NGPEU 11

THE PERFECT STORM?

GET TOGETHERCollaboration is the key to next generation innovation

HEADS UPJoe Jimenez opens the lid on the future of Novartis

TOP TRUMPSHow Amgen has broken the mould to produce a new gold standard

www.ngpharma.eu.com • Q1 2011

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

Final Cover.indd 1Final Cover.indd 1 14/01/2011 14:4314/01/2011 14:43

HEADING2

Ubichem.indd 2Ubichem.indd 2 13/01/2011 13:3813/01/2011 13:38

HEADING 3


Ads.indd Sec1:2Ads.indd Sec1:2 9/6/10 13:28:219/6/10 13:28:21




HEADING1 Accelerate and automate your microbial testing.

TheGrowthDirect™System

Rapid

Automated

Compendial Test

Non-Destructive

Replaces human eye with digital imagingto deliver rapid microbial enumeration:

• Automated incubation, enumeration, reporting & LIMS data transfer saves labor & improves compliance

• Applications & throughput cover your routine QC testing needs

• Streamlined validation—compatible with USP meth-ods and regulatory guidelines

• Non-destructive test allows faster investigations

Rapid Micro Biosystems, Inc.Bedford, MA 01730

Phone: 781-271-1444www.rapidmicrobio.com

gital imaging

Save time. Save money. Increase productivity.

RapidMicro1.indd 1RapidMicro1.indd 1 13/01/2011 13:3713/01/2011 13:37

EDITORS NOTE 7

With looming patent cliff s, 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 seem-ingly 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 fi ght 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 fi rm with at least one fi nger in the social media pie. Unfor-tunately, 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 indus-try is fi ghting with its “social media anxiety order – and it’s about time somebody assessed the proverbial patient”.

Aft er all, by immersing itself in the world of social media, it’s not just the industry that will benefi t. 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-

Push the buttonHow the minefi eld that is social media could actually prove benefi cial for the world of pharma.

Nick PrykeEditor

alised healthcare and the emergence of tele-medicine. But this isn’t some attempt at white-washing the industry with ineff ective 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 fi rst grasp the key to unlocking it.

Th e 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)

EDS NOTE.indd 7EDS NOTE.indd 7 14/01/2011 14:3414/01/2011 14:34

Umetrics.indd 1Umetrics.indd 1 13/01/2011 13:3813/01/2011 13:38

32

40

Setting a new course

Innovation and collaboration

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

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

The eye of the social stormNick Pryke takes a look at why sailing into the eye of the social media storm could be a recipe for success for the phar-ma industry.

72

CONTENTS 9

Content.indd 9Content.indd 9 14/01/2011 15:2214/01/2011 15:22

Waters.indd 1Waters.indd 1 13/01/2011 13:3813/01/2011 13:38

48

82

Casting a wider netHow Eli Lilly’s move towards a networking structure could serve them well at the inno-vation table

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

Facing the futureHow thinking ahead could pay dividends for a certain Swiss-based pharma fi rm

Adapt or perishWhat the pharmaceutical industry needs to do to avoid the fate of the dinosaurs, ac-cording to Les Hughes

Supply chain analytics: pharma has to do betterBy Eugene Jones

The new gold standardAmgen unveils its newly ap-proved breakthrough therapy for the prevention of skeletal-related events

Open for businessWith open innovation and unblocking pipelines top of the agenda for the industry, NGP talks to two leading heads to fi nd out their reci-pes for success

9248

82

86

62

114

100

76Morna White, Quintiles

Sectional Features

CONTENTS 11

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

Industry Insight


PRA1.indd 1PRA1.indd 1 13/01/2011 13:3713/01/2011 13:37

124

128

Details

66 Manfred Zurkirch, Dividella 90 Nico Scheer, Taconic

46 Mark Selker and Barb Paldus, Finesse Solutions, LLC

70 Martin Svantesson, Geodis Wilson 106 Mike Benevento, GE Healthcare

56 Surface technology, with Lester Mills of Bachem Holding AG and Jeff rey L Mooney of Corning Life Sciences

80 Trends in outsourcing support, with David Beyerlein of MicroConstants Inc. and Dominic Moore of Waters Corporation

76 Morna White, Quintiles 96 Jozsef Repasi, Ubichem

118 Gitte Nomanni Holm, MKS Umetrics AB

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

Next Big Th ing

Roundtable

Troubleshooter

Project Focus

Executive Interview

124 Travel: Las Vegas126 Gadgets 128 Photo fi nish

CONTENTS 13


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

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 Controlled, Professional and Focused Environment

The NGP Summit is a three-day critical information gathering of the most infl uential and important executives from across Europe. The NGP Summit is an opportunity to debate, benchmark and learn from other industry leaders.

The NGP Europe Summit 5 – 7 April 2011

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

Chairman/Publisher Spencer GreenWorldwide Sales Director Oliver SmartFinance Director Jamie CantillonContent Director Kelly GrantDesign Director James West

Editor Nicholas PrykeContributors Ian Clover, Lorna Davies, Lucy Douglas, Sharon Stephenson, Ben Thompson

Print Director Andrew HobsonAssociate Designers Dan Clayton, Élise Gilbert, Michael Hall, Crystal Mather, Cliff Newman, Catherine Wilson

Online Editor Jana Grune

Project Director Pramel ShahSales Executives Nick Black, Nick Ancell, Nick Roberts, Vicki Pointer, Tom Craner

Production Director Lauren HealProduction Coordinators Renata Okrajni, Aimee Whitehead

VP North America Jason GreenOperations Director Ben KellyIT Director Karen BoparoyMarketing Director John Funnell

Subscription Enquiries +44 117 9214000, www.ngpharma.eu.comGeneral Enquiries [email protected] (Please put the magazine name in the subject line)Letters to the Editor [email protected]

Legal InformationThe advertising and articles appearing within this publication refl ect 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.

GDS InternationalGDS Publishing, Queen Square House18-21 QueenSquare, Bristol, BS1 4NHTel: +44 117 9214000E-mail: [email protected]

Next Generation Pharmaceutical EuropeGDS Publishing, Queen Square House18-21 Queen Square, Bristol, BS1 4NHTel: +44 117 9214000E-mail: [email protected]

The Park Hotel Bremen, Germany

www.pharmasummiteurope.com

CREDITS.indd 14CREDITS.indd 14 14/01/2011 14:2214/01/2011 14:22

Biorad1.indd 1Biorad1.indd 1 13/01/2011 13:2913/01/2011 13:29

UPFRONT

24

25

26

29

UPFRONT NGFPEU11.indd 16UPFRONT NGFPEU11.indd 16 14/01/2011 14:3714/01/2011 14:37

THE BR

IEF

17

BREAKING the bad news


10. Bristol-Myers SquibbLayoffs: 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 higher-than-expected profi ts when the layoffs occurred. But although the company’s other drugs, including the an-tipsychotic 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 compa-nies are facing, they need to reduce costs as quickly as possible to navigate what is going to be a very challeng-ing couple of years for the industry.”

Top 10 pharma layoff s of 2010

THE

BRIE

F

18

9. NovartisLayoffs: 1400

After much concern that Novartis would release Roche-esque layoffs, the company ended the year an-nouncing 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 effi ciency in sales, marketing and manufacturing, which could lead to more extensive job cuts in the coming years.

8. TakedaLayoffs: 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 headquar-ters in Deerfi eld, IL and the Takeda Global Research and Development Center.

7. Sanofi -AventisLayoffs: 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 organ-isation has greater stability moving forward and that our resources are allocated to our strategic growth pri-orities,” says Gregory Irace, CEO of Sanofi -Aventis US/Canada Pharmaceutical Operations. Recently, sources told Pharmalot that Sanofi sales reps would fi nd 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 manage-able size until 2013.

6. Abbott LabsLayoffs: 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 restruc-turing will streamline our operations and improve ef-fi ciencies across the pharma business as we said we’d look to do at the time we announced the acquisition,”


Abbott spokeswoman Melissa Brotz said to the Wall Street Journal. As part of the restructuring, Abbott closed Solvay’s Marietta, GA offi ces 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. BayerLayoffs: 4500

Bayer’s layoffs came with the company’s new strat-egy 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 diffi -cult economy. For Bayer, it’s the price of doing business. “To fi nance the expansion of our growth activities,” CEO Marijn Dekkers said in the statement, “we there-fore need to redirect resources, improve effi ciencies and cut costs.”

4. RocheLayoffs: 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 capabil-ity 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 effi cient 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.

3. GlaxoSmithKlineLayoffs: 5201

CEO Andrew Witty spent the year fi nding cost-saving options for the company, including laying off workers in Europe and the US, including 700 from the

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. Pfi zerLayoffs: 8480

Pfi zer 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 Pfi zer 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 fi ve years.

1. AstraZenecaLayoffs: 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 virtu-ally 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 eliminat-ing 7400 positions by 2013. Three years later and the total is up to 23,550.

THE BR

IEF

19

Source: fi ercepharma.com


The human resource factor in process optimisationFrom experience, for many medium-sized companies, it is an enormous challenge to set up, coordinate and carry out process optimisation in a unifi ed 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.

Firstly, 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 fi nance and controlling there are company-wide, valid guidelines and unifi ed processes. All other business areas consist generally of their own processes, which are consistent only with their individual requirements.

The identifi cation and the resulting determination of the re-quired 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 part-time job for these employees and the effort required completely

underestimated. This results in neglect of daily work or expensive delays in the project. As a consequence, resource and time bottle-necks are fi rst 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, how-ever, 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 recom-mended 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

HR

20


Yaveon.indd 1Yaveon.indd 1 13/01/2011 13:3913/01/2011 13:39

INTE

RN

ATI

ON

AL

NEW

S

22

Diabetes solutionThe 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 fi nd 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 country-specifi c action plans designed to turn the trend in diabetes, which is

imposing overwhelming demands on the region’s healthcare systems and fi nancial burdens on its governments. Ultimately, the hope is to contribute to

changing behaviours in the entire MENA region when dealing with diabetes.

Prescription drugs switchedIn the US, up to 70 percent of prescription medicines are changed by health insur-ers 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 gener-ally 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 reac-tions 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 dealThere 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 accord-ing to fi gures released by MedTRACK, the biomedical database from Life Science Analytics. The latter’s presi-dent, Sarah Terry, noted that the huge surge in deals concluded this year has been driven by “continued back-fi lling of pipelines”, expansion into emerging markets and further diversifi cation into generics and biologics.

Unsurprisingly, Pfi zer 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 agree-ments, are Eli Lilly, Johnson & Johnson and Merck & Co.

INTERNATIONAL NEWS


New Zealand challengeNew Zealand has issued a proposal to its trading partners which con-stitutes “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 Pacifi c Partnership (TPP) free trade agreement (FTA) involving eight Asia-Pacifi c 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 confi dential 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 opera-tional coherence and enforcement and capacity-building in developing countries.

Drug price cutsChina 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 offi cial 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.

Asthma market growingIndia’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 effi cacious agents, says the report, from research fi rm 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 worst-affected 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 fi ve 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 fi erce competition from less-expensive Indian brands and generics,” adds Sherawat.

Sour

ces:

pha

rmat

imes

.com

and

wor

ldph

arm

anew

s.co

m

INTER

NA

TION

AL N

EWS

23


Top appointments Kevin Buchi

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

Christopher ViehbacherChristopher 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 fi rst by de-livering 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 WeberTwo-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.

Olivier CharmeilAs 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 affi liate, taking up his current role as SVP of Global Operations Asia/Pacifi c and Japan in February 2006.

“Olivier’s wealth of experience in both commercial operations and business strategy combined with his ex-pertise in emerging markets are core strengths required in the future development of the vaccines division,” says Christopher Viehbacher, CEO of sanofi -aventis. “I am confi dent that with Olivier’s track record, he will lead the division to further growth in the future.”

Robert IngramRobert 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 situ-ations, overseeing turnaround and M&A deals in his previous roles at Merck and Glaxo.

APP

OIN

TMEN

TS

24


WikiLeaks has published a list of overseas biopharmaceutical facilities con-sidered 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.

The Russian pharmaceutical market is one of the largest in the world, with total rev-enues of $15.3 billion in 2009, according to new analysis from 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 ex-pansion of the pharmaceutical market,” notes Frost & Sullivan Research Analyst Dominika Grzywinska.

“Multiple initiatives undertaken by the govern-ment 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 pharma-ceutical market growth.”

As one example, the 2020 Pharmaceutical Development Programme (Pharma 2020) aims to strengthen the domestic manufacture of phar-maceuticals by madndating that by 2020, at least 50 per cent of pharmaceuticals (in value terms) circulated in Russia will be of domestic origin.

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.

WikiLeaks releases list of pharma sites vital to US security

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 docu-ments 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 confi dential 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 fi nalised. Where only parts of a document contain infor-mation that cannot be disclosed, the agency will edit the document to protect personal data and commercial confi dential information, and release the non-confi dential parts.

EMA increases public access

NEW

S IN BR

IEF

25

WikiLeaks founder Julian Assange

COMPANY INDEX Q4 2010

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

5c

to

m

Opportunities in Russia


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.

Th e pillCurrently 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 ap-proval, 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 counter-part and has revolutionised choices for women worldwide.

Th e polio vaccineThere are in fact two polio vaccines used throughout the world to combat poliovirus. The fi rst 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-per-son transmission of the virus through vaccination, as its chances of survival outside of non-primate en-vironments 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.

edld to

Automated sequencing machinePerhaps one of the more diffi cult innovations to pin down in terms of credit, the fi rst fully automated sequencing machine was produced by Applied Biosystems in 1987 in collaboration with Leroy Hood and Lloyd Smith – who had also pioneered the fi rst semi-automated sequencing machine the pre-vious year. For the fi rst time ever, it allowed for DNA sequencing to be per-

formed with both speed and accuracy on a commercial scale. Where a person could produce a fi nished

sequence 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 areas previously thought to be untouchable.

formedscal

se

a

E=mc2If 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 fi rst person to propose a mass – energy relationship, he was indeed the fi rst scientist to interpret the mass – energy equivalence as a fundamental principle that follows from the symme-tries of space and time. Essentially, the equation indi-cates that energy will always exhibit mass in whatever form the energy takes. Einstein proposed his equation in 1905, and modern theory holds true to the cause by

stating that from this, neither mass nor energy can be destroyed,

only moved from one location to another. It has served the progression of countless theo-ries and provided practical ap-plications that will continue

to fuel the fi res of innova-tion for years to come.

in 1905, and modern theorstating t

nor eonlyto proriespli

Innovation inspiration

INN

OVA

TIO

NS

26


GPSEstablished 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 push-ing that button on your sat-nav seem that much easier.

AerogelWidely used in commercial circles, but perhaps best-known for its use by NASA’s aerogel is a manufactured material with several remark-able 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 space-dust particles aboard the Stardust spacecraft and also as a thermal insulator for the Mars Rover and their spacesuits. The material is pro-duced 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.

Th e World Wide WebWhat 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 fl oated 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 defi nition. 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 oper-ating websites.

INN

OVA

TION

S

27

Bionic contactsStill 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 materi-als 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.


NEW

S IN

BR

IEF

28

US universities domi-nate an international

league table of the best education institutions,

accounting for 72 of the world’s 200 best univer-sities. The Times Higher

Education magazine’s table, based on a number

of criteria including teaching, research and staff and student mix,

has Harvard top.

1 HARVARD UNIVERSITY

2 CALIFORNIA INSTITUTE OF TECHNOLOGY

3 MASSACHUSETTS INSTITUTE OF TECHNOLOGY

4 STANFORD UNIVERSITY

5 PRINCETON UNIVERSITY

6= UNIVERSITY OF CAMBRIDGE

6= UNIVERSITY OF OXFORD

8 UNIVERSITY OF CALIFORNIA,

BERKELEY

9 IMPERIAL COLLEGE LONDON

10 YALE UNIVERSITY

ACCORDING TO IMS HEALTH, the value of the global pharma market is expected to grow by fi ve to seven percent in 2011, to US$880 billion, compared with the four to fi ve 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.

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 suffi cient number of other credible competitors.”

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 ap-proved 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.

MERCK BIOVENTURES, a unit of Merck & Co, is tapping into Parexel’s expertise in the biosimilars arena – entering into a strategic alliance with the con-tract research organisation to develop new candidates and speed their path to market. While the company were reluctant to go into specifi cs, 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.


NEW

S IN BR

IEF

29

Health at a Glance: Europe 2010: additional fi ndings

Life expectancy at birth in the EU increased from 72 years in 1980 to 78 years.

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

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

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

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.

Obesity growingin the EU

In 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.

Direct to Market with Direct Compression

Developing effective DC polymers requires balancing several, sometimes confl icting, features such as powder fl ow, compress-ibility, segregation, and controlled drug release. Present in 80 percent of new matrix formulations licensed by the FDA since 2007, hydroxypropyl methylcellulose (HPMC) shows poor fl ow and limits its use in DC applications, forcing manufactures to move to granula-tion operations. Previous solutions were co-formulated with other excipients or used novel materials which complicated, rather than simplifi ed, 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 fl ow and compressibility combine to provide controlled

release equivalent to standard HPMC grades, and allow processes and development programmes

to be signifi cantly simplifi ed. Conversion to METHOCEL DC for matrix formulations has high potential to reduce the development time and overall costs for the pharmaceuti-cal formulator.

METHOCEL is a trademark of the Dow Chemical Company.,

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

Development Manager (Dow Wolf Cellulosics )

Hadditio

expectancy at birth in the80 to 78 years.

ill the biggest cause ong for 40% of all deaths.

he number of people agedto double between 19prevalence of de

The


Burket.indd 1Burket.indd 1 13/01/2011 13:3213/01/2011 13:32

This February was witness to three of phar-ma’s biggest players, Pfi zer, Merck and Eli Lilly, as they collaborated to form the Asian Cancer Research Group, Inc. (ACRG). The fully independent, not-for-profi t 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 collabora-tions between pharmaceutical companies being noted in recent months, the ACRG’s formation is a prime example of how companies are combining their resources and ex-pertise 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 scientifi c community.

Gary Gilliland, SVP and Franchise Head for Oncology at Merck, confi rmed: “Through its work and the subsequent sharing of information, the ACRG hopes to empower re-searchers, 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 specifi c 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 pharma-cogenomics 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 devel-oping treatments for certain patient populations.

The fl ipside of the coin will see the ACRG dealing with gastric cancer, which has reached near epidemic propor-tions 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 Scientifi c Offi cer of Pfi zer’s Oncology Research Unit, stated: “Environmental and genetic factors are believed to underlie the dramatic differences in the molecu-lar 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 can-cers, 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 phar-macogenomic 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 contrast-ing genomic signatures of these cancers could inform new approaches to treatment that are sorely needed.

In terms of dividing up responsibility, Eli Lilly has dedi-cated 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 proj-ect, 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 im-prove outcomes for affected patients with lung, gastric and perhaps other forms of cancer.”

For the pharmaceutical in-dustry and healthcare alike, the ACRG could `prove to be the ig-nition point in combating can-cers in the Asia-Pacifi c region; considering the current state of the pharmaceutical pipeline, it could also turn out to be some good reconnaissance for the future of emerging markets within the industry.

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

GASTRIC CANCER KILLS630,000

A YEAR

WHO PREDICTS

12 MILLION DEATHS IN

2030

NEW

S IN BR

IEF

31


There 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

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 pla-cebo 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

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.

The eye of the social

32 COVER STORY

COVER STORY 32-35.indd 32COVER STORY 32-35.indd 32 14/01/2011 15:1614/01/2011 15:16

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 compa-nies 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 fl ying the fl ag 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.

Amongst them, Pfi zer has ventured down the right avenue by team-ing 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 confi dentially post personal health information that will only be available to researchers studying their particular condition, in turn off ering 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 repre-sentation, content is king.

Indeed, instead of focusing on customer communications on the most basic of levels, many fi rms – including Pfi zer – use their new-found social

storm

COVER STORY 33


COVER STORY34

platforms for little more than distributing press releases; hardly the most innovative tool for securing better customer relations and inducing engag-ing 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 offi cial 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. Th at’s not to say that the company doesn’t matter, as aft er 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 lift ed the veil on a traditionally closed industry.

Unfortunately for pharma fi rms worldwide, let alone in the European market, this is about the best they’ll get until the overly intense regula-tory environment currently being employed loosens its grip around the industry. Anything above implementing staff to update fl uff 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 implementa-tion for pharma: Adverse Event (AE) reactions.

Offi cially defi ned as “any adverse change in health or side eff ect that occurs in a person who participates in a clinical trial while the patient is receiving treatment, or within a pre-specifi ed period of time aft er 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-identifi ed 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, stifl ed its progression into the nucleus of social media.

In the ongoing debate about who owns what when it comes to informa-tion 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 spon-sored 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 oft en 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 permis-sion 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 benefi cial for both patient and company alike. Th us, 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 poten-tial updates on a product gripe. Th e bottom line: the benefi t of social media has to outweigh the expense.

Confl ating this is the bigger picture of marketing practices pertain-ing 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.

Furthermore, promotional labelling and advertising must be submit-ted to the FDA and EMEA on a “2253 form…at the time of initial dissemi-nation”. 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 fl oating 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 deci-sions around intellectual property and what is more valuable inside the company versus outside; and how to deal with the privacy and protection of


COVER STORY 35

their employees in the new era. Th ese are all logarithmically more diffi cult 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 prod-ucts 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. Th e possibilities outside the realms of regu-latory burden are practically endless. Whatever the end goal, one thing is certain: a one-size-fi ts-all approach is not the answer the industry is look-ing 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 fl ow 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 unnec-essary 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 communi-ties “anti-bodies”. Th us, 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.

And, in relation to the groundwork that has already been done by the industry, social media is revealing some interesting truths to pharma com-panies both already involved and waiting in the proverbial wings. For start-ers, 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 com-plete 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 engi-neers to network and research will go a long way in creating the pipelines of products needed to sustain the industry. Th e 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. Th e 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. Th at is, aft er all, what makes the best captains.

Setting standardsRoche 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 affi liation with Roche and that

opinions raised are your own• Be a “scout” for sentiment and critical issues.

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 fi nancial

data• Identify yourself as a representative of Roche• Monitor your relevant social media channels• Know and follow Record Management Practices

Source: Roche


COVER STORY36

With a multitude of industry-altering chal-lenges already in the pipeline, pharmaceu-tical 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.

Th ere’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. Re-markable as they are, the discussions are endless and most loop back into themselves without generating suffi cient voltage to power an army of macrophages. Pharmaceutical companies, beset by a myriad of constraints, are anxious about fl ipping on social connection switches which the web furiously creates every day. We could say that pharma has a ‘social media anxiety disorder’. Th e question is – how can it be remedied?

Th e 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 dis-order is merely a peripheral symptom of deeper pathologies – so it’s about time someone assessed the patient.

Deep concerns and peripheral risksSocial 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, effi cacy and eff ective-ness. From production and marketing to administration and application, every step of the way involves risks. Tiny fl aws 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 pro-duction, marketing or dispensation of a product.

Furthermore, the media through which information conveys its meaning determines its interpretation. Th ere-fore, any discussion concerning the proper delivery of prod-uct 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

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

SOCIAL MEDIA ANXIETY ORDER.indd 1SOCIAL MEDIA ANXIETY ORDER.indd 1 14/01/2011 10:0414/01/2011 10:04

2COVER STORY 37

media. Twitter may help Dunkin’ Donuts move sales, but that doesn’t mean it will work for the world of pharma.

Th e order of complexity that arises out of the tasks involved in creating and cultivating safe and engaging environments for patients, doctors, pharmacists, employ-ees 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 unstop-pable 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. Th e enterprise considerations alone are almost impossi-bly daunting.

Natural versus unhealthy rates of returnLet’s take a quick pan-back for a moment from social

media to mention something about capitalism and eco-nomic fundamentals, as it’s the central economic context in which modern pharmaceutical marketing arose. An inqui-ry into the economic ramifi cations 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?

Th e rates of return for the pharmaceutical industry over the last 20 years have been quite remarkable. Aft er the industry radically transformed itself decades ago from a primarily scientifi c endeavor into a marketing juggernaut, the stock prices of publicly traded life sciences companies soared. Blockbusters made careers. Fortunes bloomed. In-vestors 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 oft en 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-infl ationary pressure of high returns inevitably leads to downward pressures on sustainability. When rates of return exceed rates of regener-ation, 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-eff ects, 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’

lives will dilute their eff ectiveness. Secondly, the mis-coordination amongst the various international regula-tory agencies and the industry will hamper innovation in customer outreach. Finally, the pool of bright, young talent will fl ow to technology and other sectors while fl owing away from an industry whose public reputation has suf-fered years of traumatic wounds.

Th erefore, the industry must undergo a radical re-alisation and acceptance that their fundamentals need serious attention. A critical dissection of assumptions and traditional business thinking will need to take place. Th e harsh realities of the 21st century’s upending nature must be faced without fear. Th e marketing models that were co-opted 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.

Th ere are times in our lives when incredibly hard and frightening decisions must be made. Th e same applies to companies and industries – entire countries in fact. And it’s always those simple decisions that must be made and are most oft en the most diffi cult to execute. Th e pharma-ceutical 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 truthOf course, maybe it’s already too late for the large phar-

maceutical 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: Jug-gernauts oft en jeopardise their long-term sustainability by assuming their ways of doing business are eternally solvent. Th ey aren’t. Technology brings forth into the world both op-portunity and obsolescence. It reveals the status quo while it destroys it.

If the industry is to be what it aught to be – a leading cre-ator of technological solutions to biological problems – then it will have to abandon the now false hope of generating un-natural rates of return via outmoded mechanisms, processes, strategies and tactics. Because if it continues to believe its in-dustry 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 eff orts into practices that forgo richer long-term prospects. Th is 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.


COVER STORY38

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 enter-prises. Th ere 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’ eff orts until executive leadership has hands-on experience with new media and a working comprehension of their properties. Th e only way things will move is when middle and executive managers start using these media personally. Th ey 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 vari-ous 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 system-deep integration of social design into their companies – and enterprise versions of Facebook aren’t the solution.

Once they understand how to use these media them-selves, only then will they see the potential and pitfalls. Th ey will realise the importance of accumulating social capital and will see more clearly what it takes to create con-tent and communities and the safe connections that engen-der markets where information can be safe and eff ective.

Th e economics of life science products and the reali-ties of emerging shift s 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 capi-talism is so important and relevant to any discussion on social technologies.

Th e pharmaceutical industry will have to get back to fundamentals in economic design and collaborative networks. It needs to bring the life scientists back to front-and-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.

Th e 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 curren-cies 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 eff orts, 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/overcoming-pharmas-social-media-anxiety-disorder/

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-fl ows 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 info-social 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 col-

lective values that can be derived from the vast array of product and service ideas inherent in these collective talents. Investing in re-

designing business towards info-social ecosystems will de-velop the platforms necessary to yield the potency

of human creativity and innovation.

Th e social injection

“Th e only way things will move is when middle and executive managers start using these media personally. ”

dle ve

”


PRA2.indd 1PRA2.indd 1 13/01/2011 13:3713/01/2011 13:37

BIG INTERVIEW40

Setting a new course

Jimenez_LEAD.indd 40Jimenez_LEAD.indd 40 14/01/2011 13:3114/01/2011 13:31

BIG INTERVIEW 41

When Daniel Vasella announced in Janu-ary of last year that he was stepping down aft er 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 no-ticed 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 inter-national business experience and ability to provide direc-tion, 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. Th at 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 impor-tance 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

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

Branching outOn 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. Aft er 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 pro-gression of telehealth technologies throughout the nation. With a further $200 million coming from private invest-ment, 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.

“Th ere are trends that are converging in healthcare today that are going to make telehealth a new growth area in the next fi ve to 10 years,” he says. “Specifi cally, 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 innova-tive. 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 cul-tures – a seeming talent for the Californian graduate.

Adapt to change“Growing up in the US, you don’t appreciate the dif-

ferences within Europe. In fact, there is no ‘Europe’. Every country is diff erent in terms of the culture. It’s diff erent in terms of practices, consumer behaviour and patient behaviour. One of the adjustments that my family and I

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.


BIG INTERVIEW42

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 oft en 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 diff erent 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 divi-sion helped me create a very clear picture of how we want to move Novartis forward,” he says. “I came into the pharma-ceutical division at a time when the industry was changing very rapidly. We had to modify both our approach to devel-oping new drugs, and also our commercial approach – that helped me get grounded in what has to happen over the next fi ve years to enable Novartis to become the most suc-cessful and respected healthcare company in the world.”

Th at 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 swim-ming 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 man-agers at all diff erent 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”


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 fi eld 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 learnBut 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 signifi cant eff ect 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. Th e FDA is still very tough on new drug ap-provals, but the rules are now clearer than they were a few years ago with the new leadership, so I’m rather encour-aged by the trends that I see in the regulatory environment. It doesn’t mean that it will be easier to get new drugs ap-proved, 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 hori-zon 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,” as-serts Jimenez.

“Once the patents have expired, generics play a very important role and I think the FDA has realised that. Th ey 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 ap-proved and launched, particularly in the US. Th at’s ex-tremely important for Novartis as our Sandoz division,

which is our generics division, is a leader in biosimiliars around the world.”

Th e potential worry for the Sandoz division, however, is that the competition for the generics market is becoming far more aggressive – especially for research-based com-panies – forcing uncharacteristically tactical moves for some of the smaller, less competitive R&D fi rms. But for Novartis, Jimenez stands fi rm on how to grasp security for the long term – and as usual, it all comes back to the basics.

“Th e 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,” off ers Jimenez. “If we can deliver medicines that provide more than just a small incremental benefi t, that really deliver on unmet medical need and allow us to protect those with intellectual prop-erty, 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 in-novate.” 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 fl ashback to the environment in the 2008 market, which Jimenez believes has intensifi ed since.

“If you look at the debt crisis, governments in Europe have recently initiated signifi cant price reductions on pharmaceuticals because they are debt strapped. Th ey 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 reim-bursed – are gone.

“We now have to take a diff erent 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 de-scribe 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. Th at’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, Th e Scripps Research Institute and the Genom-ics Institute of the Novartis Research Foundation, Novar-tis announced back in September that it had discovered a novel compound that shows signifi cant 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.


INDUSTRY INSIGHT44

The pharmaceutical industry is changing. Th ere 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. Consider-ing 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 re-search 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 associ-ates’ willingness to participate in and support those solu-tions. Th is competence can be defi ned and measured as a company’s Innovation Quotient (IQ).

Th e ‘Innovation Gap’ occurs when some are making bold and necessary choices while others are protecting fi efdoms 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:

Insight refers to the company’s internal and external scanning skills. Decision-making: speed and accuracy depends upon people’s knowledge and empowerment. En-gagement and execution is best accomplished by enrolling people in their own solutions. Alignment with strategy is achieved through cascaded objectives, measures and ini-tiatives 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 fl oat on past success and are poorly positioned to respond to threats or opportunities. Cruise ships have a few individuals setting direction and making course adjust-ments. Th e remainder are ‘intellectual passengers’. Change

is presented like a destination brochure rather than a road-map for associates to follow.

Merchant marine empower associates to eff ectively and effi ciently deliver existing services to existing custom-ers, having ownership and making course corrections. Navigators are those innovating new products, markets, and ways of doing business.

Th e 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 In-novation Gap.

Defi ne: Defi ne the attributes of the four IDEA perspec-tives: insight, decision-making, engagement and execu-tion, and alignment with strategy.

Measure: Set specifi c 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 specifi c examples from the four functions of per-formance: 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 spe-cifi c 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 ex-cellence, along with the internal customers of these groups, develop specifi c examples for each attribute that represents unacceptable, acceptable but average, and exemplary per-formance. 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. Th e 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 identify-ing the aff ected areas before a change initiative gaps in understanding, incentives and alignment can be isolated and corrected before the ship is in the storm.

What’s your company’s Innovation Quotient?

By George Henderson

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.

“Understanding your company’s Innovation Quotient and identifying its Innovation Gap is critical to success and growth”

Navigator.indd 44Navigator.indd 44 14/01/2011 14:4014/01/2011 14:40

Navigator.indd 1Navigator.indd 1 13/01/2011 13:3613/01/2011 13:36

NEXT BIG THING46

(1989), the “history of life is a story of massive removal fol-lowed by diff erentiation within a few surviving stocks”.

A common need, however, has clearly emerged for single-use sensors and easy-to-use process automation, and effi cient validation of both. Th ere 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 dispos-able 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 bio-reactor 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.

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 excel-lence, 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 out-come could have been altogether diff erent, even for the homo sapiens species. In other words, our planet could just as well be ruled today by intelligent gecko lizards, using genetically modifi ed canaries in their drug development trials.

If we return to the original question: which companies will win the ‘survival of the fi ttest’ 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.

One of the most famous of the Beatitudes, “Th e meek shall inherit the earth” (Matthew 5:5), has been likened by Darwinists to the ascen-dance of little furry mammals aft er a meteorite

hit the Earth, initiated the Ice Age, and damned the al-mighty 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 fi ttest’ principle apply to designs and vendors of single-use equipment?

Th e 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 confi gurations with diff erent blade geometries (Th ermo Scientifi c 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 (Th ermo, Sartorius, and XCellerex) to air-lift designs for more effi cient 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 equip-ment is experiencing the equivalent of the Cambrian ex-plosion, with many diverse species trying to survive and thrive. As Stephen J. Gould so aptly described in his book A Wonderful Life: Th e Burgess Shale and Nature of History

“How will the ‘survival of the fi ttest’ principle apply to designs and vendors of single-use equipment?”

By Mark Selker and Barb Paldus

Deciphering the Burgess Shale of single-use bioreactors

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.

FINESSE ED P46.indd 46FINESSE ED P46.indd 46 14/01/2011 15:2114/01/2011 15:21

Finesse AD.indd 1Finesse AD.indd 1 10/06/2010 14:3810/06/2010 14:38

HOW MUCH IS ENOUGH

Lundbeck’s JØrn Mayntzhusen

looks at the challenges of regulatory

compliance and how Lean

methodologies can help ensure a

fully optimised supply chain.

SUPPLY CHAIN48

Mayntzhusen.indd 48Mayntzhusen.indd 48 14/01/2011 14:3814/01/2011 14:38

SUPPLY CHAIN 49

As any experienced pharmaceutical manufacturer knows, ensuring an effi -cient and eff ective supply chain is crit-ical 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 fl exibility 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 tempera-ture range all the time, then you have a challenge. How should you do it? Of course you may order a temperature-controlled 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 specifi c. Everything comes at a cost and with patent expiries coming up the volumes and compli-ance demands are going to be the same, however with margins signifi cantly 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 ulti-mately somebody has to pay.”

Less and moreUnlike 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 fl exibilities follow-ing sales fl uctuations 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.

“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 off ering price to the health authorities was too high you sell nothing. Luckily Lund-beck 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 varia-tions of that scale.”

Two tools now used by many pharma companies to reduce waste and create effi ciency 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. Th ereby 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 pos-sible breakdown on your coating equipment. So you need to think about that when you set your stock levels.”

Mayntzhusen thereby praises Lean as giving com-panies 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.

Sizing“Th e 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 fl ow, meaning one pack at a time or one bottle at a time. In

“Increasing compliance is, of course, by defi nition positive, 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”


SUPPLY CHAIN50

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 fl ow” means “one batch fl ow”. 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. Th en 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 effi ciency.

“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? Th at 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 opti-mal lot size would vary for the same item.”

Lundbeck has initiated a project to maximise gains from its Lean eff orts and to align its daily continuous im-provement activity with the overall strategy. Th is will also involve linking the eff orts to a more scientifi c or theory-based approach, to fi nd the right balance for the optimal lot size.

BottlenecksOther methods being used to identify areas for

optimisation, are Value Stream Analysis and Th eory of Constraints (TOC). Both methods look at areas for opti-misation although from diff erent angles. Th e latter take a wider look on the supply chain, says Mayntzhusen. “It

asks, ‘What is our main bottleneck right now? What is hindering all the other resources that we have in operat-ing at full capacity?’ Th en 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.

“Th ere are a vast number of companies that applied Lean and Six Sigma across the diff erent parts of the organ-isation 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 fl oor. 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 meet-ings 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 op-erational excellence strategies and practices to achieve world-class results.

“Robert Miller from Jon M. Huntsman School of Busi-ness at Utah State University administering the Shingo Price, have told us about companies that received a Shingo recognition for their Lean eff orts 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 eff orts are really tested because no one is pushing any more. If the people on the shop fl oor do not see all the boards and all the KPIs

Th e Shingo PrizeThe 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.


SUPPLY CHAIN 51

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

CounterfeitLooking to the future, Mayntzhusen foresees in-

creased use of technological possibilities, as well as the advent of serialisation is defi nitely also coming and great-er 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 re-corded 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 fl ow 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 fl ow in eff ect, this global database would be the best way to fi x that.”

as supportive in their daily work they’ll stop using them, whereas if you have identifi ed 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. Th ey maintain it on their own because it helps them and they can see the benefi t of it. So that’s the ultimate test: whether you have found the right KPIs to look at.”

ComplianceReturning to the subject of compliance, Mayntzhusen

identifi es 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 unifi ed standards.”

Th e other challenge is that there can be a limited eff ect of an increased compliance requirement. Mayntzhusen gives as an example the European requirement that Braille must be on every pharmaceutical pack. “Th ere’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 benefi t all blind people so that you could have a higher eff ect with a less eff ort or with less cost. It’s just one example of something that has a good intention but the question is whether the eff ort required actually stands up to the benefi t or the value adding of it.

“With regard to regulatory development, I personally hope for an adaptation of models as smart as the Austra-lian model where the patient insert leafl et is printed at the pharmacy level.

“With the current model here, we spend a lot of time and eff ort on changing the user leafl ets and sometimes we repack batches with the new leafl et. Sometimes you’re not even through repacking before a new requirement neces-sitates 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 leafl et 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

“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”


INDUSTRY INSIGHT52

Staying competitive in this challenging economic climate is on top of the priority list for most CEOs and top business leadership. Th ey no longer accept large inventories to compensate for manufactur-

ing ineffi ciencies 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. Th e results have been signifi cant.

In highly regulated industries such as pharmaceutical and personal care products, the manufacturing process includes rigorous product testing for quality. Tradition-ally, these tests required long lead times and signifi cant resources to perform the steps. Companies in these types of industries have started to bring the concept of Lean specifi cally to their laboratories with an eye to increase the speed and reduce the cost of lab quality control functions.

Th e micro QC lab is an area that can realise substantial benefi ts 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. Th e test is inexpensive, but requires time for the con-taminating 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.

When measured against Lean concepts, the classic culture method falls short. Specifi cally, 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. Th ese 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. Th e 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 benefi t from automa-tion much like their counterparts in the analytical chem-istry QC labs and in manufacturing. Automated rapid detection removes cumbersome steps in the testing process driving effi ciency and productivity.

Lean processes are helping manufacturers push the envelope in an already dynamic and progressive industry by utilising new and rapid technologies. Th e benefi ts of Lean philosophies in the lab are signifi cant. Shorter qual-ity control cycles mean faster product release, creating the need for fewer inventories and higher inventory turns.

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

How pharmaceutical companies can use Lean to realise benefi ts in the micro QC lab. By Steve Delity

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.

“Automation of the micro QC lab takes rapid detection to the next level, allowing the lab to benefi t from automation much like their counterparts in the analytical chemistry QC labs and in manufacturing”

Rapid Micro Systems.indd 52Rapid Micro Systems.indd 52 14/01/2011 14:4014/01/2011 14:40

Learn more about the benefi ts of Automated Microbial Testing.

Listen to the webcast, “Bringing to Micro QC Lab into the 21st Century”

http://tinyurl.com/27toyjw

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

Rapid Micro Biosystems, Inc.Bedford, MA 01730

Phone: 781-271-1444www.rapidmicrobio.com

Save time, Save money, Increase productivity.

RapidMicro1.indd 2RapidMicro1.indd 2 13/01/2011 13:3713/01/2011 13:37

54

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

What specifi c 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 suffi ciently 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. Th e ability to directly make a chiral amine from the corresponding ketone was identifi ed as one of the key green research areas by the Green Chemistry Institute Pharmaceutical Roundtable2.

Th rough our sitagliptin work, this area is now a commercial reality with the launch of our evolved transaminase enzymes. Th e ability to reduce chemical steps by avoiding protection/deprotection can signifi cantly 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. Th ere 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. Th ese char-acterise the practice of sustainable chemistry, and include the use of cata-lysts, renewable feedstocks, biodegradable chemicals and safer solvents. Th e fi rst principle sets the standard: prevent waste. Green chemistry processes capture both the economic and environmental benefi ts of green technology for the pharmaceutical company, continuing to drive adoption.

EXECUTIVE INTERVIEW

As a relatively new discipline within the pharmaceutical industry, what are the main challenges currently facing green technology?Joseph Sarret. Th e 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 po-tential. Some in the industry may still believe that green technology does not make sound business sense. However, major pharmaceuti-cal 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 effi ciency. 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 Co-dexis, we enable faster, cleaner and cheaper manufacturing for many of the largest drug manufacturers in the world – companies such as Pfi zer, Merck, Roche and Teva. We suc-ceeded 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 effi cient 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.

What are the advantages for pharmaceutical companies looking to start working with green technology and its inherently alternative processes?JS. Th e ultimate advantages are better product and process economics. Co-dexis enzyme-enabled processes, which run on standard equipment, have reduced costs by requiring less extreme temperature and pressure, fewer pro-cess 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 pro-cesses in terms of effi ciency and fi nancial impact?JS. It compares very favourably. In Science1, Merck and Codexis jointly published a paper on a new manufacturing process for sitagliptin, the active

Sustainability and cost-effectiveness

Why green technology makes good business sense. By Joseph Sarret

Joseph Sarret, MD, JD, has served as Chief Business Offi cer 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.

For references related to this article, please see www.ngpharma.eu.com

CODEXIS.indd 54CODEXIS.indd 54 14/01/2011 14:1914/01/2011 14:19

Codexis.indd 1Codexis.indd 1 13/01/2011 13:3413/01/2011 13:34

Corning.indd 1Corning.indd 1 13/01/2011 13:3413/01/2011 13:34

ROUNDTABLE 57

From your perspective, what are the current hurdles being faced by the surface technology and manufac-turing sectors, and how can they be overcome?Lester Mills. Th e manufacturing industry is faced with increasingly stronger competition and the need to increase effi ciency and reduce costs. At the same time over the last two years, many customers have been signifi cantly af-fected by the fi nancial crisis. Both these eff ects 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 diff erentiated prod-ucts 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.

Th e 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 signifi cant busi-ness in generic peptides and small molecules, there are defi nitely also some positive perspectives to this dynamic.

Jeffrey L Mooney. With the increase in more stringent gov-ernment regulations and heightened competitive pressures, gone are the days of spending hundreds of millions of dol-lars 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. Th is move to more scalable technologies, such as disposable bio-reactors and synthetic, non-biological cell culture surfaces, allows pharma companies to explore many diff erent options simultaneously while minimising costs, improving results and decreasing the eff ects of biological infl uences.

Stem cell research continues to advance and is play-ing 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. Th e 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. Th e 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 manufac-turing 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 invest-ment 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.

Beneath the surface

NGP talks to two industry experts about the challenges facing manufacturers of surface technologies.

Lester Mills is currently Chief Marketing Offi cer 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.

Surf Tech RT Bachem/Corning 57Surf Tech RT Bachem/Corning 57 14/01/2011 14:3814/01/2011 14:38

58 ROUNDTABLE58

Most recently, Corning introduced the fi rst 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 scale-up 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 off ers 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 cell-based assays as well as providing enabling methodologies for drug repositioning and early toxicology profi ling.

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. Th is requires many years of know-how and many years of building a quality mentality and infrastruc-ture. We oft en say at Bachem “quality matters” and it is a mindset that pervades everything we do and is refl ected in everything we make. Th e combination of this and special technological expertise is already a very good diff erentiator.

Additionally, we have streamlined our internal pro-cesses, 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 oft en better than some other types of organisation. Where we have, however, intensifi ed our eff orts and resources is in marketing and sales. In such a challenging market envi-ronment, it makes sense to maximise activities to fi ll the pipeline with new projects.

As pharma firms look to head into more complex com-pounds dealing with higher levels of unmet medical need, how does the dynamic change between your-selves and your clients – especially considering the need for open collaboration within the industry?LM. Th e 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. Th is alignment to peptides and other Bachem technolo-gies is very positive. As we also serve the research ingredi-ent market with our peptide catalogue and we observe the trends carefully here too in order to optimise our new prod-uct selections and our services. As an example, we recently added a very exciting new selection of fractionated venom lead-fi nding kits (Melusine) to our portfolio. We have al-ready seen that this was much appreciated by our customers.

JM. In an industry where there is presently a lot of rapid change taking place, specifi cally regarding the complexity of research to meet advanced medical needs, one thing that

is clear is that a one-size-fi ts-all approach will not work. Th e 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 in-novation to meet researchers’ needs and maximise results.

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 heri-tage manufacturing leading technologies for the pharma and life sciences market, the future of surface technologies and manufacturing is moving more and more towards sur-faces that enable close in vivo cell environments, synthetic surfaces that are scalable in formats, and xeno-free sur-faces. Additionally, because research and the technologies that support it are progressing so rapidly, a solid under-standing 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.

LM. Specifi cally for our business, the development of spe-cial 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. Addition-ally, 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 pharmaceu-tical research front where some newer drugs are emerging to break though the long impenetrable therapeutic barri-ers related to cancer. I am hopeful for much more medical progress in this fi eld in the coming years. If further im-provements 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.

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.

Surf Tech RT Bachem/Corning 58Surf Tech RT Bachem/Corning 58 14/01/2011 14:3814/01/2011 14:38

Bachem.indd 1Bachem.indd 1 13/01/2011 13:2713/01/2011 13:27

EXECUTIVE INTERVIEW60

What is your outlook for the global pharma outsourc-ing industry and how is CPS – the pharma outsourc-ing business unit of Dr Reddy’s, positioned?R Ananthanarayanan. Th ere is an imminent need to en-hancing 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 phar-maceutical companies in today’s environment. Th is is am-plifi ed 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) busi-ness 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 require-ments. Our end-to-end services from clinical stage intermediates/APIs to formulation development and manufacturing services including some niche technol-ogy offerings, competitive pricing and global presence makes a compelling value proposition to our global ‘in-novator’ customers. CPS is thus uniquely positioned to become the preferred partner for innovators.

Can you give us an overview of CPS and its operations?RA. CPS has emerged as one of the largest pharma out-sourcing businesses from India. Our dedicated R&D fa-cilities – 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 manufactur-ing, 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 Pa-cific (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 formu-lation 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

The source is outAs outsourcing evolves once again to accommodate the shift in industry perspective, Dr. Reddys continues to place itself on the leading edge.

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.

DR REDDYS.indd 60DR REDDYS.indd 60 14/01/2011 14:2714/01/2011 14:27

EXECUTIVE INTERVIEW 61

IND, NDA and DMF filings. Compliance with global quality standards of cGMP, USFDA and European regu-latory 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 commer-cialise a number of projects. We have an extremely effi-cient 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 pharmaceuti-cal 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 hy-droformylation in both achiral and asymmetric vari-ance. 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 ac-tivated 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 differ-entiate our offerings to innovator companies and pro-vide 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 manufactur-ing 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 in-frastructure to manufacture these APIs.

We off er a full range of reactor capacities. We have a strong quality and safety culture. For example, we prac-tice containment through air handling, pressure zoning, and isolation. Th ere are a large number of oncology prod-ucts in various stages of development and we are very well positioned to off er development services to innovators.

In addition, we have a strong value proposition in Ste-roid, female hormonal products, Prostaglandin chemistry, and carbohydrate chemistry apart from chiral capabilities. We also off er a diff erentiated product services off ering in-tegrating our APIs to fi nished dosage forms.

DR REDDYS.indd 61DR REDDYS.indd 61 14/01/2011 14:2714/01/2011 14:27

SUPPLY CHAIN62

The global pharma industry is currently weather-ing a storm of unprecedented market conditions. Accenture research has found that over the past fi ve years, patent protection has expired on prod-

ucts 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 bil-lion (€35 billion) in excess inventory, according to a recent Accenture study. In this environment, it is no surprise that

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

companies are hungry for opportunities to improve the effi ciency of their operations, better understand their cus-tomers’ demands, and devise more creative responses to the marketplace’s challenges. Supply chain analytics pro-vide 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. Th e 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 perspec-tive 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 seg-ments, the study covers a wide range of topics, from supply chain strategy and organisational design to planning, fulfi llment and compliance. It off ers an excellent vantage point from which to observe the impact of analytical capa-bilities 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 eff orts are largely focused on a single dimension: developing greater visibility into supply chain performance. Th ere is certainly room to im-prove in this area, but the true value of analytics goes far beyond simple performance management.

Indeed, participants who indicated stronger analyti-cal capabilities (e.g. closer integration with customers on demand forecasting) also consistently demonstrated higher margins. Even beyond these quantitative benefi ts, analytics off er the keys to identifying and building on competitive strengths which will become increasingly im-portant 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

JonesSupplyChain.indd 62JonesSupplyChain.indd 62 14/01/2011 13:3114/01/2011 13:31

SUPPLY CHAIN 63

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

ObstaclesBut having the data, while necessary, is far from suf-

fi cient 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. Com-panies that have advanced analytical capabilities typically developed them by focusing fi rst on using the best data they had, and working to increase the quantity and quality of data only aft er building an ability to make meaningful data-based decisions.

In fact, organisational factors that break the link be-tween data and decisions are oft en the biggest obstacles to overcome. Too oft en, 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 fi rst step toward better analytics is to develop a focus on facts and a willing-ness 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 inven-tory if necessary to ensure that all orders are fulfi lled.

Analytical thinking might suggest a very diff erent 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 eff ectiveness of traditional processes to building new ways of operating. In the consumer goods industry, for in-stance, manufacturers are increasingly turning to point-of-sale 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.

ImprovementTh e 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

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 have driven improved performance in other industries.

A leading big-box retailer in the United States has been able to leverage two decades of experience in collect-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-fi t sale items to conditions in the community.

Forward-thinking internet retailers in several catego-ries have invested heavily in developing predictive models of user behaviour which allow them to direct advertising and product recommendations based on users’ likely pref-erences and their own inventory and margin requirements.

One of the world’s largest manufacturers of building materials uses a predictive model of traffi c and weather 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 ana-lytics to drive diff erentiation – 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 infor-mation 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 wonder-ing 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 work-ing capital using a strong analytics approach can provide both short-term opportunities for fi nancial benefi t and insights into which areas should be prioritised to develop analytics capabilities in the long run. Th e recent wave of merger and acquisition activity off ers especially tan-talising opportunities for the consolidated companies. Improved analytics in the areas of business simulation, network optimisation and risk modeling off er the poten-tial for greatly enhanced synergies, and a quantum jump in supply chain capability. Th e path blazed by pioneers in other industries off ers pharma companies the prospect of comparatively rapid advance toward strong analytical capabilities and the benefi ts 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.

have drivead

been able

have drived

been able

ve driA le

een abl

ave drivea

een able

the commwa

ries have i

the comma

ries have i

e comForw

es hav

he commw

es have

erences ano

materials

erences ano

materials

ences aOne

aterial

rences a

material

“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”

JonesSupplyChain.indd 63JonesSupplyChain.indd 63 14/01/2011 13:3114/01/2011 13:31

AMBIT AD2 DPS.indd 2AMBIT AD2 DPS.indd 2 16/06/2010 13:0016/06/2010 13:00

AMBIT AD2 DPS.indd 3AMBIT AD2 DPS.indd 3 16/06/2010 13:0016/06/2010 13:00

ASK THE EXPERT66

The 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 oft en cited patent cliff that

makes pharma executives nervous. Th ey have to manage big expectations from the market to revitalise that pipe-line with new products, which they develop themselves, licence in or buy in with an acquisition. Oft en times the pipeline per se would still be all right but to get the prod-ucts 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 in-class for unmet needs or they should show substantial cost/benefi t 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 aft ermath 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 de-veloped world or to get immediate access to new, strongly growing markets for products addressing therapeutic areas like diabetes and cardiovascular. Such acquisitions oft en 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.

Product transfers always involve adapting production capabilities because variability generally increases when diff erent sites or part of their production plan are consoli-dated. Since there are less and less big volume blockbust-ers, 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 diff erent 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 informa-tion on one single line. With such fl exibility, 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 Eff ectiveness, 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 fi ve injectors in about 45 minutes (this does not included line cleaning).

Additionally, modular and fl exible packaging equip-ment solutions like Dividella in Switzerland off ers, ad-dress 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 circum-stances asset protection is vital. In other words, the exist-ing equipment, which was bought for a specifi c product for example, should be capable of being retrofi tted for other products. In recent years, we can clearly confi rm this trend since about 50 percent of all our packaging lines have been retrofi tted for one reason or the other.

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.

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.

Dividella.indd 66Dividella.indd 66 14/01/2011 14:3814/01/2011 14:38

Dividella.indd 1Dividella.indd 1 13/01/2011 13:3413/01/2011 13:34

INDUSTRY INSIGHT68

Regulatory developments and technological innova-tion are opening up new opportunities for companies to use life cycle collaborative management to bring together parts of the value chain that have tradition-

ally been relatively distant from each other. Collaboration will become increasingly important across the R&D/manufactur-ing 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.

Th e US Food and Drug Administration’s ‘critical path initiative’ has paved the way for the use of process analytical technology (PAT) in manufacturing. Process understand-ing 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 com-panies can have the real possibility of continuous manu-facturing which avoids the need to scale up altogether, thus shrinking the time to get product to market. Information needs to fl ow from R&D to manufacturing but it should also be a two-way collaborative fl ow. Knowledge gained through manufacturing can, for example, be re-used to ac-celerate the product development process.

Th e second interface – between pharma and patient – is becoming increasingly important for a number of stra-tegic reasons. With fewer new molecules and blockbuster products left to be discovered and developed, companies have to turn more to optimising the particular eff ects of existing molecules for individual patients and segments of patients. In parallel with the decline of the blockbuster

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 infl uence 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 mecha-nisms, and to feed that information back into development, formulation and manufacturing.

Many of the technological tools to achieve collabora-tion 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. How-ever, 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.

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 man-ages whole life cycle of the drug and enables networks of innovation and collaboration, capturing best practice and lessons learned, creating a storehouse of valuable intellec-tual capital for re-use.

Th e prospect of bridging these interfaces is compel-ling. It off ers 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.

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.

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).

Sivarama Nalluri is an Enterprise Solution Architect in the Offi ce 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.

“Product lifecycle management is the missing piece in the pharma discovery and development jigsaw” Sivarama Nalluri, Enterprise Solution Architect, Siemens

Siemens_INDINS.indd 68Siemens_INDINS.indd 68 14/01/2011 13:3314/01/2011 13:33

Siemiens.indd 1Siemiens.indd 1 13/01/2011 13:3813/01/2011 13:38

NEXT BIG THING70

Challenges of the cool chainTh e distribution demands of pharmaceutical prod-

ucts 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 spe-cifi c product requirements for specifi c markets. In other words, the choice of mode is linked to a company’s supply chain strategy for a specifi c 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 harmon-ised 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-eff ective and secure solutions. Th e challenge then moves to cost.

When it comes to the costs of distributing phar-maceuticals, the gap between regular air or sea freight shipments and pharmaceutical shipments has narrowed. Th e pharmaceutical industry has put two focus areas on their internal map: global supply chain harmonisation, with cross-divisional activities and increasingly central-ised decision making, as well as cost-cutting activities, including a comprehensive review of the costs of the full supply chain. Th ese days, companies understand more than ever what they are paying for.

Naturally, these key changes are good for the phar-maceutical industry. But they also provide an opportu-nity for logistics providers – interaction between these two groups has never been greater. As patents expire for the blockbusters, fi erce competition from generic com-panies is making time-to-market the most important success factor going forward. At the same time, the phar-maceutical industry is seeking to outsource non-core

The changing challenges of supply chain performanceWhen 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.

activities. Th ere 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 cor-rect quantities. As orders become smaller, produc-tion 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 pharmaceu-ticals 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.

Th ese types of changes in supply chain routines can have dramatic eff ects if they are not properly imple-mented at all levels. However, clear communication can greatly reduce their cost. Global harmonisation therefore enhances the possibility of maximising eff ects 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 pharma-ceutical sector for many years, Geodis Wilson saw these changes coming down the road, and we realised that op-timal 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 un-derstand 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.

GeodisWilson.indd 70GeodisWilson.indd 70 14/01/2011 15:2314/01/2011 15:23

Geodis.indd 1Geodis.indd 1 13/01/2011 13:3613/01/2011 13:36

INNOVATION AND COLLABORATIONNGP 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.

INNOVATION72

TED TORPHY ED P72-74.indd 72TED TORPHY ED P72-74.indd 72 14/01/2011 14:3814/01/2011 14:38

INNOVATION 73

Probably the ultimate in a business model like that is what Steve Jobs has done at Apple. Aft er all, what does Apple really make? Th eir hardware I’m sure is manufac-tured elsewhere but they own what their core competency is – the design and then partly in the distribution chan-nels. But the hardware, the soft ware and the content is all coming from elsewhere. Th ey 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 compa-nies 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 diff erent from the other – there’s something diff erent 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. Th at’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? Th en 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 prod-ucts. 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

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 diff erence 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 eff ective 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 effi cient 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 record-enabled 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 ac-commodate it?TT. Th e 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 develop-ment 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 solu-tion 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 play-ers 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 diff er-ent players within the value chain begin to focus on what is really important for them.

Ted Torphy


INNOVATION74

but right now many of the stakeholders within this ecosys-tem: the payers and the regulators and us, we’re not neces-sarily aligned to the extent that we could be to discover, develop and launch drugs that really make a diff erence, the breakthrough drugs where there’s a lot of risk asso-ciated 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 well-understood therapeutic care.

Th e example would be – and I think that the technol-ogy 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 aft er a robust phase II programme if it’s truly a lifesaving or a life-changing drug and you’re a pioneer in that fi eld how can we set things up so that we could launch it in a contained way, that we launch it aft er a robust phase II, but only within this system where there’s essentially daily monitoring. If we could do that, every-body 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 effi cacy of the drug in real patients. Not just well-controlled clinical trials but in real life, in real patients.

Th e 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.

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 eff ects are, what the complications are.

It’s 15 years worth of investment to get that informa-tion. 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 in-stead 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. Th e 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 aff ord it or because their healthcare systems are just devel-oping. Th ere are opportunities there that are unimaginable and don’t fi t 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.

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 deliver-ing 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 fi ngers and change one thing in the industry, what would it be?TT. Th ere is one thing that comes to mind and it’s a big issue. Not absolutely clear as to how we would address it

“Th e 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”


DrReddys.indd 1DrReddys.indd 1 13/01/2011 13:3413/01/2011 13:34

TROUBLESHOOTER76

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. Non-adherence leads to poor effi cacy and lost sales, with results and economic benefi ts 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?

In the new health landscape, shift ing stakeholder power and expectations are making an already challeng-ing 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 infl uential player. Th e traditional pharma model’s short-term focus – based on deploying large numbers of reps to drive prescrib-ing of products – is no longer viable.

Pay-for-performance models are generating more at-tention, as payers look to adopt pricing models linked to the economic benefi ts a drug delivers. True added value – and not simply safety and effi cacy – is now required for market success. Unless they off er an especially compelling case on value, products lacking a novel treatment mecha-nism are falling out of favour, as they fi nd fewer advocates willing to add them to formularies and keep them there. Th e ability to use a patient-centric or outcomes approach to demonstrate that products and technologies align with and

A patient-centric focus

The key to marketing and supporting the QIPP challenge. By Morna White

Quintiles_TroubleSHOOt.indd 76Quintiles_TroubleSHOOt.indd 76 14/01/2011 13:3314/01/2011 13:33

TROUBLESHOOTER 77

drive the QIPP agenda will be essential for success. Since QIPP focuses on ‘full system’ effi ciency rather than isolated elements, pharmaceuticals need to be low in price only if they off er no other system benefi ts.

Th e true centre of gravity has shift ed from the voice of the physician to the voice of the patient, as delivered through the payer. Making the right marketing invest-ments relies on asking patients the right questions and allowing their insights to inform strategy at all levels.

Th ese 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 specifi c therapy issues relating to treatment satis-faction need to be addressed? What behaviour change can positively infl uence 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-eff ective, in-novative 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.

Th e concept of joint working between the NHS and the biopharmaceutical industry on a broad agenda for the benefi t of patients remains a promising one. To date, most major NHS initiatives have been driven by ‘big pharma’. Th ese market leaders have much to contribute and gain from strengthening their partnerships with the NHS. Th ere is an opportunity for companies to provide expertise to the NHS to increase effi ciency and meet patient and NHS needs with accessible, sustainable and cost-eff ective therapies.

For example, a collaborative NHS/industry project – involving AstraZeneca, Boehringer Ingelheim, GlaxoS-mithKline, Nycomed and Pfi zer – helped to identify undi-agnosed or misdiagnosed chronic obstructive pulmonary disease (COPD) patients. Th e project (which was delivered using Quintiles nurse advisers) demonstrates how trans-parency with stakeholder objectives and alignment of goals can build trust. It won a prestigious Association of the Brit-ish Pharmaceutical Industry (ABPI) Joint Working award.

Understanding the patient experience across a com-plete continuum of care ideally positions biopharma com-panies 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 de-liver a unique level of engagement. It capitalises on the spe-

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. Th e end result is an opportunity to maxi-mise the commercial potential of brands, to build evidence that supports value-based pricing, and to generate a variety of clinical, economic and marketing benefi ts.

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 fi ve 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. Th ird, patient interventions, based on patient programme branding and using channels appropriate for each patient profi le. Fourth, intervention feedback and real-world data collection, using regular patient community surveys to understand patient experiences. Fift h, multi-stakeholder communication, gain-ing the support of patient groups through management of advisory boards and patient associations, and driving mar-keting strategies that resonate with all stakeholders through papers, posters, publications and other tools.

In a traditional sales and marketing approach, gath-ering frequent, dynamic feedback from all of those stake-holders would be virtually impossible (and fi nancially impractical). Th rough Quintiles’ Patient-Centric Services model, steady, timely streams of knowledge feed the deci-sion-making process in a way that lets client companies put research and commercialisation resources precisely where they can best benefi t all key stakeholders.

Th is feedback has proven benefi ts for market access and brand value creation, having a positive impact on clini-cal 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-eff ectiveness, shape treatment guideline creation, lobby for formulary ap-proval and inform future health economics) and market-ing 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 eff ective channels).

Th e combined eff ect of these benefi ts 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. Physi-cians can make more effi cient 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 shar-ing their experiences with patient communities.

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 fi ve 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 patient-centric marketing strategies and has recently been working with a top fi ve pharma company to support a new launch.

“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”

Quintiles_TroubleSHOOt.indd 77Quintiles_TroubleSHOOt.indd 77 14/01/2011 13:3314/01/2011 13:33


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 eff ect in June 2007 in an eff ort to improve the level of protection of human health and the environment through better and earlier identifi cation of the intrinsic properties of chemical substances. In addition to requiring companies to provide more safety information, REACH specifi es a progressive substitution process for more dan-gerous 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, provi-sions were made to phase them in over an 11-year period. Th e deadline for registration of high-volume chemicals (those typically known as hazardous substances) is 30 No-vember 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 knowl-edgeable about the REACH requirements. For example, companies may need assistance in determining the mini-mum number of vertebrate animals necessary to meet REACH specifi cations. 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 regu-lations. Avoiding overestimation can result in signifi cant cost savings for MPI Research Sponsors who are working toward REACH compliance.

Are there any special considerations for developmental or reproductive testing?AF. Yes. When conducting research on chemical sub-stances, it is important that companies consider the clas-sifi cation scheme used by REACH to label a substance with known developmental and/or reproductive toxicity. Th e criteria used does not appear to be based on the exposure level producing these eff ects, barring excessive generalised toxicity. Th erefore, labeling these chemical substances without consideration of the eff ective dose level does not provide meaningful data about their actual risk. For ad-ditional details, see Anthony R. Scialli’s 2008 article, Th e challenge of reproductive and developmental toxicology under REACH (Scialli, A.R., Th e challenge of reproductive and developmental toxicology under REACH, Regul. Toxi-col. Pharmacol. [2008], doi:10,1016/j.yrtph.2008.04.008.)

How can I get more information about the REACH regu-lations?AF. Manufacturers of chemical substances can get most of their questions answered about these regulations by re-viewing 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 scientifi c team that is knowledgeable about REACH regulations. It is important that they have a com-prehensive understanding of the implications of REACH for your chemical substances. To discuss how you can be sure of a solid and cost-eff ective 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 [email protected].

REACH for the starsAli 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.

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 Scientifi c Counselors Computational Toxicology at the United States Environmental Protection Agency.

MPIreearch_EXINT.indd 78MPIreearch_EXINT.indd 78 14/01/2011 13:3314/01/2011 13:33

MPI.indd 1MPI.indd 1 13/01/2011 13:3613/01/2011 13:36

ROUNDTABLE80

Trends in outsourcing

analytical support

in pharmaceutical

development

With David Beyerlein of MicroConstants, Inc. and Dominic Moore of Waters Corporation

ROUNDTABLE 81

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 oft en so high that you lose out on the cost savings out-sourcing 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 aft erthought. Th is can be avoided by choosing a CRO that has a niche focus with strong relation-ships 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 part-nered 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 scientifi c 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 any-thing else. While cost and timelines are important to any drug development study, if you can’t have complete confi -dence 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. Th ey want to know the provider can generate good quality scientifi c data, using high quality, state-of-the-art instrumentation and data systems which are used in an ef-fi cient 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 bioana-lytical 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 specifi cally, the compounds being outsourced are becoming increasingly challenging analytically and the methods can be extremely diffi cult to develop. However, service providers with the most experienced and talented method developers will embrace these challenges and view them as opportuni-ties to be scientifi cally creative to achieve success.DM. To remain competitive, CROs need to remain fl exible to all of their clients’ demands, be able to work effi ciently, and

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.

How do you see the analytical outsourcing model chang-ing over the next 10 years?DB. One of the biggest changes recently in the pharmaceuti-cal industry has been the decreased focus of big pharma’s internal R&D functions. Th is change in in-house capabili-ties 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 de-velopment process.DM. Th e role of the CRO will increase to a point where they lead the strategic and development eff orts for the pharma-ceutical companies rather than being a partner in the pro-cess. 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 pro-ductivity 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.

“Today every CRO faces challenges with competition, both from foreign markets and with the internal resources of drug developers”

Dominic Moore, Waters CorporationDominic 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.

WATERS CORP.indd 2WATERS CORP.indd 2 14/01/2011 15:3514/01/2011 15:35

INNOVATION82

FACING THE FUTUREAs 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 fi nger on the pulse of the industry doing so, it can only be a good thing.

The current face of pharmaceuticals bears little resemblance to its pre-decessors. 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? Th ink again.

But while the current face of pharmaceuticals looks little like its prede-cessors, 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 work-ing 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 Transla-tional Development – both based at Nycomed’s Konstanz offi ce in Ger-many – 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 exemplifi es the need for honesty at a time when the industry is becoming more fragile.

US versus Europe“Th e US, Europe and emerging markets have very diff erent payer

systems,” continues Nikam, “so I really don’t think they are comparable in terms of revenue or how you market the pharmaceticals. Th ey’re not comparable in the way healthcare is administered and they’re not compa-rable in terms of how pharmaceutical companies are run, so very diff erent industries in all these countries.” And indeed they are, with Nikam also highlighting the fact that the US has signifi cant 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 eff orts, he feels that it is important for the phar-

McCracken.indd 82McCracken.indd 82 14/01/2011 13:3314/01/2011 13:33

HEADING 83INNOVATION 83

maceutical industry do a better job of selling themselves as the creators of medicines that signifi cantly 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 con-stant 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. “Th e 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? Th en of course there’s the money aspect to it: yes, we’re doing something good for people, but we still need to be profi table as well.”

In order to continue to remain profi table, whilst ensuring confi dence 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 signifi cant resources, will have to take the lead in undertaking cutting edge research to treat diseases that have alluded eff ective treatment.

However, big pharma has still to come up with a pharma R&D model that is cost eff ective and manages attrition in clinical development. Th ey have indeed taken time to change the business model that has negatively impacted new drug discovery and innovation. Smaller biotechs are gener-ally based on novel drug discovery ideas and have the ‘can do’ spirit but lack signifi cant 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 consis-tently. 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. Th at’s what’s going to provide the money for your future. Th ere 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.

The right perspectiveTh e regulatory minefi eld McCracken alludes to is another ‘hot topic’

that oft en 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 attri-tion early and killing compounds in preclinical or early development stage when it is much more cost eff ective.

“We’re inevitably going to be moving away from the blockbuster side of things towards targeting more specifi c people, and with that ensuring that those compounds really work in those people” - Nigel McCracken


84 INNOVATION

“My feeling is that the pharma industry has reacted signifi cantly to the regulatory environment. No drug

is absolutely safe and it’s our job to derisk to improve effi cacy and reduce side-eff ects. Th at’s the nature of our

business. Finally it’s all about the patient who is waiting for medicines that really matter”- Sham Nikam

Adding to that notion, McCracken returns to the importance of being as patient-centric as possible – and we can all admit that public relations haven’t been a strong point of pharma companies in years gone by. He believes that patients need to be more involved in the drugs that are being made, forcing out the habit companies tend to have of assuming what end-users ‘need’ as opposed to what they actually want. Together with the emergence of tele-medicine and the concept of ‘e-care’, it looks as though the old adage of the life sciences and healthcare industries becoming far more sympathetic in their involvement with each other is on the cards to nurture this ideal.

Th at’s all well and good as a concept, but for the immediate future, Ny-comed has the strongest possible minds working at its forefront, pushing productivity and innovation through new technologies and tools to bring to market ‘medicines that matter’ to patients. “We map a portfolio that has a better than average chance of success in Proof of Concept (POC) studies and refl ects high technical doability preclinically and in development,” ex-plains Nikam. “We have chosen a low attrition model through smart selec-tion of projects and addresses signifi cant unmet medical need. Th e overall strategy also involves a mix of precedented and unprecedented targets that ensures consistent delivery of candidates in stringent timelines.”

Nikam explains that once the correct portfolio is in place, the next chal-lenge is to fi nd the right resources and identify key partners that can assist in bringing new technologies and expertise required for projects. “We are a medium 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 in-house and have partnered with diverse companies to support preclinical and clinical pipeline. Our development pipeline is a testament to our being an excellent partner.”

And with the global fi nancial downturn maintaining its position at centre stage, managing resources has never been more important. But arguably for the pharma industry, the economic downturn hasn’t had as much of a direct aff ect as presumed – rather, the indirect consequences of widespread fi nancial insecurity have provoked a change in environment that can’t help but aggravate the industry.

“I believe that we will be aff ected by the fi nancial changes,” commits McCracken, “because all the measures that the governments are putting in place to save money is going to hit on pharma somewhere down the line. Th ey’re not going to be paying the same amount of reimbursement and there’s going to be challenges for the pharma industry in the future because we’re going to need to show real diversity and prove that the drugs actually work. Unless we can do that, we will struggle in the future to sell drugs.

“It may well be that some of the projects that go through are put on the backburner, slowed down or have their payments deferred. It works out that you have to become more effi cient regardless; there’s a reason we fi nd ourselves in the environment we do today. But to be honest, the change is continual and you just have to react to things as and when they come and be fl exible enough to do that. Most pharmas are run by people who are more business minded than most, which is fi ne because it’s a business, but you need to be able to react to the environment that you’re working with. If that environment changes then you need to be able to adapt relatively quickly and just get on with it.”

The right balanceWhile this sentiment may alter slightly, McCracken’s rule of thumb

highlights the need for fl exibility and an ability to adapt eff ectively – some-thing Nikam agrees with wholeheartedly. “Nycomed is a privately-owned, medium sized pharma company,” he asserts. “We have a diff erent set up compared to a publicly metered company, so we don’t have as much bu-

reaucracy as a lot of other companies. We defi nitely see ourselves as nimble and quick, so decision-making at Nycomed is extremely quick. When we change our portfolio, terminate or progress projects, we certainly don’t stumble. I’ve seen the big pharma scene fi rst hand and it’s made me realise that we are far more nimble and quick in taking and making decisions.”

And if the launch of Nycomed’s new drug Daxas, a phosphodiester-ase 4 inhibitor for the treatment of COPD, is anything to go by, Nikam is certainly a man of his word. A fi rst in class, phosphodiesterase-4-inhib-itor with an anti-infl ammatory component, Daxas has shown extremely good effi cacy in the treatment of COPD and has already been launched in Europe. If it receives linear approval from the US FDA in the coming months, then it’s all steam ahead for the creation in the US market, led by Nycomed’s US partner Forest Laboratories ; a solid transition from the EU market says a lot about a drug’s potential.

But this isn’t just down to hard work and having a solid team behind you: it’s about understanding what direction the industry is taking and placing yourself accordingly – including building that consistent team – something both Nikam and McCracken are extremely well-versed at. “Th ere is still this silo mentality in pharma,” explains McCracken. “It’s not as bad as it used to be and I think it’s starting to get better. If you’re working within an organisation that is working together as a team, with seamless communication with a common goal then that’s fi ne, however, that is not always the case. We employ people within the industry that are scientifi -

cally brilliant, innovative but we loose sight of the important fact that we also need these people to have good social and communication skills.”

As McCracken sees it, you can have the best scientists in the world, but if they can’t express themselves eff ectively then they’re likely to become counter-productive to the team as a whole – hardly an innovation-hunting asset. Gaining the right balance is key to gaining the right productivity: being as proactive as possible outside your comfort zone is becoming the currency of pharmaceutical teams across the board – a notion Nycomed has done well to acknowledge.

“If you look at the way we work, we’re doing a good job of making a diff erence to peoples’ lives in many diseases, which are going to give a better quality of life, but also prolong age as well. We’re inevitably going to be moving away from the blockbuster side of things towards targeting more specifi c people, and with that ensuring that those compounds really work in those people.”

To McCracken, thinking ahead it’s not just about personalised medi-cine, it’s also about polypharmacy. Years down the line, people won’t be taking one or two compounds, they’ll be taking 10 to 20 compounds all at 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 ques-tions that will need to be answered. Th is is where he sees the future focus being placed, which is precisely where pharma should be moving. For both McCracken and Nikam, the future is not only challenging – it’s exciting. And with the quick-pace of Nycomed behind them, they certainly have their fi ngers on the pulse of the future.


Cellular tech.indd 1Cellular tech.indd 1 13/01/2011 13:3313/01/2011 13:33

HEADING86 INNOVATION86

Adapt perish

or

Leshughes_DEC10.indd 86Leshughes_DEC10.indd 86 14/01/2011 15:5114/01/2011 15:51

HEADING 87INNOVATION 87

Consider 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 under-stand. While we may disagree on exactly what hap-

pened, 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 blockbust-ers, is lumbering toward extinction. What must companies do to avoid this fate?

Les Hughes, for one, is confi dent that the industry can rise to the challenge. Hughes, who is VP Global Discovery & Global Head of Cancer and Infection Research at AstraZen-eca, believes that, conversely, the world may even be chang-ing in a way that benefi ts Big Pharma.

“If the premise of this is that pharmaceutical com-panies can’t adapt, I think that’s untrue. You could make an alternative argument that things are moving in a way that benefi ts large pharmaceutical companies. Th e cost of drug development is going up. Th ere 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 bio-techs because the funding is not there. Th ere will be more cooperation with academic institutions and more outsourc-ing 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 fl ourish, and that includes changing the traditional attitude toward information sharing. “Th e world has moved from being very much closed, where you might have said: ‘we collaborate on our terms, we get all the benefi ts 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 benefi ts.”’

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 diff erent to the inward-looking, closed doors mentality that many pharmaceutical companies have had in the past, so it really has changed.

“Th ere 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 rec-ognise that while that is still a downside, the benefi ts 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

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

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 overseasOne 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 diff erences 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 eff ective 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 benefi t before they’re prepared to pay for it.

“Clearly when you’re discovering and developing a drug it does have an infl uence on what you’re looking for, because you’re looking to make sure that you deliver a good enough benefi t and meet payers’ needs, and that includes European ones as well as elsewhere.”

Hughes says that given the European regulatory envi-ronment, it’s important to show a much bigger eff ect with your drug, making it worthwhile for people to pay for it. “Th at is pushing us towards the environment of what people would call personalised healthcare, which means trying to tailor your drug or fi nd the patient population that fi ts to give it the best chance of being effi cacious.

“It’s either fi nding the patients who are not going to re-spond, or fi nding the patients who are going to respond and tailoring your clinical trials to that. Th at not only gives you an eff ect opposite to the payers, but also decreases your costs as well, because it can have a big eff ect on the size of the clini-cal 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 specifi cally for them, rather than being tacked on as an aft erthought.

“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 com-pany in the prescription market there. AstraZeneca China is headquartered in Shanghai, with 23 branch offi ces in major cities across the Chinese mainland, as well as one offi ce in the Hong Kong Special Administrative Region. It employs more than 3500 employees in manufacturing, sales, clinical research and new product development.

“Th e whole reason for being in China is to make sure that you understand what the market is and what the oppor-tunities are, and you’re working with people in the region,”


HEADING88 INNOVATION88

says Hughes. “Th e emerging markets will not just be an op-portunity 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.”

Th e company also has interests in India, although Hughes says the industry there is not quite so well-estab-lished. “Th e 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 not-too-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 re-gions – Turkey, India, China, Russia – clearly the European companies are much stronger than American ones. Th ey’re in a diff erent order of ranking compared to the world order.”

New modelsTh e recent global economic downturn was yet another

challenge for the industry, although Hughes says it was the banking crisis specifi cally that had the most eff ect.

“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 insti-tutions, for example. You’re spreading yourself in terms of the risk, you’re making yourself as effi cient as you possibly can, you’re making yourself more fl exible 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 mar-kets, 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, aft er being told by their GP that they suff er from a particular condition, can resist looking it up on the web?

“Working with those media to put in trustworthy in-formation that has benefi ts 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 any-thing 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-

“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”

ceutical companies can’t aff ord to alienate physicians. What you’ve got to do is get them to want patients to know. Th ere 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.

“Th eir 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 medi-cine is delivered is an important part. If doctors are prepared to engage in that and the pharmaceutical companies are en-gaged in that and there are other groups who are also help-ing, then it would be a much better dialogue.

“Th e 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.

“Th e evolution in Europe is more around the doctors. In the US it’s the healthcare companies and the insurance com-panies 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. Th e 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 prob-ably like to have some say in what’s going to happen.

“Th e 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 changesIf Hughes could change one thing in the industry, it

would be for the regulatory group authorities to have a better understanding of risk-benefi t. He believes that cur-rently there is too much emphasis on risk and safety and not enough on the benefi ts to patients.

“Finding a way to work with companies to understand how the compounds or products work, to maximise the ben-efi ts 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. Th e 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 authori-ties 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.”


Biorad2.indd 1Biorad2.indd 1 13/01/2011 13:3113/01/2011 13:31

ASK THE EXPERT90

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 gener-ated as well. In addition to the single modifi ed mouse lines, multiple humanised and knockout models were developed.

Specifi cally, humanised mice can potentially be used to more accurately predict human metabolism and drug-drug interactions compared with existing in vivo models. For example, mice humanised for cytochrome P450s can be used to screen for human-unique or human-dispropor-tionate 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.

Th e impact of drug transporters on parameters such as biodistribution and drug-drug interactions is increas-ingly recognised, and may be subject to guidelines from the FDA. Th e use of mice humanised for key transporter proteins such as MDR1, MRP2, BCRP, OATPs etc. is gen-erating considerable interest in the pharmaceutical indus-try, 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.

Th e transADMETTM portfolio fi ts extremely well with the overall Taconic mission, “to provide our cus-tomers with in vivo translational products and services to increase the effi ciency of life sciences, drug discovery research and safety evaluation”.

Only a small fraction of compounds entering clinical Phase I studies obtain market approval. A major reason for failure is that current pre-clinical models are oft en poorly predictive

of effi cacy, pharmacokinetics and clinical safety in man. Specifi cally, the predictability of current preclinical animal models is limited by profound interspecies diff erences in drug metabolism and disposition. In response, a number of academic and commercial groups including Taconic have developed humanised mouse models.

Th e 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, metabo-lism, excretion and toxicity (ADMET) of a pharmaceutical or chemical compound in humans. Th e transADMETTM models are a series of mouse lines that are humanised or annulled for key proteins involved in drug metabolism and disposition. Th ese models have the potential to sig-nifi cantly improve the in vivo safety and effi cacy evalua-tion of new drugs and chemical compounds by reducing the impact of species diff erences and thus allowing more informative decisions in the selection of the most promis-ing 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.

Th e models are categorised in three panels represent-ing critical pathways in drug metabolism and disposition:

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

Translational ADME-Tox models

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.

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

TACONIC ED P90.indd 90TACONIC ED P90.indd 90 14/01/2011 14:3714/01/2011 14:37

Taconic.indd 1Taconic.indd 1 13/01/2011 13:3813/01/2011 13:38

BUSINESS92

Casting awider net

ARMSTRONG.indd 92ARMSTRONG.indd 92 14/01/2011 14:1814/01/2011 14:18

BUSINESS 93

The modern pharmaceutical industry has been pushing the boundaries of drug discovery for decades through eff ective 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 diff erent from their modern-day counterparts: to create and provide medicine.

Yet today’s market is witness to the drying up of pipe-lines and rising costs that have left some companies with their backs against the wall, desperately in need of new in-novation and cutting-edge solutions. A pioneer in under-standing this new perspective is Eli Lilly, a company that has remained on the leading edge of executing partnership programmes since it introduced the fi rst 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 outsourc-ing no longer suffi cient, Lilly went from being a fully in-tegrated 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 pharma-ceutical industry as a whole.

With the word ‘future’ rolling across pharmaceutical lips worldwide, companies are starting to realise that the one-size-fi ts-all approach of traditional innovation cannot succeed in the current climate, leaving many looking to carve their own innovation paths. “You see most phar-

maceutical companies having specifi c strategies around addressing the overall arching quest for increased innova-tions,” explains Armstrong.

“Everybody’s going about it in a slightly diff erent 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 grow-ing 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 diff erent types of interactions externally – that’s essentially the framework of what we refer to as our FIPNet strategy.”

Looking outPre-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 com-ponent 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 scientifi c and medical fi elds 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 high-light the degree of innovation going on externally in areas that, historically, were not even available to us a few de-cades ago,” Armstrong continues. “Th e 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 – off ering specifi c expertise that was extremely focused and, in some cases, even more effi cient 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 in-novation that was coming out of our own labs as well as things that we were accessing externally.”

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.


BUSINESS94

Armstrong defi nes three levels within the FIPNet as a company-wide framework by which both local manage-ment 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 eff ectively 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 effi ciently across the globe. Th is has allowed middle managers to be able to make decisions, recom-mendations and run pilots eff ectively to allow them to become more entrepreneurial about how to make them-selves more effi cient.

“Level two is molecule based and dramatically dif-ferent from level one in as much as now all the functions touch the molecule,” Armstrong says. “Th e 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 innova-tive 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

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

UnderstandingArmstrong is quick to point out that all three levels

are off ered concurrently to aff ord every employee a specifi c 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 aff ected the most, Armstrong is confi dent that it will conjure a positive movement across the board.

“We’re very opportunist. We’re constantly monitor-ing, evaluating and surveying the growth for interesting opportunities to entertain where we present ourselves to these potential future partners. I think emerging markets will aff ect 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. Th e 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 confi dence that this is the direction we wanted to go in.

“Part of the reason we waited was to ensure that the external world was suffi ciently mature for us to feel con-


BUSINESS 95

fi dent, 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 imple-mented on multiple levels. “We would begin with ensuring thorough diligence of potential partners, which would allow us to evaluate the kind of maturity and confi dence in which we could initiate an interaction,” continues Armstrong. “Th e second thing we have is a proactive and focused group of in-dividuals 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. Th ey’ve been able to achieve effi ciencies and speed that are far better than the industry average by being close and relying heavily on a network of service providers, centres of excel-lence and even external experts to design and carry out the clinical trials specifi c to each of the individual aspects.”

Th e Chorus group that Armstrong talks of has wit-nessed 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 effi ciency. 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 specifi c molecule.

“Th e 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 for-ward. I feel that Lilly is leading in this phase and that the FIPNet has been eff ective 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?” Th ey 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 diff erent: 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 scaff olding has been removed

and the dust clouds have blown away is precisely what Arm-strong describes: a framework that not only invites innova-tion, 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.

FIPNet Q&A with Tim Garnett, CMO and SVP, Lilly’s Center of ExcellencePlease tell us about the current face of innova-tion in the pharmaceutical industry and how that is affecting conditions in the pipeline.Tim Garnett. We are all well aware of the signifi cant 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 fl ow 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 signifi cant 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 benefi ts 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 effi ciencies that exist outside Lilly’s walls, so our commitment to FIPNet is unchanged and will indeed expand as the DCoE develops.

“Th e 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”


TROUBLESHOOTER96

Aft er the credit crunch and seeing the ongo-ing crisis of the Big Pharma companies it is becoming more and more obvious that the infl uential work of E. F. Schumacher, “Small Is Beautiful –A Study of Economics as if

People Mattered,” is more relevant than ever. Th e world is not only suff ering 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.

Th ere 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. Th e pressure remains to improve the effi cacy and reduce costs. Aft er the consistent growth of the pharmaceutical industry in the 90s, recently the block-

buster model has come under pressure as it has reached the limit of its ability to generate suffi cient revenue in the long term. Th e patent cliff is close and that, combined with weaker pipelines, means lower revenue for pharma com-panies. In fact, sales at many big pharma companies were fl at or down in the last quarter.

Big Pharma companies responded to the situation with cost saving measures. Th ey reduced R&D budgets and layed off thousands of researchers. Many manufac-turing sites were closed, especially in the Western hemi-sphere. Big Pharma is turning more and more East and buys products and services en masse from Asia. More re-organisations are expected, which means more outsourc-ing of R&D and manufacturing operations.

Another interesting trend is the sale of R&D facili-ties to pharmaceutical service providers. Such deals fre-

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

The FP7 will have over €106 invested

towards 2013


TROUBLESHOOTER 97

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 de-cision makers and the actual participants to maximise the return of the invested billions and generate useful results for the benefi t of the European economy. Th e 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 chemis-try service provider for the pharmaceutical industry’s is expecting that European companies will benefi t through multiple ways from the recent changes in the business environment.

Chinese entrepreneur Jack Ma of alibaba.com ex-plained 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 ca-pable 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 custom-ers’ needs aft er completion of the actual work, even if we have to take some risk. We believe that this proactive ap-proach can be very benefi cial as we can help to compress the timeframe of the projects and provide viable choices, thus fl exibility to our customers.

We can foresee more time critical development proj-ects. For example, our American customers could even benefi t from the time diff erence 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 diffi cult technologies within very short periods of time working in a virtual two shift system in the labo-ratories in the US and in Hungary. Th anks to the better fi nancial situation of the virtual and small biotech com-panies, 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 discov-ery 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 manu-facturing 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 tra-dition of pharmaceutical sciences Ubichem Research is a wise and beautiful choice.

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. Th e long term utilisa-tion of such large facilities is hard to predict.

Th e 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, fl exible (which means small) custom research organisations are needed. Fast decisions, short turnaround times and good communication will be cru-cial in establishing a circle of these trusted service pro-viders. Most big and medium sized pharma companies established criteria to select and sort service providers all over the world. Small and medium sized pharma compa-nies typically have stronger pipelines. However, the lack of funding for developmental projects of small pharma com-panies 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 fl uctuation, the quality of their service fl uctuates as well. Due to their price advan-tage, Asian CROs have been boasting double digit yearly growth for years now. However, the price advantage is decreasing, because the wages of higly qualifi ed and ex-perienced workforce are approaching European levels. It is worth mentioning that European CROs have a stron-ger 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. Th e geographic location and the relatively small cultural diff erences between Europe and the USA make communication and site visits relatively easy for American customers as well. Customer research or manu-facturing organisations from the former East Block off er 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 Or-ganisations (CROs) also suff ered from the change of the business environment over the last few years, and some of them faced serious problems. Th anks 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.

Th e European Commission also realised the im-portance 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. Th e Euro-pean Commission wants SMEs to be the drivers of eco-nomic activity and innovation.

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.

“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 benefi t of the European economy”


Find out more at www.MeetTheBoss.tv

MeetTheBoss TV is incredible access to the world’s business leaders – so

you can learn their winning strategies and attitudes first hand

Where future leaders learn

JOIN NOW

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

Durbin.indd 1Durbin.indd 1 13/01/2011 13:3513/01/2011 13:35

100 INNOVATION

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. Th e other hurdle that I believe will become an issue is that the phar-maceutical 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 be-coming 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. Th at could be one potential way to concentrate eff orts.”

Th is idea Giron points to of concentrating eff orts will undoubtedly

OPEN FOR BUSINESS

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 defi ne the path you walk down? NGP spoke to two heads in the know to delve a little deeper.

“From an innovation and intellectual ca-pacity 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 diff erence; I think Europe is as good as the US. We have the same potential in Europe just as anywhere else. Th ere are perhaps a few diff erences in terms of how business is done and the regulations for setting up businesses, which clearly diff ers 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 ex-perience 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-

Bottlenecks. Pipelines. Patents. Col-laboration. Th ese 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 inescap-able 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. Th e days of closed collaboration are stagnant – and the industry is working at full-pace 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 success-fully 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.

giron_DEC10.indd 100giron_DEC10.indd 100 14/01/2011 13:3014/01/2011 13:30

101INNOVATION

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 re-sources 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 taxa-tion 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 compa-nies 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 emerg-ing markets, especially those in Eastern Asia. However, with the general European culture being inherently open and arguably more ad-venturous, 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”.

“Th e 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. Th ere is an infrastructure that should enable quicker collaborations and com-munications. Having said that, everyone is be-coming so Americanised it’s hard to truly say.”

And while Sjorgen views these diff erences from outside the metaphorical box, Giron’s sen-timent remains very much an organic, par-for-the-course example of the European attitudes to moving towards emerging markets and open collaboration. “Th e most important thing is to be open in general, but also open to listen and share what you know as much as possible – obvi-ously 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 equat-ing 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 indus-try is to start being secured. And with companies like Google suggesting a search engine platform similar to their fl agship consumer model, the idea of open innovation has perked up many an ear outside of the industry too.

“Th e open innovation model is something that’ll also come from IT business,” reveals Sjorgen. “Th e open source code from that end certainly brings in the idea of open innova-tion 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 diff erence; I think Europe is as good as the US”


102 INNOVATION

sidering the European Commission’s Innova-tive 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 gov-ernments could enable it, would create a booster where you have diff erent things to bring to the table – and with this type of col-laboration, you can aff ord 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 benefi ts over their short-term protection worries if open in-novation 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 diffi cult question,” as Giron rightly assesses.

“A prime example where we’re all struggling at the moment is with relevant models. When

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 pos-sibility could be to completely share the knowl-edge and collaborate on the models in vitro, in vivo and with biomarkers, but maintain your IP on the molecules potential.

“Th e other thing about open collabora-tion is that nothing is completely open. Th ere 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 inno-vation – 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 fi rms – 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 fi rst step into this vast and unmapped land-scape. 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 fi rst 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 scientifi c questions that bring our compounds to a better confi dence 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 signifi cantly, es-pecially in biological development. We would be keen on investing in biotech and biomarker companies that bring the tools to us for a rea-sonable price so that we are able to very quickly answer questions on target engagement and pharmacological downstream eff ects within the clinic setting.”

On a more specifi c 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. “Th e other thing that is important within this,” adds Giron, “is the quality of data that you get, because if your data is of poor qual-ity, inevitably you will make misinformed and ultimately bad decisions.”

And while that may seem like a rather obvi-ous comment to make, the idea of having accu-rate 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,


103INNOVATION

with the implementation of EMRs and new tech-nologies that can potentially provide data that, up until a few year ago, was only theoretically possible. Combine that with the recent global fi nancial 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 at-trition and the factors involved,” explains Sjor-gen, “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 compa-nies with new tools and technologies for the key scientifi c 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 ex-perts in what we do.

“It’s also important to us that we remain honest and thorough and don’t become inter-nally 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

they’re usually optimists, so we bring some re-alism to the table. I think that sense of realism has increased as we raise awareness of the reali-ties; 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 situ-ation, 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 oft en 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 ball-game 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 tech-nology 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?’ Th ese are questions that are not being asked deeply enough within the industry with regards to the technology that we use.”

Excluding the obvious constants sur-rounding technology, Sjorgen’s frustration stems more from the scientifi c process arena and the blind “buying-in” to a down-turned economy. “Th is downturn has caused the in-dustry to focus on safeguarding certain paths forward,” he says. “Th e levels of risk-taking are minimised, and even though we speak about taking risks and being challenging, the down-turn 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 benefi cial 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 every-way possible, as much as possible, is the key to unlocking the door of next generation pharma-ceuticals. As Giron puts it: “Innovation comes from problems. If you don’t have a problem, why would you innovate?”

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


INDUSTRY INSIGHT104

Achieving long-term treatment responses in moderate to severe Crohn’s Disease

Crohn’s Disease is an autoimmune chronic and progressive infl ammatory disease of the gastro-intestinal tract. It manifests itself via a range of debilitating symptoms, including severe diar-

rhoea, abdominal pain, cramping, intestinal strictures and fi stulae 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 aff ects nearly one million people in the seven larg-est pharmaceutical markets.

Since the late 1990s, Crohn’s patients failing tradi-tional 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 effi cacious in both inducing and maintaining remission, and further as very safe for such powerful drugs.

Despite this success, they have one major fl aw: in many patients, they stop working over time. For example, in pa-tients 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 infl ammatory diseases, there is currently no safe and effi cacious 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 gastro-enterologists 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 infl ammatory disorders such as rheumatoid arthritis.

Th e reasons for the loss of response phenomenon are not fully understood. Part of it is certainly that many pa-tients’ 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 effi cacy, 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

will be ineff ective. 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

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?

NEOVACS ED P104-105.indd 104NEOVACS ED P104-105.indd 104 14/01/2011 14:3714/01/2011 14:37

INDUSTRY INSIGHT 105

antibodies recognise only a single target, the antibody re-sponse 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 eff ect 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 refl ects the pharma-co-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.

Th ese 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. Th e fi rst objective of this study was to demonstrate safety, and the results here were very pleasing, with no treatment-related adverse events and no premature withdrawals from the study. Local and systemic tolerance was also very good. Second, the Kinoid consistently produced anti-TNF anti-bodies at the higher doses tested: this confi rms 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 benefi t. Specifi cally, at week 12, 76 percent of patients showed a clinical re-sponse (defi ned as a drop in Crohn’s Disease Activity Index (CDAI) of 70 points or better), and 43 percent were in clini-cal remission (CDAI of 150 or less). Encouragingly, these fi gures 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 eff ect and antibody response as well as between the evolution of disease activity measured by CDAI and the evolution of a biomarker for intestinal infl ammation. 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 hypoth-esis of broad effi cacy and that TNF treatment failures may be eff ectively treated with the Kinoid.

All told, we were very encouraged by the results of our Phase I/II study and gratifi ed by the level of interest and support we have received from the gastroenterology com-munity. 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, dura-bly and broadly inducing and maintaining remission. To this end, Neovacs is in the process of initiating of double-blind, placebo-controlled Phase II study of TNF-Kinoid in Crohn’s patients.

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 fi gure 1), which takes the full-length cy-tokine, couples it to a carrier protein and inactivates the cytokine. Th e resultant compound is administered with an immune stimulant by intra-muscular injection. We oft en hear people referring to this as a ‘vaccine’, although from a regulatory and scientifi c perspective we think the term active immunotherapy is more accurate. One key diff er-ence as compared to a traditional vaccine is that the Kinoid does not raise a T cell response to the cytokine, an impor-tant safety consideration.

Figure 1: Neovacs’ Kinoid Technology

Th e characteristics of the antibodies produced by the TNF Kinoid are very diff erent to the synthetic monoclo-nal antibodies currently used in the treatment of Crohn’s Disease. As it relates to the problem of loss of response, we believe two diff erences in particular are of critical im-portance. 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.

For more information, please visit: www.neovacs.comReferences: 1. Hanauer et al, the Lancet, 2002, 2.Colombel et al, Gastroenterology, 2007, 3. Colombel et al, NEJM, 2010

“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 eff ect”

CYTOKINE: TNFa or IFNa

KLH(carrier protein)

Inactivation &Conjugation

KINOID ADMINISTRATION IM+ Emulsion Adjuvant

Cytokine target

NEOVACS ED P104-105.indd 105NEOVACS ED P104-105.indd 105 14/01/2011 14:3714/01/2011 14:37

NEXT BIG THING106

A diminishing pipeline, imminent patent expi-ries, and global recession are all contributing to the financial pressures facing life science businesses today. Consolidation through

mergers and acquisitions is providing some cost ef-ficiency, and CFOs are examining every aspect of the business for opportunities to further trim long term budgets. As a response to these pressures, asset man-agement in the R&D environment has emerged as an op-portunity 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 re-search. 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.

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 oper-ating 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 administra-tion, 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-

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, compa-nies 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 con-tracts, to demanding a deeper understanding of their asset utilisation. Merging inventory and maintenance data with insight into utilisation and deployment of in-struments is the next frontier of opportunity for achiev-ing 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 opportu-nities 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 equip-ment utilisation in their labs. A solution that provides a true programme measure will deliver the critical information required to redeploy or liquidate unneces-sary 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 com-panies conduct their business. When deciding how to implement and optimise such programmes, companies must keep the long term in mind.

Asset Management for the Long Term

How a deeper understanding of asset utilisation is priceless in the long term.

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.

“Eff ective asset management programmes not only control costs, they also emphasise innovation”

GE HEALTH.indd 106GE HEALTH.indd 106 14/01/2011 14:2914/01/2011 14:29

GEHealth.indd 1GEHealth.indd 1 13/01/2011 13:3613/01/2011 13:36

108 INDUSTRY INSIGHT

Abstract

There is a need to improve the effi ciency in the pharmaceutical industry to meet the new challenges of globalisation, competitiveness and the increasing

diversity of products. Th e risk of biological con-tamination 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 consid-ers environmental monitoring and contamination control strategies using the benchmark gaseous bio-decontamination process, hydrogen peroxide vapour (HPV).

Bio-contamination control and monitoringQuality Risk Management (QRM) needs to consider the ineffi ciencies

in microbiological monitoring. Th e forthcoming revisions to the ISO14698 standard on Bio-contamination in cleanrooms and con-trolled areas and the USP<1116> microbiological control and monitoring of aseptic processing environment chapter, will place more emphasis on ‘contamination rates’.

Improving bio-decontamination assurance As monitoring technology improves, the detection of

‘actual’ contamination will present new challenges. Im-provements in monitoring need to be complemented by im-provements in bio-decontamination control. Alongside this, ‘decontamination assurance’ will need to be demonstrated through log reductions in the biological contamination to pre-defi ned target levels.

Vapourised hydrogen peroxide can be validated with Geobacillus stearothermophilus biological indicators1 to routinely achieve 6-log sporicidal reduction at room scale. Use Biological indicators areis an industry standard method commonly used to validate steam sterilisers/autoclaves. Th e gaseous vapour phase decontamination process4, using hydrogen peroxide under specifi ed conditions, has been ac-cepted by international regulators as a method of achieving ‘surface sterilisation’.

Bio-decontamination effi cacy and material/process compatibility

Most importantly the H2O2 process is not wet – compared with manual disinfection. In the optimised process2 vapourised hydrogen per-oxide molecules are only delivered to surfaces past dew point3, at an a invis-ible sub-visible and eff ective level (2-6 μm thicknessmicrons). Controlled

removal then leaves surfaces ‘residue free’. Th e controlled contact time of the active

HPV (at sub-visible invisible levels2-6 μm thickness) and the residue-free nature follow-ing the aeration cycle, separates the process from a ‘wet’ condition. HPV also exhibits ex-tremely broad material compatibility and can be successfully used in areas containing sensi-tive electronics equipment.

Potential effi ciency 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 signifi cant effi ciency savings and risk mitigation4.

Following commissioning, or re-qualifi cation, with facility shut-downs, cleanrooms can be returned to ‘microbiological control’ state quickly by deploying a HPV process that can be verifi ed using a bio-

logical challenge. Such a process can be deployed as a room bio-decontamination service without the need for capital expenditure.

At the restart of a HVAC set back in a cleanroom facil-ity during following a quiet or non-operational period, a validated HPV decontamination process and biological challenge can provide evidence for compliance to enable the room to be returned quickly into production.

Traditional ‘spray and wipe’ disinfection transfers for materials entering cleanrooms are now under challenge, as the process is diffi cult to comprehensively validate. Th is has led to signifi cant growth in effi cient HPV gassed transfer chamber products, which provides a more eff ective and veri-fi able fully validatable bio-decontamination process.

DiscussionTh e HPV process provides a more ‘complete’ bio-

decontamination. When a high-effi cacy, automated bio-de-contamination process is used (including in-process critical control point monitoring), signifi cantly less microbiological monitoring can be justifi ed, limiting sample sites to worst case and high risk locations. Th e reduction in monitoring also reduces the cost and extentent of monitoring required

in addition to reducing the risk of false positives. By improving the ‘decontamination assurance’ using a scientifi cally

validated HPV process then there is inherent improvement in ‘sterility as-surance’.

Environmental monitoring and contamination control

Improving effi ciency in bio-contamination control and risk mitigation using hydrogen peroxide (H2O2) decontamination processes. By James Drinkwater

For references associated with this article, please see www.ngpharma.eu.com

James Drinkwater is currently the Process and Compliance Director for Bioquell UK bio-contamination control and contamination risk mitigation solutions in life sciences, together with being the Chairman of the Pharmaceutical and Healthcare Sciences Society. After 10 years in the pharmaceutical industry, his current specialisation is in aseptic processing and infection control.

BIOQUELL.indd 108BIOQUELL.indd 108 14/01/2011 14:1914/01/2011 14:19

Bioquell.indd 1Bioquell.indd 1 13/01/2011 13:2913/01/2011 13:29


Remind us what you do at Xceleron.Mike Butler. Xceleron is a small specialised develop-ment service company playing a part in helping drug companies overcome the signifi cant challenges they face in today’s environment. We have facilities in Europe and the US and we use a unique analytical platform called ac-celerator mass spectrometry (AMS) to measure investiga-tional 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 sensitiv-ity. 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. Th e 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.

Th e trend that unfolded over the past 12 years in-volved movement from traditional phase 2/3 AME/mass balance studies through phase 0 microdosing and onto phase 1 absolute bioavailability and metabolism.

Th e 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 fi ve years or so ago when European compa-nies sponsored the CREAM and EUMAPP collaborative investigations and then the US FDA proposed microdos-ing as a component of their e-IND approach. Finally, pharmaceutical companies wishing to improve early

developmental effi ciency have driven interest in phase 1 studies. Needless to say, we’ve consistently performed the established studies as we’ve developed new ones.

Th e 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 magni-tude 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 stud-ies 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 sensitiv-ity or to overcome radio-instability or safety issues. For small molecule drugs, 14C LC AMS off ers signifi cant 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 sig-nifi cant uptake in our innovative absolute bioavailability clinical design. Time and money is saved because there is no need for IV-specifi c safety data, formulation eff ort, or large-scale GMP manufacture of an IV dose. For in-stances where absolute bioavailability is required by the

The helping hand

Mike Butler explains how Xceleron is helping its clients to answer critical clinical development questions.

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

“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”

XCELERON.indd 110XCELERON.indd 110 14/01/2011 14:3014/01/2011 14:30


regulators, our approach provides an attractive option over the traditional crossover design.

In phase 1, our customers get the benefi ts of know-ing absolute bioavailability (should the drug proceed, what is the likely down-stream cost of goods?) generated from this study design. Oft en 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-eff ect studies, SAD and MAD studies and have shown that we can co-administer a PET ligand and 14C and generate absolute bioavailabil-ity from an imaging study. Essentially, our customers can derive absolute bioavailability from a simple additional arm on a previously scheduled phase 1 study.

Th e 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 ef-fi cacy by confi rming compound disposition in target and non-target tissues, quantifi ed 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 effi cacy are confi rmed. Secondly, for portfolio manage-ment, 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 com-pliance?

MB. At Xceleron we like to think of the 14C LC AMS ap-proach 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 GlaxoS-mithKline 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 Janu-ary 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 an-alytical techniques and ensure we’re practicing a robust analaytical validation process.

Does Xceleron help pharmaceutical customers in-volved in biologics development?MB. Yes. We’ve worked with mostly protein-based biologics thus far because we’ve shown that small pro-teins 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 pre-clinical.

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 devel-opment 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 con-ducted a number of such studies and I expect many more as we move toward more fit-for-purpose approaches to individual asset R&D.

XCELERON.indd 111XCELERON.indd 111 14/01/2011 14:3014/01/2011 14:30


being absolutely open about our procurement costs and our selling costs. We actually go as far as providing docu-mentary proof of purchase price.

We believe this is vitally important for a number of reasons and off er it to our clients. Th e 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 pos-sible 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 phar-maceuticals on the market. With transparent pricing the sponsor obtains full clarity of where the drugs have been purchased and what profi t 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 com-pany can trust and have confi dence in to carry out the work to the required specifi cation. In our fi eld 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 Amer-ica. 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?

Th ese however are the ‘front offi ce’ capabilities. Th ey obviously need to be backed up by the general infrastruc-ture of the company with full quality management, ap-propriate technical and professional support including Pharmacovigalence, in-house pharmacists and respon-sible persons. A properly resourced and licensed ware-house 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.

The pharmaceutical industry is under increasing pres-sure to improve the productivity of drug development and streamline the clinical trial process. From your per-spective, how can this be achieved?Leslie Morgan: Th e industry is under huge pressure to reduce costs. In my particular fi eld of expertise the sourc-ing of comparators, ancillaries and standard-of-care medi-cations we are continually innovating to reduce costs. Let me cite some examples – purchasing from one country for the entire global supply thus using the diff erential 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, stan-dard of care drugs in a way that is most cost eff ective. 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 diff erent things. We believe transparent pricing is

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

The transparency trial

Leslie Morgan is a qualifi ed 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.

DURBIN ED P112.indd 112DURBIN ED P112.indd 112 14/01/2011 14:4014/01/2011 14:40

iStrategy AD_B2B.indd 1iStrategy AD_B2B.indd 1 14/01/2011 13:3614/01/2011 13:36

INNOVATION114

THE NEWGOLD STANDARDAmgen 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?

Bone metastases have been a constant and major clinical concern for the healthcare and life sci-ences 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 eff ort 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?

Th rough the largest clinical programme ever conducted in patients with bone metastases, with the drug being ap-proved following a six-month priority review by the FDA – a designation usually reserved for drugs that off er 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. “Th e area of bone metabolism in cancer patients has really been dominated in the past few years by the bisphosphonates,” he begins. “Th ey’ve gone through various generations of development aimed at producing increasingly more potent molecules. Th e contrast between Xgeva and bisphospho-nates 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.”

75% of patients will

experience a spread to

their bones

Amgen 114Amgen 114 14/01/2011 14:3914/01/2011 14:39

INNOVATION 115

Indeed, by contrast bisphosphonates are relatively non-specifi c; instead being taken in by the body and ab-sorbed into the bone. From here, the bone becomes semi-impregnated with bisphosphonate. Th e osteoclast – in the action of reabsorbing bone –ingests the bisphosphonate before being killed from within by a toxic eff ect of the bisphosphonate. So where the former therapy was a non-specifi c and non-targeted mechanism, Xgeva represents the emergence of an elegant and specifi cally 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 specifi c 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 or-ganic 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 scientif-ic 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 con-sequences can be devastating. We are pleased to off er this new advance to patients and their healthcare providers.”

“Th e 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. “Th e fi rst was to look at patients who had boney metastases who were at risk of developing skeletal-related events. Th ese events complicate a metastases and normally include one of four events that in turn cause morbidity and the sig-nifi cant 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. Th e fi nal, and most feared compli-cation, 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 benefi t. We also started to see a benefi t in skeletal-related events, so we were confi dent about the molecule.”

Th e 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 bisphospho-nate 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

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 de-velopment 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 eff ect.

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-specifi ed 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 effi cacy.

“In terms of safety, we were very comparable. We had two major side eff ects that showed up: hypocalcemia and osteonecrosis of the jaw. Th ese are both well-recognised complications of bisphosphonates. In terms of low calcium, we produced more frequently than Zometa, which speaks to the increased effi cacy of the molecule because the mech-anism 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 signifi cant number of those on Xgeva were reversible, so a very favourable risk and effi cacy profi le.”

Further backing this, David Henry, clinical profes-sor 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 signifi cant proportion of these patients still experience bone complications or are not candidates for existing treatments.

“Based on the compelling science and robust clini-cal 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 – ef-forts have proved pioneering in breaking through to produc-ing 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 fi rst 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 specifi cally, Baynes has identifi ed 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

Amgen 115Amgen 115 14/01/2011 14:3914/01/2011 14:39

INNOVATION116

Xgeva inproves bone

Metastases survival by 4.2 months

Bone Metastases is estimated at US$12.6b

Annually

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. Th ese 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 Sur-vival. 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 signifi cantly improved median bone metasta-sis-free survival by 4.2 months compared to placebo (pri-mary endpoint), and signifi cantly improved time to fi rst occurrence of bone metastases.

“Our data demonstrates that Xgeva, which antago-nises 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 confi rming 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. Th is 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

patients with breast cancer. Known as the DK Study, women with high-risk, primary breast cancer who are getting adju-vant 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 fi nal 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. Th e total economic burden of patients with bone metastases in the US alone is already estimated to be US$12.6 billion an-nually. Patients who experience skeletal-related events (SRE) as a result of bone metastases incur signifi cantly 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. Th e 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 signifi cantly reduces debilitating and costly SREs”. It’s more than just a pioneering break-through for the Californian-based human therapeutics com-pany. 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 fi nancial improvements, but in pushing the envelope of success for future patients. For Amgen, it seems that the Gold Standard will never be enough – a senti-ment that has got them to where they stand today.

Amgen 116Amgen 116 14/01/2011 14:3914/01/2011 14:39

Cellular tech.indd 1Cellular tech.indd 1 13/01/2011 13:3313/01/2011 13:33

PROJECT FOCUS118

well as to the authorities?” In design space projects dif-ferent departments are commonly involved. Th erefore, 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 workfl ow 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 n-ing 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.

Th e outcome of the DoE investigations should be judged on two criteria resulting in a case categorisation: (1) are the CQA inside or outside the specifi cation limits and (2) is the model statistically signifi cant or not. Below, the diff erent cases are outlined and a work fl ow of defi ning a fi nal design space is given.

uality by design and design space are con-cepts 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. Th e 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

Reporting the DoE part of a design space

By Gitte Nomanni Holm

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 fi ling to authorities.

Q

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

The CQAs are inside specifi cation. A statistically signifi cant model is obtained.

Some CQAs are outside specifi cation. A statistically signifi cant model is obtained.

The CQAs are inside specifi cation. No or a weak statistically signifi cant model is obtained.

Some CQAs are outside specifi cation. No or a weak statistically signifi cant model is obtained.

Case 4

Case 3

Case 2

Case 1

Identify possible CPPs and CQAs using risk analysis

DoE

Case 4

Case 3

Case 2

Case 1

Design Space is established

Design Space is established

Estimate a Design

Space

Estimate a Design

Space

UMETRICS ED P118-119.indd 118UMETRICS ED P118-119.indd 118 14/01/2011 14:3814/01/2011 14:38

PROJECT FOCUS 119

When starting the project of establishing and fi ling a design space, it is extremely important that the teams from the diff erent 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 misunder-standings 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.

Diagnostic tool Description and Decisions Replicate plot

Coeffi cient plot

Validated Design Space

Replicate plot

Coeffi cient plot

Estimated Design Space

Contour plot

Interaction and prediction plots

Replicate plot

Replicate plot

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

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

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.

See above.

See above.

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.

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.

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 fulfi ls the practical constraints.

A Design Space is established.

No Design Space is established. Identify problem. Case 4Case 3

Case 2

Case 1

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

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 vis-ible in all plots.

Creating the report of the design space itself runs rather smoothly if the above issues have been handled properly. Th e 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, specifi c 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 diff er-ent illustrations. Th is is of course related to the fact that this case does not represent a robust system as the CQAs are outside specifi cation and there exists a signifi cant re-lationship 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.

UMETRICS ED P118-119.indd 119UMETRICS ED P118-119.indd 119 14/01/2011 14:3814/01/2011 14:38


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 off er greater eff ectiveness, as well as increased effi ciency in promotion-al spend and strategies. Many are also balancing some-times 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; se-curing the right exposure to the pharmerging markets, aligning the organisation’s current and future strategy across new markets while addressing major markets that are fl at to declining in opportunity; and identifying solid sources of growth, positioning the organisation so that, as the market returns to growth aft er 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 ini-tiatives simultaneously. Th is can result in one of the ini-tiatives 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 eff ective, as the commercial model is in fl ux or can no longer support the brand strategy; misappropri-ated 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 eff ort 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 reali-ties of the future. Companies that have not yet fully de-termined 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

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. Th e ideal method of devising a commercial strate-gy 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. De-pending 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 implemen-tation 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 compa-nies make the most progress planning their new organisa-tion 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 com-panies implement and support a thoughtful change man-agement 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 over-arching plan (but do not be afraid to move slowly when

BALANCING ACT:aligning competing strategic objectives in turbulent timesIMS offers insight to new commercial model and launch excellence initiatives.

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.

IMS_EXINT.indd 120IMS_EXINT.indd 120 14/01/2011 13:3114/01/2011 13:31


needed); assess progress oft en, 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 identifi ed 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. Misalign-ment 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. Th e importance of organisa-tional 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 straight-forward. 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 diffi cult.

A powerful and pertinent value proposition. Success-ful 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 nd-ing 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.Eff ective and effi cient stakeholder engagement. Stake-

holder power shift s are acknowledged and earlier engage-ment is growing, but new models must address the ability to infl uence widespread product usage. Among compa-nies 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 perfor-mance in that country.

What are the fi ve drivers of uptake?CN. Th e fi ve 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 ad-herence 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 eff orts across NCM and launch excellence initiatives are the key to long-term suc-cess. Aligning the organisation includes collaboratively setting objectives and timelines of both NCM and key launch; communicating launch strategies early and then oft en (milestones) to those in charge of NCM activities to ensure both eff orts are complementary and not competi-tive; taking steps to ensure that running both initiatives simultaneously, does not cause confusion to stakeholders outside, and inside, the company; considering geographi-cal priorities across both initiatives as to not overload local affi liates; ensuring commercial models, both in their current and future state, eff ectively engage and support communication of value to various stakeholders, and can be supported by transitional infrastructures; and ensur-ing 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 ef-forts across new commercial models and launches will set their own destiny. Th ose 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 advan-tage in the marketplace, and quite possibly even discover new commercialisation strategies as an output of their harmonisation eff orts.

“Internal harmonisation eff orts across NCM and launch excellence initiatives are the key to long-term success.”

IMS_EXINT.indd 121IMS_EXINT.indd 121 14/01/2011 13:3114/01/2011 13:31

From the people you hire to the products you sell, if you’re in business, we’ve got it covered...

Your World. COVERED

Find out more: www.ngpharma.eu.com

Next Generation PharmaceuticalApproximately 50% of new drug development fails in the late stages of phase ||| – while the cost of getting a drug to market continues to rise. NGP is written by pharmaceutical experts from the discovery, technology, business, outsourcing and manufacturing sectors. It is committed to providing information for every step of the pharmaceutical development path.

ALSO AVAILABLE FOR: US

US EditionUS Edition

Previous EU Edition

Next Generation PharmaceuticalApproximately 50% of new drug development fails in the late stages of phase 3 – while the cost of getting a drug to market continues to rise. NGP is written by pharmaceutical experts from the discovery, technology, business, outsourcing, and manufacturing sectors. It is committed to providing information for every step of the pharmaceutical development path.Available for: Europe, US

Find out more: www.ngpharma.eu.com

Next Generation Power & EnergyA poll of 4000 utility executives posed the simple question: what keeps you up at night? The answers were costs, new technologies, ageing infrastructure, congested transmission and distribution, viable renewables and inadequate generation capacity. Available for: Europe, US

Find out more: www.ngpowereu.com

Oil & GasCollaboration between Government and multinationals to ensure the energy supply is developing on two fronts. O&G is the defi nitive publication for stakeholders and service companies to read about the regional projects, technologies and strategies affecting their group.Available for: MENA, Russia, US

Find out more: www.ngoilgasmena.com

Business ManagementWhat 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.bme.eu.com

CATALOGUE PAGE.indd 122CATALOGUE PAGE.indd 122 14/01/2011 14:0614/01/2011 14:06

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

Details.

Welcome to Las Vegas

Book Review: Teach us to sit stillp127

Gadgets: The best and the restp126

Work to play: Las Vegasp123

Photo fi nish: Up in smoke p128

TRAVEL.indd 123TRAVEL.indd 123 14/01/2011 14:3014/01/2011 14:30

DETAILS: TRAVEL124

The other city that never sleeps – and it truly never does – is without doubt the world’s largest adult playground; exchange the climbing-frames 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 CasinoTwo types of people walk through the doors at the Stratosphere of those there to relax, which is com-pletely 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 coast-ers 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 memo-rable experience. Just don’t try to take your drink up with you.

2. ‘Bodies…The Exhibition’ at the Luxor HotelPerhaps not one to visit immediately after the Stratosphere rides, ‘Bodies…The Exhibition’ will easily trump any science lab dissection you did at school. With an intricate, 3-D vision of the human form, visi-tors 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 com-pletely different perspective on the human body – after all, it’s not everyday you get to see what makes you tick.

3. The Freemont street experienceLegendary 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 fi rst 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.

01

02

03


DETAILS: TRAVEL 125

4. Siegfried and Roy’s secret garden and dolphin habitat at The Mirage hotelNot 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 bottle-nose 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 par-ticipate in plenty of activities including playing with, training and getting in the water with the dolphins. When you fi nally 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?

Top fi ve 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 fl oors 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.

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

04

05

06

5. The Bellagio conservatoryWith over 100 cast and crew members, this could very well be Vegas’ biggest free gig. With over fi ve million visitors each year, the conservatory lets the seasons dictate its contents and, just like a Broadway show, the fl oral 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.

6. Gondolas at The VenetianI’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.


DETAILS: GADGETS126

Objects of desireThe latest technology devices for today’s business executive

New Amazon KindleSleeker, cheaper, quicker than its predecessors, the latest Kindle has been hailed by UK broadsheet The Daily Telegraph as “the fi rst 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.

Canon G11It 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 fi ts nicely in the hand and the impressive zoom size allows for some quality photography. It is not without its fl aws, 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.

Nokia E7Once 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 fi ghting 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 fi les 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.

Samsung Galaxy TabEver 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 defi nition voice calling capabilities, a well developed email application and compact size, this could be the next essential business accessory.

2

1

3

4

Gadgets.indd 126Gadgets.indd 126 14/01/2011 14:2814/01/2011 14:28

DETAILS: BOOK REVIEW 127

Fresh off the press

Five years ago, Tim Parks found himself getting up every night to go to the bathroom. Not an excusable once or twice, but a worrying fi ve, 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 subse-quently his ‘vata’ – the energy that fl ows through the body – is blocked, Parks raises an eyebrow and wants to walk off with a patronising snigger. But with his despera-tion at an all-time high, he reluctantly accepts the “hippy help” in the hope that he might fi nd a cure.

Months pass by. Parks is stricken with impotence and no closer to fi nding 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, allow-ing 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 previ-ously with fi lling it. In treading new ground and hurling himself head-fi rst into a world supposedly occupied by sensationalists and placebo-takers, Parks manages to fi nd what he’s been looking for all along – a sense of his own serenity.

From the outset, Teach us to Sit Still could be con-strued 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 effi cacy in a world fi lled 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 shuffl e doubtfully toward a glimmer of light. Indeed, his writing has been noted as “intensely engag-ing”, with the capacity to write “wittily and with great beauty about the near indefi nable”.

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?

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 HealingBy Tim Parks

BookReview.indd 127BookReview.indd 127 14/01/2011 14:1914/01/2011 14:19

DETAILS PHOTOFINISH128 All 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 signifi cant 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 classifi cation 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.

PHOTOFINISH.indd 128PHOTOFINISH.indd 128 14/01/2011 14:2914/01/2011 14:29

Quintiles.indd 1Quintiles.indd 1 13/01/2011 13:3713/01/2011 13:37

Durbin.indd 1Durbin.indd 1 13/01/2011 13:3513/01/2011 13:35