SMITHKLINE BEECHAM SEEKING 25% IMPROVEMENT IN DRUG DEVELOPMENT TIME
Executive Summary
SMITHKLINE BEECHAM SEEKING 25% IMPROVEMENT IN DRUG DEVELOPMENT TIME over the next four years through the recently-completed reorganization of its pharmaceutical R&D activities into interdisciplinary "matrices," according to Pharmaceutical R&D Chairman George Poste, DVM/PhD. The R&D reorganization marks the "final phase" of the strategic realignment that began with the merger of SmithKline Beckman and Beecham Labs in 1989. SB is narrowing the focus of its drug discovery units to five therapeutic areas -- anti-infectives/antifungals, cardiopulmonary, central nervous system, inflammation and tissue repair -- plus vaccines. Other research units in the new matrix system will focus on core technologies applicable to all therapeutic areas -- biotechnology, chemistry, biochemistry, molecular pharmacology and cell biology. SmithKline Beecham, which reaps more than a billion dollars in sales anually from its flagship ulcer drug Tagamet (cimetidine), is moving away from research in gastrointestinal drugs and making "adjustments" in the anti-infective/antifungal areas, Poste says. However, compounds currently in the pipeline will continue to be pursued. Over 40 drug discovery programs are in progress worldwide at the company. Among gastrointestinal drugs currently listed in SB's pipeline are two proton pump inhibitors: SK&F-96067, a reversible proton pump inhibitor being codeveloped with the Dutch firm Byk Gulden for the treatment of duodenal and gastric ulcers, gastroesophageal reflux disease (GERD) and Zollinger Ellison syndrome; and SK&F- 97574, for ulcer and acid secretion. The Byk Gulden project is in Phase II trials; SK&F-97574 is in preclinicals. The company is also working on SK&F-97426, a bile acid sequestrant in Phase I. In December 1991, the company halted development of the irreversible proton pump inhibitor pantoprazole, which had been in Phase II/III trials worldwide, due to questions about rodent carcinogenicity data ("The Pink Sheet" Dec. 2, 1991, In Brief). Codeveloper Byk Gulden is continuing to develop that drug. Research operations in the U.K. are undergoing the most significant changes, where SmithKline Beecham will reduce by almost half its total number of research sites, from 11 to six, and eliminate 150 positions. The company has committed nearly $400 mil. over the next four years to renovation of the remaining U.K. facilities. No staff cutbacks are planned in the U.S. "Current R&D budgets will continue to be funded at approximately 15% of pharmaceutical sales and will grow in concert with the increasingly strong business performance of SmithKline Beecham," the company said in a Sept. 1 press release. The firm's 1992 pharmaceutical R&D budget is around $780 mil., up from about $700 mil. the previous year. Based on sales through the first six months of 1992, worldwide prescription drug volume is currently annualizing at roughly $5 bil.
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