The erosion of our UK industrial science base - think creatively Pfizer. Where will new medicines come from?

1. This country needs a strong industrial science base to ensure the future translation of our medicines. 2. Our medicines are built on innovation – so let’s be creative in this situation: a. What is really important in this debate is to secure the best future for the pharmaceutical industry, economy of the UK, the next generation of scientists and the next generation of innovative medicines and therapies. The solution doesn’t have to be exclusive of any aspect but it does have to be different. 3. Companies will always find ways to grow financially but the future business of the pharmaceutical industry depends on a good supply of new medicines, which with a 20+ year product research and development cycle requires continuous investment in a strong science base. The larger the corporate giants become the more prolific their product pipelines have to be – but they can’t innovate and deliver these alone and they source the new products from academia and small creative biotechnology companies, often set up around highly specialised technologies. 4. The UK has a great science base and strong track record of delivery. This is because of our pharmaceutical industry and significant attention and investment from successive governments, our universities, large research charities and research foundations - we contribute daily to the breakthroughs in medicine and the life sciences. 5. Successive consolidation of the past 15 years in our industry, which leads to R&D site closure means this current generation of young post-doctoral scientists does not have the opportunities the current leaders of translation research in the UK had – the current CEOs of the biotechnology companies. We had the pick of 6-7 top R&D sites in the UK (Glaxo, Wellcome, SKB and many more) each of which provided us with superb jobs and great training and development. 6. The current leaders are trained to go on to lead teams in academia or industry and contribute fully to translation of early discoveries into new medicines. Those of us leading biotech companies would love to pass this training and experience on to others. What we need innovative schemes to fund this next generation in the right environment. 7. I am pleased and sincerely hope that Pfizer honour their commitment to the Cambridge R&D investment that AZ have planned, but that is not sufficient. For all the reasons I have stated I ask them to think differently. a. Provide funds and fellowships for the next generation of scientists that can be used within our academic and biotech sector.. b. Translational research is a different language and training – you could support 100 post-docs each year for 20 years for translational training fellowships in biotechnology companies and allow us to train the next generation – that would be a relatively small financial investment in the UK which would make a huge difference. c. Let the leaders of today train the leaders of tomorrow. d. A Centre for Therapeutic Innovation has been an idea that has been toyed with but not committed to – don’t try to control it because innovation cannot be ‘managed into happening’ in the sense understood by large corporations – but do allow it to happen by making the investment.

Pfizer’s bid for AZ - the consequences will impact the industry long term as well as the UK science ecosystem

 

As reported in the Independent, Dr John LaMattina understands because he has led pharmaceutical R&D, in his case in Pfizer. Without this insight the real consequences of the consolidation of the pharmaceutical industry seems not to be fully appreciated. The truth is that this is a hugely complex issue with elements that are unique to the industry that cause those outside, even captains of other sectors, to fail really get it.

I too have led R&D and appreciate the issues – let’s briefly examine them...

 

M&A justification purely financial:

The purchase of AZ by Pfizer is a pure play financial transaction.  The large pharma are so huge that only multi-billions of $ revenue each year will sustain their market value.  The value that is supported by major institutional investors who expect steady returns – and don’t pension investors all benefit? This transaction will most likely go ahead – everyone has their price, but for the science base of the UK and the pharmaceutical industry pipelines of the future the real price is too high and no real solutions exist amongst the pledges being offered by Pfizer (or any large acquirer in existence today). Pfizer must look at sustainability more than their immediate financials.

Consolidating companies were pioneers & took years to build

During the 1960s through to the 1990s the ‘Fully integrated pharmaceutical company (FIPCO)’ model emerged. Glaxo, Beecham, ICI/Zeneca……all built on their early research roots to extend their internal activities and departments to shepherd their products through to the marketplace.  The early companies were pioneers and they built unique internal capability to develop the products everyone has come to rely on to retain our family units.  The next generation of companies is not being built in the UK on a sufficient scale to replace those being lost.

Consolidation loses value in R&D which is not compensated for by size

Many subsequent mergers (between the plethora of early companies) later have proven that creativity and productivity in R&D is inversely proportional to the size and maturity of the organisation. The reasons for this are an essay in themselves, too extensive to discuss here but are consistent with the teaching of Utterback and Abernathy (ref…). 

 

Consolidated companies need larger pipelines and seek more in-licensed products

The larger the newly merged companies become, the greater their need to fill their pipelines with new products – so a rise in in-licensed products is seen and more are required. These come from small biotechnology companies which in themselves are founded on early inventions and discoveries from academia. So the mega companies of today, such as will be a joint AZ/Pfizer entity will only survive long term with products originating from outside the company.

Cycle time of R&D is long and relies on a vibrant ecosystem

Here in lies the real issue. The R&D to Commercialisation cycle of pharmaceutical products takes around 25 years. Companies need more products and need them faster.  The presence of an extensive and vibrant R&D ecosystem in the UK is crucial to provision of this pipeline. Yet each new merger results in the closure of long established R&D sites, with a corresponding and overnight massive loss of value. The value and expertise that has taken 20+ years to build up is gone in an instant and the emotional heart and then brains of these sites are actively disengaged and separated.

 

The R&D base and investment has suffered long term erosion

Large pharmacos had started cutting internal R&D some years ago.  Once the human genome was sequenced there was a realisation that new discoveries and inventions were possible which would change the face of medicine. New examples emerged in smaller more nimble organisations and the large pharmacos which had become rich, fat, sluggish and unsuited to the adaptations required to recognise and exploit the new potential also failed at time even to recognise the new wave of medicine. At this time shining examples of a new companies which had been beavering away working with new modalities (i.e.Genentech, Amgen) were suddenly appreciated has the next pioneers with the drugs to match the reputation.

 

Reducing the large pharmacos in the UK to a remaining few is a serious blow for our future production of the next generation scientists and products.

The reduction in FIPCO internal R&D resource was heralded as being inevitable and ‘a good thing’. Strategic outsourcing to reduce internal bulk was discussed and became a new way of life. A significant situation then hit each one of the established pharmacos, each was facing a patent cliff. In turn each company reduced internal R&D budgets, driving outsourcing and downsizing and large merger transactions looked good on the basis of strong consolidation and synergies. Now the number of large companies is reduced to so few through, there is too great a concentration of resources being channelled through a few entities which completely alters the vibrancy of the external ecosystem. A single entity investing $200m in the UK will make entirely different choices to 10 companies each investing $20m. The commitment we need to extract from Pfizer is to understand fully this issue and to take some responsibility for ensuring the health of the UK ecosystem it is depriving of one of its home grown companies. We need Pfizer to sustain their combined company future R&D investment in the UK and we all need to realise that even this will not sustain the vibrancy of the past and provide the next generation of translational scientists and new products.

Condensing this to three relevant points:

Early R&D innovation never benefits from being in a bigger organisation - there is an entire literature on this - small fast moving somewhat chaotic groups spawn the new innovations.  So the bigger the Pharma the more they rely in the scientific ecosystem around them to feed their pipelines.

 

The presence and investment in R&D in the UK in the past has spawned the current generation of scientific leaders and numerous innovations and will be reduced to a critical level without some smart plans and investment.

The third relevant point is our industry works on a 25 year cycle from inception if an idea to final product (as a minimum). Large companies taking their investment elsewhere on the basis of cost reductions will not see productive returns in the near term (the 25 year rule will reign). The UK has a strong experienced science base with a proven track record of innovation.   So for the successful future of UK bioscience we need a Pharma R&D base here. The huge Pharma giants need their pipelines  feeding and their commitment to the UK will be all the stronger if they believe it to be a sustainable source of innovation for them.

Unless the promises made by Ian Read to David Cameron are binding Pfizer could pull out of the UK in 5 years and the whole cycle of invention, innovation to Products on the market will be broken.   AZ and GSK are this country's only real hope of sustaining the scale of investment that will make the difference for this current generation of scientists and their commitment has to be here for the next 25+ years. Pfizer have a US mindset and no allegiance to the UK.  Corporations have short memories and financial drivers.  Do the financiers really understand this? We must keep explaining……..

Interventional Medicine: Collaboration in Action

I have a vision of the future of medicine and healthcare that I cannot square at this time with the businesses of the present, the financial models, the research and development pathway and the regulatory environment.

At the core of this mis-match is that treatment will be multimodal.  Small molecule medicines are one small component of the future.  We are really looking at combinations, diagnostics, drugs and devices etc. ‘Patient Centric Solutions’ as mentioned by Tony Farino of PwC at the opening of his panel session at the recent EU BioPharmaceutical Conference 2013 held in Divonne des Bains, France.

People talk about ‘Personalised Medicine’ – this sums up the individual tailoring of medicine that is almost necessarily unaffordable.  As time goes on we need to find a way, not just to affordability but to understand that in the single mission of treatment of each patient we do it safely and ensure the greatest possible efficacy. This, to me, is better described as Interventional Medicine and this means that, to be best treated we need to diagnose, administer and monitor the patient.  All this is possible if we combine skills, technologies and regulatory paths.

Let’s think this through from the perspective of the business models in Pharma.

At this conference a member of our audience said, ‘We must consider we are in the healthcare business’. ‘Innovation is woefully lacking in the business model’.

Another quote was, ‘It doesn’t have to stay like this’.

No it doesn’t and the good news is that the industry isn’t staying still. Our industry is changing rapidly – every facet of the once successful FIPCO model is now challenged and shown to be vulnerable, if not totally unsuitable.  But this has not gone unnoticed and the leaders of companies in our industry in large and small enterprises are making the change.  Sometimes the change is taking the form of a dramatic site closure in a big pharma.

Take the shutting of GSKs Verona site – their centre for CNS diseases research.  The reaction to this – shock and exclamations of ‘it’s sad’ and ‘it’s mad’!

I don’t think so.  This was a productive site with some of the best pharmacologists and chemists in our industry who had developed some of our best CNS drugs that we use today.  But they had reached the end of the road.

CNS medicine will not just come from pharmacologists and chemists.  In the future we need:

                Genetics – analysis

Diagnostic and imaging substances and technology

Functional MRI and other measures

Professionals in interpretation of these measurements

Therapeutic modalities like:

                Small molecules

Biological agents

Stem cells

Encapsulation technologies

Implantation systems

Professional surgeons

Monitoring skills amongst professionals across healthcare including in nurses, the patients and their GPs

This does require a rethink of the business model from front to back of the process from Discovery research through to the market and healthcare delivery.  Of course Verona had had its day – let’s start building now the alternatives for our industry.  Where you might well ask?  Start within our biomedical research institutes and align those skilled in the knowledge of R&D processes with those with brave new ideas but who are not conversant with translation.  Breakdown traditional specialist silos and encourage team work amongst chemists, biologists, mathematicians, physicists, engineers and surgeons…….

Change may be slow, it may be frustrating, but it is happening and it is up to us to encourage it.  The last bastion of resistance will be the large pharma commercial teams who want answers before they can be given as they try to figure out market access.  They can’t do this without our help to demonstrate the advantages of our drugs, suitably delivered, packaged, formulated and presented with the right accompaniment and by the right people.  Companies will continue to seek the value proposition for these medicines and if they require collaboration, multidisciplinary teams and a new business model these will emerge.

My panel at the Eu Biopharma conference used 4 case studies to show examples of early entries to market that bring together drugs, diagnostics and devices. Their stories show that this is not easy but their examples help to show how we must strive to improve the process to make the delivery of new breakthrough medicines possible.  Through these examples the audience heard of companies’ motivations to navigate the regulatory quagmire to deliver these products which begins to shine light on why it is worth the effort and how the final product improves the value proposition for the medicine as well as the safety and efficacy of the drug for the patient.

My panellists were;

Iain Miller, formerly from GE Healthcare and bioMerieux, from Healthcare Strategies Group.   Iain described two products from GSK and BioMerieaux  that have recently received approval accompanied with a Braf molecular mutation test as a companion diagnostic.

Sue Herbert from Merck Serono who described two smart devices for improving compliance and the cost benefit of two established biologic agents.

Guenter Janhoffer from BTG described two combination products which were differently assessed by the FDA, one for which they considered the drug division should lead and the second where they considered the device division should lead the review. Nevertheless both divisions have to have oversight of the products.

Grant Castle of Covington and Burling told a story of a Medtech company who had an approved device but found that partnership with large pharma companies which intended to use the device for their medicines came up against medicines regulators who made such significant difficulty for the device assessment alongside a medicine that the company had to alter their business strategy completely.

All panellists gave strong accounts demonstrating that the pioneers in our industry are from multiple companies and disciplines and that it will and does take significant perseverance of the sort they described for us to move this field of interventional medicine and personalised treatment forwards.

Leadership and Teams - your role as a leader

As CEO you have 360 degree responsibility for the success of your company. It's a lonely role - why do it alone. Read my latest presentation on the selection, forming and shaping of a team for high performance. E mail for the pdf presentation - using the latest of published work from Teresa Amabile and Steven Radcliffe amongst others. Melanie@Think10.eu

Preparing the way for genomic medicine at MCRC

Genomic medicine will change the way we see patients and what we need to know about them to treat them. We will have to know something about their genetics and if they have a tumour we will want to know something about the tumour's genetic profile. It is the changes that are within the tumour DNA that are meaningful and which will give us information about how responsive the tumour will be to cancer medicines and what the tumour will do in response to that medicine - will it die or will it further mutate to evade the effects of treatment?
The big issue is where and how will we receive this level of analysis about our disease? Currently our generalist hospitals are not equipped with the people, skills or equipment to make this happen.
I visited the Christie Hospital in Manchester - a dedicated cancer centre with a huge catchment area of new patients each year. Alongside the Christie Hospital, Cancer Research UK has a thriving cancer research institute, The Paterson Institute, which does research of the highest calibre and most impressively with the delivery of future medicines in mind. The University of Manchester is adjacent to the Christie/Paterson site and provides critical access to technologies from their faculties. Working together, those in the Christie Hospital, at the University and in the Paterson Institute (collectively forming the Manchester Cancer Research Centre, MCRC) are trying to identify rapid ways to assess the patient's status and that of their disease. The scientists and clinicians hope that from nothing more than a blood sample they will gain significant information to guide treatment. More drugs coming through company pipelines will be associated with diagnostic and prognostic tests to make treatment more effective and ultimately more affordable (as they will be used when they can be most effective to reduce the disease burden and not when they cannot work). A magnificant building of the Christie Hospital, jointly funded with CRUK, will provide a PhaseI/II unit to ensure UK cancer patients are given access to the newest drugs on trial.
Why does this set up in Manchester excite me? Because it is dedicated to one therapeutic area - Cancer. All the stakeholders can point to the goal of curing cancer and helping their patients. This common interest and integrated skill set between academia and the clinic and NHS has to be how we design the future of our healthcare systems - specialist centres with the ability to use molecular analytical techniques, whole body imaging technology and sophisticated medicines is where there is hope that today's drug R&D research will be sufficiently understood to be used to best effect for us all when we are patients. Well done to CRUK, University of Manchester, the Christie NHS hospital for supporting this integration and collaboration and to Nic Jones who as well as running the Paterson Institute, heads up the MCRC.

TED MED 2009 continued................

Marc Hodosh says TED MED is "about celebrating scientists and engineers and people who solve problems"... indeed there are extraordinary people at TED MED who have solved many many problems.
Below are a few representative synopses of key themes from the conference.....

Collaboration


A chord was struck by John Abele - co-founder of Boston Scientific who described the lack of collaboration in medicine - he says the word is over-used and in the medical dictionary there is no such word. John has bought the KingBridge centre and turned it into the

Kingbridge Collaboration Institute
Building Collaborative Cultures and Leaders

OK....... - this is interesting for pharmaceutical companies. Are we amongst those who use the word and don't actually practise?

Cancer

There was a good degree of outrage by a notable cancer patient, Laura Ziskin and specialist doctors like David Agus (Professor of Medicine at the Unversity of Southern California) that we are not winning the war on cancer because we are not capitalising on what is available. David has founded Oncology.com and Navigenics. David has figures that say the death rate is the same today as it was 30 years ago. He wants to see the integration of the informatics and genetic information that can be gleaned today into the practise of medicine...NOW. Laura has founded Stand Up To Cancer which raised $100mUS and distributes this money to researchers with tough timelines for delivery according to the collective wisdom of the dream team of cancer specialists 'Blue Ribbon Committee'. The objective is to bring products to patients in 3 years!! There are smaller grants available for young inventors also. Bart Kamen (CMO from Case
Western Reserve University in Cleveland, Ohio) advocates treating the "whole patient" who has cancer and is an advocate of chronic regimes of therapy. We saw the power of driving behavioural change for young patients to ensure compliance on longer term therapies ie. following ALL (typically striking young teenagers who strive to get back to normal living and who risk relapse with poor complicance). Video games are showing great promise to influence behaviour - preventing relapse in half of the usual 20% of patients who relapse. David Ornish - frequently on US television talks about the proven impact on our gene expression profile of healthy living and eating - supporting our ability to influence our state of health directly with our lifestyle.

The future target for cancer treatment is the cancer stem cell - this is a growing agreed strategy and Keith Black of Mount Sinai Hospital where he is a brain surgeon is an advocate of cancer vaccination. He says that cancer stem cells are immunogenic and spend much energy in strategies to evade immune surveillance. His clinical work and interest is in the interplay between the immune system and medicine, for example how to work with chemotherapy and vaccination in unison. He said that Viagra has been shown to improve penetration of chemotherapy to the brain. He describes microwave technology also to minimise invasive surgery and showed remarkable tumour regression in a patient with this technique of both the primary treated tumour and a further tumour adjacent to the treated site which he attributes potentially to stimulated immune surveillance.

Continuing the theme of Non-invasive surgical procedures

Rick Satava, a US Army Medical Advisor described and showed pictures of the first full apendectomy, non-invasively performed through the mouth. Rick is acclaimed through his work with the Army to have great insights into future technology and it's impact on medicine. He is an advocate of simulation and believes that simulation systems of the human body should be more advanced today than they are - he interesting and challengingly says that the pharmaceutical and healthcare industry is the only major producer now that does not have a simulation of its target (the human body). Rick is an awesome mine of information and a challenging disrupter of the status quo. He also talked about a femtosecond lasar that can remove perform single gene manipulations and how we can now put animals into suspended animation for up to 6 hours - in which time they cannot die as they are technically not alive in this state by our criteria. They can be brought out of this state and are fine. Scary stuff and as he so correctly describes each advance brings moral and ethical questions and ultimately decisions.

We are what we eat

You have to view the wonderful pictures of Peter Menzel and his wife Faith D'Alusio following their round the world trip to photograph families and their food. Peter describes how they will try all diets but amongst the most concerning and stomach churning was beef from the high intensive farming practices of Texas. We are not progressing but regressing....

A key theme is to eat naturally, non-processed foods and to stop eating when you are 80% full and let the food enter your body and give the right signals. The growing obesity epidemic in the world and in particular it the US is a cataclismic disaster for healthcare and future generations' well being.

Behaviour change towards integrative medicine

TED MED 2009 vision....The future will involve and integrated healthcare system. One with empowered patients, who are in possession of their own data, accessed by their mobile phone. They will take care of their life style and choose to look after themselves and monitor their health. When in need of treatement they will choose their physicians and their doctors will be part of a team who are intent on treating the whole person, not just their cancer, but their mind and whole body.

This was the vision expounded by so many speakers and attendees. However Ezekiel Emanuel, brother of the Chief of Staff to President Obama's administration, is skeptical. Cautious and even, perhaps "silenced" on the topic of healthcare reform, it was evident that today's reality of getting heathcare to the masses is not a vision facilitated and supported by future technology and a mass of empowered and educated people who will act responsibly. For me this was a disconnect between the TED MEDsters and the reality and complexity faced by today's leaders. TED MEDsters are self selected, relatively wealthy, educated people and the enjoy visionary worlds. The are not wrong about the possible future but have some way to go before the future is a reality and the technology must keep coming in order to make it accessible to the the world at large.

'Business model malpractise'

Finally I need to mention Jason Hwang, Executive Director of Innosight Institute in San Francisco. He used the term "Business Model Malpractise". It is an a challenge to the way we think and is applicable to the pharmaceutical industry as it is to the whole healthcare system. He said that barriers we are experiencing today (as illustrated by the disconnect of the vision and the potential described in the previous paragraph) is because we are trying to fit new disruptive technologies into old business models. An example is that we feel we should have all our healthcare delivery eminating from one place - the hospital - this is not necessary or even desirable in the future yet we persist in building new large hospitals - when perhaps small local community clinics will be better. This is really food for thought for all business executives across possibly all industries at this time - but never more so than for those involved in healthcare and, I would argue, pharmaceuticals.

I have to stop there because you need to be at the next TED MED to get the full breadth and depth of insights and challenge. You can always ring me or write and ask for more........ Thanks for reading this far.

A First evening at TED MED 27/10/09

At TED in San Diego. Johnson and Johnson are the major sponsors - well done J&J, you're looking at the world differently! TED MED's founder, Richard Saul Wurman opened with Marc Hodosh. Richard likes to makes things simple and understandable - to demystify. This makes things accessible to everyone - he is an amazing man.

Let's move to regenerative medicine and stem cell breakthroughs. Daniel Kraft a physician at the Stanford Institute for stem cell biology and regenerative medicine told us the following..........The cutting edge of surgery and regenerative medicine is to build blood vessels, heart valves, bladders and skin - described as relatively simple now - we know how to do it, and are doing it!!! More complex organs such as the liver have more cell types and are highly vascularised structures. Surgeons would rather we receive such organs made predominantly of our own cells.

Imagine this Anthony Atala, Director of the Wake Forest Institute for Regenrative Medicine... told us ...take one liver, remove the liver cells to leave a vascular bed and regrow the new host's liver using their own cells around this vasculature. This hasn't been done in man of course, and it still leaves the issue of a foreign tissue vascular bed, but it's amazingly close to pushing organ development and regeneration to another level. These same amazing scientists are working on regenerative capacity of salamander limbs and are asking what stands in the way of humans regenerating their limbs - scar tissue is the answer - so skin science is leading the way here to provide an artificial living layer that prevent the body from scaring and keeps it on the healing and regeneration pathway.

So may highlights and insights but one more thought - Geo-medicine. Our geographical history has a huge impact on our health yet it is unrecorded - what was in the environment where we were growing up, were students and where we have spent our adult lives? Actually so much information is now available about those environments - it's just we don't tie the data into our medical history. There are some intent on changing this - Bill Davenhall, Global marketing manager of Health and Human Service Solutions, ESRI is onto this!! He thinks it will help determine our risk and thus avoid unexpected events like his heart attack without warning nor apparent risk. He also looks to the changing healthcare service contribution of our high street stores like CVS and Walgreen.

www.TEDMED.com