Biogen Idec Business Development Plan Includes Small Molecules For Oncology
This article was originally published in The Pink Sheet Daily
Executive Summary
The company expects the bulk of expenditures from a $200 mil. business development plan will go toward up-front milestones and new clinical costs for in-licensed drugs.
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Biogen Idec's planned $200 mil. in "business development" investments for 2006 include expanding the pipeline to include small molecules in oncology, the company said during an Oct. 26 earnings call. "Focus for '06 will be expanding our oncology R&D effort: attracting top talent, developing early-stage partnerships with academic centers, entering R&D collaborations with other companies, building opportunities in the solid tumor market, and expanding our pipeline to include small molecules," Exec Chairman William Rastetter said. In September, the company announced plans to earmark $200 mil. for business development and external research opportunities in 2006 in conjunction with a broader strategic plan aimed at reducing operating expenses. The plan, which seeks to reduce annual operating expenses by $200 mil.-$300 mil., includes workforce reductions and divesture of the psoriasis treatment Amevive (1 (Also see "Biogen Idec To Reduce Annual Operating Expenses By $200 Mil.-$300 Mil." - Pink Sheet, 8 Sep, 2005.)). The cost cutting follows the withdrawal of Tysabri from the market. An sBLA seeking to start selling the multiple sclerosis product again was submitted to FDA in September. Biogen expects that the bulk of the business development expenditures would be for products already in clinical trials. CFO Peter Kellogg said most of the expenditures would go toward "primarily the additional programs we'd be bring in with either up-front milestones or new clinical costs that we'd be sharing as soon as we sign the deal and bring it in." The company intends to boost its oncology portfolio within the next five to seven years. "It is our goal to make the leap from being a top U.S. company in hematological tumors to being viewed as a true global leader in oncology from discovery to development to commercialization," Rastetter said. Biogen entered into a co-development agreement with Protein Design Labs in August for three Phase II biologics in multiple sclerosis and cancer applications (2 (Also see "Biogen Idec Gains Phase II MS, Cancer Biologics Through PDL Deal" - Pink Sheet, 3 Aug, 2005.)). "As result of our efforts to collaborate at all levels of our pipeline, we will expect to see a doubling of products progressing through our pipeline in the 2010-2012 timeframe," Rastetter said. The company also hopes to expand its presence in neurology - including treatments for Parkinson's, Alzheimer's, stroke and neuropathic pain - by 2012. "We will remain open…to expanding into other major therapeutic areas," Rastetter said. "We will stay focused on discovering, developing and commercializing significant products against high unmet medical need for specialty markets." Biogen Idec's revenue rose 10% in the third quarter to $596 mil. Reported net income was $27 mil., down from $37 mil. in the prior year period. - Christopher Hollis |