Archive for November 2011
Today’s long awaited launch of the generic form of Lipitor, atorvastatin, has been the inspiration for a number of recent news stories. One that particularly caught my eye is by Bloomberg’s Drew Armstrong entitled “Pfizer After Lipitor Slims Down to Push Mini-Blockbusters.” The gist of the article is contained in the following line: “The next step will be rebuilding the world’s biggest drugmaker into a smaller, faster-moving company that focuses on development of biologic drugs and specialty medicines….” The implication of this statement is that Pfizer previously had a strategy that was based on discovering compounds like Lipitor that would each generate annual sales of $12 billion and that Pfizer now realizes that this is a flawed plan and is going to get leaner and smarter.
If it was only so simple.
First of all, the original peak sales predictions for Lipitor were on the order of $700 – 800 million, as it was the fifth statin to reach the marketplace. As discussed in this blog previously, the fact that it evolved into the biggest selling drug of all time was due to a “perfect storm” of great efficacy, excellent safety and the growing realization of needing to lower bad cholesterol (LDL) more than had been previously recognized. Lipitor is a once in a generation product. To base a company’s strategy on this luck is foolish – and it’s not what happened at Pfizer.
What is a mini-blockbuster? Is it a compound that has sales of $750 – $1 billion? Pfizer generated a number of these internally in the last decade: Chantix, Vfend, Geodon, Sutent, etc. Interestingly, most analysts paid little heed to these compounds. The general refrain was: “These are nice compounds, but none of them are Lipitor.” Yet, many of these same analysts are now advocating this as the direction that Pfizer should take.
Will focusing on these biologics and specialty drugs make Pfizer “a smaller, faster-moving company” as the author suggests? These drugs should be quicker to develop after all, right? Not exactly. A recent issue of the New England Journal of Medicine published an editorial titled “Therapy for Cystic Fibrosis (CF) – The End of the Beginning?” (NEJM, 365;18, November 3, 2011) which discusses the truly outstanding research that led to the CF drug ivacaftor. This is an important new medicine that will meet an important medical need. It is also a specialty drug. And this research STARTED in 1989. A focus on specialty drugs doesn’t ensure rapid R&D programs – nor robust revenues.
Analysts give high grades to compounds in the company’s late stage pipeline, including tofacitinib for rheumatoid arthritis, criizotinib (Xalkori) for lung cancer and apixiban (Eliquis) for heart disease (which was co-developed with BMS). All of these drugs are traditional small molecules and all resulted from extensive R&D programs. In fact, the tofacitinib program began in 1993. The predictions for peak sales of these compounds range from $1.5 billion for crizotinib to over $4 billion for tofacitinib and apixiban – not exactly “mini-blockbuster” numbers. Pfizer also has important biologics in its pipeline, including the vaccine Prevnar, which is also on its way to being a blockbuster. Pfizer’s portfolio is diverse; its problem is that with top line revenues of over $60 billion, it needs more of these great compounds.
There are a few lessons in all of this. First of all, predicting commercial success for a new medicine is always tenuous. The biopharmaceutical industry has always been surprised, both positively and negatively, by the performance of new drugs. That is not going to change. As I’ve written before, to say that you are going to focus on niche or specialty products is a prescription for disaster. Such compounds can play a role in a company’s portfolio of products, but this shouldn’t be a driver for companies with sales of $25 – 60 billion.
Second, from a discovery research standpoint, the resources needed to come up with a new compound for clinical development differ little for a niche product or a projected blockbuster. Admittedly, the development costs for a specialty products can be less, particularly for a so-called orphan disease for which there is no treatment and relatively few patients worldwide with the disease. But a big pharmaceutical company’s portfolio should have a very limited number of such approaches if it is to thrive.
Finally, there is a view that there are fewer and fewer opportunities for major blockbusters. I beg to differ. A truly effective and safe drug to cause weight loss would likely have sales in excess of Lipitor’s. The challenge in this field is clearing the high regulatory hurdle that exists for such a compound. A new drug that can slow or reverse Alzheimer’s Disease would also have tremendous commercial potential as the incidence of this disease will surge over the coming years with the increasing life spans of people globally. Heart disease continues to be a problem, and the obesity/diabetes epidemic will likely reverse the progress made in this arena over the past decade. Will an agent that raises the good cholesterol, HDL, be a new breakthrough for treating cardiovascular disease? If yes, major blockbuster status will be achieved here as well. There also other major medical needs awaiting new, effective treatments.
You don’t build a business strategy on the hope of discovering $10 billion/year products. You DO base it on having the most robust R&D organization possible. And this leads to my final point. Slimming down R&D isn’t the answer. Rather focus, stability and resources are required for an R&D organization to thrive.
For those who have heart disease, changes in diet and exercise are often not sufficient to reduce the risk of having a heart attack or a stroke. Some type of medication is usually required for these patients to help them control their high lipid levels, particularly LDL, the so-called “bad” cholesterol. As discussed recently in this blog, the usefulness of niacin, one of the drugs used for decades by heart disease patients, has been called into question. Long-term outcomes studies with niacin are starting to show that niacin offers little, if any, benefit over statins, the relative newcomers to cardiovascular therapy.
As the industry evaluates the new information on the long-term usage of niacin, it’s natural to pose the same questions about statins. Are their protective benefits maintained over many years of use? Are patients exposed to these drugs for long periods susceptible to other diseases? Over the past few years, studies have appeared showing that statins like Lipitor (atorvastatin) can, in fact, reduce the occurrence of heart attacks and strokes in patients with heart disease. Now, a new study reported in The Lancet (November 23, 2011) from the Heart Protection Study (HPS) Collaborative Group offers further evidence for the value of this class of medicines.
The trial design was pretty simple. This group of patients at high risk of heart attacks and/or strokes was given either 40 mg of simvastatin or placebo for slightly over 5 years, then post-trial follow-up occurred for another 5+ years bringing the duration of the study to 11 years. Not surprisingly, those patients on simvastatin had an average decrease in LDL cholesterol of 40mg/dL and, more importantly, a decrease of 23% in major vascular events. This benefit continued throughout the post-trial follow-up period. Equally important was the fact that there was no evidence of “emerging hazards” (e.g., cancer) resulting from long-term simvastatin use.
The lead author of the HPS, Dr. Richard Bulbulia of the University of Oxford, commented: “All of those at increased vascular risk should start taking statins early and continue taking them long-term.” He also commented that these results should provide reassurance to patients and physicians about the safety of statins and that the results should translate to other members of this class of medicines such as atorvastatin and Crestor.
The HPS has provided valuable results at a time when health care providers are struggling with increasing rates of obesity, diabetes and heart disease. But this study is important for another reason. Medications designed for controlling a chronic disease that patients will need to take for decades – not only heart disease, but also diseases like osteoporosis, depression or even cancer – will need this type of long-term outcome study, not just to provide patients and physicians with all-important risk-benefit data, but also to justify to payers the value of new medications. These studies add time to the development of a new drug and greatly increase development costs. But they are invaluable.
A number of years ago, I needed to address my rising cholesterol levels. Despite being an avid runner with a Body Mass Index well within normal limits, my total cholesterol was 250 mg/dL and my LDL (“bad cholesterol”) was 140 mg/dL – both above recommended healthy levels. Given that I have a family history of heart disease, I decided to seek medical treatment and, being a Pfizer employee, I visited my personal physician with the intent of getting a prescription for Lipitor.
Interestingly, my doctor was reluctant to do this. This was the 1990s and Lipitor was new to the market. He was not comfortable prescribing a drug that I potentially would take for the rest of my life without having seen more long term safety data. Instead, he recommended that I take long-acting niacin, which is available over-the-counter at any pharmacy.
Niacin, also known as vitamin B3, is known to raise HDL, the so-called good cholesterol, by about 25% as well as modestly lower both LDL and triglycerides. It has been used for decades to treat dyslipidemia based on results from the Coronary Drug Project (CDP). Carried out in the late 1960s, the CDP study tested niacin vs. placebo in men who’d had a previous heart attack, over a period of five years. Interestingly, niacin showed no difference from placebo in the death rate of the men in this study, but fewer patients on niacin had a non-fatal heart attack or stroke, by 26% and 24% respectively. This study is the basis of the use of niacin in cardiovascular (CV) disease.
My experience with niacin was pretty typical. There were modest reductions of both total cholesterol and LDL (~15%), but these changes weren’t maintained over time. But I also experienced the major niacin side-effect, flushing. This irritation wasn’t minor. The flushing was intense and was accompanied by itching and heat sensations. Because of this side-effect, many patients refuse to stay on this medication despite its potential benefits. After about a year, my physician took me off niacin and I started on Lipitor which was far more effective for me than niacin and which I tolerated very well.
So, why am I taking you on this stroll down memory lane? A recent study reported in The New England Journal of Medicine (NEJM.org, 11/15/11), along with an accompanying editorial, call into question the value of using niacin to treat CV disease. The AIM-HIGH trial, co-sponsored by the NIH and Abbott, looked at patients with established CV disease who were already on intensive statin therapy. The goal of this study was to see whether adding niacin therapy provided any extra benefit. The rationale for this was pretty sound. Unlike statins, niacin can significantly raise HDL and further lower LDL. Shouldn’t combining both modalities work better? Surprisingly, it didn’t. While the expected beneficial changes in terms of raising HDL did occur, adding niacin to intensive statin therapy was no different from adding a placebo in terms of preventing heart attacks, strokes or other adverse CV events.
The NEJM editorial accompanying the AIM-HIGH study results entitled, “Niacin at 56 Years of Age – Time for an Early Retirement?,” basically questions further use for niacin given the copious data with statins showing the superiority of these drugs in CV disease therapy. This is causing some intense debate amongst cardiologists, who are unwilling to give up on niacin after this one study. The defenders of niacin correctly point out that there are other long-term studies with niacin currently underway that will provide a more definitive answer to the value of niacin for treating heart disease.
Niacin is a medicine that has been used by physicians for 56 years. Physicians take comfort in the fact that it has been around for so long and it has been taken by millions of people, so they know what the side-effects are. Yet, niacin hasn’t been as intensively studied as newer classes of lipid modulating drugs. It is now being subjected to the same type of scrutiny demanded by the FDA of new drugs. I, for one, am looking forward to the completion of these studies.
As I have often written in this blog, decades of use does not ensure that a medicine is automatically safe and/or effective. Industry detractors seem to forget that pharmaceutical companies are full of people that also need medicine. I was my own case study in the effectiveness and risk-benefit profile of Lipitor versus niacin. For me, Lipitor was the answer. Whether or not that is also the case for others is a decision that a patient must make in consultation with his physician. However, one thing is for certain: only long-term, well-controlled studies can provide assurance that a medicine is both safe and effective.
“Some forms of ‘medicalisation’ may now be better described as ‘disease mongering’ – extending the boundaries of treatable illness to expand markets for new products.”
-Ray Moynihan, Iona Heath, David Henry in the British Medical Journal, 2002; 324:886-91.
Moynihan is one of the leading critics of the pharmaceutical industry. He has a strong belief that the industry effectively invents diseases by the medicalization of conditions in such a way that convinces healthy people that they are sick. One example used in the paper cited above is in the area of osteoporosis:
“Like high blood pressure or raised cholesterol levels, the medicalisation of reduced bone mass – which occurs as people age – is an example of a risk factor being conceptualized as a disease… Slowing bone loss can reduce the risk of future fracture – just as lowering blood pressure can reduce a person’s chance of a future stroke or heart attack – but for most healthy people, the risks of serious fractures are low and/or distant, and in absolute terms, long term preventive drug treatment offers small reductions in risk.”
Is bone-thinning a disease? Of course not. But, if you are a petite female of Asian or northern European background, bone thinning is the first sign of osteoporosis. Unfortunately, when journalists like Moynihan make statements like this, it results in people ignoring health issues and taking the steps necessary to forestall diseases like osteoporosis. Thus, it was refreshing to see Jane Brody’s recent article in The New York Times (November 1, 2011) entitled “A Reminder on Maintaining Bone Health.”
Brody believes that osteoporosis is under diagnosed because of a reluctance to get bone density tests and under treated because people avoid drug therapy for fear of side effects. At age 60 she was found to have osteopenia, a condition characterized by low bone density but without frank osteoporosis. She likens osteopenia to prediabetes or prehypertension. At this stage, one doesn’t need to take drugs but lifestyle changes are recommended, such as regular weight-bearing and strength-training exercise, intake of calcium and vitamin D, smoking cessation and limited alcohol consumption. However, people with osteopenia can benefit from drug therapy if they have already had a fracture.
But what about the safety of drugs for osteoporosis? Brody does an excellent job in discussing the risk-benefit profile of bisphosphonates, the major class of drugs prescribed for this disease.
“On average, the bisphosphonates reduce the risk of a fragility fracture by 30 – 50%. By comparison, the risk of the most talked about serious side effect – an atypical fracture of the femur, or thigh bone – is miniscule.”
What appealed to me about this article is the fact that an independent journalist from The New York Times has basically pointed out that bone loss is a real issue and needs to be treated long before symptoms arise. Brody’s messages are pretty clear: monitor your bone health; at the first serious signs of bone loss you should make life-style changes; if your bone loss evolves into early osteoporosis, you should work with your doctor to identify the medicine best suited for you. Unlike Moynihan’s minimization of a common disease of aging women and even some men, Brody has provided a thoughtful commentary on how best to approach bone loss. It is great advice.
On the surface, this appears to be a strange question. After all, the pharmaceutical industry prides itself on its ability to discover and develop new medicines. Yet, this ability is being challenged as the industry’s productivity didn’t live up to expectations in the last decade. The complete outsourcing of R&D was recently put forward in a November 2 article on Investopedia by Stephen D. Simpson entitled: “Should Pfizer Forget R&D Altogether?” Here is what Simpson had to say:
“Maybe the answer is for Pfizer not to worry so much about its own pipeline. Spending billions of dollars in R&D doesn’t change the fact that the odds of any single compound making it to market are long, indeed. Perhaps it makes more sense, over the long run, to save on R&D and wait to license, or acquire, drugs (or companies) once they have either made it to market or shown strong enough signs of efficacy and safety to de-risk the proposition. It would be a bold and potentially risky strategy. But then, is it really riskier to pay a heavy premium for Celgene, Biogen Idec or Shire than to invest over $1 billion and 10 years in a competing drug whose odds of success are likely below 15%?”
Before getting to the specifics of Simpson’s proposal, it is important to understand the nature of a company’s R&D budget line. First of all, everything is included in that figure, not just internal R&D costs but also things like the expenses generated in running co-development programs for clinical candidates partnered with other companies and milestone payments made to small companies whose early stage candidate it has licensed. Second, the size of an R&D budget is largely driven by “D,” not “R.” The research component of a pharmaceutical company’s budget tends to be only about 15% of the total due to the tremendous costs involved in developing a clinical candidate from Phase 1 through NDA approval.
In addressing Simpson’s proposition, it must be noted that companies are already outsourcing a significant part of their pipeline. Martin Mackay, President of AstraZeneca’s R&D division, has recently said that their goal is to have 40% of their pipeline generated through licensing of compounds. My sense is that this is a goal shared by a majority of pharmaceutical companies, and, as I’ve previously written on my blog, I support this strategy. But should a company like Pfizer be totally dependent on outside sources for its future?
Simpson’s comment that companies would be better off acquiring drugs that have shown enough signs of efficacy and safety to de-risk the proposition is, frankly, naïve. A compound can show promising signs of efficacy in Phase 2 studies and you can license it at that point. However, you will still need to invest heavily in the Phase 3 programs needed to get the drug approved. Given the needs these days to perform very costly outcomes and differentiation studies, the bulk of the development costs remain in this aspect of Simpson’s strategy. Furthermore, a program is never totally de-risked – there are a number of examples of drugs that prove to be disappointing commercially because of adverse events found post-launch when the drug gets used by millions of people.
So perhaps then, Big Pharma should forgo the licensing of compounds and simply buy companies, as Simpson suggests. This strategy has been used by Pfizer with its acquisitions in the last decade of Warner-Lambert, Pharmacia and Wyeth. History teaches that this strategy has its issues. Beyond the internal disruption not just to your entire organization but also that of the acquired company, these mergers have not been viewed as being financially attractive due to the premium that the acquiring company must pay and the lack of sustainability of the merged pipeline to meet long-term growth targets. Besides, you cannot just assume that the smaller company will automatically roll over and let itself be purchased, nor can you assume that smaller companies will be available on-demand.
While Simpson didn’t directly address the complete shut-down of a company’s early research activities, others have. I also find this problematic. As noted above, the “R” component makes up only a small percentage of the overall R&D budget. And, when internal efforts deliver new products, you own them completely – no milestone payments, no royalties, no co-marketing deals. Thus, these products are more profitable. Even Simpson acknowledged that “Pfizer has some encouraging drugs that should come out soon” and most of these are internally derived. But it is also important to have a strong internal cadre of scientists to help evaluate the strength of the supporting data of compounds being considered for in-licensing. A good research organization provides this. Many a deal has been squashed by internal scientists based on their rigorous reviews.
Any company forgoing internal R&D risks its future. It is not something I would recommend.
This month, Lipitor loses its patent exclusivity in the US. This event has prompted a number of articles in the press and elsewhere. An excellent piece was done earlier this week by Shannon Pettypiece on Bloomberg television. She actually went to the former Warner-Lambert Parke-Davis (WL) labs in Ann Arbor, Michigan and interviewed Dr. David Canter, who led the clinical trials program for what proved to be the biggest selling drug of all time.
At the time Lipitor was launched, however, it wasn’t envisioned to be a $13 billion per year product. In fact, as Dr. Canter pointed out, the former WL executives estimated that the initial annual sales projections would be about $600 – 800 million. Given that Lipitor was being launched into a statin market already dominated by Merck (Mevacor and Zocor) and BMS (Pravacol), WL felt it needed a marketing partner who could help them compete. Thus, they signed a co-marketing deal with Pfizer in 1997.
The Pfizer sales force has always been known to be among the best in the industry. Furthermore, Lipitor was known to be able to lower LDL cholesterol more than the competitive agents, so the sales force had actual data to share with prescribing physicians to show that Lipitor was different from the other marketed statins. But in the late 1990s, the significance of greater LDL lowering was unappreciated. Many felt that an LDL cholesterol level under 120 mg/dL was good enough. Furthermore, why would a physician who had been happily prescribing Zocor for years (and getting good results with patients) suddenly switch to the newest entry?
The answer lies in the studies that Pfizer carried out with Lipitor AFTER it had already been approved and on the market. Pfizer invested over $800 million to show the importance of driving LDL cholesterol as low as possible. One such study was “Treating to New Targets” (also known as TNT). Conceptually, it was a simple study. Ten thousand patients with stable coronary artery disease and a baseline level of 130 mg/dL of LDL (which was considered reasonable 15 years ago) were randomly assigned to get either 10 mg or 80 mg of Lipitor and followed for nearly 5 years. At the end of the study, those on 10 mg of Lipitor had a median LDL level of 101 mg/dL and those on 80 mg had a median LDL cholesterol of 77 mg/dL. More importantly, those on 80 mg of Lipitor had 22% fewer heart attacks and 25% fewer strokes.
This proved to be a landmark study. For the first time, it was shown that lower LDL is better and that for people with a high risk of cardiac events, driving LDL levels down can be life-saving. Suddenly, Lipitor’s potency advantage proved to have a major clinical benefit. Pfizer also performed another major study known as CARDS (Collaborative Atorvastatin Diabetes Study) which for the first time showed that diabetics can reduce their risk of heart attacks and strokes by lowering their LDL levels with Lipitor. Similarly, in the lipid lowering arm of the ASCOT trial (Anglo-Scandinavian Cardiac Outcomes Trial) lowering LDL cholesterol in patients with high blood pressure was shown to lower the risk of adverse cardiac events over hypertension therapy alone.
These studies and others helped to change medical practice. The importance of lowering LDL cholesterol as much as possible in patients at risk of a heart attack or stroke was unquestionable. In addition, these studies greatly expanded the patient population for those who would benefit from Lipitor therapy. With these data in hand, it was easy for the Pfizer sales force to drive the Lipitor sales from $5 billion to almost $13 billion six years later. But there is no doubt that the results from these studies proved to be crucial in recognizing the full potential of this important medicine.
On the face of things, working in antibacterial R&D should be a “no-brainer.” After all, you can never fully eradicate any pathogen. The reason for this is bacterial resistance. If you get an infection and are treated with an effective antibiotic, it is likely that the drug you take will wipe-out as much as 99% of your infection. This impact is sufficient for you to feel fine and to return to your daily routine. But the small percentage of bacteria that survives does so because it is resistant to this medication. A drug designed to kill them can be extremely effective, but a small subset will be unscathed because they are genetically resistant to the way the drug exerts its lethal effects. As a result, some bacteria survive, multiply over a finite period of time, and emerge as a drug-resistant pathogen.
This field of research, therefore, should be eternal. Infectious diseases can’t be “cured.” Furthermore, doing clinical trials is relatively easy. Unlike R&D for conditions like heart disease or Alzheimer’s Disease where thousands of patients need to be treated for years to measure the true effectiveness of a new medicine, a new antibiotic is used acutely. Generally, patients are dosed for 2 – 4 weeks and a physician can measure via blood samples whether the bacteria has been eradicated. Thus, the need for long and expensive clinical trials doesn’t exist in this therapeutic indication.
Why, then, are fewer and fewer large pharmaceutical companies investing in antibacterial R&D? Why are companies like Johnson & Johnson and Pfizer either scaling back their efforts or getting out of this field entirely? According to the Infectious Diseases Society of America (IDSA), of the 20 major companies doing R&D in this area 20 years ago, only two remain. How can this be? After all, according to the IDSA, antibiotic-resistant pathogens cost the US healthcare system more than $20 billion a year. This treatment is clearly a major medical need. Yet, there are only a handful of new antibiotics currently in clinical trials, as opposed to nearly 1,000 exploratory new drugs for cancer.
While there are a lot of attractions to doing R&D in this area, there are significant downsides. Although clinical trials for a new antibiotic are not daunting, the discovery of a new drug is very difficult. The resistant bacteria have evolved to such an extent that finding a new way to penetrate their defenses is much harder now than it was decades ago. Making modifications to existing classes of antibiotics is no longer fruitful; totally new molecular approaches are needed. Thus, just getting a new compound to test in the clinic may be more difficult in this therapeutic area than any other.
Just as important, however, is the fact that the commercial return on a new antibiotic would pale in comparison to a new treatment in areas like cancer or Alzheimer’s Disease. This is attributed to the fact that an antibiotic is generally used acutely, not chronically, and so profits are diminished by short-term use. However, a truly effective antibiotic against a life-threatening infection such as methicillin-resistant Staphylococcus aureus (MRSA) would likely receive very favorable pricing. The commercial issue really centers on the highly limited use of such a life-saving antibiotic. In order to prevent overuse of such an important new medicine, federal agencies would limit its use so that it was the last line of defense. This would slow down the potential for drug-resistance to the new antibiotic and prolong its effectiveness. This narrow use of the drug would limit its commercial viability, making it unattractive for a big company.
Last week, the GAIN (Generating Antibiotic Incentives Now) Act was introduced by Senators Blumenthal (D, Connecticut) and Corker (R, Tennessee). A similar bill had already been introduced in the House last June. Its purpose is to incentivize companies to carry out antibacterial R&D. Among other things, the GAIN Act, when passed, will extend the patent protection for a new antibiotic by 5 years and streamline the FDA approval pathway and allow for rapid NDA review – welcome changes. But this reform probably isn’t sufficient for the major companies to re-enter this area. The GAIN Act should, however, be a boon to small companies that are seeking novel antibiotics. In fact, this problem seems ideally suited to the expertise of biotech companies.
Also, this may be an area where the NIH can make a major contribution. Dr. Francis Collins, the Director of the NIH, has been seeking areas where the NIH can be more involved in quickening the drug discovery/development process. Perhaps using NIH resources to seek new ways to understand the genomics of resistant pathogens can lead to better insights into how best to kill them. More innovation is needed and the NIH can help fill this gap.
This problem is only going to get worse. It’s great that Congress is taking steps to help work on this. Back in the 1980s, the FDA, academia and pharmaceutical companies all worked together to discover new drugs that converted AIDS from a death sentence to a manageable disease. One would hope that it will not take a similar major disease outbreak to galvanize all parties to recommit to this field of research in a big way.