Corante

About this Author
DBL%20Hendrix%20small.png College chemistry, 1983

Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: derekb.lowe@gmail.com Twitter: Dereklowe

Chemistry and Drug Data: Drugbank
Emolecules
ChemSpider
Chempedia Lab
Synthetic Pages
Organic Chemistry Portal
PubChem
Not Voodoo
DailyMed
Druglib
Clinicaltrials.gov

Chemistry and Pharma Blogs:
Org Prep Daily
The Haystack
Kilomentor
A New Merck, Reviewed
Liberal Arts Chemistry
Electron Pusher
All Things Metathesis
C&E News Blogs
Chemiotics II
Chemical Space
Noel O'Blog
In Vivo Blog
Terra Sigilatta
BBSRC/Douglas Kell
ChemBark
Realizations in Biostatistics
Chemjobber
Pharmalot
ChemSpider Blog
Pharmagossip
Med-Chemist
Organic Chem - Education & Industry
Pharma Strategy Blog
No Name No Slogan
Practical Fragments
SimBioSys
The Curious Wavefunction
Natural Product Man
Fragment Literature
Chemistry World Blog
Synthetic Nature
Chemistry Blog
Synthesizing Ideas
Business|Bytes|Genes|Molecules
Eye on FDA
Chemical Forums
Depth-First
Symyx Blog
Sceptical Chymist
Lamentations on Chemistry
Computational Organic Chemistry
Mining Drugs
Henry Rzepa


Science Blogs and News:
Bad Science
The Loom
Uncertain Principles
Fierce Biotech
Blogs for Industry
Omics! Omics!
Young Female Scientist
Notional Slurry
Nobel Intent
SciTech Daily
Science Blog
FuturePundit
Aetiology
Gene Expression (I)
Gene Expression (II)
Sciencebase
Pharyngula
Adventures in Ethics and Science
Transterrestrial Musings
Slashdot Science
Cosmic Variance
Biology News Net


Medical Blogs
DB's Medical Rants
Science-Based Medicine
GruntDoc
Respectful Insolence
Diabetes Mine


Economics and Business
Marginal Revolution
The Volokh Conspiracy
Knowledge Problem


Politics / Current Events
Virginia Postrel
Instapundit
Belmont Club
Mickey Kaus


Belles Lettres
Uncouth Reflections
Arts and Letters Daily

In the Pipeline

Category Archives

« Book Recommendations | Business and Markets | Cancer »

August 20, 2014

Did Pfizer Cut Back Some of Its Best Compounds?

Email This Entry

Posted by Derek

John LaMattina has a look at Pfizer's oncology portfolio, and what their relentless budget-cutting has been doing to it. The company is taking some criticism for having outlicensed two compounds (tremelimumab to AstraZeneca and neratinib to Puma) which seem to be performing very well after Pfizer ditched them. Here's LaMattina (a former Pfizer R&D head, for those who don't know):

Unfortunately, over 15 years of mergers and severe budget cuts, Pfizer has not been able to prosecute all of the compounds in its portfolio. Instead, it has had to make choices on which experimental medicines to keep and which to set aside. However, as I have stated before, these choices are filled with uncertainties as oftentimes the data in hand are far from complete. But in oncology, Pfizer seems to be especially snake-bit in the decisions it has made.

That goes for their internal compounds, too. As LaMattina goes one to say, palbociclib is supposed to be one of their better compounds, but it was shelved for several years due to more budget-cutting and the belief that the effort would be better spent elsewhere. It would be easy for an outside observer to whack away at the company and wonder how incompetent they could be to walk away from all these winners, but that really isn't fair. It's very hard in oncology to tell what's going to work out and what isn't - impossible, in fact, after compounds have progressed to a certain stage. The only way to be sure is to take these things on into the clinic and see, unfortunately (and there you have one of the reasons things are so expensive around here).

Pfizer brought up more interesting compounds than it later was able to develop. It's a good question to wonder what they could have done with these if they hadn't been pursuing their well-known merger strategy over these years, but we'll never know the answer to that one. The company got too big and spent too much money, and then tried to cure that by getting even bigger. Every one of those mergers was a big disruption, and you sometimes wonder how anyone kept their focus on developing anything. Some of its drug-development choices were disastrous and completely their fault (the Exubera inhaled-insulin fiasco, for example), but their decisions in their oncology portfolio, while retrospectively awful, were probably quite defensible at the time. But if they hadn't been occupied with all those upheavals over the last ten to fifteen years, they might have had a better chance on focusing on at least a few more of their own compounds.

Their last big merger was with Wyeth. If you take Pfizer's R&D budget and Wyeth's and add them, you don't get Pfizer's R&D post-merger. Not even close. Pfizer's R&D is smaller now than their budget was alone before the deal. Pyrrhus would have recognized the problem.

Comments (18) + TrackBacks (0) | Category: Business and Markets | Cancer | Drug Development | Drug Industry History

August 11, 2014

Med-Chem and Trucking, Together At Last

Email This Entry

Posted by Derek

One of my standard lines (in presentations or lab conversation), when referring to some research that just flat-out isn't working, is that I should chuck it all and go to truck-driving school just like my mother always wanted. (She actually didn't, in case you're wondering!)

The similarities between organic chemistry and truck driving may be closer than they appear, though. Try this blog post at the New York Times out. The title alone will send you right into crippling-STEM-shortage land: "The Trucking Industry Needs More Drivers. Maybe It Needs to Pay More."

Consider this: The American Trucking Associations has estimated that there was a shortage of 30,000 qualified drivers earlier this year, a number on track to rise to 200,000 over the next decade. Trucking companies are turning down business for want of workers.

Yet the idea that there is a huge shortage of truck drivers flies in the face of a jobless rate of more than 6 percent, not to mention Economics 101. The most basic of economic theories would suggest that when supply isn’t enough to meet demand, it’s because the price — in this case, truckers’ wages — is too low. Raise wages, and an ample supply of workers should follow.

But corporate America has become so parsimonious about paying workers outside the executive suite that meaningful wage increases may seem an unacceptable affront. In this environment, it may be easier to say “There is a shortage of skilled workers” than “We aren’t paying our workers enough,” even if, in economic terms, those come down to the same thing.

Considering the sorts of speeches that Lilly's John Lechleiter gives, this sounds familiar indeed. And the same things has come up in many of the "STEM shortage" discussions around here. A minor adjustment might be "We can't find people who will work for what we're paying our outsourced contractors", but the principle is pretty much the same.

Comments (20) + TrackBacks (0) | Category: Business and Markets

July 30, 2014

Amgen Cuts Hard

Email This Entry

Posted by Derek

Amgen cuts over 2,500 jobs. Amgen completely shuts down its big facilities in Washington state and Colorado. Amgen's stock goes up nearly 7% in one day, adding about five (corrected late-night mistake) billion dollars in market cap. And there you have it. That's the industry.

As this FierceBiotech piece says, Amgen's big shareholders have been unhappy with the way the company has been performing during the recent biotech bull market. This also puts the company in line with all the other big outfits who have been trimming staff and consolidating research sites in the past few years. It also puts them in line with all the companies who have been consolidating particularly in the Boston/Cambridge and San Francisco Bay areas - this Boston Globe article says that positions will actually be added in both of those Amgen locations. So no one can say that they're behind the times now.

And if you'd like to know more about just what state the industry is in, have a look at analyst Geoffrey Porges' take on Amgen's portfolio. It's too damn innovative, he says:

Over the last 10 years, the company has spent about $30 billion on R&D--including buyouts--but generated just $15 billion in cumulative revenue from the resulting drugs, he points out in a research note Friday. And, looking at Amgen's current pipeline, Porges doesn't see that ratio evening out any time soon.

That's because of Amgen's affinity for risk. Compared to its Big Biotech peers, the company has a pipeline particularly loaded with what Porges terms "breakthrough" assets: first-in-class agents with unproven targets and unknown safety profiles. At the moment, 80% of Amgen's pipeline is made up of such breakthrough therapies, according to Bernstein's numbers. . .That commitment to inherently risky science, coupled with a "quixotic" M&A track record, has saddled Amgen with a below-average return on invested capital over the past four years, Porges writes, suggesting "changes to the company's strategy and structure may be warranted."

To be fair, he's suggesting a change that puts the cash-cow parts of the company in a separate place from the risky parts, and he claims that the two resulting companies would have a higher combined market cap than Amgen as it currently exists. But for those people who feel that the still-profitable legacy drugs are there to pay for the risky R&D (which could become the legacy drugs of the future), this scheme may not sound very appealing. How the new company with all the risky programs might survive if it runs into trouble is apparently not Porges' department. Raising Amgen's market cap is, though. But consider it raised, as of today: an all-time high, as a matter of fact. All it took was a whacking big layoff and a string of site closures - why, success has been around the corner all this time.

Comments (48) + TrackBacks (0) | Category: Business and Markets

July 28, 2014

Targacept Comes Up Empty, Yet Again

Email This Entry

Posted by Derek

Targacept's attempt to salvage something by testing TC-5214 for overactive bladder has failed. John Carroll at FierceBiotech counts eight straight failed clinical trials from this company: a record? I don't see anyone beating that very easily, that's for sure. Nicotinic receptors have proven to be a very, very difficult field to work in, and I'm not sure that Targacept has anything left in their tank.

Comments (26) + TrackBacks (0) | Category: Business and Markets | Clinical Trials

July 25, 2014

The Antibiotic Gap: It's All of the Above

Email This Entry

Posted by Derek

Here's a business-section column at the New York Times on the problem of antibiotic drug discovery. To those of us following the industry, the problems of antibiotic drug discovery are big pieces of furniture that we've lived with all our lives; we hardly even notice if we bump into them again. You'd think that readers of the Times or other such outlets would have come across the topic a few times before, too, but there must always be a group for which it's new, no matter how many books and newspaper articles and magazine covers and TV segments are done on it. It's certainly important enough - there's no doubt that we really are going to be in big trouble if we don't keep up the arms race against the bacteria.

This piece takes the tack of "If drug discovery is actually doing OK, where are the new antibiotics?" Here's a key section:

Antibiotics face a daunting proposition. They are not only becoming more difficult to develop, but they are also not obviously profitable. Unlike, say, cancer drugs, which can be spectacularly expensive and may need to be taken for life, antibiotics do not command top dollar from hospitals. What’s more, they tend to be prescribed for only short periods of time.

Importantly, any new breakthrough antibiotic is likely to be jealously guarded by doctors and health officials for as long as possible, and used only as a drug of last resort to prevent bacteria from developing resistance. By the time it became a mass-market drug, companies fear, it could be already off patent and subject to competition from generics that would drive its price down.

Antibiotics are not the only drugs getting the cold shoulder, however. Research on treatments to combat H.I.V./AIDS is also drying up, according to the research at Yale, mostly because the cost and time required for development are increasing. Research into new cardiovascular therapies has mostly stuck to less risky “me too” drugs.

This mixes several different issues, unfortunately, and if a reader doesn't follow the drug industry (or medical research in general), then they may well not realize this. (And that's the most likely sort of reader for this article - people who do follow such things have heard all of this before). The reason that cardiovascular drug research seems to have waned is that we already have a pretty good arsenal of drugs for the most common cardiovascular conditions. There are a huge number of options for managing high blood pressure, for example, and they're mostly generic drugs by now. The same goes for lowering LDL: it's going to be hard to beat the statins, especially generic Lipitor. But there is a new class coming along targeting PCSK9 that is going to try to do just that. This is a very hot area of drug development (as the author of the Times column could have found without much effort), although the only reason it's so big is that PCSK9 is the only pathway known that could actually be more effective at lowering LDL than the statins. (How well it does that in the long term, and what the accompanying safety profile might be, are the subject of ongoing billion-dollar efforts). The point is, the barriers to entry in cardiovascular are, by now, rather high: a lot of good drugs are known that address a lot of the common problems. If you want to go after a new drug in the space, you need a new mechanism, like PCSK9 (and those are thin on the ground), or you need to find something that works against some of the unmet needs that people have already tried to fix and failed (such as stroke, a notorious swamp of drug development which has swallowed many large expeditions without a trace).

To be honest, HIV is a smaller-scale version of the same thing. The existing suite of therapies is large and diverse, and keeps the disease in check in huge numbers of patients. All sorts of other mechanisms have been tried as well, and found wanting in the development stage. If you want to find a new drug for HIV, you have a very high entry barrier again, because pretty most of the reasonable ways to attack the problem have already been tried. The focus now is on trying to "flush out" latent HIV from cells, which might actually lead to a cure. But no one knows yet if that's feasible, how well it will work when it's tried, or what the best way to do it might be. There were headlines on this just the other day.

The barriers to entry in the antibiotic field area similarly high, and that's what this article seems to have missed completely. All the known reasonable routes of antibiotic action have been thoroughly worked over by now. As mentioned here the other day, if you just start screening your million-compound libraries against bacteria to see what kills them, you will find a vast pile of stuff that will kill your own cells, too, which is not what you want, and once you've cleared those out, you will find a still-pretty-vast pile of compounds that work through mechanisms that we already have antibiotics targeting. Needles in haystacks have nothing on this.

In fact, a lot of not-so-reasonable routes have been worked over, too. I keep sending people to this article, which is now seven years old and talks about research efforts even older than that. It's the story of GlaxoSmithKline's exhaustive antibiotics research efforts, and it also tells you how many drugs they got out of it all in the end: zip. Not a thing. From what I can see, the folks who worked on this over the last fifteen or twenty years at AstraZeneca could easily write the same sort of article - they've published all kinds of things against a wide variety of bacterial targets, and I don't think any of it has led to an actual drug.

This brings up another thing mentioned in the Times column. Here's the quote:

This is particularly striking at a time when the pharmaceutical industry is unusually optimistic about the future of medical innovation. Dr. Mikael Dolsten, who oversees worldwide research and development at Pfizer, points out that if progress in the 15 years until 2010 or so looked sluggish, it was just because it takes time to figure out how to turn breakthroughs like the map of the human genome into new drugs.

Ah, but bacterial genomes were sequenced before the human one was (and they're more simple, at that). Keep in mind also that proof-of-concept for new targets can be easier to obtain in bacteria (if you manage to find any chemical matter, that is). I well recall talking with a bunch of people in 1997 who were poring over the sequence data for a human pathogen, fresh off the presses, and their optimism about all the targets that they were going to find in there, and the great new approaches they were going to be able to take. They tried it. None of it worked. Over and over, none of it worked. People had a head start in this area, genomically speaking, with an easier development path than many other therapeutic areas, and still nothing worked.

So while many large drug companies have exited antibiotic research over the years, not all of them did. But the ones that stayed have poured effort and money, over and over, down a large drain. Nothing has come out of the work. There are a number of smaller companies in the space as well, for whom even a small success would mean a lot, but they haven't been having an easy time of it, either.

Now, one thing the Times article gets right is that the financial incentives for new antibiotics are a different thing entirely than the rest of the drug discovery world. Getting one of these new approaches in LDL or HIV to work would at least be highly profitable - the PCSK9 competitors certainly are working on that basis. Alzheimer's is another good example of an area that has yielded no useful drugs whatsoever despite ferocious amounts of effort, but people keep at it because the first company to find a real Alzheimer's drug will be very well rewarded indeed. (The Times article says that this hasn't been researched enough, either, which makes me wonder what areas have been). But any great new antibiotic would be shelved for emergencies, and rightly so.

But that by itself is not enough to explain the shortage of those great new antibiotics. It's everything at once: the traditional approaches are played out and the genomic-revolution stuff has been tried, so the unpromising economics makes the search for yet another approach that much harder.

Note: be sure to see the comments for perspectives from others who've also done antibiotic research, including some who disagree. I don't think we'll find anyone who says it's easy, though, but you never know.

Comments (56) + TrackBacks (0) | Category: Business and Markets | Drug Development | Drug Industry History | Infectious Diseases

July 23, 2014

Neratinib Comes Through For Puma

Email This Entry

Posted by Derek

Yet another entry in the "Why do people keep investing in biopharma?" files. Take a look at the case of Puma Biotechnology. Their stock was as high as $140/share earlier in the year, and it gradually deflated to the high 50s/low 60s as time went on. But yesterday, after hours, they reported unexpectedly good Phase III results for neratinib in breast cancer, and as I write, they're at $228 or so, up about $167 per share.

It's another HER2/EGFR tyrosine kinase inhibitor (like Tykerb/lapatinib in the small molecule space, although neratinib is an irreversible inhibitor) and would be targeted at patients who are now taking Herceptin. Neratinib itself has not had a smooth path to this stage, though. Puma licensed the compound out from Pfizer, and took on the responsibility for all of the development. Pfizer ditched the compound a few years ago in a review of their oncology portfolio. I note that the two companies have reworked their licensing agreement on this news as well. Puma's entire business model is taking up oncology candidates that other companies have shed, and it certainly seems to have come through for them this time.

So chalk one up for irreversible kinase inhibitors, and (of course) for Puma. And for the patients who will be taking the drug, naturally, and lastly, for Puma's shareholders, who are having an excellent day indeed.

Comments (18) + TrackBacks (0) | Category: Business and Markets | Cancer | Clinical Trials

How Many Biopharma Employees Would Rather Be Working Somewhere Else?

Email This Entry

Posted by Derek

How many people working in the biopharma industry would jump to another company if they could? According to this survey, it's just over half: well above the average set by other industry sectors.

The usual reasons are cited, in part (pay, opportunity for advancement). But two factors that seemed unusually prominent in our industry were high stress levels and "difficult relations with supervisors and co-workers". I found that last one interesting, because (like all science and engineering fields) we do have a certain number of people in this business who can be described, as the old British music hall song has it, as "E's all right when you know 'im, but you've got to know 'im first". And there's the ever-present disconnect between the scientists and any non-science-background upper managers, a clash of worldviews if ever there was one.

I've worked in some situations where most people seemed satisfied, but I've probably spent more of my career in those other workplaces described by this survey. I well recall an employee survey many years ago, given out with pencil and paper, yet, where people were calling out to each other before the start with helpful questions like "Is "half-assed" hyphenated or not?" and "Do you capitalize "Moron" when you're talking about a specific one?"

Some of what this survey found, though, is surely pent-up demand. There have been fewer and fewer opportunities to change companies over the years, and it used to be a fairly frequent career move. So I'd guess that there are plenty of people who would be glad to jump if there were anywhere much to jump to.

Comments (21) + TrackBacks (0) | Category: Business and Markets

July 21, 2014

The Hep C Field Gets Nastier By the Minute

Email This Entry

Posted by Derek

What a mess there is in the hepatitis C world. Gilead is, famously, dominating the market with Sovaldi, whose price has set off all sorts of cost/benefit debates. The companies competing with them are scrambling to claim positions, and the Wall Street Journal says that AbbVie is really pulling out all the stops. Try this strategy on for size:

In a lawsuit filed in February, AbbVie noted it patented the idea of combining two of Gilead's drugs—Sovaldi and an experimental drug called ledipasvir, which Gilead plans to combine into one treatment—and is therefore entitled to monetary damages if Gilead brings the combination pill to market. Legally, AbbVie can't market Sovaldi or ledipasvir because it doesn't have the patents on the underlying compounds. But it is legal for companies to seek and obtain patents describing a particular "method of use" of products that don't belong to them.

Gilead disputes the claims of AbbVie and the other companies. A spokeswoman said Gilead believes it has the sole right to commercialize Sovaldi and products containing Sovaldi's active ingredient, known as sofosbuvir. An AbbVie spokeswoman said the company believes Gilead infringes its patents, and that it stands behind the validity and enforceability of those patents.

You don't see that very often, and it's a good thing. Gilead is, naturally, suing Abbvie over this as well, saying that Abbvie has knowing mispresented to the USPTO that they invented the Gilead therapies. I'm not sure how that's going to play out: Abbvie didn't have to invent the drugs to get a method-of-use patent on them. At the same time, I don't know what sort of enablement Abbvie's patent claims might have behind them, given that these are, well, Gilead's compounds. The company is apparently claiming that a "sophisticated computer model" allows them to make a case that these combinations would be the effective ones, but I really don't know if that's going to cut it (and in fact, I sort of hope it doesn't). But even though I'm not enough of a patent-law guy to say either way, I'm enough of one to say, with great confidence, that this is going to be a very expensive mess to sort out. Gilead's also in court with Merck (and was with Idenix before Merck bought them), and with Roche, and will probably be in court with everyone else before all this is over.

This whole situation reminds me of one of those wildlife documentaries set around a shrinking African watering hole. A lot of lucrative drugs have gone off patent over the last few years, and a lot of them are heading that way soon. So any new therapeutic area with a lot of commercial promise is going to get a lot of attention, and start a lot of fighting. Legal battles aren't cheap on the absolute scale, but on the relative scale of the potential profits, they are. So why not? Claim this, claim that, sue everybody. It might work; you never know. Meanwhile, we have a line forming on the right of ticked-off insurance companies and government health plans, complaining about the Hep C prices, and while they wait they can watch the companies involved throwing buckets of slop on each other and hitting everyone over the head with lawsuits. What a spectacle.

Comments (43) + TrackBacks (0) | Category: Business and Markets | Infectious Diseases | Patents and IP | Why Everyone Loves Us

Allergan Twists and Turns

Email This Entry

Posted by Derek

It's getting nasty over at Allergan. They're still trying to fight off a takeover attempt by Valeant, making the case that the company's R&D efforts are not a waste of money (which, only slightly simplified, is the Valeant position regarding every company they're taking over).

But Allergan's had a lot of trouble getting one of their drugs (Semprana) through the FDA. Semprana is an inhaled version of the classic dihydroergotamine therapy for migraine, and had been rejected last year when it was still known as Levadex. The recent further delay isn't helping Allergan make its case, and Valeant is using this news to peel off some more shareholders.

This morning comes word that Allergan is cutting back staff. That Fierce Biotech report says that it looks like a lot of the cuts will be hitting discovery R&D, which makes you wonder if Allergan will manage to escape Valeant's grip only by becoming what Valeant wanted to make them.

Comments (7) + TrackBacks (0) | Category: Business and Markets | Regulatory Affairs

July 15, 2014

The Prospects of an Academic Job

Email This Entry

Posted by Derek

Over the years, there have been more comments than anyone can count here on the often-grim employment picture for chemistry and biology employment in biopharma. Plenty of people here (myself included) can speak from experience. But we should also remember that the academic job market in the biomedical sciences is in awful shape, too, unfortunately. And since a disproportionate number of people start off grad school picturing themselves getting jobs in academia, a clear picture of what's going on is essential.

That's the point of this piece in Nature, in the Jobs section. The author, Jessica Polka (post-doc at Harvard Medical School) says that far too many of her colleagues don't have an accurate impression of the job market. She's created this graphic to get the point across. Some 16,000 students will start graduate school in biology in the US this fall. The best guess is that fewer than 10% of them will eventually become tenure-track faculty somewhere.

But at least half of them list that as their most preferred career path, which means that a lot of things are not going to work out as planned. Polka's right - the most people who understand this, and the earlier, the better.

Comments (40) + TrackBacks (0) | Category: Academia (vs. Industry) | Business and Markets

July 11, 2014

Employment Among New Chemistry PhDs

Email This Entry

Posted by Derek

Another dose of reality for the "Terrible STEM Shortage!" folks, courtesy of Slate. Here's what author Jordan Weissmann has to say:

With a little cleaning up, however, the federal data do tell a pretty clear story: The market for new Ph.D.s in the much obsessed-about STEM fields—science, technology, engineering, and math—is stagnant. Over the last 20 years, employment rates are either flat or down in each major discipline, from computer science to chemistry. It’s not what you’d expect given the way companies like Microsoft talk about talent shortages.

Why no, it isn't, is it? There seems to be something a bit off. Weissmann is working with data from the NIH NSF and their surveys of new doctorates in the sciences, and it shows several things. For one, the post-doc populations remain very high in every field, which isn't a good sign. The number of new doctorates who report being employed has not attained the levels seen in the late 1990s, for any field. And here's chemistry in particular:
employment.jpg
Not a very pretty picture, to be sure. It's true that the number of postdocs have been declining the last few years, but the slack seems to be picked up, more or less equally, by people who are getting jobs and people falling into the flat-out unemployed category. And remember, this is a snapshot of new doctorates, so the numbers for more experienced people are going to be different (but ugly in their own way, to judge from the waves of layoffs over the last few years). It's notable that the new chemistry doctorate holders who are unemployed have outnumbered the ones with non-postdoc jobs for the last few years, which may well be unprecedented.

Weissmann's figures for computer science doctorate and engineers are telling, too, and I refer you to the article for them. Neither group has made it back to its heights back in 2000 or so, although the 2011-2012 number have picked up a bit. Whether that's a blip or a real inflection point remains to be seen. It's safe to say, though, that none of these charts support the "Just can't find anybody to hire" narrative that you hear from so many companies.

Comments (43) + TrackBacks (0) | Category: Business and Markets

July 10, 2014

Biopharma Stock Events for the Rest of the Year

Email This Entry

Posted by Derek

We've had some big biopharma market events so far this year, but if you're wondering what's coming in the next few months, here's a handy rundown from Adam Feuerstein of what may be the top 14. There are a few regulatory events on there, but most of the list are highly anticipated clinical trial results, which is where the action is, for sure. That's what makes the sector so attractive to both legitimate investors and to cult-like lunatics alike. These people, many of whom would cross the street to avoid each other in the real world, come together to make a market - and anyone with enough nerve and a little cash can join right in.

Comments (1) + TrackBacks (0) | Category: Business and Markets

July 8, 2014

AbbVie and Shire, Quietly

Email This Entry

Posted by Derek

Pfizer's bid for AstraZeneca made headlines for weeks on both sides of the Atlantic. But there's another US drug company trying to buy a British one right now - AbbVie for Shire - and it's going on very quietly indeed.

Over at FierceBiotech, they're wondering why that should be so, after an article in the Telegraph. There are several reasons, some better than others. For one thing, the whole deal is a smaller affair than the Pfizer saga. Most importantly, it would involve fewer UK jobs, because Shire itself doesn't really have all that many employees in the UK (91% of them are elsewhere!) Some years ago, they reworked themselves into an Irish-domiciled company, anyway, for (you guessed it) tax purposes. But there's not much noise in Ireland about this deal, either.

Fewer politicians have an interest in what's going on. If names change on pieces of paper, and it hardly affects anyone in their constituencies, then they have other things to worry about. The financial reasons behind the deal are similar to Pfizer's - relatively generous corporate tax policies, but the principles behind those, and behind deals predicated on them, was never the primary political concern. You might have gotten a different impression from some of the speechmaking that went on during the Pfizer/AZ business, but that's what comes from listening to politicians, rather than watching their actions with the sound off. I recommend that technique; it improves the signal/noise immensely.

Comments (7) + TrackBacks (0) | Category: Business and Markets

June 30, 2014

The GSK-China Situation Gets Even Weirder

Email This Entry

Posted by Derek

OK, the GlaxoSmithKline/China business has officially crossed over into new territory. Over the weekend, the company confirmed reports that Mark Reilly, the GSK executive in the country who's been in the middle of this affair from the beginning, was the object of a blackmail attempt by unknown parties. (The story was broken by the Sunday Times, and it's behind a paywall, but it's been picked up by every major news outlet).

Someone shot extensive footage of Reilly alone with his Chinese girlfriend, and mailed the resulting file to higher-ups at the company. The connection between all this and the corruption allegations has not been made clear, but the footage apparently accompanied some of the emails accusing the company of bribery. We may never know quite what's going on here, but I'll bet it's very interesting indeed. More on surveillance in China here.

Update: an excellent overview from the BBC.

Comments (36) + TrackBacks (0) | Category: Business and Markets | The Dark Side

June 26, 2014

Alzheimer's Bonds

Email This Entry

Posted by Derek

I wrote a couple of years ago about Andrew Lo of MIT, and his idea for securitization of drug discovery. For those of you who aren't financial engineers, that means raising funds by issuing securities (bonds and the like), and that's something that (as far as I know) has never been used to fund any specific drug development project.

Now Pharmalot has an update in an interview with Lo (who's recently published a paper on the idea in Science Translational Medicine). In particular, he's talking about issuing "Alzheimer's bonds", to pick a disease with no real therapies, a huge need for something, and gigantic cost barriers to finding something. Lo's concerned that the risks are too high for any one company to take on (and Eli Lilly might agree with him eventually), and wants to have some sort of public/private partnership floating the bonds.

We would create a fund that issues bonds. But if the private sector isn’t incentivized on its own, maybe the public sector can be incentivized to participate along with some members of the private sector. I will explain. But let’s look at the costs for a moment. The direct cost of treating the disease – never mind home care and lost wages – to Medicare and Medicaid for 2014 is estimated at $150 billion. We did a calculation and asked ourselves what kind of rate of return can we expect? We came up with $38.4 billion over 13 years. . .

. . .Originally, I thought it could come from the private sector. We’d create a fund – a mega fund of private investors, such as hedge funds, pension, various institutional investors. The question we asked ourselves is will they get a decent rate of return over a 13-year period? The answer, which is based on a best guess, given the risks of development and 64 projects, and we believed the answer was ‘no.’ It wouldn’t be like cancer or orphan diseases. It’s just not going to work. I come from that world. I talked to funds, philanthropists, medical experts. We did a reality check to see if we were off base. And it sounded like it would be difficult to create a fund to develop real drugs and still give investors a reasonable rate of return – 15% to 20%.

He's now going around to organizations like the Alzheimer's Association to see if there's some interest in giving this a try. I think that it's going to be a hard sell, but I'd actually like to see it happen. The difficulty is that there's no way to do this just a little bit to see if it works: you have to do it on a large scale to have any hope of success at all, and it's a big leap. In fact, the situation reminds one of. . .the situation with any given Alzheimer's drug idea. The clinical course of the disease, as we understand it now, does not give you any options other than a big, long, expensive path through the clinic (which is why it's the perfect example of an area where all the risk is concentrated on the expensive late stages). Lo is in the position of trying to address the go-big-or-go-home problem of Alzheimer's research with a remedy that requires investors to go big or go home.

The hope is that you could learn enough along the way to change the risk equation in media res. There's an old science fiction story by A. E. van Vogt, "Far Centaurus", which featured (among other things - van Vogt stories generally had several kitchen sinks included) a multidecade suspended-animation expedition to Alpha Centauri. The crew arrive there to find the planets already covered with human-populated cities, settled by the faster-than-light spaceships that were invented in the interim. We don't need FTL to fix Alzheimer's (fortunately), but there could be advances that would speed up the later parts of Lo's fund. But will this particular expedition ever launch?

Comments (24) + TrackBacks (0) | Category: Alzheimer's Disease | Business and Markets | Clinical Trials | Drug Development

June 25, 2014

Zafgen's Epoxide Pays Its Way

Email This Entry

Posted by Derek

I've written here before about Zafgen, a small startup targeting obesity therapy with