The Optimist Club: What Big Pharma R&D Execs are Doing to Save the Industry
This article was originally published in RPM Report
Executive Summary
The output of pharmaceutical industry R&D is at an all-time low. But Big Pharma R&D execs say better times are coming soon. What do they know that everyone else doesn't? Optimism plays well with lots of key constituencies-including FDA, which is being spared public criticism on the state of R&D portfolios.
The output of pharmaceutical industry R&D is at an all-time low. But Big Pharma R&D execs say better times are coming soon. What do they know that everyone else doesn’t? Optimism plays well with lots of key constituencies—including FDA, which is being spared public criticism on the state of R&D portfolios.
"I’m a romantic and an optimist," Pfizer Inc. ’s new global head of R&D, Martin Mackay, told The RPM Report’s FDA/CMS Summit for Biopharma Executives in December. That much was clear from his upbeat assessment of the state of industry pipelines. And he didn’t stop there: "This is the golden age of drug discovery."
This is the golden age? The Food & Drug Administration approved just 17 new molecular entities in 2007, the lowest output since 1983. Over the last three years, FDA has approved just 61 new molecular entities or novel biologics. You have to go back to 1978-1980 for a lower output. (Also see "FDA Amendments Act: More Regulation = More Comfort and More Products" - Pink Sheet, 1 Oct, 2007.)
Even the new burdens potentially placed on industry by the law—including mandatory post-marketing trials and risk management programs—were embraced by the panelists.
"Post approval commitments I think is a really good thing," Mackay said. "It could allow us to get medicines out to the public, and then the responsibility is on us to monitor them."
As for FDA’s ability to impose risk management plans on new drugs, the "EU has already mandated this for all your submissions," Bristol’s Daniels said. "It isn’t like this is new to us."
To some extent, industry can’t credibly blame the new drug approval drought on FDA. As the agency itself points out, new drug launches are down globally, not just in the US.
Still it is certainly possible to argue that FDA is more conservative than some of its global counterparts, at least in the current political climate. Some Big Pharma CEOs, like Wyeth ’s Bob Essner and GlaxoSmithKline PLC’s JP Garnier, haven’t shied away from making that argument. (Also see "Straight Talk from FDA: Wyeth R&D Head Reacts to Climate Change for NDA/BLA Reviews " - Pink Sheet, 1 Nov, 2007.)
As 2008 begins, however, top industry execs seem to be going out of their way not to attack FDA. Even Amgen Inc. CEO Kevin Sharer, whose company has not been bashful about expressing views on some of the governmental actions regarding the safety profile of EPO, went out of his way to praise FDA’s approach to the issue during the JP Morgan conference.
Strategic Optimism
Pfizer’s Mackay has gone even further in public forums—defending FDA from criticism published in the Wall Street Journal by Pharmacyclics Inc. CEO Richard Miller, who accused FDA of "stifling, rather than encouraging, investments in innovation through cumbersome and overly restrictive policies."
"How sad that Prof. Miller reports ‘pervasive pessimism’ surrounding new treatments against pancreatic cancer," Mackay wrote in a letter to the editor. "Some of us working in this field are, in fact, remarkably optimistic about our discoveries that represent new ways to treat this dreadful disease."
"I can also offer some reassurance to counter Prof. Miller’s complaints about the FDA’s ‘retreat from the use of streamlined approval procedures.’ The agency recently granted fast-track status to Pfizer for axitinib, an experimental medicine now being studied in pancreatic cancer."
"There is remarkable innovation coming from pharmaceutical companies, smaller biotechs and academic institutions," he added.
Mackay’s letter suggests another constituency for the message of optimism: smaller companies who are potential partners or acquisition candidates. While Mackay et al. express enthusiasm for their robust pipelines, they also acknowledge that they need to be even more aggressive about using dealmaking to supplement their internal activities.
Big Pharma can ill afford to see investors give up on innovation, or else they will lose access to the external pipelines they increasingly rely upon.
For that matter, they don’t mind if Wall Street knows that drug development is getting harder—if it were easy, there would be no reason for start-up companies to turn to partners to develop their products.
If Pharmacyclics can’t navigate the drug development process successful but Pfizer can, then Mackay has even more reasons to be optimistic about Big Pharma’s future.