for instance, manufacturers are increasingly turning to point-ofsale data from their retail customers to design algorithms that allow product manufacturing and replenishment strategies to be tailored to the stages of the product lifecycle in real time.

Improvement The utility of such an approach for pharma companies facing tougher generic competition and lengthening R&D timeframes is obvious. What’s more, the industry’s current focus on improving product traceability and supply chain

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security will tend to build exactly the kind of links with customers and distribution partners that can provide the data to drive more analytically oriented forecasting and replenishment. For guidance on how analytics can be best deployed in the pharma industry, it’s helpful to look at how analytics ave ve drive dri driv have driven improved performance in other industries. A leading leeaad d big-box retailer in the United States has een able abl to leverage two decades of experience in collectbeen ing and reporting on product data to radically democratise decision-making; pushing decisions on reorder points, product mix and discounting to a local level; and allowing store employees to custom-fit sale items to conditions in hee comm com the community. Forw waa w Forward-thinking internet retailers in several categoes have hav iinvested heavily in developing predictive models ries of user behaviour which allow them to direct advertising and product recommendations based on users’ likely prefrences ences aan erences and their own inventory and margin requirements. One o of the world’s largest manufacturers of building material aterial uses a predictive model of traffic and weather materials conditions that allows them to guarantee a 20-minute arrival window for perishable mixed cement, a capability which has enabled them to charge premium prices for the most basic of commodities. Several common themes emerge from these examples. One is a cultural focus on analytics; high performers have a quantitative mindset, constantly using data to challenge assumptions and separate ‘what we know’ from ‘what we think we know’. Equally important is a focus on using analytics to drive differentiation – analytics are used to seek out prospective sources of competitive advantage, rather than just measuring past performance. Finally, these companies have moved beyond internal data to draw information from the outside world where necessary. All these capabilities come together to make analytically advanced companies more customer-centric than their competitors. If the challenges facing the pharma industry are large, so are the opportunities. For companies wondering how to begin building analytics capabilities, taking a closer look at working capital can be an excellent place to start. A short, two- to four-week investigation of working capital using a strong analytics approach can provide both short-term opportunities for fi nancial benefit and insights into which areas should be prioritised to develop analytics capabilities in the long run. The recent wave of merger and acquisition activity offers especially tantalising opportunities for the consolidated companies. Improved analytics in the areas of business simulation, network optimisation and risk modeling offer the potential for greatly enhanced synergies, and a quantum jump in supply chain capability. The path blazed by pioneers in other industries offers pharma companies the prospect of comparatively rapid advance toward strong analytical capabilities and the benefits that go with them. Eugene Jones is a senior executive at Accenture, a global management consulting, technology services and outsourcing company. He leads the supply chain practice for Accenture’s Life Sciences industry group.

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ASK THE EXPERT

It’s all in the packing As pharmaceutical markets emerge and evolve, so do the regulations and innovations surrounding them – and nowhere is this more prevalent than with its packaging.

he dynamics that we have been observing over the last few years in the pharmaceutical industry is probably greater than in most other industries. On one hand, it is the often cited patent cliff that makes pharma executives nervous. They have to manage big expectations from the market to revitalise that pipeline with new products, which they develop themselves, licence in or buy in with an acquisition. Often times the pipeline per se would still be all right but to get the products approved is getting more and more challenging. Drug approval agencies like the FDA have ever increasing requirements for new drugs. Either they have to be fi rst inclass for unmet needs or they should show substantial cost/ benefit improvements over existing drugs. On the other hand, the pressure from governments to bring down healthcare costs will grow even more in the years to come. In the aftermath of the fi nancial crisis, most governments have no leeway at all to spend more money than absolutely necessary. In this environment pharmaceutical companies, of course, work on both their revenue as well as their cost side along the whole value chain. Naturally, this also involves production and packaging of the drugs. One obvious opportunity to generate new business and to contain costs is the move into emerging markets. Hence, many big pharmaceutical companies bought local production facilities to transfer their products from the developed world or to get immediate access to new, strongly growing markets for products addressing therapeutic areas like diabetes and cardiovascular. Such acquisitions often times also helped to diversify into areas like generics and to have a sales organisation readily available. In order for this move to be as smooth as possible, the packaging solutions and the corresponding packaging equipment have to easily enable life-cycle management.

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Product transfers always involve adapting production capabilities because variability generally increases when different sites or part of their production plan are consolidated. Since there are less and less big volume blockbusters, the old maxim “one packaging machine per product” does not apply anymore. Ideally, the packaging concept and the equipment are ready to package a whole variety of different dosage forms. Today it is not unusual for the production department to run ampoules, vials, syringes, alcohol swaps and, of course, all kind of patient information on one single line. With such flexibility, it is easier to do more on less equipment and to make sure capacities are utilised well. It goes without saying that swift format change over is crucial to get a good Overall Equipment Effectiveness, which in turn is the biggest cost driver in production. In state of the art packaging facilities it is today certainly the norm to change, for instance, from a presentation containing a vial, an adapter, a syringe, an alcohol swap and a booklet to a presentation containing five injectors in about 45 minutes (this does not included line cleaning). Additionally, modular and flexible packaging equipment solutions like Dividella in Switzerland offers, address the uncertainties of today’s pharmaceutical market, be it in the developed or in the emerging markets. It is less and less predictable if a product is going to be approved by the regulators. And even if it is approved there is no guarantee that the market will fully embrace the new product in its chosen presentation. Under these circumstances asset protection is vital. In other words, the existing equipment, which was bought for a specific product for example, should be capable of being retrofitted for other products. In recent years, we can clearly confi rm this trend since about 50 percent of all our packaging lines have been retrofitted for one reason or the other.

Dr. Manfred Zurkirch is Managing Director of Dividella AG, which he joined in 2006 from a leading Swiss technology group, where he was Business Unit Manager, and previously VP of Marketing and Sales. His expertise covers the capital equipment industry, and through his extensive sales activities he has an excellent knowledge of international markets.

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13/01/2011 13:34

INDUSTRY INSIGHT

Collaborative platforms key to future pharma success Bringing together the worlds of the scientist, engineer, patient and payer will be increasingly important for future pharmaceutical success, argue Siemens’ Rebecca Vangenechten and Sivarama Nalluri.

egulatory developments and technological innovation are opening up new opportunities for companies to use life cycle collaborative management to bring together parts of the value chain that have traditionally been relatively distant from each other. Collaboration will become increasingly important across the R&D/manufacturing interface and across the pharma/patient interface. Until now, these interfaces have traditionally been points of disconnection rather than connection. For example, as a product moves from the development stage to the production stage, it is more likely to be ‘thrown over the wall’ between R&D and manufacturing rather than be part of an ongoing process where knowledge gained by the scientists has already been shared collaboratively with the engineers. The US Food and Drug Administration’s ‘critical path initiative’ has paved the way for the use of process analytical technology (PAT) in manufacturing. Process understanding gained in the process development lab needs to provide the foundation for process control and optimisation that PAT enables at the manufacturing stage. Indeed, with good process understanding and control, pharmaceutical companies can have the real possibility of continuous manufacturing which avoids the need to scale up altogether, thus shrinking the time to get product to market. Information needs to flow from R&D to manufacturing but it should also be a two-way collaborative flow. Knowledge gained through manufacturing can, for example, be re-used to accelerate the product development process. The second interface – between pharma and patient – is becoming increasingly important for a number of strategic reasons. With fewer new molecules and blockbuster products left to be discovered and developed, companies have to turn more to optimising the particular effects of existing molecules for individual patients and segments of patients. In parallel with the decline of the blockbuster

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drug, governments and healthcare payers are coming under immense pressure to contain costs. In the future, most medicines will be paid for on the basis of the results they deliver. Because many factors influence outcomes, pharma companies will need to have more knowledge and understanding of how and why outcomes vary at the point of use and to be able to use that insight to optimise drug characteristics to a patient’s therapeutic needs, whether that is through product formulations or delivery mechanisms, and to feed that information back into development, formulation and manufacturing. Many of the technological tools to achieve collaboration across these vital interfaces are available. Product lifecycle management (PLM) platforms have a key part to play in providing the backbone infrastructure for shared knowledge, data and work process collaboration. However, unlike other industries, their potential is relatively unexplored in pharma. PLM soft ware platforms have the ability to handle large volumes of data and to support a large number of users with diverse skill sets in globally distributed environments.

Rebecca Vangenechten is a Life Sciences Industry Consultant with Siemens. She is responsible for business development life sciences US and focuses on innovative technologies, including process analytic technology (PAT).

“Product lifecycle management is the missing piece in the pharma discovery and development jigsaw” Sivarama Nalluri, Enterprise Solution Architect, Siemens Siemens already has a strong presence in healthcare, with diagnostic devices, soft ware and other solutions, and in pharma with PAT, LIMS and other technologies. PLM soft ware, developed by UGS, is now part of the Siemens’ portfolio of solutions. By providing common access to a single repository of all molecule and product-related knowledge, data and processes, PLM can speed up the innovation and launch of successful products. PLM manages whole life cycle of the drug and enables networks of innovation and collaboration, capturing best practice and lessons learned, creating a storehouse of valuable intellectual capital for re-use. The prospect of bridging these interfaces is compelling. It offers the twin prize of being able to build the right product, using the interface with healthcare to develop a product that the patient needs, and to build the product right, using data and process understanding from R&D all the way down through manufacturing to get quality right and shrink time to market.

Sivarama Nalluri is an Enterprise Solution Architect in the Ofﬁce of Architecture and Technology, Siemens PLM Software. He has more than 20 years of experience in research, planning, architecting, developing and deploying innovative PLM and other enterprise software solutions for Fortune-500 corporations. He is responsible for translating CPG, F&B, Pharma and other consumer products customer requirements into product technology roadmaps.

14/01/2011 13:33

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13/01/2011 13:38

NEXT BIG THING

The changing challenges of supply chain performance When it comes to pharmaceutical supply chains, cost pressures are merging with shifting production, and time-to-market is becoming more challenging than ever. Geodis Wilson’s Martin Svantesson believes that the answer lies in global solutions, and he says that interaction between freight forwarders and pharmaceuticals has never been greater. Challenges of the cool chain The distribution demands of pharmaceutical products are more stringent than for many other types of products. End-to-end logistics solutions in this market segment must maintain ‘cool chain’ ambient temperature requirements of between two and 25 degrees Celsius. As a result, pharmaceutical companies, manufacturers and distribution providers are constantly working together to develop better ways of securing optimal temperature control for all shipment modes. However, mode of transport is really not the driver for pharmaceutical companies. Instead, the challenge lies in securing the right type of equipment for specific product requirements for specific markets. In other words, the choice of mode is linked to a company’s supply chain strategy for a specific market or region. Pharmaceuticals are predominately high value goods. As such, they demand a safe process at all hubs in the chain. Security measurements must be harmonised and rigorously checked across the operating lanes, and defi nitely at sub-warehouses and on/off loading places, which should be kept to a minimum. In fact, the importance of minimising on/off loading places and transport mode changes of is one of best ways to create time-effective and secure solutions. The challenge then moves to cost. When it comes to the costs of distributing pharmaceuticals, the gap between regular air or sea freight shipments and pharmaceutical shipments has narrowed. The pharmaceutical industry has put two focus areas on their internal map: global supply chain harmonisation, with cross-divisional activities and increasingly centralised decision making, as well as cost-cutting activities, including a comprehensive review of the costs of the full supply chain. These days, companies understand more than ever what they are paying for. Naturally, these key changes are good for the pharmaceutical industry. But they also provide an opportunity for logistics providers – interaction between these two groups has never been greater. As patents expire for the blockbusters, fierce competition from generic companies is making time-to-market the most important success factor going forward. At the same time, the pharmaceutical industry is seeking to outsource non-core

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activities. There is room for an innovative solution provider that is willing to go beyond general freight management. Today’s market now demands global solutions, and customers want the ability to lower inventory levels while ensuring correct quantities. As orders become smaller, production and order profi les change. While this is obviously a challenge for distribution, it also greatly increases the value of consolidation possibilities that can meet the lead time demands of end customers. As the production of high and low value pharmaceuticals is moving to emerging markets it has an impact on solution providers – they need to be where the industry is, so their network infrastructure needs to expand while meeting GDP requirements, and local compliance and competence regulations. These types of changes in supply chain routines can have dramatic effects if they are not properly implemented at all levels. However, clear communication can greatly reduce their cost. Global harmonisation therefore enhances the possibility of maximising effects in a supply chain. It is this type of harmonisation and interaction between pharmaceutical companies, freight forwarders and carriers that helps ensure supply chain success. As a company that has worked closely with pharmaceutical sector for many years, Geodis Wilson saw these changes coming down the road, and we realised that optimal supply chain performance would become a vital part of the key winning strategy for pharmaceutical companies. We are going to do our part to make sure all parties understand just how much sales strategy impacts the supply chain, and that time-to-market – with a keen eye on the chosen distribution strategy to and from the warehouse – will help pharmaceuticals be a successful as possible. 

Martin Svantesson is Vertical Market Director of Geodis Wilson Pharmaceuticals. He has 15 years experience in Global distribution and holds a Masters degree in Supply Chain Management. Svantesson’s role is to develop Geodis Wilson’s pharmaceutical distribution solution/ proposal for existing and potential pharmaceutical customers, as well as to harmonise a global approach within Geodis Wilson in regards to pharmaceutical handling according to GDP standards.

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13/01/2011 13:36

INNOVATION

INNOVATION AND COLLABORATION NGP talks to Ted Torphy, Vice President and Head of External Innovation for the Research Capabilities Organisation of Johnson & Johnson, about the need for greater collaboration to boost innovation in R&D.

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What do you consider to be the most serious hurdles that currently need to be overcome in the discovery and development sectors within the pharmaceutical industry in Europe and in the US? Ted Torphy. In many ways the EU is ahead of the US in terms of what the business climate is going to be. I think the major difference is and what is changing progressively within the US is that in the EU, reimbursement is based upon outcomes. In the US, at least in the past, of course you had to have a positive outcome, but reimbursement was whatever the market would bear. I think that’s likely to change over time and the payers don’t care where the solution comes from or what the solution is, they simply want an effective outcome for the patients. What tools and technologies are Johnson & Johnson using to ensure that you’re continuing to push that envelope and stay as efﬁcient as possible? TT. To the extent that we can, we’re continuing to use biomarkers. We’re attempting to identify biomarkers that will predict outcome in the clinic, which can help in identifying subsets of patients as well as reducing the size of clinical trials. My own personal opinion is that the most important technology coming along will allow us to access and use data from electronic medical recordenabled databases. Changing a system is not something that can be achieved by grafting new technology on to old modes of thought. To what extent do you consider that to be a truth and how will the system need to change to accommodate it? TT. The most important change that we will go through is not related to technology – yet it may even be more important than the introduction of new technologies at least in the foreseeable future – is a change in the business model of R&D. By that I mean how do we leverage what we do best in large pharma? How do we use economy of scale and the breadth and the depth of expertise that we have? How do we use it in the discovery and the development of drugs? How do we use it to enable our external partners? How do we compliment what they don’t have and how do we use what they do have to provide that solution to the customer? You gave a speech recently at the NGP Drug Discovery summit, in which you talked about virtual integrated systems. Could you please elaborate on the concept? TT. By that I mean that there’s a competitive advantage for all of the players within an industry, that all the pieces of the value chain that are within an industry and the players that lead them, that there’s an economic advantage for them to work with each other to see to it that each other succeeds. So rather than having one company build and maintain every part of the value chain that is needed to put either the product or the service on the market, the different players within the value chain begin to focus on what is really important for them.

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Ted Torphy Probably the ultimate in a business model like that is what Steve Jobs has done at Apple. After all, what does Apple really make? Their hardware I’m sure is manufactured elsewhere but they own what their core competency is – the design and then partly in the distribution channels. But the hardware, the soft ware and the content is all coming from elsewhere. They wouldn’t be the company they are now if they tried to do all of that themselves. Choosing your business approach is never a simple binary choice. If a company chooses not to do that or not to take on a certain approach in terms of the business model and in three years the environment changes, great companies will fi nd their own way to move on. I think the real concern is that we don’t learn from what has happened in the past. Our real concern is that we think we’re special, that we’re different from the other – there’s something different and special about the pharmaceutical industry compared to others. It just isn’t the case. So since so many other industries, as they mature they change, and chances are since that’s almost always happened in the past it will happen with us. What are your thoughts on open collaboration? How do companies go about ensuring that they’re securing themselves while getting involved within that? TT. That’s a key question. What you need to decide, what any large pharma needs to decide is, “Why are we here?” What does society need them for and what is the value they have? Then ensure that they protect that unique value. We’re going through a transition now where we used to sell ‘hardware’, and were reimbursed or paid for the outcomes. Our value is is going to change somewhat in terms of the value as the whole package. It’s the patient outcome and it’s the information that we provide along with the products. You don’t pay US$4 a day for a pill because the pill costs that amount. It’s actually the package insert that costs

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INNOVATION

that. It’s the information in terms of why it works, who it works on and who it doesn’t work on and what to use it with, what not to use it with, what the side effects are, what the complications are. It’s 15 years worth of investment to get that information. If you think about that, just to give you an example, if we are not contract research organisations, if we don’t care about certain pieces of intellectual property, either know-how or patents, if it’s not our core competency but it enables what we do, if we can use that and let our partners use that too to enable what they do, by defi nition it helps us. Yet many pharma companies won’t do that and instead they say, “If we’re working with a partner and we decide that we are going to move out of this therapeutic area, we’re going to dissolve our relationship we had with a partner.” Why not make part of the value equation to them and to bring partners to us to say, “If we do this we will license any of the IP we have that is related to that to you at terms that aren’t going to tie your hands behind your back. It’s hard for us to understand that and it’s hard for us from an emotional standpoint to let go of that. But in fact now we’ve just enabled them as a partner, which is good. It’s good for the ecosystem and in the long run it’s going to be good for us. How do you feel about the pharmaceutical industry expanding into emerging markets? TT. It’s critically important that whatever we do in the emerging markets needs to be done there. The R&D needs to be done there: using the local talent to address the local problems because trying to shoehorn the solutions that we think will work in the west into a developing economy is the wrong way around. We can’t, either because they can’t afford it or because their healthcare systems are just developing. There are opportunities there that are unimaginable and don’t fit into the IP-rich environment of the way we have done things. Don’t try to force our solutions down the throats of the emerging economies. Let it emerge there.

but right now many of the stakeholders within this ecosystem: the payers and the regulators and us, we’re not necessarily aligned to the extent that we could be to discover, develop and launch drugs that really make a difference, the breakthrough drugs where there’s a lot of risk associated with them. I’m not pointing a fi nger at any of the constituencies here but it just seems like there should be an expedited pathway for lifesaving or life-changing drugs where there’s an incentive for the innovators of those drugs to focus more of their resources there rather than focusing many of their resources on incremental changes for wellunderstood therapeutic care. The example would be – and I think that the technology is getting there – that we could do it with integrated EMR-enabled databases where you can essentially follow what’s happening with patients who are receiving a therapy in real time but after a robust phase II programme if it’s truly a lifesaving or a life-changing drug and you’re a pioneer in that field how can we set things up so that we could launch it in a contained way, that we launch it after a robust phase II, but only within this system where there’s essentially daily monitoring. If we could do that, everybody wins: the regulators win because they get much more information before a drug is launched more widely, and much more information about the safety and efficacy of the drug in real patients. Not just well-controlled clinical trials but in real life, in real patients. The patients win because they’re getting therapy for a debilitating or life threatening disease. We win because we understand much more about our drug and who the drug works in and who the drug does not work in before it’s fi nally launched. So it just seems to me that the fi nancial incentives are not necessarily aligned right now to deliver truly innovative drugs.

“The most important change that we will go through is not related to technology – yet it may even be more important than the introduction of new technologies at least in the foreseeable future – is a change in the business model of R&D”

How did the global economic downturn affect Johnson & Johnson in terms of your productivity and security within the discovery and development sectors? TT. We manage for the long term in a comprehensive and proactive way. While there are certain choices that we have to make as the top line gets squeezed and the margins get squeezed and the bottom line gets squeezed, it really hasn’t changed our view that we have to invest for the long term. Th is is a cycle and we’re going to come out of it. When and how isn’t clear but we have to hang on to one thought and that thought is that as long as the innovators are delivering lifesaving and life-changing solutions we will be fairly compensated for that. If not, if we believe that’s not going to be the case in the future, let’s quit. If hypothetically you could click your ﬁngers and change one thing in the industry, what would it be? TT. There is one thing that comes to mind and it’s a big issue. Not absolutely clear as to how we would address it

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TROUBLESHOOTER

A patient-centric focus The key to marketing and supporting the QIPP challenge. By Morna White

A patient questions: How can the biopharmaceutical sector achieve long-term brand success? A key challenge is the shift in power from physician to payer, as payers are now demanding more demonstration of value in a cost-constrained environment. The NHS’ Quality, Innovation, Productivity and Prevention (QIPP) challenge is but one of many initiatives being deployed across Europe that address this. Value must be demonstrated in terms of patient health outcomes, which may not be consistent with clinical trial results due to the many complicating factors inherent in naturalistic settings. Nonadherence leads to poor efﬁcacy and lost sales, with results and economic beneﬁts that are worse than expected. This generates mistrust. To address this, we need an understanding of ‘real-world’ patients that is as thorough as our understanding of physicians. This would allow us to select market access and marketing strategies that are aligned with payer and patient needs. How can we build this in-depth understanding and tackle the patient challenge?

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In the new health landscape, shift ing stakeholder power and expectations are making an already challenging environment even more complex and less predictable. More than ever, payers are demanding evidence of a drug’s value beyond clinical trials: they are seeking to evaluate how it performs in the real world. Although payers are the dominant stakeholders, their focus on patient outcomes makes the patient an influential player. The traditional pharma model’s short-term focus – based on deploying large numbers of reps to drive prescribing of products – is no longer viable. Pay-for-performance models are generating more attention, as payers look to adopt pricing models linked to the economic benefits a drug delivers. True added value – and not simply safety and efficacy – is now required for market success. Unless they offer an especially compelling case on value, products lacking a novel treatment mechanism are falling out of favour, as they fi nd fewer advocates willing to add them to formularies and keep them there. The ability to use a patient-centric or outcomes approach to demonstrate that products and technologies align with and

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Morna White is Practice Leader, Commercial Strategy for Quintiles. She is focused on creating innovative sales and marketing solutions, including greater integration of clinical/ commercial insight within the pharma business model. White has particular expertise in patient-centric marketing strategies and has recently been working with a top ﬁve pharma company to support a new launch. Morna White is Practice Leader, Commercial Strategy for Quintiles. She is focused on creating innovative sales and marketing solutions, including greater integration of clinical/ commercial insight within the pharma business model. White has particular expertise in patientcentric marketing strategies and has recently been working with a top ﬁve pharma company to support a new launch.

drive the QIPP agenda will be essential for success. Since QIPP focuses on ‘full system’ efficiency rather than isolated elements, pharmaceuticals need to be low in price only if they offer no other system benefits. The true centre of gravity has shifted from the voice of the physician to the voice of the patient, as delivered through the payer. Making the right marketing investments relies on asking patients the right questions and allowing their insights to inform strategy at all levels. These questions include: What drives the patient to the doctor? Will the ‘political’ voice of the patient support access to therapy? What patient pathways allow optimal access to therapy? What is the patient experience like? Which specific therapy issues relating to treatment satisfaction need to be addressed? What behaviour change can positively influence adherence? A new approach is clearly needed to support brands over the long term, using an in-depth knowledge of patient behaviour to build loyalty and retention. A patient-centric focus by biopharma can also help address the QIPP challenge, positioning pharma as a core component of the value chain, delivering cost-effective, innovative and value-based healthcare delivery to patients. Th is approach will also meet demands for evidence of a brand’s value in a real-world setting – essential if market access is to be granted and maintained. Proving this value also requires a thorough understanding of actual patient outcomes and experiences. The concept of joint working between the NHS and the biopharmaceutical industry on a broad agenda for the benefit of patients remains a promising one. To date, most major NHS initiatives have been driven by ‘big pharma’. These market leaders have much to contribute and gain from strengthening their partnerships with the NHS. There is an opportunity for companies to provide expertise to the NHS to increase efficiency and meet patient and NHS needs with accessible, sustainable and cost-effective therapies.

“Understanding the patient experience across a complete continuum of care ideally positions biopharma companies to build and demonstrate a brand’s value against existing treatments” For example, a collaborative NHS/industry project – involving AstraZeneca, Boehringer Ingelheim, GlaxoSmithKline, Nycomed and Pfi zer – helped to identify undiagnosed or misdiagnosed chronic obstructive pulmonary disease (COPD) patients. The project (which was delivered using Quintiles nurse advisers) demonstrates how transparency with stakeholder objectives and alignment of goals can build trust. It won a prestigious Association of the British Pharmaceutical Industry (ABPI) Joint Working award. Understanding the patient experience across a complete continuum of care ideally positions biopharma companies to build and demonstrate a brand’s value against existing treatments. Th is understanding starts with a fresh approach, using tailored online patient communities to deliver a unique level of engagement. It capitalises on the spe-

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cial value that patient communities possess in providing patient support, fostering patient dialogue and collecting rich data on intervention successes and patient outcomes. It forms a ‘closed-loop’ system, meaning that data collected can provide vital disease and therapy insights – and help companies to determine where best to allocate resources going forward. The end result is an opportunity to maximise the commercial potential of brands, to build evidence that supports value-based pricing, and to generate a variety of clinical, economic and marketing benefits. What evidence is there that this closed-loop model works? Quintiles’ clients are already seeing practical proof, thanks to our 2.5 million-strong patient community. Our approach is anchored to five integrated capabilities. First, creating custom-built communities of target patients by registering patients and keeping them engaged with their therapy. Second, evidence-based programmes designed to collect primary and secondary research data. Third, patient interventions, based on patient programme branding and using channels appropriate for each patient profile. Fourth, intervention feedback and real-world data collection, using regular patient community surveys to understand patient experiences. Fift h, multi-stakeholder communication, gaining the support of patient groups through management of advisory boards and patient associations, and driving marketing strategies that resonate with all stakeholders through papers, posters, publications and other tools. In a traditional sales and marketing approach, gathering frequent, dynamic feedback from all of those stakeholders would be virtually impossible (and fi nancially impractical). Th rough Quintiles’ Patient-Centric Services model, steady, timely streams of knowledge feed the decision-making process in a way that lets client companies put research and commercialisation resources precisely where they can best benefit all key stakeholders. Th is feedback has proven benefits for market access and brand value creation, having a positive impact on clinical trials (informing planning through real-world insight, helping to overcome study design challenges, understand length-of-treatment issues, identify potential problem areas and increase adoption); economics (providing rich information to guide fi nancial analysis on programme impact, illustrate a product’s cost-effectiveness, shape treatment guideline creation, lobby for formulary approval and inform future health economics) and marketing impact (helping clients identify key patient segments, enhance adoption and retention of patients and adherence to therapy, reduce patient attrition and measure and deploy the most effective channels). The combined effect of these benefits touches all key stakeholders. Payers can capitalise on improvements in patient care while gaining a better understanding of a product’s behaviour under real-world conditions. Physicians can make more efficient use of their time, thanks to patients who are better educated and more likely to access and adhere to appropriate therapies. And patients enjoy better health outcomes by being better informed and sharing their experiences with patient communities.

14/01/2011 13:33

EXECUTIVE INTERVIEW

REACH for the stars Ali S. Faqi discusses the implications of the REACH initiative for manufacturers of chemical substances. Dr. Faqi, DVM, PhD, DABT is Director of the Developmental and Reproductive Toxicology (DART) team and Senior Principal Study Director at MPI Research. What exactly is REACH? Ali S. Faqi. Established by the European Chemicals Agency (ECHA), the Registration, Evaluation, Authorisation, and Restriction of Chemical Substances (REACH) regulations were put into effect in June 2007 in an effort to improve the level of protection of human health and the environment through better and earlier identification of the intrinsic properties of chemical substances. In addition to requiring companies to provide more safety information, REACH specifies a progressive substitution process for more dangerous chemicals when suitable alternatives are known. If the regulations were put into effect more than three years ago, why is a sense of urgency associated with the REACH regulations today? AF. When the REACH regulations were established, provisions were made to phase them in over an 11-year period. The deadline for registration of high-volume chemicals (those typically known as hazardous substances) is 30 November 2010. To continue manufacturing and selling these products, manufacturers and importers must document their risk according to REACH guidelines. How can I ensure that my company is meeting the REACH requirements? AF. It is essential that producers of chemical substances work with contract research organisations that are knowledgeable about the REACH requirements. For example, companies may need assistance in determining the minimum number of vertebrate animals necessary to meet REACH specifications. Guidance may also be necessary in determining the number and types of tests that should be performed. MPI Research scientists work diligently to avoid overestimation, a problem acknowledged by the European Chemicals Agency that results primarily from lack of knowledge and improper interpretation of the regulations. Avoiding overestimation can result in significant cost savings for MPI Research Sponsors who are working toward REACH compliance.

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Are there any special considerations for developmental or reproductive testing? AF. Yes. When conducting research on chemical substances, it is important that companies consider the classification scheme used by REACH to label a substance with known developmental and/or reproductive toxicity. The criteria used does not appear to be based on the exposure level producing these effects, barring excessive generalised toxicity. Therefore, labeling these chemical substances without consideration of the effective dose level does not provide meaningful data about their actual risk. For additional details, see Anthony R. Scialli’s 2008 article, The challenge of reproductive and developmental toxicology under REACH (Scialli, A.R., The challenge of reproductive and developmental toxicology under REACH, Regul. Toxicol. Pharmacol. [2008], doi:10,1016/j.yrtph.2008.04.008.) How can I get more information about the REACH regulations? AF. Manufacturers of chemical substances can get most of their questions answered about these regulations by reviewing the ECHA publication, REACH in Brief. How can I be assured that my REACH testing strategy is solid and cost-effective for my company? AF. Work with a contract research organisation that has an accomplished scientific team that is knowledgeable about REACH regulations. It is important that they have a comprehensive understanding of the implications of REACH for your chemical substances. To discuss how you can be sure of a solid and cost-effective strategy for complying with REACH, discuss the development of a customised testing strategy for your chemical substances with Dr. Faqi at 269-668-3336, ext 1618, or ali.faqi@mpiresearch.com.

Ali S. Faqi, DVM, PhD, DABT is Director of Developmental and Reproductive Toxicology at MPI Research. He received his PhD from the University of Leipzig and serves on the Editorial Board of Reproductive Toxicology and on the Board Scientiﬁc Counselors Computational Toxicology at the United States Environmental Protection Agency.

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13/01/2011 13:36

ROUNDTABLE

Trends in outsourcing analytical support in pharmaceutical development With David Beyerlein of MicroConstants, Inc. and Dominic Moore of Waters Corporation

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What do you see as the main trends in outsourcing of analytical and bioanalytical support for pharmaceutical development? David Beyerlein. One continuing trend is the emergence of new “one-stop shop” service providers. While these models seem attractive initially, the overhead for these organisations is often so high that you lose out on the cost savings outsourcing makes possible. Additionally, drug developers need to ensure that the bioanalytical/analytical support function is indeed the core expertise of the vendor, rather than an ancillary service, or an afterthought. This can be avoided by choosing a CRO that has a niche focus with strong relationships and partnerships formed with other niche CROs to provide services all along the drug development continuum. Dominic Moore. Partnerships are the key way forward to pharmaceutical outsourcing relationships. Every month we see announcements that a pharmaceutical company has partnered with an outsourcing organisation to help develop their drug and this extends into the analytical arena. Numerous companies now rely on their outsourcing partners to provide the majority of their analytical and bioanalytical expertise, not just in a routine sense, but from early method development onwards. As such, the scientific presence in these providers is growing exponentially, thus the demand for state-of-the art instrumentation and data systems is growing. What are the current expectations of customers in the analytical outsourcing function? DB. Our clients are always looking for quality above anything else. While cost and timelines are important to any drug development study, if you can’t have complete confidence in the data that is produced, then money and time have been wasted. As an outsourcing provider, quality has to be the top priority. Every study needs to adhere to the latest relevant regulatory guidelines in the industry so that there is no question about the validity and accuracy of the results generated. DM. Customers are looking for quality, timeliness and then cost. They want to know the provider can generate good quality scientific data, using high quality, state-of-the-art instrumentation and data systems which are used in an efficient and compliant manner which allow the customer to accelerate their drug development plans. What are the main challenges the CRO industry has to face with regards to outsourced analytical and bioanalytical work? DB. Today every CRO faces challenges with competition, both from foreign markets and with the internal resources of drug developers. With regards to bioanalytical work specifically, the compounds being outsourced are becoming increasingly challenging analytically and the methods can be extremely difficult to develop. However, service providers with the most experienced and talented method developers will embrace these challenges and view them as opportunities to be scientifically creative to achieve success. DM. To remain competitive, CROs need to remain flexible to all of their clients’ demands, be able to work efficiently, and

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have the most productive systems and processes available. In order to do this, they need to invest in the latest rapid and sensitive analytical solutions, and ensure that processes are geared around getting the highest level of productivity from these investments at all stages of the cycle.

“Today every CRO faces challenges with competition, both from foreign markets and with the internal resources of drug developers” How do you see the analytical outsourcing model changing over the next 10 years? DB. One of the biggest changes recently in the pharmaceutical industry has been the decreased focus of big pharma’s internal R&D functions. This change in in-house capabilities is going to have a huge impact on the outsourcing model over the next 10 years. It has already led to an increase in virtual drug development and outsourcing models which will eventually increase the role CROs play in the drug development process. DM. The role of the CRO will increase to a point where they lead the strategic and development efforts for the pharmaceutical companies rather than being a partner in the process. In order to do this, the CRO industry will continue to innovate in areas of science and operations, ensuring they have the best tools possible to maintain high levels of productivity and quality for years to come. David Beyerlein, MicroConstants, Inc. David Beyerlein has over 12 years of experience managing laboratory operations, is an experienced analytical chemist and is highly skilled in the use of the mass spectrometer. Beyerlein co-founded MicroConstants, a bioanalytical and pharmacokinetic-specialty CRO, in 1998 with Dr. Gilbert Lam, and currently serves as Vice President of Global Operations.

Dominic Moore, Waters Corporation Dominic Moore is a Senior Business Manager in the Waters Pharmaceutical Business Operations team, working to deliver solutions that will positively impact customers’ laboratories and business objectives. Moore brings several years of experience in pharmaceutical development at AstraZeneca in the UK. Prior to joining Waters, he was pivotal in growing the analytical services business at Charles River Laboratories, a global CRO, focusing on formulation support.

14/01/2011 15:35

INNOVATION

FACING THE FUTURE T As the industry continues to come to terms with its need to evolve, there are those already looking towards the future to make changes for today – and for Nycomed, having key players with a ﬁnger on the pulse of the industry doing so, it can only be a good thing.

he current face of pharmaceuticals bears little resemblance to its predecessors. Of course, its end goals remain a constant and no doubt the idea of research and development can be traced back to its common denominator, in the days where apothecaries were 10 to the dozen and R&D was nothing more than rudimentary testing. But gone are the days of modern-age, closed innovation, securing multi-million dollar blockbuster drugs on a conveyor-belt of success. Whipping through to proof-of-concept with minimal intrusion has vanished. Regulatory leniency? Think again. But while the current face of pharmaceuticals looks little like its predecessors, the brains behind it still maintain an appreciation of its changing face – and at a time where the sector is deciding which path to choose to not just survive, but continue to thrive, these brains are the people who know what the industry needs. However, getting to that end point is anything but easy: open innovation, knowledge sharing and redressing the business model holistically are all ingredients to next generation success – but working out the right recipe is proving somewhat troublesome. For Sham Nikam, Vice President and Head of Global Discovery, and Nigel McCracken, Vice President and Head of Exploratory and Translational Development – both based at Nycomed’s Konstanz office in Germany – fi nding the right balance of ingredients is pivotal if the future of the industry is to be secured. But for the two VPs, having the same perspectives can be a stale process to progression at times, which is precisely why they take solace in grabbing both ends of the metaphorical stick. While Nikam believes comparing the US, European and emerging market sectors is like “comparing oranges to apples”, McCracken asserts that “we all have the same problem”, which exemplifies the need for honesty at a time when the industry is becoming more fragile.

US versus Europe “The US, Europe and emerging markets have very different payer systems,” continues Nikam, “so I really don’t think they are comparable in terms of revenue or how you market the pharmaceticals. They’re not comparable in the way healthcare is administered and they’re not comparable in terms of how pharmaceutical companies are run, so very different industries in all these countries.” And indeed they are, with Nikam also highlighting the fact that the US has significant innovation in all areas of the pharma industry. Europe in general has limited resources for true innovation – whereas the emerging markets are focusing on incremental innovation around the old drugs and making them available to patients at competitive prices. However, the biggest challenge in both the US and Europe is fi nding adequate fi nancial resources. “Resources are short and everybody in the last decade has cut R&D spending,” he says. “I also think that in terms of diversity of talent, the US tends to have a slight edge in its depth due to its political system encouraging immigration from all over the world. Th is is important for high quality innovation. In emerging markets there is a sense of ‘having to prove’ that they are not far behind and would like to show that they are also capable of bringing NCEs into development and eventually to the market.” Yet where Nikam is more on the payer system, which in turn provides revenues for future R&D efforts, he feels that it is important for the phar-

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maceutical industry do a better job of selling themselves as the creators of medicines that significantly help the relative society to reduce costs of healthcare by avoiding expensive hospitalisation and health maintenance costs, McCracken’s perspective concerns itself with the end-user – a constant of any pharma market. “We need to assure to the patients and peers that the drugs we develop have value to the end-user,” he explains. “The question is, how do we do a better job of convincing people that we can do that, and how do we literally make it happen? Then of course there’s the money aspect to it: yes, we’re doing something good for people, but we still need to be profitable as well.” In order to continue to remain profitable, whilst ensuring confidence in the end-user, open innovation has been brought up time and time again as part of a potential solution to the sector’s woes. But for an industry that is used to working in a closed environment, old habits and processes can be that much harder to break. In addition, big pharma, with its significant resources, will have to take the lead in undertaking cutting edge research to treat diseases that have alluded effective treatment. However, big pharma has still to come up with a pharma R&D model that is cost effective and manages attrition in clinical development. They have indeed taken time to change the business model that has negatively impacted new drug discovery and innovation. Smaller biotechs are generally based on novel drug discovery ideas and have the ‘can do’ spirit but lack significant resources of big pharma. In emerging markets such as China and India, local companies have focused on generic products and are involved in incremental innovation that can launch novel formulations of known drugs for local markets and also in some cases for worldwide distribution. “However, in the last ten years big pharma has not delivered consistently. Th is lack of delivery has – to some degree – come down to the fact that no one is prepared to let go of their IP. Th is is also because sharing of IP has not been done well traditionally. From an IP point of view that’s your bread and butter. That’s what’s going to provide the money for your future. There are obvious examples from a safety point of view for collaborations, which is bound to be a hot topic, but IP – unless the regulatory groups increase that 20-year patent protection issue – is going to be a tough one,” asserts McCracken.

“We’re inevitably going to be moving away from the blockbuster side of things towards targeting more specific people, and with that ensuring that those compounds really work in those people” - Nigel McCracken The right perspective The regulatory minefield McCracken alludes to is another ‘hot topic’ that often divides those sat within the realms of pharma. Of course the regulatory grasp has tightened across the board in recent years, but Nikam doesn’t believe this to be the only issue. Conversely, he places emphasis on the reaction of the industry to stricter regulations as a bigger issue. In fact, it has encouraged the industry to address some of the safety issues more proactively and be creative in bringing new drugs to the market. According to Nikam, it’s understood that no drug is absolutely safe and it’s the responsibility of the pharma companies to market safe drugs with the right therapeutic index – an inherent part of innovation too. In this regard, the pharma industry is doing an excellent job by taking attrition early and killing compounds in preclinical or early development stage when it is much more cost effective.

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INNOVATION

reaucracy as a lot of other companies. We defi nitely see ourselves as nimble Adding to that notion, McCracken returns to the importance of being as and quick, so decision-making at Nycomed is extremely quick. When we patient-centric as possible – and we can all admit that public relations haven’t change our portfolio, terminate or progress projects, we certainly don’t been a strong point of pharma companies in years gone by. He believes that stumble. I’ve seen the big pharma scene fi rst hand and it’s made me realise patients need to be more involved in the drugs that are being made, forcing that we are far more nimble and quick in taking and making decisions.” out the habit companies tend to have of assuming what end-users ‘need’ as And if the launch of Nycomed’s new drug Daxas, a phosphodiesteropposed to what they actually want. Together with the emergence of telease 4 inhibitor for the treatment of COPD, is anything to go by, Nikam is medicine and the concept of ‘e-care’, it looks as though the old adage of the certainly a man of his word. A fi rst in class, phosphodiesterase-4-inhiblife sciences and healthcare industries becoming far more sympathetic in itor with an anti-inflammatory component, Daxas has shown extremely their involvement with each other is on the cards to nurture this ideal. good efficacy in the treatment of COPD and has already been launched That’s all well and good as a concept, but for the immediate future, Nyin Europe. If it receives linear approval from the US FDA in the coming comed has the strongest possible minds working at its forefront, pushing months, then it’s all steam ahead for the creation in the US market, led by productivity and innovation through new technologies and tools to bring Nycomed’s US partner Forest Laboratories ; a solid transition from the EU to market ‘medicines that matter’ to patients. “We map a portfolio that has market says a lot about a drug’s potential. a better than average chance of success in Proof of Concept (POC) studies But this isn’t just down to hard work and having a solid team behind and reflects high technical doability preclinically and in development,” exyou: it’s about understanding what direction the industry is taking and plains Nikam. “We have chosen a low attrition model through smart selecplacing yourself accordingly – including building that consistent team tion of projects and addresses significant unmet medical need. The overall – something both Nikam and McCracken are extremely well-versed at. strategy also involves a mix of precedented and unprecedented targets that “There is still this silo mentality in pharma,” explains McCracken. “It’s not ensures consistent delivery of candidates in stringent timelines.” as bad as it used to be and I think it’s starting to get better. If you’re working Nikam explains that once the correct portfolio is in place, the next chalwithin an organisation that is working together as a team, with seamless lenge is to find the right resources and identify key partners that can assist communication with a common goal then that’s fi ne, however, that is not in bringing new technologies and expertise required for projects. “We are a always the case. We employ people within the industry that are scientifimedium sized pharma company that has a business model that encourages synergistic collaborations and partnerships. We at Nycomed do not believe in having all the necessary expertise or technology “My feeling is that the pharma industry has reacted in-house and have partnered with diverse companies to support significantly to the regulatory environment. No drug preclinical and clinical pipeline. Our development pipeline is a is absolutely safe and it’s our job to derisk to improve testament to our being an excellent partner.” And with the global fi nancial downturn maintaining its efficacy and reduce side-effects. That’s the nature of our position at centre stage, managing resources has never been business. Finally it’s all about the patient who is waiting more important. But arguably for the pharma industry, the for medicines that really matter”- Sham Nikam economic downturn hasn’t had as much of a direct affect as presumed – rather, the indirect consequences of widespread cally brilliant, innovative but we loose sight of the important fact that we fi nancial insecurity have provoked a change in environment that can’t help also need these people to have good social and communication skills.” but aggravate the industry. As McCracken sees it, you can have the best scientists in the world, but “I believe that we will be affected by the fi nancial changes,” commits if they can’t express themselves effectively then they’re likely to become McCracken, “because all the measures that the governments are putting in counter-productive to the team as a whole – hardly an innovation-hunting place to save money is going to hit on pharma somewhere down the line. asset. Gaining the right balance is key to gaining the right productivity: They’re not going to be paying the same amount of reimbursement and being as proactive as possible outside your comfort zone is becoming the there’s going to be challenges for the pharma industry in the future because currency of pharmaceutical teams across the board – a notion Nycomed we’re going to need to show real diversity and prove that the drugs actually has done well to acknowledge. work. Unless we can do that, we will struggle in the future to sell drugs. “If you look at the way we work, we’re doing a good job of making “It may well be that some of the projects that go through are put on the a difference to peoples’ lives in many diseases, which are going to give a backburner, slowed down or have their payments deferred. It works out that better quality of life, but also prolong age as well. We’re inevitably going you have to become more efficient regardless; there’s a reason we find ourselves to be moving away from the blockbuster side of things towards targeting in the environment we do today. But to be honest, the change is continual and more specific people, and with that ensuring that those compounds really you just have to react to things as and when they come and be flexible enough work in those people.” to do that. Most pharmas are run by people who are more business minded To McCracken, thinking ahead it’s not just about personalised medithan most, which is fine because it’s a business, but you need to be able to react cine, it’s also about polypharmacy. Years down the line, people won’t be to the environment that you’re working with. If that environment changes taking one or two compounds, they’ll be taking 10 to 20 compounds all at then you need to be able to adapt relatively quickly and just get on with it.” one time. What is important to know is how this concoction of compounds reacts with one another in vivo. How it’s assessed and anticipated are quesThe right balance While this sentiment may alter slightly, McCracken’s rule of thumb tions that will need to be answered. Th is is where he sees the future focus highlights the need for flexibility and an ability to adapt effectively – somebeing placed, which is precisely where pharma should be moving. For both thing Nikam agrees with wholeheartedly. “Nycomed is a privately-owned, McCracken and Nikam, the future is not only challenging – it’s exciting. medium sized pharma company,” he asserts. “We have a different set up And with the quick-pace of Nycomed behind them, they certainly have compared to a publicly metered company, so we don’t have as much butheir fi ngers on the pulse of the future.

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HEADING INNOVATION

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What the pharmaceutical industry needs to do to avoid the fate of the dinosaurs, according to Les Hughes

onsider the dinosaurs. For millions of years they ruled the earth, then they were suddenly wiped out by a mysterious event we have yet to fully understand. While we may disagree on exactly what happened, one thing is certain: few traces of these monstrous beasts remain. Now consider the pharmaceutical industry. Many would argue that Big Pharma, increasingly hobbled by lack of innovation, patent expiries and a dearth of new blockbusters, is lumbering toward extinction. What must companies do to avoid this fate? Les Hughes, for one, is confident that the industry can rise to the challenge. Hughes, who is VP Global Discovery & Global Head of Cancer and Infection Research at AstraZeneca, believes that, conversely, the world may even be changing in a way that benefits Big Pharma. “If the premise of this is that pharmaceutical companies can’t adapt, I think that’s untrue. You could make an alternative argument that things are moving in a way that benefits large pharmaceutical companies. The cost of drug development is going up. There is a wide range of technologies to apply and a large amount of knowledge from previous experience to be fed back in, and the large companies are in a much better position to do that than the small companies. “Clearly they will adapt in terms of where they get their innovation from, and that will probably be less from biotechs because the funding is not there. There will be more cooperation with academic institutions and more outsourcing of specialist activities to specialist companies. But the people who own the intellectual knowledge will still be the pharmaceutical companies.” For Hughes, it’s a question of doing what you have to in order to flourish, and that includes changing the traditional attitude toward information sharing. “The world has moved from being very much closed, where you might have said: ‘we collaborate on our terms, we get all the benefits and you take all the risks,’ to a situation that is much more open, where you say, ‘We’re both in this together. It’s a partnership. We can have shared risk, but we’re also going to get shared benefits.”’ AstraZeneca is putting its money where its mouth is, by sharing its compound collection and even some of its intellectual property. “We’re out there talking about our products, the whole transparency of clinical trial data,” says Hughes. “All of that is different to the inward-looking, closed doors mentality that many pharmaceutical companies have had in the past, so it really has changed. “There was always the worry that you might give away too much information to your competitors and therefore they are able to respond much more quickly. Now we recognise that while that is still a downside, the benefits are becoming more apparent.” When asked why it has taken so long for this change in attitude to come about, Hughes smiles. “Why didn’t it happen

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years ago? It’s a big industry, and not that easy to change. I don’t think we’re dinosaurs; we’re more like supertankers, and it can take a while to get the ship turned in a new direction.”

Looking overseas One area to which many companies are looking to ensure their future success is emerging markets. Hughes points out that when pursuing drug approval overseas, it’s important to consider the needs of each individual market. He gives as an example the challenges of moving between even the relatively similar markets of the US and Europe. “Between Europe and the US there are differences in the regulatory environment and the payer environment, which adds an extra hurdle to American-based companies seeking drug approval here. You can develop an effective medicine that you can sell in the current US environment, which then struggles within the EU environment, because it has to give a certain amount of benefit before they’re prepared to pay for it. “Clearly when you’re discovering and developing a drug it does have an influence on what you’re looking for, because you’re looking to make sure that you deliver a good enough benefit and meet payers’ needs, and that includes European ones as well as elsewhere.” Hughes says that given the European regulatory environment, it’s important to show a much bigger effect with your drug, making it worthwhile for people to pay for it. “That is pushing us towards the environment of what people would call personalised healthcare, which means trying to tailor your drug or find the patient population that fits to give it the best chance of being efficacious. “It’s either finding the patients who are not going to respond, or finding the patients who are going to respond and tailoring your clinical trials to that. That not only gives you an effect opposite to the payers, but also decreases your costs as well, because it can have a big effect on the size of the clinical trial; instead of 10,000 patients you may only need 500.” He points to the crucial nature of understanding your market, beginning with the marketing company working out what the market needs, which will not always be the same as the drugs under development. He also believes that in the future, attitudes toward emerging markets will change so that drugs are developed specifically for them, rather than being tacked on as an afterthought. “In terms of the R&D, we have our oncology group in Shanghai, which is getting alongside the key opinion leaders and the clinicians in Asia to be able to tailor our products to that particular market.” AstraZeneca has a big presence in China, claiming status as the largest multinational pharmaceutical company in the prescription market there. AstraZeneca China is headquartered in Shanghai, with 23 branch offices in major cities across the Chinese mainland, as well as one office in the Hong Kong Special Administrative Region. It employs more than 3500 employees in manufacturing, sales, clinical research and new product development. “The whole reason for being in China is to make sure that you understand what the market is and what the opportunities are, and you’re working with people in the region,”

14/01/2011 15:51

HEADING INNOVATION

“I don’t think we’re dinosaurs; we’re more like supertankers, and it can take a while to get the ship turned in a new direction”

says Hughes. “The emerging markets will not just be an opportunity for products; they will be an opportunity for talent, particularly in places like China, which has a tremendous education system, and a tremendous number of very talented individuals coming back from the West to work there.” The company also has interests in India, although Hughes says the industry there is not quite so well-established. “The market in India is less well-developed; China moves slightly faster. But because of their size and the pace of economic upturn in both countries, they will both be massive markets in 10 years. “I don’t think you can be a global player in the future without having a substantial presence in Asia. We predict our business will be at least one-third emerging markets, one-third current markets, and one-third US in the nottoo-distant future.” Hughes agrees with the point that European-based companies have a head start in emerging markets simply because they are more used to looking outside their own borders for business than their US counterparts. “I think it certainly has given the European companies a head start. If you look at the sales in some of the key regions – Turkey, India, China, Russia – clearly the European companies are much stronger than American ones. They’re in a different order of ranking compared to the world order.”

New models The recent global economic downturn was yet another challenge for the industry, although Hughes says it was the banking crisis specifically that had the most effect. “What we’ve been doing is to integrate right away from discovery and through development. We’re doing more sharing of risks with other companies and academic institutions, for example. You’re spreading yourself in terms of the risk, you’re making yourself as efficient as you possibly can, you’re making yourself more flexible by not doing it all in-house and you’re making sure you have a clear strategy right from the beginning of drug development through to the marketplace. You’ve got to have that vision of the whole product right the way through, and I don’t think that has always been the case in most companies.” Given the need to change and adapt and reach new markets, you’d be forgiven for thinking that the rise of the internet and social media would provide an ideal avenue for pharma to spread its message. Indeed, this is happening whether the pharmaceutical industry likes it or not: how many people these days, after being told by their GP that they suffer from a particular condition, can resist looking it up on the web? “Working with those media to put in trustworthy information that has benefits to people will be tremendous,” says Hughes. “If we can do that and get that partnership in a trusting sense I think that would be great. At the moment, if pharmaceutical companies were to put information out there, the general view might be that they’re only trying to market things, that they don’t care about my safety or anything else, and I think that’s untrue. “On the other hand, you have to recognise that the physician population is a very powerful one, and pharma-

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ceutical companies can’t afford to alienate physicians. What you’ve got to do is get them to want patients to know. There is still sometimes a feeling that if you go in and talk to your GP about something that you’ve read on the internet, they can be pretty dismissive. “Their reaction may be, ‘What do you know? You just read it; I did six years training.’ Although that attitude is changing. When you go and see younger GPs they might be more engaged. And I think that whole change in how medicine is delivered is an important part. If doctors are prepared to engage in that and the pharmaceutical companies are engaged in that and there are other groups who are also helping, then it would be a much better dialogue. “The timescale for a truly integrated use of the internet in healthcare is probably close to 20 years. Most health issues are with people who are over 60, and you’ve got a whole generation who are not used to using computers; whereas if you took your current 40-year-olds and 50-year-olds, you’d probably feel pretty comfortable that they could interact with that in a meaningful way. “The evolution in Europe is more around the doctors. In the US it’s the healthcare companies and the insurance companies needing to get more comfortable with this, because they would like to be in control of all decisions. “Interestingly, this ties in to the rise of emerging markets, because when you have more money to spend what else can you spend it on? You can buy a new car or you can be healthy. The car isn’t any use to you if you’re not around anymore; so people are prepared to spend a lot more money on healthcare, and if it’s in the emerging markets, most of that comes out of people’s pockets. If it’s coming out of your pocket you’d probably like to have some say in what’s going to happen. “The interest in this is going up dramatically. And I think in the future if people are spending more and more of their money, the engagement is going to be much higher.”

Regulatory changes If Hughes could change one thing in the industry, it would be for the regulatory group authorities to have a better understanding of risk-benefit. He believes that currently there is too much emphasis on risk and safety and not enough on the benefits to patients. “Finding a way to work with companies to understand how the compounds or products work, to maximise the benefits and diminish the risks rather than having to do that all upfront before you can even get into the marketplace is an inevitable thing we have to do. “In the end if you’ve got too many big hurdles in front of making any money or return back to the companies, then they will go bust. The regulatory authorities have to work with companies to allow them to have a return on their capital. “If I could do nothing else but create a much stronger partnership between companies and regulatory authorities and perhaps academia, that would be great. For the moment the pharmaceutical companies are viewed as the bad guys and the regulatory authorities are the policemen. You don’t have very much liaison between bad guys and policemen; it’s not allowed.”

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ASK THE EXPERT

Translational ADME-Tox models What are the strategies for reducing drug attrition rates in the clinic through the application of transgenic ADME-Tox rodent models? By Nico Scheer, PhD

“Humanised mice can potentially be used to more accurately predict human metabolism and drug-drug interactions”

nly a small fraction of compounds entering clinical Phase I studies obtain market approval. A major reason for failure is that current preclinical models are often poorly predictive of efficacy, pharmacokinetics and clinical safety in man. Specifically, the predictability of current preclinical animal models is limited by profound interspecies differences in drug metabolism and disposition. In response, a number of academic and commercial groups including Taconic have developed humanised mouse models. The transADMETTM portfolio is the result of a joint development programme between Taconic and its partner CXR Biosciences Ltd to deliver novel mouse models that are more predictive for the absorption, distribution, metabolism, excretion and toxicity (ADMET) of a pharmaceutical or chemical compound in humans. The transADMETTM models are a series of mouse lines that are humanised or annulled for key proteins involved in drug metabolism and disposition. These models have the potential to significantly improve the in vivo safety and efficacy evaluation of new drugs and chemical compounds by reducing the impact of species differences and thus allowing more informative decisions in the selection of the most promising candidates to take further in development. Due to this improved selection process in the preclinical development phase, it is anticipated that the transADMETTM models will contribute to increase the currently poor success rate of getting clinical compounds into the market. The models are categorised in three panels representing critical pathways in drug metabolism and disposition:

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Xenoreceptor Panel, Cytochrome P450 Panel and Drug Transporter Panel. In each of these panels, key murine genes have been exchanged for their human counterparts and the corresponding knockout controls have been generated as well. In addition to the single modified mouse lines, multiple humanised and knockout models were developed. Specifically, humanised mice can potentially be used to more accurately predict human metabolism and drugdrug interactions compared with existing in vivo models. For example, mice humanised for cytochrome P450s can be used to screen for human-unique or human-disproportionate metabolites prior to entering the clinic. Or mice humanised for both nuclear receptors (such as PXR and CAR) and cytochrome P450s could potentially be used to predict the impact of novel inducers on recommended victim substrates such as triazolam. The impact of drug transporters on parameters such as biodistribution and drug-drug interactions is increasingly recognised, and may be subject to guidelines from the FDA. The use of mice humanised for key transporter proteins such as MDR1, MRP2, BCRP, OATPs etc. is generating considerable interest in the pharmaceutical industry, and Taconic has facilitated the formation of an expert panel (TEP) bringing together experts from eight major companies to help progress the validation of these models. The transADMETTM portfolio fits extremely well with the overall Taconic mission, “to provide our customers with in vivo translational products and services to increase the efficiency of life sciences, drug discovery research and safety evaluation”.

Nico Scheer is Head of the transADMETTM portfolio at Taconic. He is the lead molecular biologist in creating these models and directs the team (including Chairing the TEP) towards their further development and commercialisation.

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13/01/2011 13:38

BUSINESS

Casting a

wider net

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As a lack of innovation becomes more of an issue within the industry, Eli Lilly has decided to open up and create the framework to support a more distributed, network-based operation. Robert Armstrong talks to Nick Pryke.

he modern pharmaceutical industry has been pushing the boundaries of drug discovery for decades through effective and sympathetic collaborations. Indeed, even before society’s introduction to this modern-day, multi-billion euro industry, scientists and apothecaries had been doing exactly the same behind closed doors with a fundamental goal no different from their modern-day counterparts: to create and provide medicine. Yet today’s market is witness to the drying up of pipelines and rising costs that have left some companies with their backs against the wall, desperately in need of new innovation and cutting-edge solutions. A pioneer in understanding this new perspective is Eli Lilly, a company that has remained on the leading edge of executing partnership programmes since it introduced the first commercially available insulin to the world back in 1923, with the help of Professors Fredrick Banting and Charles Best. Lilly has come a long way since then, and the start of 2008 saw it announce a new strategy that would help it evolve into a more distributed operation, working with partners in all areas of the business. With mere outsourcing no longer sufficient, Lilly went from being a fully integrated pharmaceutical company (FIPCO) to becoming a fully integrated pharmaceutical network (FIPNet). With his fi nger directly on the pulse, Robert Armstrong, VP of Global External R&D at Eli Lilly, knows what this could mean for the future of the company and for the pharmaceutical industry as a whole. With the word ‘future’ rolling across pharmaceutical lips worldwide, companies are starting to realise that the one-size-fits-all approach of traditional innovation cannot succeed in the current climate, leaving many looking to carve their own innovation paths. “You see most phar-

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maceutical companies having specific strategies around addressing the overall arching quest for increased innovations,” explains Armstrong. “Everybody’s going about it in a slightly different way; some groups are shutting down therapeutic areas so that they can focus on the remaining ones that they have. I think that strategy would tell you that focus is what they’re looking for instead of the work to the rest of the parts. From our point of view, we have been very successful at accessing external innovation as part of our history, and we have a large number of innovative products that are the result of collaborations with both academic groups as well as biotechs and even other pharmaceutical companies, which we intend to continue with. “Where we’re really seeing an opportunity to change the face of innovation around the globe is through a growing network of innovators who are testing new models; we’re participating in a very focused way on how to act on these external innovations in ways we did before. We’ll continue to look at opportunities traditionally, but have also augmented that quite dramatically with a large number of different types of interactions externally – that’s essentially the framework of what we refer to as our FIPNet strategy.”

Looking out Pre-2008, Lilly functioned as a FIPCO, the traditional pharmaceutical model with certain attributes inherent within it. Perhaps one of its main characteristics was that Lilly found itself wanting to be involved in every component of the value chain from hypothesis generation to marketing products. Unfortunately for the company, that meant more than a 15-year timeline that would also require all the relevant expertise to cross the scientific and medical fields while putting together a team that would allow it to innovate from the nuts-and-bolts platform upwards. “What we came to realise early on in the 2000s was that many of the pilot programmes were starting to highlight the degree of innovation going on externally in areas that, historically, were not even available to us a few decades ago,” Armstrong continues. “The idea would be that there were a number of developing networks, not only in the US, Europe and Japan but also in the rest of the world, which would allow us to tap in where we had never tapped into before – offering specific expertise that was extremely focused and, in some cases, even more efficient at doing some of the tasks that are required in contributing to the development of drugs. “We renamed our strategy in the framework of FIPNet, with the concept being that we no longer have to own every single component from beginning to end, and that we might be able to amplify and increase our innovations by being far more savvy and strategic about what source we can access that complements and makes us better than we would otherwise have been. We’re very comfortable in knowing what we needed to do to sustain a standard of innovation that was coming out of our own labs as well as things that we were accessing externally.”

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BUSINESS

Armstrong defi nes three levels within the FIPNet as a company-wide framework by which both local management and portfolio management groups can think about this concept simultaneously and intertwine it into the entire portfolio execution. In level one, FIPNets deal with the more traditional outsourcing components where they have effectively empowered the function and technical expertise in support of the global portfolio to basically establish strategic relationships with external partners, where a fair amount of the work that can be done here can be done efficiently across the globe. Th is has allowed middle managers to be able to make decisions, recommendations and run pilots effectively to allow them to become more entrepreneurial about how to make themselves more efficient. “Level two is molecule based and dramatically different from level one in as much as now all the functions touch the molecule,” Armstrong says. “The complexity of support of that in the network is substantially greater than it would be at level one, but nonetheless we see it as a huge opportunity to access external innovation and new innovative funding models to access development groups that are going to become substantive innovation groups – either in academia, biotech or academic centers. “Level three ultimately deals with equity investments in new innovative interests. We have a corporate ventures group and what we refer to as a ‘mirror portfolio’ that we’re currently developing that’s extremely new in innovation terms, working with both external and internal partners

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to create and obtain other avenues for molecule developments. Basically, they’re funding the fi nancial transformation that we feel is important for this industry in terms of risk sharing for development of a number of molecules.”

Understanding Armstrong is quick to point out that all three levels are offered concurrently to afford every employee a specific understanding of how it plugs into their work; if this were overlooked, more than likely Lilly would end up with a moniker called FIPNet that only a few, essential staff would be able to comprehend. It was therefore pivotal for Lilly that everybody was able to align themselves with the new strategy and, while it’s a bit premature to predict which areas will be affected the most, Armstrong is confident that it will conjure a positive movement across the board. “We’re very opportunist. We’re constantly monitoring, evaluating and surveying the growth for interesting opportunities to entertain where we present ourselves to these potential future partners. I think emerging markets will affect components of areas of opportunities that we are currently pursuing actively in this network environment, but I wouldn’t restrain it to that as I think there are many other areas. The FIPNet evolved out of individual piloting activities in the early 2000s that led to a substantial critical mass that then allowed us to have the confidence that this is the direction we wanted to go in. “Part of the reason we waited was to ensure that the external world was sufficiently mature for us to feel con-

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BUSINESS 95

“The stress of continuing to sustain the innovation and expectation that we have going forward is creating lots of creative solutions to a historical industry that perhaps was not as rapid to adapt to opportunities that came forward”

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fident, so again we anticipated that there would be many new, exciting things happening around the globe and we feel that we’re poised to jump on opportunities that might come up with time.” With an almost living, breathing network evolving in front of their eyes, Lilly needs to ensure that their security measures are second to none and viable on all levels. As this is the case, it’s only logical that security issues are also implemented on multiple levels. “We would begin with ensuring thorough diligence of potential partners, which would allow us to evaluate the kind of maturity and confidence in which we could initiate an interaction,” continues Armstrong. “The second thing we have is a proactive and focused group of individuals within the company that have become, for lack of a better word, FIPNet experts; they have plenty of experience working with external collaborators, so we actively put them front and center into the initiation of all our collaborators. “Th is network concept gives you a lot of latitude to strategically direct from the company; you can rely very heavily on our internal expertise in certain areas while relying just as heavily on external expertise in other areas. For example, one of the groups that I run, called Chorus, consists of 29 very experienced medical and technical minds who have been developing Lilly molecules and will soon begin on developing non-Lilly molecules. They’ve been able to achieve efficiencies and speed that are far better than the industry average by being close and relying heavily on a network of service providers, centres of excellence and even external experts to design and carry out the clinical trials specific to each of the individual aspects.” The Chorus group that Armstrong talks of has witnessed solid success since its inception, but he is quick to assert that the group will avoid growing in size as a result of its success and instead should be ‘cloned’ to ensure that the group retains its high levels of efficiency. Undoubtedly, opportunistic experimentation in many of these areas will continue to make sure they keep hitting the two molecules per year per two employees in the development stage of each specific molecule. “The stress of continuing to sustain the innovation and expectation that we have going forward is creating lots of creative solutions to a historical industry that perhaps was not as rapid to adapt to opportunities that came forward. I feel that Lilly is leading in this phase and that the FIPNet has been effective as a working tool to allow our scientists and business folk to think about more globally while removing the historical boundaries on how we think of ourselves as a super company.” To analogise the potential of the FIPNet, Armstrong cleverly equates it to the iPhone ‘apps’ phenomenon and asks – “What did they really create?” They created a framework for creative people with ideas that Apple would never have been able to think of on its own, and let them innovate. In its simplest form, the FIPNet is no different: it provides a framework that allows ideas to slot in logically and non-disruptively as the entire strategy continuously evolves in the context of innovation. What remains once the scaffolding has been removed

FIPNet Q&A with Tim Garnett, CMO and SVP, Lilly’s Center of Excellence Please tell us about the current face of innovation in the pharmaceutical industry and how that is affecting conditions in the pipeline. Tim Garnett. We are all well aware of the significant challenges facing the pharmaceutical industry, including patent cliffs, a slower regulatory approval process and rising expectations and requirements from payers and regulators. And yet there is tremendous opportunity because many diseases remain unconquered and there is room for improvement in diseases for which treatments exist. Our strategy is to create value by accelerating the flow of innovative new medicines that provide improved outcomes for individual patients. To take advantage of this opportunity, we must substantially increase our productivity and rise to meet the significant challenges that we face. We currently have nearly 70 potential new medicines in our pipeline – the largest in Lilly’s 135-year history – and our goal is to begin launching at least two new medicines a year beginning in 2013. We believe that innovation is key to the future, but it doesn’t just mean a new molecule or mechanism of action: it can also mean innovative clinical trial design or analysis. Your new operating model, the DCoE, was launched last September. Has it lived up to Lilly’s expectations and how will it function within the new FIPNet? TG. It is still early days, of course, and the full benefits of the DCoE will be apparent with time. However, we have already seen early successes with, for example, our advanced analytics group and the expertise it has brought to our clinical trial designs and analysis. We will heavily leverage FIPNet within the DCoE to take full advantage of the expertise and efficiencies that exist outside Lilly’s walls, so our commitment to FIPNet is unchanged and will indeed expand as the DCoE develops.

and the dust clouds have blown away is precisely what Armstrong describes: a framework that not only invites innovation, not only encourages innovation, but allows a vacuum of freedom to be exploited by open, reciprocal channels that give those creative minds the expertise, knowledge base and tools needed to bring innovation to the table. Just as the iPhone changed the pace of mobile technology in recent years, hindsight could prove the same for FIPNets and the pharmaceutical industry in the years to come.

14/01/2011 14:18

TROUBLESHOOTER

Small is beautiful – the future of SMEs in pharmaceutical development How can a small European pharmaceutical service provider remain competitive and attractive in the changing Pharma landscape?

fter the credit crunch and seeing the ongoing crisis of the Big Pharma companies it is becoming more and more obvious that the influential work of E. F. Schumacher, “Small Is Beautiful –A Study of Economics as if People Mattered,” is more relevant than ever. The world is not only suffering from the consequences of the worst fi nancial and economic crisis since the Great Depression of the 1930s, but we are also facing what seems to be an anthropogenic global warming. There are signs indicating that the world is fi nding its way out of the economic crisis, however, this does not necessarily mean that the pressure on the pharmaceutical industry will ease. The pressure remains to improve the efficacy and reduce costs. After the consistent growth of the pharmaceutical industry in the 90s, recently the block-

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buster model has come under pressure as it has reached the limit of its ability to generate sufficient revenue in the long term. The patent cliff is close and that, combined with weaker pipelines, means lower revenue for pharma companies. In fact, sales at many big pharma companies were flat or down in the last quarter. Big Pharma companies responded to the situation with cost saving measures. They reduced R&D budgets and layed off thousands of researchers. Many manufacturing sites were closed, especially in the Western hemisphere. Big Pharma is turning more and more East and buys products and services en masse from Asia. More reorganisations are expected, which means more outsourcing of R&D and manufacturing operations. Another interesting trend is the sale of R&D facilities to pharmaceutical service providers. Such deals fre-

The FP7 will have over €106 invested towards 2013

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TROUBLESHOOTER 97

quently go with multi-year research contracts, that is most employees remain in place, work on the same or similar projects; only the employer changes. The long term utilisation of such large facilities is hard to predict. The good news is that the number and volume of outsourcing projects will likely increase from Big and Medium Pharma. For the most important and time sensitive projects, flexible (which means small) custom research organisations are needed. Fast decisions, short turnaround times and good communication will be crucial in establishing a circle of these trusted service providers. Most big and medium sized pharma companies established criteria to select and sort service providers all over the world. Small and medium sized pharma companies typically have stronger pipelines. However, the lack of funding for developmental projects of small pharma companies forced many of them to focus on late stage projects and stall discovery or early stage molecules. Big Pharma wisely noticed this trend and stepped in as a fi nancier. More cooperations and investments from Big Pharma are and will fi nd their way to small biotechs. As a consequence, more outsouring projects can be expected from small pharmaceutical companies as well in the future. Regarding Asian service providers, their prices for large volume projects are very competitive, but due to the high employee fluctuation, the quality of their service fluctuates as well. Due to their price advantage, Asian CROs have been boasting double digit yearly growth for years now. However, the price advantage is decreasing, because the wages of higly qualified and experienced workforce are approaching European levels. It is worth mentioning that European CROs have a stronger tradition of and more experience in R&D. Generally speaking, their innovative approach, communication and project management skills are up to the highest customer expectations. The geographic location and the relatively small cultural differences between Europe and the USA make communication and site visits relatively easy for American customers as well. Customer research or manufacturing organisations from the former East Block offer the best of two worlds, Western style services with prices between that of the West and the East. Nevertheless, small and medium size pharmaceutical companies still prefer to work with local service providers. Unfortunately, the European Custom Research Organisations (CROs) also suffered from the change of the business environment over the last few years, and some of them faced serious problems. Thanks to their ability to adapt to the changing business, most of the Small and Medium sized Enterprises (SMEs) managed to survive and expect to see growth in 2011. The European Commission also realised the importance of SMEs regarding the future of the European economy (Th ink Small First principle) and the aim of the Enterprise European Network is to help SMEs become more successful in the European programmes. The European Commission wants SMEs to be the drivers of economic activity and innovation.

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For the current seventh Framework Programme (FP7) more than 50 billion Euros will be invested in research and innovation till 2013. It is the responsibility of the decision makers and the actual participants to maximise the return of the invested billions and generate useful results for the benefit of the European economy. The change of the application process to the funds makes these fi nancial resources easier for SMEs to access, which hopefully will mean more research and less paperwork for them. Ubichem, as a Hungary based medium size chemistry service provider for the pharmaceutical industry’s is expecting that European companies will benefit through multiple ways from the recent changes in the business environment. Chinese entrepreneur Jack Ma of alibaba.com explained his vision regarding the way out of the crisis at the 2009 Singapore APEC SME Summit: “In the last century, big was better, but in the 21th century, I believe small is beautiful because it is not about how much equipment you have, it is about how quickly you can change yourself to meet the market”. Ubichem, as a service provider, has always been capable to adapt rapidly to the changing requirements of its customers. Our aim is always not only to deliver the ordered services, but also think ahead about the customers’ needs after completion of the actual work, even if we have to take some risk. We believe that this proactive approach can be very beneficial as we can help to compress the timeframe of the projects and provide viable choices, thus flexibility to our customers. We can foresee more time critical development projects. For example, our American customers could even benefit from the time difference stemming from our European location. In collaboration with their research team, thanks to the daily communication and share of the development results, we managed to develop and scale-up difficult technologies within very short periods of time working in a virtual two shift system in the laboratories in the US and in Hungary. Th anks to the better fi nancial situation of the virtual and small biotech companies, we can see a growing number of active projects in their portfolios. Ubichem Research Ltd. of Hungary is well positioned to face the challenges of the changing pharmaceutical outsourcing landscape. Being a relatively small enterprise, we can make decisions fast and are willing to take risks and be proactive in trying innovative ideas. Our labs and multipurpose plant can tackle projects from late discovery till Phase III clinical trials. Our comprehensive range of services along the drug development path, on top of the usual scale-up, intermediate and clinical API manufacturing services, include safety evaluation, analytical services, radiolabelling, salt screening, crystallisation and stability studies, impurity profi ling and preparation of reference standards. Additionally, being located in a relatively low cost country within the EU and with a tradition of pharmaceutical sciences Ubichem Research is a wise and beautiful choice.

“It is the responsibility of the decision makers and the actual participants to maximise the return of the invested billions and generate useful results for the benefit of the European economy”

Jozsef Repasi has over 20 years experience in pharmaceutical research and development. As cofounder and Managing Director of Ubichem Research Ltd., his responsibilities include managing the daily operation of Ubichem and directing the continuous development of the company.

14/01/2011 14:41

MTB AD_B2B_2010_14june 28/09/2010 14:15 Page 1

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100

INNOVATION

OPEN FOR

BUSINESS B

ottlenecks. Pipelines. Patents. Collaboration. These four pharma-staples have permeated the pharma psyche with such regularity and intensity in months gone by that for all the players within the industry, both big and small, conversation can’t pass without boiling down to the inescapable big four. No longer are decision makers able to keep their cards as close to their chests; no longer can scientists work solely with in-house knowledge. The days of closed collaboration are stagnant – and the industry is working at fullpace to fi ll its void. But in order to do so, a new culture needs to prevail that doesn’t include just the top movers and shakers. For the world of pharma to successfully evolve, all within its grasp need to be aware of a vision and understanding of precisely why it is doing so. Fortunately, there are those sat within and around the nuclei that can provide just that. As Vice President of Global Exporter Development at UCB Pharmaceuticals, as well as an Associate Professor in clinical neuroscience, a former physician of 12 years and an academic scientist to boot, Magnus Sjorgen certainly falls into that category.

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“From an innovation and intellectual capacity point of view,” begins Sjorgen in giving his opinion on the state of the European market in comparison to that of the US, “I don’t think there is any difference; I think Europe is as good as the US. We have the same potential in Europe just as anywhere else. There are perhaps a few differences in terms of how business is done and the regulations for setting up businesses, which clearly differs from Europe to the US, where the business models are broader and arguably less regulated. In turn, that enables quicker paths from ideas to set up and also the acquiring of intellectual properties and so on.” And he is not alone in his view. Another member of this ‘nuclei’ is Chiara Giron, Head of the Department of Screening and Technology at Siena Biotech. With a priceless amount of experience under her belt in both leading external collaborations in various therapeutic areas and optimising clinical candidate selections, Giron is well versed in the importance of keeping an eye on the changing pace of the industry. “I don’t think that there is a dif-

The pharma industry is explicitly aware of the problem it faces with the need for new and creative innovation through open collaboration. The question is – how do you deﬁne the path you walk down? NGP spoke to two heads in the know to delve a little deeper.

ference in the hurdles that the pharmaceutical industry has to overcome,” seconds Giron. “In terms of science, there will probably need to be a gain in more relevant animal models and translational studies as new novel targets arrive that are far less validated. The other hurdle that I believe will become an issue is that the pharmaceutical industry is becoming too much of a fi nancial industry. With venture capitalists and investors expecting to see a rapid return on their money, we could start to see this becoming an exacerbated problem down the line, potentially causing a breaking point where we, as an industry, will need to make a tough decision to go back and tackle serious diseases like oncology and not concentrate as much on fi nances. That could be one potential way to concentrate efforts.” Th is idea Giron points to of concentrating efforts will undoubtedly

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INNOVATION 101

include itself in the arena of debate in months to come, as companies begin to tread their own paths towards a new era of pharmaceuticals, where new business models and ethics start to take shape. “In my opinion, more companies are closing down in Europe and moving to East Asia and the US to cluster or consolidate their resources due to costs,” continues Sjorgen. “If we want to see the same type of innovation as it has been up until now in Europe – and if we want to see Europe bloom in the pharmaceutical sector in the future – we have to work together with government at the European level to identify the boosters from a business, cost relief and taxation relief point of view. It just seems to be much quicker in the US and East Asia in that sense.” And indeed it is. But with US based companies fi nding themselves balancing precariously on the edge of the patent cliff, perhaps it’s a case of swings and roundabouts when comparing the European and US markets. Regardless, the common denominator between the two remains their vested and continued interest in the emerging markets, especially those in Eastern Asia. However, with the general European culture being inherently open and arguably more adventurous, that unavoidably translates into the industry – but does that give them an advantage over the US in entering the emerging markets? Well, according to Sjorgen, the answer is a clear “defi nitely”.

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“The number of perspectives are potentially broader in Europe,” affi rms Sjorgen. “I know that America is extremely multicultural, so they would probably not agree completely, but I think Europe has many advantages with the shorter distances and high-tech culture that seems to be everywhere. There is an infrastructure that should enable quicker collaborations and communications. Having said that, everyone is becoming so Americanised it’s hard to truly say.” And while Sjorgen views these differences from outside the metaphorical box, Giron’s sentiment remains very much an organic, par-forthe-course example of the European attitudes to moving towards emerging markets and open collaboration. “The most important thing is to be open in general, but also open to listen and share what you know as much as possible – obviously without going against your own interests.” “It’s also important to be as transparent as possible,” continues Giron, “both in sharing your successes and failures, because most of the time it’s from failures that you and other people learn. In a way, it’s also sobering as you realise many people are in the same boat with the same problem, but it’s also helpful because if you share your problems then maybe you can come to a solution.”

Of course, the idea of problem sharing equating to potential problem solving touches upon a lot more than just a way to establish oneself within an emerging market. Open innovation has been discussed relentlessly as something that needs to prevail if the future success of the industry is to start being secured. And with companies like Google suggesting a search engine platform similar to their flagship consumer model, the idea of open innovation has perked up many an ear outside of the industry too. “The open innovation model is something that’ll also come from IT business,” reveals Sjorgen. “The open source code from that end certainly brings in the idea of open innovation where everyone can join.” Sjorgen further believes that Europe will be a key player in introducing this to the industry, especially con-

“From an innovation and intellectual capacity point of view, I don’t think there is any difference; I think Europe is as good as the US”

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sidering the European Commission’s Innovative Medicines Initiative (IMI). Inbuilt into this prediction is what Sjorgen refers to as ‘clusters’ – where companies literally cluster together to form stronger bonds and IP sharing to promote innovation and progress business and R&D. “Perhaps the creation of clusters, if governments could enable it, would create a booster where you have different things to bring to the table – and with this type of collaboration, you can afford to keep ownership of your IP, technologies and compounds whilst still working in a collaborative way. If you progress the clusters, you might have to share or give something away, but you’ll recoup it in the end. Th at could certainly be something for Europe in the future.” With that one statement, Sjorgen hits the proverbial nail on the head: pharma companies now need to think of the long-term benefits over their short-term protection worries if open innovation is to truly take-off. Much easier said than done for an industry that has got into the habit of working hush-hush behind closed doors for a very long time. So, how do you go about balancing collaboration with protecting your essential IP? “A difficult question,” as Giron rightly assesses. “A prime example where we’re all struggling at the moment is with relevant models. When

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you do eventually fi nd compounds that work , that is where your creative core is inevitably going to go. My view is perhaps that one possibility could be to completely share the knowledge and collaborate on the models in vitro, in vivo and with biomarkers, but maintain your IP on the molecules potential. “The other thing about open collaboration is that nothing is completely open. There is always someone at the end of the line who wants to gain more than someone else, which negates the idea of openness.” Giron does well to highlight the bottom line that in the universal world of business, which by its very nature deals with formalised competition, there will always remain a healthy element of one-upmanship. If pharma wants to jump the hurdle of open innovation – and it certainly does – this core value of business will have to take an uncomfortable back seat and be leap-frogged by a sense of unity and humility. With this in mind, there are plenty of smaller biotech companies that are pushing the envelope of innovation and creativity, but for the larger firms – with a lot more to lose than just their credibility – there’s a stand-off as all and sundry wait and watch to see who takes the first step into this vast and unmapped landscape. However, while it might look like a whole load of feet tapping and clock-watching on the surface while someone musters up the courage to take that first step, behind

the scenes new technology and tools are being gauged, bought, tested and developed to ensure they hit the ground running when the time comes. “Any sort of technology that can help us answer the scientific questions that bring our compounds to a better confidence level is going to be key for us,” admits a deliberately brief Sjorgen. “We’re a lean biopharma company, so we do collaborate with a lot of companies in partnerships and networks and so on, so the technologies we have in-house – as well as the one we acquire – help us significantly, especially in biological development. We would be keen on investing in biotech and biomarker companies that bring the tools to us for a reasonable price so that we are able to very quickly answer questions on target engagement and pharmacological downstream effects within the clinic setting.” On a more specific note, Giron cites that Siena Biotech has chosen to go down the path of re-assessing their current tools and processes from the very beginning of their pipeline, trying to set up in vitro studies that are relevant to the relative diseases that are scheduled for future investigation. “The other thing that is important within this,” adds Giron, “is the quality of data that you get, because if your data is of poor quality, inevitably you will make misinformed and ultimately bad decisions.” And while that may seem like a rather obvious comment to make, the idea of having accurate data and knowing precisely what to do with it is an issue that is being faced across both the healthcare and life sciences board, especially in the US,

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“Innovation comes from problems. If you don’t have a problem, why would you innovate?”

with the implementation of EMRs and new technologies that can potentially provide data that, up until a few year ago, was only theoretically possible. Combine that with the recent global financial downturn and the funding stringencies brought with it, and the context of the situation becomes all the more immediate. “We are extremely aware of the risks of attrition and the factors involved,” explains Sjorgen, “so we’re focused on the factors that may alleviate late-stage attrition. In every stage of development, we’re now trying to zoom in on how we can increase the probability of success and avoid the Hail Mary approach of wishful thinking, so that means looking at companies that have biomarkers and scouting for companies with new tools and technologies for the key scientific questions that we have. To me, it’s the translation from pre-clinical to clinical: hypothesis testing, science-driven approaches and so on. We want to holistically know what we’re doing and make sure that we remain experts in what we do. “It’s also important to us that we remain honest and thorough and don’t become internally driven by wishful thinking to save the day, which thankfully we are far from doing. Answering questions that can be answered – that’s going to be key. As clinicians, we try to bring that back to discovery scientists, as

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they’re usually optimists, so we bring some realism to the table. I think that sense of realism has increased as we raise awareness of the realities; the development pharma sector was most probably in a bit of a dream stream for a while.” And if development truly was in a dream stream, then that was put into check when the reality of what the global downturn was doing to job security jumped out of the woodwork in 2008 – a setback for industries across the board of course, but for the pharma industry it meant a lot more than just losing manpower. “I’ve seen many people that I know losing their jobs,” asserts Giron, “but the most critical thing to consider is that when very talented people lose their jobs, the industry also loses their expertise. Bar the economics of the situation, that is one of the hardest things to deal with because whilst it’s true that all the data are in databases, the people themselves are the ones who put them there – and they’re the ones who will inevitably help you through all the problems.” Losing big fi sh from your talent pool is never an easy-to-swallow pill and, as Giron points out, even less so when you lose the people who help solve your problems. When you’re left to try and fi ll the void yourself, it often only takes the motivation to realise something’s wrong to get out and try to fi x it. And that’s fi ne if it’s an internal problem, but industry-wide frustrations are another ballgame altogether. “One thing that I fi nd very worrying,” continues Giron, “is that there is always – in spite of many years of seeing this happening – an unincredible and not completely supported enthusiasm for new technologies. A new technology comes out, and everyone wants to use it for everything, which is very dangerous as, in my opinion, it increases the cost of pharma

expenditure. Th is is something that I would like to change to try and become more rational about it. ‘Do I really need this for everything? Can I survive without it?’ These are questions that are not being asked deeply enough within the industry with regards to the technology that we use.” Excluding the obvious constants surrounding technology, Sjorgen’s frustration stems more from the scientific process arena and the blind “buying-in” to a down-turned economy. “Th is downturn has caused the industry to focus on safeguarding certain paths forward,” he says. “The levels of risk-taking are minimised, and even though we speak about taking risks and being challenging, the downturn is seen as the risk. I would hope that could change a little bit, potentially with screening technologies and a newer concept known as high throughput clinical. If you could have these and scale them up for your early clinics and safety assessments, for example, then that would be fantastic. We all rely on that hope for new technologies, tools and breakthroughs, but really, it would be enormously beneficial if we could get this scaling up to happen.” Ultimately for an industry that has found itself at a crossroads, there’s never an easy way forward. Choose to merely tweak an existing system and watch as pipelines become arid and the talent moves elsewhere. Conversely, shift the culture of the industry too quickly and risk provoking confusion and becoming counter-productive. Becoming open in everyway possible, as much as possible, is the key to unlocking the door of next generation pharmaceuticals. As Giron puts it: “Innovation comes from problems. If you don’t have a problem, why would you innovate?”

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Achieving long-term treatment responses in moderate to severe Crohn’s Disease The advent of monoclonal antibody therapies revolutionised the treatment of Crohn’s Disease, but sustaining clinical response has proven a challenge. Time to ask patients’ immune systems to pick up the load?

rohn’s Disease is an autoimmune chronic and progressive inflammatory disease of the gastrointestinal tract. It manifests itself via a range of debilitating symptoms, including severe diarrhoea, abdominal pain, cramping, intestinal strictures and fistulae and malnutrition. It is most frequently diagnosed in young adulthood. In the vast majority of cases, patients receive long-term treatment that focuses on suppression of the immune response, although surgery is also part of the therapeutic arsenal. According to Datamonitor, Crohn’s Disease affects nearly one million people in the seven largest pharmaceutical markets. Since the late 1990s, Crohn’s patients failing traditional therapies have had an additional option: monoclonal antibodies (mAbs) to TNFα. Two such drugs are approved in Europe, infl iximab and adalimumab, and have shown themselves to be highly efficacious in both inducing and maintaining remission, and further as very safe for such powerful drugs. Despite this success, they have one major flaw: in many patients, they stop working over time. For example, in patients with initial response to infl iximab, only 43 percent were still responding at one year1 and adalimumab shows a similar profi le2. For a life-long serious disease usually diagnosed in early adulthood, this issue is clearly a major problem for patients, especially because, unlike some other inflammatory diseases, there is currently no safe and efficacious alternative to the anti-TNF mechanism. As a consequence, patients’ post-TNF options are poor: immuno-suppressants like azathioprine, corticosteroids and surgery. Loss of response may also explain why gastroenterologists are reluctant to make wider early use of mAbs (the so-called top-down approach), despite a growing body of evidence3 that such a treatment model might change the natural course of the disease, as demonstrated with other inflammatory disorders such as rheumatoid arthritis. The reasons for the loss of response phenomenon are not fully understood. Part of it is certainly that many patients’ immune systems react to the monoclonal antibody as a foreign entity and raise an immune response against it: it is established that patients with a detectable antibody to the drug (ADA) they are taking have lower levels of circulating drug and experience lower efficacy, including loss of response over time. A second putative mechanism might be that, as the name implies, monoclonal antibodies recognise and bind to a single site (epitope) on the target. If this epitope is absent or shielded, the monoclonal antibody

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will be ineffective. Th is might explain why patients who do not respond to, or lose response to, a given TNF inhibitor frequently do respond to a second drug in the same class although this response is more likely to be transient. Given the central role of TNF in the pathology of this disease, but the clear shortcomings of the current antibody products, we at Neovacs asked ourselves if there might not be a better way to target TNF to achieve superior and more

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“Whereas the monoclonal antibodies recognize only a single target, the antibody response to the Kinoid is polyclonal (multi-target). One might expect that the Kinoid would produce a broader therapeutic effect”

durable therapeutic outcomes. Our focus as a company is on using the patients’ own immune systems to generate an antibody response to a pathogenic cytokine of interest (in this case, TNF). To do this, we use our proprietary Kinoid technology (See figure 1), which takes the full-length cytokine, couples it to a carrier protein and inactivates the cytokine. The resultant compound is administered with an immune stimulant by intra-muscular injection. We often hear people referring to this as a ‘vaccine’, although from a regulatory and scientific perspective we think the term active immunotherapy is more accurate. One key difference as compared to a traditional vaccine is that the Kinoid does not raise a T cell response to the cytokine, an important safety consideration.

Figure 1: Neovacs’ Kinoid Technology CYTOKINE: TNFa or IFNa

KINOID

ADMINISTRATION IM + Emulsion Adjuvant Cytokine target

Inactivation & Conjugation

KLH (carrier protein)

The characteristics of the antibodies produced by the TNF Kinoid are very different to the synthetic monoclonal antibodies currently used in the treatment of Crohn’s Disease. As it relates to the problem of loss of response, we believe two differences in particular are of critical importance. First, the antibodies are generated by the patient him or herself, and the patient’s immune system will not therefore respond to them as foreign and raise anti-drug antibodies against them. Second, whereas the monoclonal

Guy-Charles Fanneau de la Horie is the CEO of Neovacs, the leader in active immunotherapies to cytokines. He is a Doctor of Veterinary Medicine and has over 15 years of experience in the biotechnology sector.

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antibodies recognise only a single target, the antibody response to the Kinoid is polyclonal (multi-target), as with any natural immune response to an antigen. Consequently, one might hope and expect that the Kinoid would produce a broader therapeutic effect as well as one that was more sustained, since it is not reliant on a single target for its mechanism of action. Another interesting characteristic reflects the pharmaco-kinetics of the Kinoid-induced antibodies, which can be measured for an average period of three to four months post-administration. Hence, treatment with a Kinoid could be composed of four intramuscular injections per year, making it simple and easy to follow, a key need for a treatment for a chronic disease such as CD. Th is regimen compares very favorably with the mAbs which typically require frequent (every second week) or cumbersome (IV infusion) injections. These hypotheses have received some confi rmation from the recently announced top-line data from Neovacs’ Phase I/II clinical trial of TNF-Kinoid in Crohn’s patients. The first objective of this study was to demonstrate safety, and the results here were very pleasing, with no treatmentrelated adverse events and no premature withdrawals from the study. Local and systemic tolerance was also very good. Second, the Kinoid consistently produced anti-TNF antibodies at the higher doses tested: this confirms the ability of the Kinoid to “break natural tolerance” to TNF, which has proven challenging for others in the past. Importantly, patients treated with TNF-Kinoid showed promising evidence of clinical benefit. Specifically, at week 12, 76 percent of patients showed a clinical response (defi ned as a drop in Crohn’s Disease Activity Index (CDAI) of 70 points or better), and 43 percent were in clinical remission (CDAI of 150 or less). Encouragingly, these figures compare favorably with those achieved with mAbs, although one should note that this was a fi rst small safety study. Moreover, there is a correlation between observed clinical effect and antibody response as well as between the evolution of disease activity measured by CDAI and the evolution of a biomarker for intestinal inflammation. Finally, we do see responses to therapy in patients who have previously failed therapy with monoclonal antibodies to TNF: in other words, this study supports both the hypothesis of broad efficacy and that TNF treatment failures may be effectively treated with the Kinoid. All told, we were very encouraged by the results of our Phase I/II study and gratified by the level of interest and support we have received from the gastroenterology community. Th is speaks to the continuing high level of unmet medical need in Crohn’s Disease. We are hopeful that the TNF-Kinoid will present a new option for patients, durably and broadly inducing and maintaining remission. To this end, Neovacs is in the process of initiating of doubleblind, placebo-controlled Phase II study of TNF-Kinoid in Crohn’s patients. For more information, please visit: www.neovacs.com References: 1. Hanauer et al, the Lancet, 2002, 2.Colombel et al, Gastroenterology, 2007, 3. Colombel et al, NEJM, 2010

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NEXT BIG THING

Asset Management for the Long Term How a deeper understanding of asset utilisation is priceless in the long term.

diminishing pipeline, imminent patent expiries, and global recession are all contributing to the financial pressures facing life science businesses today. Consolidation through mergers and acquisitions is providing some cost efficiency, and CFOs are examining every aspect of the business for opportunities to further trim long term budgets. As a response to these pressures, asset management in the R&D environment has emerged as an opportunity to achieve productivity gains. Effective asset management programmes not only control costs, they also emphasise innovation by minimising scientists’ administrative burden, allowing them to focus on research. The pioneering asset management programme providers are moving toward quantitative measures of capacity and output in the lab, enabling companies to optimise capital and operating expenditures.

“Effective asset management programmes not only control costs, they also emphasise innovation” As a first step in improving asset management, service providers offer accuracy and control over basic inventory activities. Keeping track of tens of thousands of instruments across multiple labs can be daunting, especially if managed manually and with different operating systems. A robust IT system tracking the location and ownership of instruments offers many advantages and, when properly managed, provides access to up to date inventory records on-demand. Many asset management programmes include a multi-vendor service component, of which the managed services element is a single contact that coordinates all instrument service needs. This simplifies administration, shifting the burden from scientists and technical staff, releasing them for more valuable research work. In addition to managed services, some programmes offer on-site service support, with a dedicated team of engineers responding to service requests. When prop-

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erly staffed and executed, such programmes can reduce issue resolution from days to hours, whilst generating cost efficiencies. The vast volume and variation in the installed base of equipment at R&D sites make these programmes difficult to execute, but the payoff is huge when managed effectively. It is important to recognise that consolidation achieves only so much, before service delivery or quality is compromised. Investment must be made to maintain an instrument in a condition to produce a reliable and repeatable result. While savings are desirable, companies should resist the temptation to maximise short-term gains to such an extent that availability and reliability of instruments is jeopardised. Many early adopters have progressed from the ‘quick wins’ of securing multi-vendor maintenance contracts, to demanding a deeper understanding of their asset utilisation. Merging inventory and maintenance data with insight into utilisation and deployment of instruments is the next frontier of opportunity for achieving the optimal balance of creativity and productivity in the R&D lab. Looking ahead, innovation in asset management must move beyond simply managing and maintaining the asset base more efficiently, to reliably generating measurements that can be used to adjust the capacity and workf low of the R&D facility to match current and anticipated demand. Offerings will need to report not only where instruments are, but how and when they are being used, to support analysis which reveals opportunities for reducing the asset base to match the workload. Growing M&A activity has highlighted the poor understanding most companies have of their total asset base and even worse lack of assessment of the equipment utilisation in their labs. A solution that provides a true programme measure will deliver the critical information required to redeploy or liquidate unnecessary equipment, offsetting capital expenditures for new equipment and operating costs such as bench space, power consumption, reagents, and maintenance. The depth of asset visibility that market-leading asset management service providers can deliver through inventory-taking, asset management, and ultimately asset optimisation could revolutionise the way companies conduct their business. When deciding how to implement and optimise such programmes, companies must keep the long term in mind.

Mike Benevento leads the Services organisation for GE Healthcare’s Life Sciences business – providing maintenance and validation support for GE instruments, as well as multi-vendor support / asset management services. His extensive background in the pharmaceutical industry includes serving as an industry specialist at PricewaterhouseCooper. Since joining GE, Mike has served in leadership roles in six-sigma, operations management and marketing.

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Environmental monitoring and contamination control Improving efﬁciency in bio-contamination control and risk mitigation using hydrogen peroxide (H2O2) decontamination processes. By James Drinkwater Abstract

here is a need to improve the efficiency in the pharmaceutical industry to meet the new challenges of globalisation, competitiveness and the increasing diversity of products. The risk of biological contamination is increasing and unchecked; it is a risk factor that has the potential for a major impact on production processes and product quality, with potential damaging consequences, detrimental outcomes on business performance and risks to patient health. Th is article considers environmental monitoring and contamination control strategies using the benchmark gaseous bio-decontamination process, hydrogen peroxide vapour (HPV).

removal then leaves surfaces ‘residue free’. The controlled contact time of the active HPV (at sub-visible invisible levels2-6 μm thickness) and the residue-free nature following the aeration cycle, separates the process from a ‘wet’ condition. HPV also exhibits extremely broad material compatibility and can be successfully used in areas containing sensitive electronics equipment.

Potential efﬁciency savings using a vapourised H2O2 bio-decontamination process:

Using the gaseous vapour phase decontamination process, fi lling lines can be gassed-in-place (GIP) including indirect product contact parts. Such a strategy presents significant efficiency savings and risk mitigation4. Bio-contamination control and monitoring Following commissioning, or re-qualification, with facility shutQuality Risk Management (QRM) needs to consider the inefficiencies downs, cleanrooms can be returned to ‘microbiological control’ state in microbiological monitoring. The forthcoming revisions to the ISO14698 quickly by deploying a HPV process that can be verified using a biostandard on Bio-contamination in cleanrooms and conlogical challenge. Such a process can be deployed as a room trolled areas and the USP<1116> microbiological control and bio-decontamination service without the need for capital monitoring of aseptic processing environment chapter, will expenditure. place more emphasis on ‘contamination rates’. At the restart of a HVAC set back in a cleanroom facility during following a quiet or non-operational period, a Improving bio-decontamination assurance validated HPV decontamination process and biological As monitoring technology improves, the detection of challenge can provide evidence for compliance to enable the ‘actual’ contamination will present new challenges. Imroom to be returned quickly into production. provements in monitoring need to be complemented by imTraditional ‘spray and wipe’ disinfection transfers for provements in bio-decontamination control. Alongside this, materials entering cleanrooms are now under challenge, as ‘decontamination assurance’ will need to be demonstrated the process is difficult to comprehensively validate. Th is has through log reductions in the biological contamination to led to significant growth in efficient HPV gassed transfer James Drinkwater is currently pre-defi ned target levels. chamber products, which provides a more effective and verithe Process and Compliance Director for Bioquell UK Vapourised hydrogen peroxide can be validated with fiable fully validatable bio-decontamination process. bio-contamination control Geobacillus stearothermophilus biological indicators1 to and contamination risk mitigation solutions in routinely achieve 6-log sporicidal reduction at room scale. Discussion life sciences, together Use Biological indicators areis an industry standard method The HPV process provides a more ‘complete’ biowith being the Chairman of the Pharmaceutical commonly used to validate steam sterilisers/autoclaves. decontamination. When a high-efficacy, automated bio-deand Healthcare Sciences The gaseous vapour phase decontamination process 4, using contamination process is used (including in-process critical Society. After 10 years in the pharmaceutical industry, hydrogen peroxide under specified conditions, has been accontrol point monitoring), significantly less microbiological his current specialisation is in aseptic processing and cepted by international regulators as a method of achieving monitoring can be justified, limiting sample sites to worst infection control. ‘surface sterilisation’. case and high risk locations. The reduction in monitoring also reduces the cost and extentent of monitoring required Bio-decontamination efﬁcacy and material/process in addition to reducing the risk of false positives. compatibility By improving the ‘decontamination assurance’ using a scientifically Most importantly the H2O2 process is not wet – compared with validated HPV process then there is inherent improvement in ‘sterility asmanual disinfection. In the optimised process2 vapourised hydrogen persurance’. oxide molecules are only delivered to surfaces past dew point 3, at an a invisible sub-visible and effective level (2-6 μm thicknessmicrons). Controlled For references associated with this article, please see www.ngpharma.eu.com

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The helping hand Mike Butler explains how Xceleron is helping its clients to answer critical clinical development questions. Remind us what you do at Xceleron. Mike Butler. Xceleron is a small specialised development service company playing a part in helping drug companies overcome the significant challenges they face in today’s environment. We have facilities in Europe and the US and we use a unique analytical platform called accelerator mass spectrometry (AMS) to measure investigational drugs and their metabolites in drug development. We use a light label of 14C sometimes to distinguish from non-labeled drug and sometimes just to enhance sensitivity. Many of the clinical investigations we support would not be possible without this unique approach. What types of clinical studies do you support and where are you seeing the greatest interest? MB. Xceleron has conducted client studies in phase 0, phase 1 and phase 2/3 clinical development. The question of client demand is fascinating and we’ve witnessed long term changes, where adoption of AMS is still ongoing, and short-term, driven by clients who are comfortable with how 14C LC AMS can provide value. The trend that unfolded over the past 12 years involved movement from traditional phase 2/3 AME/ mass balance studies through phase 0 microdosing and onto phase 1 absolute bioavailability and metabolism.

“This year, we’ve witnessed more than normal levels of interest in phase 2/3 AME/mass balance studies as larger companies usher assets through the later stages of development” The drivers of AME/mass balance in the early days were sensitivity (conventional techniques couldn’t support the study), radio-stability of the investigative drug (the molecule wasn’t stable with a high activity 14C label), and drugs where high levels of radioactivity couldn’t be dosed for safety reasons. Phase 0 microdosing studies attracted great attention five years or so ago when European companies sponsored the CREAM and EUMAPP collaborative investigations and then the US FDA proposed microdosing as a component of their e-IND approach. Finally, pharmaceutical companies wishing to improve early

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Michael J. Butler, PhD is Chief Executive Officer of Xceleron. Butler has 20 years’ experience in science-driven businesses in Europe, US and Asia. He has been President, Scientific Operations and Chief Scientific Officer with Aptuit, Group Vice President at MDS-PS and Group Director, Business Development for Huntingdon Life Sciences.

developmental efficiency have driven interest in phase 1 studies. Needless to say, we’ve consistently performed the established studies as we’ve developed new ones. The shorter-term change that we’ve witnessed is equally fascinating. Starting two years ago, we entered into a period of high demand for studies to investigate absolute bioavailability in phase 1. Th is has continued into 2010 and we’re now conducting an order of magnitude more of these studies than we did just three years ago. Th is year, we’ve witnessed more than normal levels of interest in phase 2/3 AME/mass balance studies as larger companies usher assets through the later stages of development. We think that client demand today is based more on business need than on waves of adoption as it was in the past. What are the advantages to running the types of studies that you’re seeing increased interest in? MB. Starting with AME/mass balance in phase 2/3, our customers talk about two distinct advantages of working with 14C LC AMS, irrespective of the need for sensitivity or to overcome radio-instability or safety issues. For small molecule drugs, 14C LC AMS offers significant time and cost savings because using a light 14C label precludes the need for GMP material and animal dosimetry and distribution studies. Also in phase 2/3 we’re seeing significant uptake in our innovative absolute bioavailability clinical design. Time and money is saved because there is no need for IV-specific safety data, formulation effort, or large-scale GMP manufacture of an IV dose. For instances where absolute bioavailability is required by the

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MB. At Xceleron we like to think of the 14C LC AMS approach as complimentary to tried and tested platforms such as LC-MS/MS. In small molecule development, I foresee our clients using 14C LC AMS in conjunction with LC-MS/MS to enable innovative clinical study design that could not be achieved with either separately. Xceleron is very lucky to have had the benefit of time with a number of client study types to develop a balanced and robust regulatory approach. In 2010 we took steps to share and test the lessons we had learned over the years and processes we had developed. The first thing we did was to collaborate with clients GlaxoSmithKline and Astra Zeneca and a respected expert in the regulated bioanalytical industry comparing 14C LC AMS with LC-MS/MS. From there, we developed a consensus toward an approach for analytical method validation, using the USFDA guideline as a benchmark. A white paper from this effort will be published in January 2011. Later in the year we were invited to speak at the US CPSA meeting where we discussed with Celgene, GlaxoSmithKline and Bristol-Myers Squibb those same issues. We think that this kind of collaborative approach is the best way to help everyone understand how 14C LC AMS can be used productively alongside established analytical techniques and ensure we’re practicing a robust analaytical validation process. regulators, our approach provides an attractive option over the traditional crossover design. In phase 1, our customers get the benefits of knowing absolute bioavailability (should the drug proceed, what is the likely down-stream cost of goods?) generated from this study design. Often in phase 1, our customers also save time because they don’t need to plan an entirely separate line of clinical investigation. For example, we’ve included light 14C doses in food-effect studies, SAD and MAD studies and have shown that we can co-administer a PET ligand and 14C and generate absolute bioavailability from an imaging study. Essentially, our customers can derive absolute bioavailability from a simple additional arm on a previously scheduled phase 1 study. The value that our clients are deriving from phase 0 varies enormously according to their objectives. To give you some insight we’ve helped determine likely efficacy by confi rming compound disposition in target and non-target tissues, quantified rate of conversion of pro-drug in isolated target cells and estimated the likely pharmacokinetics prior to full development. Supporting later development, we see a couple of interesting uses. Firstly, smaller companies are able to back-fi ll required information prior to an asset sale once safety and human efficacy are confi rmed. Secondly, for portfolio management, phase 0 microdosing has a place in establishing fast follow-on candidates. How does Xceleron’s approach to 14C LC AMS compare to LC-MS/MS and how do you ensure regulatory compliance?

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Does Xceleron help pharmaceutical customers involved in biologics development? MB. Yes. We’ve worked with mostly protein-based biologics thus far because we’ve shown that small proteins can be labeled with 14C with no apparent loss of structural integrity. This approach is very sensitive and provides cost-savings over ELISA testing because there is no need to generate matrix-specific methods. Thus far we’ve conducted most work with compounds in preclinical. In the clinical arena, we are in discussions with a handful of large molecule innovators around potential clinical uses. What do you think the future holds for Xceleron? MB. Considering the challenges our customers face in the pharmaceutical industry, we expect to see even more growth in each of the areas I’ve described in the very near future. We have demonstrated value in identifying strong lead contenders, expedited late-stage asset development and helped identify drugs that would likely fail later and more expensively without our approaches. If I were to gaze into the future and run the risk of being proven wrong by our customers, I’d expect to see us conducting more and more target studies that engage the platform’s ability to enable investigations beyond systemic circulation. I see great potential in following disposition and localised kinetics. We’ve already conducted a number of such studies and I expect many more as we move toward more fit-for-purpose approaches to individual asset R&D.

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The transparency trial As the clinical trial process continues its reign under the microscope of scrutiny, companies are starting to realise the true power of transparent pricing.

Leslie Morgan is a qualiﬁed Pharmacist, owner and Managing Director of Durbin PLC, the leading specialist supplier of pharmaceuticals. Durbin has divisions operating in Clinical Trials Supply, International Distribution, Family Planning Supply, Charity Supply, Unlicensed Medicines and Early Access Programmes. He has recently been appointed an Honorary Visiting Fellow at the Cass Business School, City University London. The pharmaceutical industry is under increasing pressure to improve the productivity of drug development and streamline the clinical trial process. From your perspective, how can this be achieved? Leslie Morgan: The industry is under huge pressure to reduce costs. In my particular field of expertise the sourcing of comparators, ancillaries and standard-of-care medications we are continually innovating to reduce costs. Let me cite some examples – purchasing from one country for the entire global supply thus using the differential pricing between countries to deliver a real cost reduction for our client. We have also worked directly with the manufacturer to produce special batches just for our client. Th is ensured the reliability of the supply for the trial. By working in partnership with the trial sponsors and becoming part of the planning process, we can structure the sourcing and procurement of the comparators, standard of care drugs in a way that is most cost effective. In essence it’s about working with experts and getting them involved as soon as possible so that you use their expertise to help you reduce costs. How important is transparent pricing in clinical trial supply? LM: Let me fi rst defi ne transparent pricing as it can mean many different things. We believe transparent pricing is

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being absolutely open about our procurement costs and our selling costs. We actually go as far as providing documentary proof of purchase price. We believe this is vitally important for a number of reasons and offer it to our clients. The procurement of comparator products can be a complex operation with possibly packing houses, CROs and specialist procurement companies all involved. Only with transparent pricing can the sponsor be assured that they are achieving the best possible value. However, transparent pricing is not just about cost. It also ensures the pedigree of the product which is vitally important with the increase in fraudulent pharmaceuticals on the market. With transparent pricing the sponsor obtains full clarity of where the drugs have been purchased and what profit margins the supplier is making. It’s really about true partnership between the sponsor and the service provider. Certainly our clients are welcoming this approach. What should pharmaceutical companies look for when choosing a clinical trial supply partner? LM: Overall it has to be one that the pharmaceutical company can trust and have confidence in to carry out the work to the required specification. In our field of comparator and standard-of-care medication supply this means they have to have a global reach for sourcing and procurement covering not just the USA and EU but also the emerging research areas such as Russia, the Far East and Latin America. I think it is important to choose a supplier who has a history and experience of dealing with these countries, which will generally mean that you need to choose a larger, more diverse supplier. Also vital is the transport capability of the supplier – can they get the product to where you need it on time and in the right condition? These however are the ‘front office’ capabilities. They obviously need to be backed up by the general infrastructure of the company with full quality management, appropriate technical and professional support including Pharmacovigalence, in-house pharmacists and responsible persons. A properly resourced and licensed warehouse with the capability to handle both ambient, cold chain and controlled drugs is also vital. In summary it’s about trust and as I have said before, transparency in all dealings not just in pricing is the best way to demonstrate and build this.

14/01/2011 14:40

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THE NEW GOLD STANDARD Amgen has set the standard once again by producing a new Gold Standard in therapy for bone metastases from solid tumours. But what does it mean for its patients worldwide?

one metastases have been a constant and major clinical concern for the healthcare and life sciences sectors for decades. For the patient they can translate into severe pain, bone fractures, spinal cord compressions and a general, rapid degradation in quality of life; for the industry and its experts they have meant a head-scratching journey trying to assess how to push the envelope of treatment once more towards combating mortality and securing a future with next generation treatments. In an effort to do precisely that, Amgen has recently taken the torch as the owner of the fi rst bone-targeted therapy for cancer patients in nearly a decade. Approved by the US Food and Drug Administration (FDA) back in November 2010, Amgen’s Xgeva (denosumab) is the fi rst and only RANK Ligand inhibitor for the prevention of skeletal-related events in patients with bone metastases from solid tumors. And how did they achieve Xgeva?

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75% of patients will experience a spread to their bones

Th rough the largest clinical programme ever conducted in patients with bone metastases, with the drug being approved following a six-month priority review by the FDA – a designation usually reserved for drugs that offer major advances in treatment or provide a treatment where no adequate therapy exists. Developing Xgeva from the outset, Roy Baynes, Vice President of Global Development and lead for Denosumab in the Oncology setting for Amgen, has been pivotal in the birth and subsequent upbringing of Xgeva. “The area of bone metabolism in cancer patients has really been dominated in the past few years by the bisphosphonates,” he begins. “They’ve gone through various generations of development aimed at producing increasingly more potent molecules. The contrast between Xgeva and bisphosphonates is that the Xgeva molecule is exquisitely targeted. Basically, this is directed at RANK Ligant, which is the fi nal common pathway for the activation of the osteoclast.”

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Indeed, by contrast bisphosphonates are relatively non-specific; instead being taken in by the body and absorbed into the bone. From here, the bone becomes semiimpregnated with bisphosphonate. The osteoclast – in the action of reabsorbing bone –ingests the bisphosphonate before being killed from within by a toxic effect of the bisphosphonate. So where the former therapy was a nonspecific and non-targeted mechanism, Xgeva represents the emergence of an elegant and specifically targeted mechanism to switch off the osteoclast. But whilst it’s easy to sit back and describe how the therapy works, it’s only the tip of the proverbial iceberg. As Baynes asserts, the Xgeva programme is completely organic – from axis and specific target discovery through to development and the full clinical programme. And, quite frankly, it represents the culmination of 15 years of cumulative work of scientists and clinicians at Amgen, proving how important innovation in the context of organic development truly is for their patients. Kevin Sharer, Chairman and CEO of Amgen, said at the initial announcement of the FDA’s approval of Xgeva: “Today’s approval illustrates what is possible when scientific innovation, commitment and investment come together to advance medicine, A diagnosis of bone metastases is a major event for patients living with cancer and the consequences can be devastating. We are pleased to offer this new advance to patients and their healthcare providers.” “The development of Xgeva, which is primarily in the cancer setting, has focused on two major opportunities,” continues Baynes off the back of Sharer’s statement. “The first was to look at patients who had boney metastases who were at risk of developing skeletal-related events. These events complicate a metastases and normally include one of four events that in turn cause morbidity and the significant impairment of patients’ quality of life: a pathologic fracture where the metastases leads to the bone breaking; surgery, which is usually required to prevent a fracture; and radiation therapy to irradiate the bone that’s had to be replaced surgically. The fi nal, and most feared complication, is an oncologic emergency, which is what happens when a metastases in a vertebrae ruptures through into the spinal canal and compresses the spinal cord, causing nerve compression that could take the form of paraplegia. “All of these are grievous and serious, so as you can imagine there’s a desire to address these. So, what we did was say ‘Okay, we’ve got a drug that’s exquisitely-targeted and we’re very impressed with its actions’. We’d done a Phase II programme, which established that we could suppress a bone turnover market, which is essentially a surrogate for the bone benefit. We also started to see a benefit in skeletal-related events, so we were confident about the molecule.” The next step for Baynes and his team was to set up a programme that compared their fi ndings with the Gold Standard of Treatment at the time – a potent bisphosphonate known as Zometa that primarily contains zoledronic acid – and study it in a head-to-head fashion in the context of various cancers, from breast to prostate, and with a

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mixture of solid tumours. Using a selection of randomised patients to either receive Xgeva or Zometa on the backbone of the standard of care they were already receiving, Baynes’ team then monitored the patients for any sign of the development of skeletal-related events. According to Baynes, these were set as “non-inferiority trials” that aimed to highlight that, at the very least, Xgeva was no worse than Zometa in terms of effect. Once that had been established, Baynes and his team went on to test, in accordance with FDA guidance, whether Xgeva was superior to Zometa. “What we found,” details Baynes, “was that we were superior in the breast cancer study; we were superior in the prostate cancer study and we were very close to superior in the solitary trial. So, in those three trials we were clearly extremely favourable for Xgeva – not only for the fi rst event but also for subsequent events. In the solid tumour, it was close to superior but didn’t quite make it. When we looked at pre-specified integrated analysis of all three studies it was strikingly superior – so if you think about this for patients, we have a treatment that certainly surpasses the Gold Standard in terms of efficacy. “In terms of safety, we were very comparable. We had two major side effects that showed up: hypocalcemia and osteonecrosis of the jaw. These are both well-recognised complications of bisphosphonates. In terms of low calcium, we produced more frequently than Zometa, which speaks to the increased efficacy of the molecule because the mechanism here is on target. In other words, you’re switching off the osteoclast, which is one of the sources of calcium for the body, so the osteonecrosis jaw occurs at a similar rate with the two agents. Encouragingly, a significant number of those on Xgeva were reversible, so a very favourable risk and efficacy profi le.” Further backing this, David Henry, clinical professor of medicine and vice chair for the Department of Medicine at the University of Pennsylvania Healthcare System, said: “As many as three out of four patients with advanced prostate, lung and breast cancer will experience a spread to their bones. Despite the availability of current treatments, a significant proportion of these patients still experience bone complications or are not candidates for existing treatments. “Based on the compelling science and robust clinical evidence seen with Xgeva, I expect this new option to quickly become a mainstay of cancer care and to play an important role in reducing the incidence of debilitating bone complications in patients with advanced cancer.” But whilst Amgen, Baynes – and indeed his team’s – efforts have proved pioneering in breaking through to producing a world leading treatment, as we all know it’s far harder to stay at the top than it is to get there in the first place. So what is Baynes doing to ensure Xgeva and Amgen maintain their position as top dogs? Well, naturally they’re now focused on patients who have not yet developed boney metastases but who are at risk of doing so. More specifically, Baynes has identified two major tumour types to begin work on. “One is prostate cancer, the other is breast cancer. In the prostate cancer arena, we have conducted a randomised

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INNOVATION

control trial versus placebo where men who are at high risk of developing metastatic prostate cancer are randomised to either get a placebo of Xgeva along with whatever prostate standard of care they’re getting for their prostate cancer. These are the patients who are castrate resistant – that is to say they are no longer responding to hormone deprivation – so what we’re looking at is the time to the fi rst metastases or death: an endpoint known as Bone Metastases Free Survival. At the moment, we’re looking to see whether Xgeva will be able to delay that and improve the outcome.” To date, the trial has completed enrolment, with its subsequent data release managing to be squeezed into the tail end of 2010. In announcing the top-line results from their Phase III trial, conducted with 1432 male patients with castrate-resistant prostate cancer, Amgen concluded that: “Xgeva significantly improved median bone metastasis-free survival by 4.2 months compared to placebo (primary endpoint), and significantly improved time to fi rst occurrence of bone metastases. “Our data demonstrates that Xgeva, which antagonises the RANK Ligand axis, limits the ability of tumours to colonise bone, an important fi nding for men at risk of bone metastases and their healthcare providers. We look forward to presenting this landmark data at an upcoming medical conference.” Further confirming the importance of the prostate trial, Neal Shore, Medical Director at Carolina Urologic Research Centre, said back in 2010: “As many as 70 percent of patients with prostate cancer that have metastasized to the bone are not currently receiving therapy to prevent complications from these bone metastases. This may be secondary to urologists lacking comfort or facilities to provide infusion treatment. Xgeva could provide increased treatment care options and accessibility for urologists who treat advanced prostate cancer; as Xgeva is administered as a subcutaneous injection on a monthly basis. Also, Xgeva does not require dose adjustment for changes in renal function.” Amgen also has another large trial ongoing with women

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patients with breast cancer. Known as the DK Study, women with high-risk, primary breast cancer who are getting adjuvant treatment are being randomised in very much the same way as the male trial population – being given either Xgeva or a complete placebo. Ultimately it’s the same idea, but with the prostate trial in its final stages, having started in early 2006, it’ll be some time before the data sets for the breast cancer trial are collated, analysed and released. Whilst Xgeva is a breakthrough in every sense of the word for Amgen, it’s ever more important for its customers. The total economic burden of patients with bone metastases in the US alone is already estimated to be US$12.6 billion annually. Patients who experience skeletal-related events (SRE) as a result of bone metastases incur significantly higher medical costs compared with those who don’t go through the pain of such events. Moreover, once patients experience an SRE, the risk of a subsequent SRE is increased. The costs of SREs vary by type and severity – ranging from relatively low costs for minor fractures to high cost events like spinal cord compression associated with hospitalisation. When it comes to the crunch, Xgeva is more than just “an innovative therapy that significantly reduces debilitating and costly SREs”. It’s more than just a pioneering breakthrough for the Californian-based human therapeutics company. And it’s more than just years of work for Roy Baynes and his team. Xgeva is the key to changing lives for patients with bone metastases from solid tumours – not just in terms of physiological and financial improvements, but in pushing the envelope of success for future patients. For Amgen, it seems that the Gold Standard will never be enough – a sentiment that has got them to where they stand today.

Xgeva inproves bone Metastases survival by 4.2 months

Bone Metastases is estimated at US$12.6b Annually

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PROJECT FOCUS

Reporting the DoE part of a design space By Gitte Nomanni Holm

uality by design and design space are concepts that have been around for quite some time in the pharmaceutical industry. Slowly the industry has warmed to these concepts. Since the authorities provided the industry with guidelines, the interest has increased even more. The vision of fi ling a design space is ambitious and may feel overwhelming when fi rst proposed. However, over the years more and more knowledge has accumulated and the industry seems ready to take the next step. When taking this step a frequently asked question is: “How do we report the DoE part of a design space document internally as

“When starting the project of establishing and filing a design space, it is extremely important that the teams from the different departments ‘start on the same page’, communicate and use the same terminology”

Case 1

Case 2

Case 3

Case 4

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The CQAs are inside specification. A statistically significant model is obtained. Some CQAs are outside specification. A statistically significant model is obtained. The CQAs are inside specification. No or a weak statistically significant model is obtained. Some CQAs are outside specification. No or a weak statistically significant model is obtained.

well as to the authorities?” In design space projects different departments are commonly involved. Therefore, a standard operating procedure (SOP) to avoid errors due to misunderstandings is necessary. Th is article will focus on the DoE part of the design space and on the workflow to establish before creating a successful report. A detailed white paper on creating and reporting a design space can be found on www.ngpharma. eu.com. Establishing a design space is a process start by defi ning the critical process parameters (CPPs) and the critical quality attributes (CQAs). Design of experiments (DoE) is used to identify the important CPPs and their impact on the CQAs. The outcome of the DoE investigations should be judged on two criteria resulting in a case categorisation: (1) are the CQA inside or outside the specification limits and (2) is the model statistically significant or not. Below, the different cases are outlined and a work flow of defi ning a fi nal design space is given.

Gitte Nomanni Holm is Application Specialist at MKS Umetrics AB, the leading provider of design of experiment and multivariate data analysis software and consultancy. She has written close to ten technical design space reports that have been used for ﬁling to authorities.

Identify possible CPPs and CQAs using risk analysis

DoE

Design Space is established

Case 1 Case 2

Design Space is established

Estimate a Design Space

Case 3 Case 4

Estimate a Design Space

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“Choose software that allows the name of the experiment to be traceable and visible in all plots”

When starting the project of establishing and fi ling a design space, it is extremely important that the teams from the different departments ‘start on the same page’, communicate and use the same terminology. Structure from the beginning to the end is Alpha and Omega for the fi ling process to run smoothly. Trivial things, such as an inconsistent naming of the input parameters (CPPs) and output parameters (CQAs) and their abbreviations can lead to numerous rewrites, if not addressed at the beginning. Start the project by gathering a representative from each involved department and discuss the topics in this section. Communication is the key and small misunderstandings can take a long time to realise and to correct. A trivial thing such as naming and abbreviations can build a bottleneck if not organised from the beginning. To avoid this, create a fi le where abbreviations and names are given in alphabetical order. Make this fi le accessible to all involved parts in the project. Assign a person from each department to communicate with the other departments so that the used names are unique and not used for another CPPs or CQAs.

Another thing that is of high importance, when fi ling a design space, is the traceability. Choose soft ware that allows the name of the experiment to be traceable and visible in all plots. Creating the report of the design space itself runs rather smoothly if the above issues have been handled properly. The report can be built around a predefi ned template; such a template has been created by Umetrics and can be accessed by contacting Umetrics. Aside from a general section in the template, revolving type of design, quality of design, as well as a list of the CPPs and CQAs the template also consists of an analytical part built around the four cases above. For each case, specific plots are suggested. Below is a list of plots to use for the four cases. Optional plots are also listed with the rationale on when to use them. Note that Case 2 has many opportunities for different illustrations. Th is is of course related to the fact that this case does not represent a robust system as the CQAs are outside specification and there exists a significant relationship between changing the CPPs and the CQAs. An example of Case 2 and the reporting can be found in the full white paper at www.ngpharma.eu.com.

Diagnostic tool

Description and Decisions

Replicate plot

The replicate plot displays the variation of the replicated runs. The plot allows quick identiﬁcation of runs outside speciﬁcation and displays the repeatability of the replicated runs and the position of the centre points in comparison with the response range.

Coefﬁcient plot

The coefﬁcient plot informs on which CPP is most relevant for the system.

Validated Design Space

If one or more of the experiments are very close to the limit(s) we recommend to use Monte Carlo simulations to validate the Design Space and estimate the risk of failure.

Replicate plot

See above.

Coefﬁcient plot

See above.

Contour plot

The contour plot can be used to illustration and to some degree understand the relationship and the position of the Design Space up to 4 CPP’s. However, the contour plot lacks a risk of failure estimate and the illustration of higher dimensions spaces.

Estimated Design Space

By identifying the optimal setting (set point) and applying Monte Carlo simulations around this point the largest possible Design Space for the selected set point can be estimated with the acceptable risk of failure.

Interaction and prediction plots

In cases where additional practical constraints (cost, time etc.) are present the interaction and prediction plots can be used to illustrate a suitable Design Space that fulﬁls the practical constraints.

Case 3

Replicate plot

A Design Space is established.

Case 4

Replicate plot

No Design Space is established. Identify problem.

Case 1

Case 2

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EXECUTIVE INTERVIEW

BALANCING ACT: aligning competing strategic objectives in turbulent times IMS offers insight to new commercial model and launch excellence initiatives. IMS says pharma’s coming challenges will change the way products are commercialised. What are you seeing here? Chris Nickum. Pharma executives have a complex agenda for 2011. At the top of the list is a common objective to develop new commercial models (NCM) that offer greater effectiveness, as well as increased efficiency in promotional spend and strategies. Many are also balancing sometimes competitive strategic objectives, the most common of which are: achieving launch excellence, ensuring that what is in the pipeline is optimally launched in new market realties and managed to commercial return; securing the right exposure to the pharmerging markets, aligning the organisation’s current and future strategy across new markets while addressing major markets that are flat to declining in opportunity; and identifying solid sources of growth, positioning the organisation so that, as the market returns to growth after the patent cliff, commercial, R&D and investment decisions today are properly aligned to future needs. What are the key challenges? CN. For companies addressing both NCM needs and launch requirements for their portfolio, a key challenge is that organisations are generally not considering both initiatives simultaneously. Th is can result in one of the initiatives overshadowing the other, or for both to be dilutive to the company’s overall success. Common implications of this disconnect include launches that are constrained and less effective, as the commercial model is in flux or can no longer support the brand strategy; misappropriated launch investments, requiring the company to build or buy essential services that internal resources can no longer support, driving up overall expenses; and an NCM effort that is delayed or derailed within a company due to a short-sighted focus on critical launches. What are IMS’s best practices for NCM development? CN. Five key building blocks are: • Landscape assessments: understand the market realities of the future. Companies that have not yet fully determined their future direction should develop a common point of view on how the healthcare environment will change over the short- and long-term. Essential to this is

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recognising how power will shift among the stakeholders for a given therapeutic class in a given geography. • Strategic planning: articulate the implications for the business. Companies that have already established the commercial context in which they will operate need to assess the timing and importance of various trends and events. The ideal method of devising a commercial strategy is to hold a series of organised and integrated planning sessions with representatives from all disciplines across the commercial organisation. • Capability assessment: support the new strategy. Depending on the types of changes implemented, companies may need to build or amend their marketing, technical, motivational, knowledge repository, reporting and analytical capabilities, among others. A well-structured commercial blueprint with logical priorities, coupled with a roadmap to the future and proper key performance indicators (KPIs), is at the core of successful initiatives. • Organisational design and development: organise to support the strategy. In order to support the implementation of the new strategy, companies must consider the structural implications (the organisation, roles and responsibilities) as well as non-structural implications (processes, tools, skills and knowledge). IMS sees companies make the most progress planning their new organisation and supporting processes when they bring together people from geographical management, brand leadership (sometimes with emerging P&L responsibilities) and those in charge of new service strategies. • Execution and performance management: make changes and track progress. IMS recommends that companies implement and support a thoughtful change management program not only for the macro transformation, but for the smaller components as well; rely on change agents at the regional and local level; follow the overarching plan (but do not be afraid to move slowly when

Chris Nickum is Vice President and Global Practice Leader, Commercial Effectiveness at IMS Management Consulting. Nickum has 20 years of experience in consulting to the pharmaceutical industry, and has prior experience in all aspects of commercial strategy and execution, including geographic, promotion and product launch expertise and consultation.

14/01/2011 13:31

EXECUTIVE INTERVIEW 121

“Internal harmonisation efforts across NCM and launch excellence initiatives are the key to longterm success.”

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needed); assess progress often, as managing expectations is critical while pilots and other implementation aspects take place; and realise that there is no such thing as ‘over communicating,’ as communication is a primary tool for ensuring alignment and inspiring acceptance throughout the organisation. What are IMS’s best practices for launch excellence? CN. IMS research has identified three recurring themes that are common to every excellent launch and which the company believes will be the key to future launch success. An aligned and prepared organisation. Misalignment can occur at the functional as well as the geographic levels and can turn a potential winner into an also-ran. Common goals, shared incentives and earlier launch preparation are essential. The importance of organisational alignment has been central to the fi ndings of IMS launch excellence studies, underscoring its pivotal role as a driver of success. At its simplest level, alignment means that the various functional and geographic elements of a company are working together in harmony, with common goals, on the launch. Th is may seem obvious and straightforward. Yet both our quantitative analysis and our qualitative research suggest that lack of real alignment for launches is very common and achieving it is very difficult. A powerful and pertinent value proposition. Successful launches are powered by compelling demonstrations of value, drawn from evidence generated that addresses disparate stakeholder needs. Gaining advocacy, approval and market access requires a powerful and pertinent value proposition that appeals to both regulators and payers. Th is increasingly means meeting disparate – and possibly contradictory – needs. Our research suggests that companies are facing the growing dilemma of fi nding the right balance between regulatory requirements for trials versus payer expectations from trials, as well as trial

investment (for the same label) pre- and post-launch. Effective and efficient stakeholder engagement. Stakeholder power shift s are acknowledged and earlier engagement is growing, but new models must address the ability to influence widespread product usage. Among companies with major launches during the period 2005-2008, earlier stakeholder engagement has become increasingly common. In some cases, successful organisations have driven earlier country-level stakeholder engagement and examples exist where this has been vital to launch performance in that country. What are the ﬁve drivers of uptake? CN. The five drivers of uptake that critically build market share are: achieving brand advocacy among regulators, payers, key opinion leaders, prescribers, patients and other stakeholders, with an early focus on creating the right value proposition; gaining brand approval at a regulatory level with optimal positioning and label for the right patients to maximise brand success; securing market access on the right terms with national and local payers; attaining brand adoption for the optimal patient segments with a focus on working with prescribers and providers to achieve early strong positioning in the dynamic market (new, switch, and, if relevant, add-on patients); and ensuring brand adherence by retaining patients as loyal repeaters for as long as is clinically appropriate. How can companies harmonise their NCM and launch excellence initiatives? CN. Internal harmonisation efforts across NCM and launch excellence initiatives are the key to long-term success. Aligning the organisation includes collaboratively setting objectives and timelines of both NCM and key launch; communicating launch strategies early and then often (milestones) to those in charge of NCM activities to ensure both efforts are complementary and not competitive; taking steps to ensure that running both initiatives simultaneously, does not cause confusion to stakeholders outside, and inside, the company; considering geographical priorities across both initiatives as to not overload local affi liates; ensuring commercial models, both in their current and future state, effectively engage and support communication of value to various stakeholders, and can be supported by transitional infrastructures; and ensuring proper focus of people involved in both initiatives, as not to lose focus on one of the initiatives, or both. Companies with sometimes competing internal efforts across new commercial models and launches will set their own destiny. Those that do not address the space between the two initiatives will ultimately dull the success of the new launch or hamper movement to new commercial models. However, those that create synergies between the two initiatives will create competitive advantage in the marketplace, and quite possibly even discover new commercialisation strategies as an output of their harmonisation efforts.

14/01/2011 13:31

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What business processes work? What are the proven, successful strategies for taking advantage of domestic and international markets? Business Management is about real, daily management challenges. It is a targeted blend of leadership and learning for key decision makers in government and private enterprise. Available for: Europe, Middle East, US

Find out more: www.ngpowereu.com Find out more: www.bme.eu.com

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TRAVEL & GADGETS & BOOKS & LEISURE & TRAVEL & GADGETS & BOOKS & LEISURE & TRAVEL & GADGETS

Work to play: Las Vegas p123

Gadgets: The best and the rest p126

Book Review: Teach us to sit still p127

Photo ямБnish: Up in smoke p128

Details. Welcome to Las Vegas TRAVEL.indd 123

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he other city that never sleeps – and it truly never does – is without doubt the world’s largest adult playground; exchange the climbingframes for blackjack tables and swings for slot machines and you get the idea. But nothing can replace the moment when you realise you’ve just walked past two pyramids and a sphinx in the middle of the Nevada Desert while the skyline illuminates everything behind you. Fortunately, Las Vegas is a hub of pharmaceutical events and conferences, spanning across hotels, arenas and incredible customised venues that have been serving the industry’s biggest and brightest for a good few years, so if you haven’t had the privilege of having your jaw-dropped recently, NGP has the answer in its own version of Las Vegas tourist information. Take our word for it.

1. The Stratosphere Las Vegas Hotel and Casino Two types of people walk through the doors at the Stratosphere of those there to relax, which is completely understandable for a hotel, and those there for an adrenaline rush. If you’d consider yourself one of the latter, then this is a must. Standing at a chilling 1149 feet high in the Vegas skyline, the Stratosphere Tower boasts of being the tallest observation tower in the US. Not that exciting? Well, add three roller coasters and a controlled free fall, all outside the roof of the tower, and you have your answer. The ‘X-Scream’ propels you 27 feet over the edge of the tower while you look 866 feet below you, while ‘Insanity’ extends you 64 feet out from the tower on a huge mechanical arm and spins you with a force of 3G for a truly memorable experience. Just don’t try to take your drink up with you.

2. ‘Bodies…The Exhibition’ at the Luxor Hotel Perhaps not one to visit immediately after the Stratosphere rides, ‘Bodies…The Exhibition’ will easily 03 trump any science lab dissection you did at school. With an intricate, 3-D vision of the human form, visitors get to see real bodies preserved along with their inner organs. Showcasing 13 whole-body specimens from China and more than 260 organs and partial body specimens, each piece goes through a method known as polymer preservation where all the tissue and water is replaced with silicone rubber. There are sections dedicated to bodily decay, wonders and anomalies that will leave you with a completely different perspective on the human body – after all, it’s not everyday you get to see what makes you tick. 3. The Freemont street experience Legendary casinos, free entertainment, old-fashioned gambling hospitality – this is the vintage Vegas of the Freemont Street Experience. On any given night you could bump into famous bands, strolling showgirls or be privileged enough to witness an amazing saxophone performance. The ﬁrst paved street in Vegas, Freemont Street boasts a seven-block, open-air pedestrian mall underneath a 90-foot LED canopy that projects myriad eye-popping color combinations, while 12.5 million bulbs ramp up the resolution to literally blow your mind. To cut a long story short, no visit to Vegas is complete without a walk down this legendary street.

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4. Siegfried and Roy’s secret garden and dolphin habitat at The Mirage hotel Not only is The Mirage hotel an icon in Vegas, but many of the attractions it holds are too – and Siegfried and Roy are no exception. Their secret garden and dolphin habitat lets you come face-to-face with white lions and tigers, panthers, leopards and a family of bottlenose dolphins; if looking at them isn’t enough for you, or indeed your little nippers, then you can indulge your fantasy and become a dolphin trainer for the day. Working with their dolphin specialists, you’ll participate in plenty of activities including playing with, training and getting in the water with the dolphins. When you ﬁnally tire of your aquatic shenanigans, there’s a three-course gourmet lunch waiting for you. Didn’t think you could do that in the desert, did you?

5. The Bellagio conservatory With over 100 cast and crew members, this could very well be Vegas’ biggest free gig. With over ﬁve million visitors each year, the conservatory lets the seasons dictate its contents and, just like a Broadway show, the ﬂoral theatrical productions take months of work and an army of talented people. From giant ants to dragons throughout the walk, you can’t help but become a small cog in the imagination of the Bellagio – inspired, of course, by Mother Nature herself. Last year’s summer event was witness to a 40-foot tall ferris wheel and an assault of 16-foot tall poppies, and the word on the grapevine is that this year’s event promises to surpass any other they’ve ever done. The best bit about it all – it stays open 24 hours a day so there’s no need to interrupt your luck at the tables.

Top five hotels

Wynn Las Vegas: The newest hotel to hit the strip, the Wynn boasts original Van Gogh and Picasso pieces showcased around Louis Vuitton and Chanel shops – just in case you didn’t have enough luxury already.

Four Seasons: A hotel within a hotel, based on ﬂoors 35-39 of the Mandalay Bay hotel. Say no more.

The Bellagio: Remember Ocean’s Eleven with the amazing hotel fountains and the angry boss? This is that hotel – minus the angry boss.

The hotel at Mandalay Bay: If you’re looking for the biggest rooms in Vegas, look no further.

06 05 6. Gondolas at The Venetian I’m sure everyone is aware of the gondola rides in Venice, but how many people have actually been there? For those of you who haven’t, you can make it up by taking a stroll down to The Venetian hotel and casino at the intersection of Las Vegas Boulevard and Spring Mountain Road to witness the surreal for yourself. With opera singers, a strolling juggler and various violinists all under a painted fresco overhead, a visit is sure to entice your Italian side out to play. If shopping is your thing – or your other half’s thing – then the Grand Canal Shoppes have everything to offer, including exceptionally high-quality blown glass and unique Venetian masks. Of course, you could just use it as an excuse to lose someone and go gambling. The choice, as they say, is entirely yours.

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The Venetian: Italian opulence, complete with marble baths in every room, provides a truly relaxing stay away.

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Objects of desire The latest technology devices for today’s business executive Nokia E7 Once the super power of the mobile phone market, Nokia has been slow off the mark in the smart-phone market, and in recent years has been over-shadowed by rivals at Apple and BlackBerry. Today the Finnish manufacturer is ﬁghting back with its new Symbian software, used in the E7, C7 and C6 models. The E7 boasts a large screen similar to those made popular by the iPhone in recent years, but slides to reveal the Qwerty keyboard facility, designed to appeal to the business market. It also allows users to access emails in Outlook, as well as edit Windows ﬁles directly from the handset. Less slick than those of its rivals, the E7 is solid with quality features for the business user. Certainly the best corporate phone from the Nokia portfolio for a while.

Canon G11 It is generally considered that lowering the spec on a device is moving in the wrong direction. However in the instance of Canon’s latest compact camera, lessening the capability of one function has improved the product as a whole. Canon decided to lower the megapixel count from the previous G10 model in order to improve the pixel density on the sensor, making the quality of low light photography better. This may seem like a small development to a device, however Canon’s ‘G’ range has already established itself as the best compact range on the market. The body of the camera ﬁts nicely in the hand and the impressive zoom size allows for some quality photography. It is not without its ﬂaws, however: the menu system is slow and awkward for a device of such capabilities and the price is extremely high which, considering the improvements of rival models at Panasonic may damage the G11’s success in the market.

2 New Amazon Kindle

Sleeker, cheaper, quicker than its predecessors, the latest Kindle has been hailed by UK broadsheet The Daily Telegraph as “the ﬁrst ebook reader that has a credible chance of cracking the mass market”. Weighing only 240g, this device is ideal for book lovers on the go. Improved e-ink technology has enhanced the clarity of images and has made the device comfortably readable in direct sunlight, unlike the iPad as Amazon’s marketers are quick to point out. The memory can hold up to 3500 books and with more print media outlets expanding their use of the e-reader platform, the Kindle will soon be able to hold your daily newspaper as well.

4 Samsung Galaxy Tab Ever since the iPad barged its way rather arrogantly on to the technology scene, cynics have eagerly awaited a genuine rival to Apple’s tablet. Well here it is. Using Android technology, the Samsung Galaxy is two and a half inches smaller than the iPad, making it lightweight without losing its strength, and with similarly sleek aesthetics. It can send and make calls and text messages, and the 3G internet connection combined with front screen camera allows for video calling. It’s probably too early for Android tablets to seriously contend with the iPad, but with high deﬁnition voice calling capabilities, a well developed email application and compact size, this could be the next essential business accessory.

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Fresh off the press NGP delves into one of the year’s most inspiring tales of health, wellbeing and the elusive search for mental serenity.

Teach Us to Sit Still: A Sceptic’s Search for Health and Healing By Tim Parks

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ive years ago, Tim Parks found himself getting up every night to go to the bathroom. Not an excusable once or twice, but a worrying five, six, seven times. Thinking he might have prostate problems, he went and had himself checked out. The results came back negative. But with increasing pain and a severe lack of comfort growing by the day, he knew something was up. Googling incessantly for any hint of an answer, Park gives up coffee before going the same route with alcohol, neither of which offer any discernable change. Having exhausted every possible modern day medicinal avenue, he begins to think about his inner workings. Meeting with an ayurvedic doctor, who tells him he has “a profound contradiction in his character” and subsequently his ‘vata’ – the energy that flows through the body – is blocked, Parks raises an eyebrow and wants to walk off with a patronising snigger. But with his desperation at an all-time high, he reluctantly accepts the “hippy help” in the hope that he might find a cure. Months pass by. Parks is stricken with impotence and no closer to finding an answer to his deteriorating health, despite his prior meeting with the New Age doctor. That is until he picks up a book called A Headache in the Pelvis by two American doctors. The book describes his symptoms to a tee and suggests they be treated by a programme of breathing techniques – “the concept of paradoxical relaxation”. Don’t try to run away from the pain, the book advises, but engage with it. At the same time, he has to try to empty his head of thoughts, allowing him to experience his body from the inside. To his amazement, Parks’ paradoxical relaxation works. Not only that, but he’s becoming engrossed in the practices he once laughed at. Meditation, advanced breathing – nothing remains out of reach to the newly functioning Parks. Soon, he becomes as obsessed with emptying his head of thoughts as he had been previously with filling it. In treading new ground and hurling himself head-first into a world supposedly occupied by sensationalists and placebo-takers, Parks manages to find what he’s been looking for all along – a sense of his own serenity. From the outset, Teach us to Sit Still could be construed as yet another self-pitying, self-help book, but it truly is anything but. Parks’ ability to engage with the potential of ancient medicinal practices and logical health techniques not only highlights their efficacy in a world filled with impatient get-healthy schemes, but

also depicts how implementing their principles can, quite literally, change a person from the inside out. But it’s not just Parks’ experiences that make the book so enthralling – his talents as a writer transform the book from looking through the eyes of a hypochondriac to one in which you follow a man on a journey where there is no such thing as a silver bullet, an easy answer or a magic formula to good health – merely someone who is trying to shufﬂe doubtfully toward a glimmer of light. Indeed, his writing has been noted as “intensely engaging”, with the capacity to write “wittily and with great beauty about the near indeﬁnable”. It goes without saying that the large majority of us will fall ill at some point in time, yet few will be able to describe that journey with the same verve, insight and radiant intelligence as Tim Parks. Regardless of whether you’re a believer or a sceptic, Parks draws you into the advantages of mind over matter – and if you don’t mind, why should it matter?

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ll eyes were on California back in November 2, 2010, as its population waited for the outcome on Proposition 19: a ballot initiative that, if passed, would have legalised various marijuana-related activities and changed the face of medicinal marijuana for thousands of patients dealing with the pains of a plethora of treatments. With a 53.9 percent outcome swinging towards the ‘No On Proposition 19’ party, the initiative was ultimately defeated. But what it has left in its wake is a serious message for the big thinkers in both healthcare and law enforcement: the days of free love and hippies are over. With a relatively small margin between success and defeat, California has shown the watching world that there is a signiﬁcant call for marijuana to help in the treatment and alleviation of pain for both chronic illness sufferers and the people who dedicate their lives to cultivating the medicinal herb. But it’s not just in the US where the decision has ignited debate. In the UK and Europe, various parties have been citing a complete lack of understanding when it comes to the classiﬁcation and laws surrounding currently illegal drugs. And, with prominent voices now beginning to back the notion, it could just be a matter of time before Proposition 19’s start making their way across the pond.

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