Astra Zeneca has started the 2010 bloodletting by announcing 8000 layoffs as it attempts to reduce costs ahead of anticipated drops in revenue over the next few years. AZ had already announced about 13000 job cuts which, coupled with newly announced plans, will certainly amount to significant financial increases. However R&D is also going to be affected as AZ said that it will be consolidating it's in house development projects in favor of looking elsewhere to establish partnerships with other companies on promising products. One thing of note is that AZ is following in Pfizer's footsteps by trimming down its internal R&D focus areas to concentrate on a smaller number of products instead of a shotgun approach.

Read more in the UK publication, the Telegraph

It's usually small biotechs that make news when they announce plans to go public. This time though, it's a bit different as Otsuka plans to go public sometime soon. According to Reuters this would make Otsuka the 4th biggest drug firm by value and serves to be a good investing opportunity for people usually hesitant about buying into an IPO because Otsuka already has a number of marketed products along with a good R&D pipeline

The Reuters article is here

Yesterday the FDA approved a potential blockbuster diabetes drug manufactured by Novo Nordisk after a very lengthy 21 month review period. The medication is called Victoza and it represents a new class of treatments for diabetes that work by stimulating insulin release from pancreatic cells. This may not seem like a novel idea, but Victoza only stimulates insulin release when blood sugar levels are high, which is a significant functional improvement over other diabetes treatments. Expect Novo to benefit for a long time from this medication, not only in terms of US sales but worldwide, as the drug is already approved in Europe and Japan.

Read more about the approval and Victoza here

What happens when two big pharma companies merge? Well you get lots of job cuts and a bigger-than=necessary development pipeline. That's exactly what happened with Pfizer, so the pharma giant announced that it was chopping 100 drugs in development from it's pipeline...trimming the fat if you will. Look for Pfizer to continue to make cuts as it concentrates on only a few different therapeutic areas with larger numbers of biologics and vaccines, compounds that are expensive to develop yet extremely profitable once approved...

The LA Times discusses the culling here

Finally with the Obama administration came a new FDA. Well, after a year or so of the new FDA leadership it seems that drug manufacturers are taking fewer risks with advertising aimed directly at consumers (DTC ads, as they're known). There have been several examples of the FDA sending out scathing warning letters to manufacturers identifying the promotion of incorrect or misleading drug information directly to patients. It seems that the rest of industry has learned from those companies that fell on the FDA's sword, and you can expect to see even fewer ads on TV, the radio, and other forms of mass media as we breeze through 2010...

Bloomberg writes on the topic in this article

On Friday the FDA announced approval of Acorda's new MS drug. As expected stock prices jumped and now Acorda is the subject of numerous buyout rumors. This certainly bodes well for investors as they get a double treat. Experts seem to think the time is right for a company with a vested interest in MS to snatch up Acorda along with the promising new drug, Fampridine. It makes sense to me...why not market a front line therapy such as Avonex and couple it with Fampridine to help deal with walking dysfunction?

Read more from BNet here

So the FDA says that generics are equivalent to brand name drugs, but what if they're not. Multiple complaints that generic Wellbutrin is inferior to the real thing sprouted a study conducted by Teva, who makes the generic version, to prove that the drugs are the same. Obviously Teva is out to prove that their version of Wellbutrin is essentially the same as the brand name, but what if it's not? Can you imagine what that will do for brand name manufacturers? I think that it could set off a string of studies comparing effectiveness of all different types of medications, and could set the generics industry into a frenzy. Just like always, we'll have to wait and see...

Here's a piece on the situation from Fierce Pharma

And finally some good news for consumers and the vaccine industry (usually those don't go hand in hand). GSK has promised to price its new Malaria vaccine at a reasonable price "just above cost" (which could mean anything really, but that's not the point). The British pharma giant is planning on making its Malaria vaccine, once approved, available to those who need it. The issue is that those who need it are those who can't afford it, so GSK is slashing the price of the vaccine to increase availability. This is a smart move for GSK for a couple reasons:

1)good PR move
2)good financial move. I think the lowered cost will be covered by increased sales to people/countries who might otherwise not be able to afford the shot. Even better: proceeds will be funneled back to research.

Check out more in the Financial Times on the situation

Acorda finally got what it's been looking for: an FDA nod of approval for its pill (Ampyra or Fampridine) to aid MS patients's ability to ambulate. I didn't think this was actually every going to happen as Acorda had to fight through one unsuccessful NDA submission and delays in the approval process. While the data are not overwhelming, it is in doubt that that pill can and does actually help some MS patients walk better...a significant benefit to this disease that can severely restrict ones ability to get around. You can expect Acorda's stock to reflect this approval in a big way, and as an added bonus for the company: a front page CNN.com article about the drug and the approval.

Here's the release from the FDA, courtesy of Fierce Biotech

Acorda's pipeline here


In other news it seems there is a potential cure for baldness. The only problem is that the public can't get it right now because of legal issues between the original developer (SkinMedica) and it's current developer (Histogen). It's hard to say who's right and who's wrong, but one thing is for sure...neither company will end up suffering as much as the men out there who hate their lack of hair. Somebody should really patch things up between those two companies so people can benefit from their collective work on this hair growth promoting product. Ridiculous.

BNet reports on the situation here


Last, but not least: Somaxon has resubmitted the NDA for its insomnia drug, Silenor. This drug has been rejected, not once but twice by the FDA. After meeting with agency a couple times, Somaxon thinks it has ironed out the problems and accumulated the data needed for an approval. Somaxon would clearly benefit from an approval, and stock prices have already risen substantially. Silenor itself is another example of an attempt at a sleep promoting drug that works without the residual sedation that plagues medications like Ambien. Unfortunately these drugs often don't work as well as Ambien...maybe Silenor will be different.

http://www.fiercebiotech.com/press-releases/somaxon-provides-update-new-drug-application-silenor-treatment-insomnia and Silenor itself

Several months ago I noted that Novartis and Merck KGaA were in the midst of developing the first front line oral therapies for MS. Well, now it seems that an approval of the drug is on the horizon. Novartis has filed for approval of their drug, which goes by FTY720, in the US and Europe after seeing some very promising late stage trial data come through (Merck isn't far behind, but the FDA requested retooling of the application before accepting the NDA). This oral MS market has huge potential for patients and manufacturers for a number of reasons, mainly coming from the promise of an effective MS therapy that isn't injectable.
The only potential drawback is one that should not be overlooked: an increased risk of infection that comes a result of the drugs mechanism of action. It sounds eerily similar to the PML that have plagued Tysabri, but I believe that the benefit of a pill to treat MS far outweighs the risk of infection to patients. In general, it looks like a winner...keep an eye on Novartis for the next 6 months or so...good things are likely to happen!

Here's the article from Bloomberg for more info

While Novartis was basking in the light of a promising future for its drug, SkyePharma is trying to put out the flames after the FDA rejected the NDA for its lead drug candidate, Flutiform. The asthma drug may not be completely finished though, as the FDA said that it needed additional information about the drug in the form of more clinical studies before regulatory action can be taken. I wouldn't touch SkyePharma for now...wait and see.

The company's news release here for you!

and if you're interested in flutiform...read up here

AspenBio is in prime position for a big year, at least according to Seeking Alpha. This small biotech company is developing a new diagnostic test for appendicitis that allegedly can give a result in 15 minutes. A diagnostic kit that could diagnose the potentially fatal condition without the use of expensive CT scans or ultrasounds would really be a boon for all sectors of the healthcare industry. AspenBio benefits because their product would likely be used everywhere, Insurance companies would benefit because they wouldn't have to foot the bill for CT scans when a small, local lab kit would do the trick, Patients would benefit because they wouldn't have to pony up a percentage of the CT scan for the same reason as mentioned previously. Basically put, it's a win-win situation for all parties. The only issue is whether the data presented by AspenBio are enough for the FDA to approve this new device...we should have an answer sometime next month. In the meantime, why not get a piece of the company...it's only running about 3 bucks/share.

AspenBio's website for more

...and Seeking Alpha's take on the new diagnostic test

If at first you don't succeed....Depomed is taking that to heart by rolling out another phase III trial of it's hotflash drug, Serada. In the fall of last year, Depomed announced disappointing results from 2 different late stage trials that missed about 75% of their primary endpoints after 3 months of treatment. This next study is slated to start in April and Depomed is hopeful that it will finally yield results that lead to an FDA nod of approval for Serada. I just wonder how much tweaking study designs will really beget a meaningful result. It's great that this has potential to be first non-hormone treatment for hot flashes (a real unmet need for women), but where should Depomed draw the line? What happens if this trial is no more successful than the previous two? Only time will tell, I suppose...

See the Depomed press release here

Caught up in all the health care reform battles is the war to establish patent protection for biologics produced by biotech and pharma companies. The premise is simple: the manufacturers want 12 years protection from biosimilars (the biologics version of generics), some democrats (including President Obama and Senator Waxman) and generics manufacturers want less. On the surface it seems that less protection would benefit consumers because biologics, while generally effective therapies, are typically very expensive to patients. This is because they are expensive to develop, often involving proprietary processes and many years to bring from the lab to the market. Manufacturers are arguing that the only way they can recoup the losses of developing the biologics is to have a longer period of patent protection on the product before it is opened to competition from biosimilars.
At first I was all for legislation reducing the length of time for protection, but the more that I consider the problem, the more I feel that 12 years is fair. The way that I look at it, if companies feel that developing biologics (some of the most effective auto-immune treatment available today are biologics, by the way) is cost-prohibitive because patent protection is lost too quickly, then developers may abandon the production of these important treatments. Furthermore the production of biologics is a very labor intensive and scientifically complex matter, and any competition would likely have to undertake similar expensive manufacturing techniques just to produce a biosimilar. That being said, companies that invest the time and money into producing biologics should have 12 years of market exclusivity for their treatment.
As for the cost of the biologics, I think that future improvements in manufacturing techniques along with competition from other manufacturers will help control the cost of biologics, but these treatments will always be more expensive than standard medications. It's hard to say how this battle will play out, but neither side will go down without a fight.

Read more in The Washington Post

Nevermind that the FDA said it will miss its self imposed Jan. 16th deadline for action on MannKind's inhaled insulin. Nevermind that the agency has yet to complete inspection of the company's manufacturing facility. MannKind remains optimistic that their product will clear that final hurdle and get good news within "days" of the completed facility inspection. In a world full of cautious optimism, MannKind's belief in their product is great, but how would they handle a negative FDA response to Afresa? I guess we'll find out one way or another within the next few weeks...

Reuters reports here

Finally, some good news for Biogen and the much beleaguered Tysabri. The company said reported that Tysabri's sales exceeded $1 billion for the first time ever in 2009, essentially elevating the biologic to "blockbuster" status (i guess you could call it the equivalent of going platinum). I think this speaks wonders for the drug because patients/physicians seem to believe pretty strongly in Tysabri in spite of the continuous presence of PML. Unless the incidence of PML or other problems spikes unexpectedly, I would plan on Tysabri being around for the long haul.

See more from Bloomberg on Biogen's Tysabri announcement...

Must be nice if you market a top 15 drug with no legit competition on the horizon. That seems to be the case with Advair, at least according to GSK. Several potential asthma drugs have gotten the chop lately by the FDA and GSK does not think that any generics will rise to challenge Advair when its patent expires in 2011. Pretty good news I'd say, and not something that you hear everyday with the surge in generics lately.

Fierce Pharma talks about it here

Roche got good news when the FDA approved Actemra for the treatment of Rheumatoid Arthritis in adults. What's good for Roche (formally Genentech's product by the way) is that Actemra is the first in a new class of monoclonal antibodies, so basically if it proves to effective it will have free reign on the market for some time. There is some heavy competition in the RA field though with Remicade, Humira, and others being staples in the market for several years now. Keep an eye on this drug, Roche looks to make a significant splash with this one.

See the Press Release here from Genentech

The other day I mentioned Novartis working to acquire Alcon in an effort to expand and diversify their assests. If you're interested the folks at Seeking Alpha have expounded a bit more on this developing merger...


Finally this whole H1N1 thing may end up backfiring on vaccine manufacturers, regardless of the intentions of the companies. First the H1N1 outbreak tapered off significantly in late November/December, then vaccine surpluses began to emerge as public interest faded. Now, countries are slashing their vaccine orders and the European Union is actually holding a formal investigation into whether or not manufacturers over-exaggerated the threat of H1N1.

I don't buy those threats, I think they'll do more harm than good. Time has shown that's impossible to predict nature, and this H1N1 outbreak is a good example of this. Better safe than sorry in my mind.

The other day I mentioned the sharks circling, waiting on a decision from the FDA on Mannkind's inhaled insulin. Well, now it seems they'll be waiting around a little bit longer: the Agency said that it would miss its own January 16th deadline for a decision on the hotly debated medication, Afresa. However the delay here is not due to more data review, safety reports or things like that; rather the FDA says that it has not yet completed a thorough inspection of Mannkind's Afresa manufacturing facility. Analysts feel that in spite of this, an approval is waiting in the wings...so don't jump off board quite yet. Clearing this final regulatory hurdle will be huge news for Mannkind as well as insulin users across the US.

Pharmalot cogitates about the topic here....

Just so you don't forget that Vivus is not a one trick pony, the company released more information on their new ED treatment and the drug, Avanafil, continues to impress. The Phase 3 results were very impressive, showing significance compared to placebo at all doses being examined. While Vivus is entering a tough market with several ED meds already eating up market share, perhaps the quick response time (15 minutes) of men after taking the drug will encourage some changeovers. Keep Vivus in mind as they continue to impress...

Vivus press release can be found here, courtesy of Fierce Biotech

Targacept was busy making headlines over the second half of 2009 with its strong results from its new anti-depressant. As was mentioned in the fall, Astra-Zeneca felt good enough about the results to enter in a marketing/development agreement with the NC based biotech firm. Targacept has managed to secure its first big payment from Astra-Zeneca as part of this agreement ($200 million), so look for them to keep up the good work and continue to bring in the money. The company's stock has risen significantly over the past year...expect that trend to continue at least until phase 3 trials are completed in the near future.

And here's Targacept's press release, again from Fierce Biotech

Finally, some good news for Sanofi: a new Dengue fever vaccine being developed by the French company generated sufficient protection in all 66 adults receiving the vaccine in a small study. Just like the Malaria vaccine being examined by GSK, successful development of a Dengue fever jab will certainly have far reaching financial benefits to the manufacturer. The only question is (if the medication is effective) how much will it cost to those who are at risk of getting sick (think people in Africa)?

Read all about it from Bloomberg

The promise of Vivus's Qnexa as a weight loss agent is well documented, but now data suggests that the combination of phenteramine and topiramate is also effective in treating sleep apnea. However it's not a treatment for apnea in the same way that CPAP alleviates the problem, rather Qnexa causes weight loss that can improve the condition to the point where it is not a concern to the patient anymore. Because weight loss has been known to decrease the severity of sleep apnea, any consistently positive results for Qnexa should be pretty easily result in an approval for that indication and concordantly, another revenue boost for Vivus (and whomever they up partnering with in the future). Remember, however, that Vivus has not yet submitted a NDA for Qnexa, so all this is speculation at this time...

See the Vivus Press Release here

Teva's management is looking for some serious growth in the next five years, so much so that we may be considering the company in the same breath as Pfizer, Sanofi, Novartis, GSK, and other so called "big pharma." Unlike other companies however, Teva focuses on generic drugs and they feel that increasing health care costs will drive patients to more and more generic drug use. This, coupled with the standard diversification of the company portfolio would certainly lead to Teva becoming a much bigger player in the global drug market. I like their plan, so hop on board, but don't expect big returns for at least several years....

Read the Bloomberg article for more insight

Maybe Carl Icahn has picked on Biogen long enough. It seems that Icahn wants a big piece of Genzyme (he bought over a million shares of the company last year) and he could be interested in forcing changes at the beleaguered biotech that has certainly seen its share of problems over the past year. Genzyme seems to have been watching Icahn's moves with Biogen and it doesn't look like they will play nice with the billionaire, but maybe they should. As many problems as Genzyme has had lately, maybe they could use a little shakeup...

Here's the abcnews story....

As we know MannKind is developing an inhaled insulin that they hope to get approved by the FDA. However analysts are spurning the company's confidence that the approval will come by January 16th. One cannot argue that MannKind has every right to be optimistic: an effective inhaled insulin will be a tremendous step forward in the treatment of diabetes. Unfortunately there is only speculation as to what will happen in the coming weeks, and it seems that analysts are taking the conservative route by advising against MannKind and Afresa (trade name for the inhaled insulin product).

Read more here from Bloomberg

Yesterday I mentioned that Gilead has shown the highest margins in pharma/biotech. Well, today the shares of Gilead jumped significantly after a phase II study of a new HIV treatment met it's primary endpoint. I would proceed with caution based on this news, however, because this new add on therapy could very easily meet its demise in large scale Phase III studies. Let's wait and see what happens as this drug moves further in development...

Gilead's Press Release Here


Speaking of high margins, have you ever wondered which products generate the highest profits for manufacturers? Well, if you haven't Pharmalot has come up with the top 10 drugs that offer the most bag for their buck for pharma/biotech and it looks like the antidepressant Effexor takes the number 1 spot. There are some heavy hitters on the list like Lipitor and Plavix, and one can only speculate where those drugs will end up as their patents expire in the coming years.

See the Pharmalot post for more

Good news for those of us headed down the future road of joint degeneration: a study has been commissioned to examine whether or not stem cells can be used to regenerate cartilage. The study will start in retired race horses and if the procedure works, then a similar process would presumably be effective in humans. The potential implications of this are easy to imagine...no more suffering from cartilage loss due to sports injuries or wear-and-tear over time: just a treatment or two with regenerative stem cells to grow more tissue and back out you go to a pain free lifestyle. Of course this idea is still is in its relative infancy, but keep an ear out in the future.

Fierce Biotech Research Reported that here

This next one is for you job seekers out there: Biogen is on the lookout for a new CEO after James Mullen announced that he will be retiring this year, with his last day being June 8. This could send shockwaves through the company as they struggle with ongoing safety issues concerning Tysabri and they continue to struggle with the botched acquisition of Facet late in 2009, but maybe it was the right thing to do. Sometimes a breath of fresh air at the top can change things for a company...

Have a look at the Boston Globe piece for more

Heard of Dainippon? If not, you will soon enough if their potential blockbuster schizophrenia drug is approved by the FDA in the coming months. The Japanese company (which bought Sepracor last year) has filed a New Drug Application for lurasidone, which is supposed to work in a similar fashion to other atypical antipsychotics, but without the reported weight gain that have plagued manufacturers over the past year. With very promising clinical trial data, look for Dainippon to move up in value in the coming weeks as a likely approval looms...

Fierce Biotech on the NDA submission

And, just to make you more familiar...here's Dainippon's website


Finally, for those of you investing out there: Seeking Alpha reports that Gilead has the highest profit margins in biotech, but you'd have to dig further in the AFG50 for other potential winners...

Happy New Year, everyone!

Novartis started off 2010 with an announcement that they have agreed on a deal to purchase a majority stake in Alcon (should be familiar to those of you who wear contact lenses). This move no doubt shows Novartis's desire to diversify and grow into new markets, specifically the fast growing eye care sector. Just like Sanofi's takeover of Chattem a few weeks ago, Novartis is working to improve cash flow from a variety of products.

Read more here from the New York Times

And for those of your unfamiliar with Alcon, here's information from their website

Dr. Reddy's released preliminary information suggesting that its new add-on treatment for diabetes, balaglitazone, met the primary endpoint of a key Phase III study by significantly reducing HbA1c in clinical trial participants. Although similar to pioglizatone, this new treatment is supposed to have a positive effect on lowering HbA1c while having fewer of the negative adverse effects such as fluid retention, weight gain, and heart enlargement. As diabetes is always a hot market for safer and more effective medications, look for Dr. Reddy's to jump with this positive news.

see the press release from Dr. Reddy's here

Pfizer continues to wait (impatiently, perhaps) for a FDA ruling on the BLA submitted for Prevnar-13, an updated and allegedly more effective version of what was once Wyeth's blockbuster pneumonia vaccine, Prevnar. This vaccine has been under review for some time now and a decision was actually due by December 30, but the FDA has extended the review period by 90 more days. Pfizer is likely itching for this approval so they can start marketing this vaccine to build up some revenue to help fight off the effects of the upcoming patent cliff and the loss of Lipitor. Hold off for now on Pfizer, there doesn't seem to that much promise for the time being...

For more, have a peak here

Finally, as a small nugget, read here about Barron's predictions for the big pharma/biotech winners of the new healthcare bill...