Amgen on the prowl? September 15, 2010

The world’s largest biotechnology company is again in feeding mode. According to CEO Kevin Sharer, Amgen is reportedly eyeing alternatives toward acquisitions to add to its international footprint. Best guesses have Dendreon, UCB, Ipsen & Actelion on their target list.

Amgen’s cash position includes $12.3 billion being held in international accounts, which would be subject to a 35% tax rate on profits if repatriated to the United States. This provides a unique incentive to pursue overseas transactions with tax-free profits.

Belgian pharmaceutical group UCB has been quietly growing its presence in the U.S. out of Atlanta, GA. French drugmaker Ipsen (oncology, hematology, endocrinology) solidified its U.S. foothold through the acquisition of Tercica in the Bay area. Expansion plans are aggressive for 2011. Actelion is Europe’s largest biotech company focused on orphan drugs for cardiovascular diseas & has expanded its U.S. presence nearly next door to Ipsen in northern California.

What U.S. companies could draw Amgen’s interest? Genzyme is not an option, as Amgen is unlikely to bid against Sanofi Aventis. However, two midsize targets could include Human Genome Sciences in MD and Dendreon in Seattle.

While no deal is not eminent, most expect its only a matter of time due to Amgen’s financial position and the need to foster continued growth. Certainly, acquisitions are a part of the company’s history with the largest being Immunex back in 2001.

So, who do you think Amgen will pursue?

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An olive branch from the White House for the life sciences industry September 14, 2010

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The current White House administration has not been nearly as supportive of the life sciences industry as other that came before.  Today, some good news.  All categories of the life sciences industry could potentially benefit from President Obama’s proposal to expand the R&D tax credit.   Obama has asked Congress to expand the tax credit by about 20%and make it permanent.   Starting in 1981, the credit has been extended 13 times and expired 8 times – most recently on the final day of 2009.

AdvaMed, BIO and PhRMA (& anyone else in our industry) supports the move by the White House.  In a statement by PhRMA: “For America to keep its global leadership in medical innovation, it is critical that public policies and programs support continued research and development (R&D) of new medicines. Investments made in R&D help support the economy and U.S. jobs, including jobs in the U.S.-based biopharmaceutical sector.”

At the end of the day this is $100 billion dollars on the table over the next 10 years for companies that are performing research and development in the U.S. A full approval by Congress may take into next year; yet, in the wake of healthcare reform & stem cell rulings, this is the first good news our industry has seen from the Obama White House in a while.

Rumors of deep cuts at Roche? Standby… September 13, 2010

In a statement riddled with bad intentions, Roche AG announced that it will ‘review its business and cut costs to cope with recent setbacks on key drugs and rising pressures on prices from healthcare reforms’.  In plainspoken language, significant cuts are on the way.

The world’s largest maker of cancer drugs, once seen as the darling of the pharmaceuticals industry, has slipped since the acquisition of Genentech.  Most of its shortcomings are related to disappointments within its development pipeline, including follow-on indications for Genentech’s Avastin.

No details have been provided about reductions in force or cost savings.  According to Roche, details will follow in the coming months and be implemented starting in 2011.  Swiss newspaper Sonntag has speculated that Roche could slash thousands of jobs across drug sales, research and development, production and administration.

J&J CEO faces the music & shows why he is one of the best September 10, 2010

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In the past six months, Johnson & Johnson has issued almost a dozen different product recalls including Benadryl, Tylenol, hip implants and contact lenses. From the outside, it appears a debilitating mess.

Yet in all the confusion and miscommunication, CEO Bill Weldon goes on CNBC to face the scrutiny.  Maria Bartiromo shows all the consternation she can muster, even calling him William like a scolding grandmother.  And while Weldon admits the company has ‘let customers down’, he deserves credit for taking the questions and doing what he can to set the record straight.

Location, location, location! Bristol-Myers acquires Zymogenetics September 8, 2010

Seattle-based companies continue their streak of headlines. Following Dendreon, Alimera and soon-to-be Seattle Genetics, Zymogenetics made its own splash this week with its acquisition by Bristol-Myers Squibb. BMS did the deal for Zymo’s hepatitis C biologic treatment that has been the focus of a collaboration between the two companies.

Hep C is predicted to a grow into a multi-billion dollar market, and Vertex, J&J and Merck are already in the race. With ZymoGenetics, BMS becomes an immediate player in this growing market. On a lighter note, they also now control one of the more storied and attractive landmarks in the life sciences industry. Zymo’s corporate offices are on the shores of Lake Union in Seattle in a distinctive converted factory. Anyone who’s driven by has had their attention drawn by the enormous stacks protruding from the renovated historic steam plant. Without question, the office building is one of the more recognizable across the entire industry. Of course, neither company is speculating on the fate of Zymo’s offices or its employees until the deal closes.

So our question: Is Zymogenetics building the most unique for any life sciences company?   If not, submit your nomination.

Developing the next generation of performance enhancing drugs. Should we? September 3, 2010

Anabolic steroids, human growth hormone and other PED’s have dominated the sport’s landscape for the past decade. While governing bodies must decide how best to police & regulate such technology, the industry is on the hunt for the next generation of such products. A new alternative to controversial anabolic steroids would build muscle by mimicking the effects of the hormone testosterone without the side effects. Human growth hormone is also frowned upon because of side effects and questions about whether it can increase strength. But what if the industry could develop a better, safer way to deliver the same results?

Companies like GTx and Ligand Pharmaceuticals are developing drugs called selective androgen receptor modulators, or Sarms. These Sarms can potentially deliver the muscle-building qualities of HGH or steroids without side effects. On a different tack, Pfizer, Amgen and Acceleron Pharma are separately pursuing drugs that block myostatin, a protein made by the body that acts as a brake on muscle formation. The proof can be found in cattle raised in Belgium. Belgian Blue cattle, which do not make myostatin, have huge, rippling muscles and yet are otherwise apparently healthy. Several years ago, scientists reported that a German boy who lacked myostatin because of genetic mutations had abnormal strength and muscle mass.

Most of the drugs have been tested in only early-stage clinical trials so far, and there have been many setbacks. Wyeth, now part of Pfizer, dropped a myostatin inhibitor that did not work well in a muscular dystrophy clinical trial. Amgen last month called off a trial to test its myostatin blocker for age-related muscle decline. Merck withdrew from a partnership to develop GTx’s drug.

But those companies all say they are not giving up on the quest. And, while these technologies all have potential clinical applications not related to performance in competitive sport, there is certainly a moral boundary. But apparently not one strong enough to hinder the natural progression of technology & science.

Genzyme CEO to Sanofi: “We are not a fixer upper…we’re beachfront property!” September 2, 2010

Henri Termeer finds himself at a crossroads.  The biotech industry pioneer and CEO of Genzyme the verge of losing control of the company he transformed from a start-up in 1983 into a $4.5 billion biotechnology powerhouse.  Those who know Henri can share how much he loves managing Genzyme. They can also share how difficult the past few years have been.

Now, pressured by an $18.5 billion buyout offer from Sanofi Aventis & antagonistic shareholders, Termeer says he will consider selling, if he can get the right price.  Termeer stands to make about $300 million from a sale to Sanofi.  At the same time, Termeer is under siege.  Billionaire investor Carl Icahn controls two seats on the board and would like nothing more than a quick transaction to realize gains from his investment.  What else?  Genzyme is racked with manufacturing & quality issues that have led to product shortages that devalued the stock.

Thus far, Genzyme has rejected Sanofi’s initial offer, saying it undervalues Genzyme’s pipeline of potential products.  And, the deal centers on a Genzyme share price that is already depressed, down 43% from a 2008 high.  Still, this is not a one sided deal.  Sanofi Aventis & new CEO Chris Viehbacher need new products to help replace revenue that will be lost in 2013 due to generic competition.

Most in the industry believe, like Roche-Genentech, it’s only a matter of time…and money. But be sure that ‘Biotech Hank’ will not sell out for one penny less than what he believes his company to be worth.  Let the posturing begin…

On the heels of Dendreon, another big hit in Seattle? September 1, 2010

On the heels of Dendreon’s FDA product approval & stunning growth, another company is looking to solidify a banner year for the Seattle life sciences community.

Seattle Genetics, locally known as SeaGen, will release results from two important trials in the coming weeks: one for an experimental leukemia treatment called lintuzumab, followed within weeks by results from two trials of their lead drug candidate (brentuximab vedotin) for lymphoma. Wall Street is expecting success for the lymphoma drug, but positive results for the leukemia treatment could turn 2010 into a landmark year for the 13-year-old biotechnology company.

Lintuzumab was licensed in 2005 from Protein Design Labs, while the lymphoma drug is partnered with Takeda. Seattle Genetics plans to potentially file for FDA regulatory approval of both drugs in the first half of 2011.

100 Most Powerful in Healthcare = 0 life sciences executives August 31, 2010

Definition of the ‘Power’: (verb) supplying the force or power for the functioning of.

So help me understand the just-released Modern Healthcare’s 100 Most Powerful People in Healthcare? The list starts at the top with Barack Obama & every other government administrator remotely connected to the new healthcare reform bill. It trickles down to enclude the CEO’s of every major health insurance provider or health network across the country.

Yet not a single CEO from a healthcare products company makes the list? Apparently the industry that brings to market the technology for diagnosis and treatment and prevention of disease and ailments does not make the cut. How can Bill Weldon from J&J, Miles White from Abbott, or industry legend Al Mann not be on this list? What about Jim Greenwood from BIO or Stephen Ubl from Advamed? How about the researchers on the front lines of new technologies that will eradicate disease or bring medical solutions to millions of patients?

Seriously? Seriously.

Cast your vote. If you could nominate any individual to Modern Healthcare’s list of the Most Powerful People in Healthcare, who would it be?

In a dramatic change, Hospira to replace both CEO & COO August 30, 2010

Just a few days back, Hospira has announced that both its CEO and COO are set to leave the company. In doing so, the global specialty pharmaceutical and medication delivery company is set to experience a significant (even if planned) period of change in its corporate leadership.

Hospira CEO Chris Begley will retire but remain in his title as Executive Chairman. Begley previously led the earlier incarnation of Hospira as the Hospital Products division of Abbott Labs, which was spun off in 2004. Since then, he has doubled Hospira’s revenue outside the United States and doubled its market cap.

Surprisingly in the same announcement, Hospira announced that COO Terrence Kearney will retire in the coming months. While Hospira will search externally for a new CEO, the COO role will be filled from within the organization. The key to this next step forward for Hospira is its move into biogenerics or biosimilars. The company is already the world’s largest supplier of generic injectables and is looking to fuel its growth from the generic market for biologics, a pathway opened by healthcare reform passed earlier this year.