Archive for Pharma and Biotech CEOs
by David Williams
December 20, 2007 at 3:57 pm · Filed under Pharma and Biotech CEOs, Policy Makers, Pharma
As reported extensively on the Health Business Blog (see here, here, here, here, here, here, and here ) Genentech has undergone a contentious period with the American Academy of Ophthalmology (AAO) and American Society of Retina Specialists (ASRS). Compounding pharmacies have been repackaging Avastin into small doses, which eye doctors then use in place of Lucentis, a very similar drug from Genentech that is indicated for ocular use. This has been a real headache for Genentech, because repackaged Avastin sells for about $40 compared to Lucentis, which is $2000. The latest controversy was triggered when Genentech announced its intention to stop distributing Avastin to compounding pharmacies.
Now the parties seem to have come to terms. The way I read the statements (see below) from Genentech and AAO/ASRS, physicians have essentially gotten what they wanted.
A number of fascinating issues are raised by this controversy, including:
- Is Genentech selling a product or a solution to a problem? Obviously the manufacturing cost of Avastin/Lucentis is low relative to the sales price. If Genentech can make a real impact on wet Age Related Macular Degeneration they probably deserve more than $40 for it. Think of it like software: Microsoft licenses a home version of Office for much less than the commercial version. The product is the same, but it’s licensed for a different use at a different price. This strikes me as fair. Perhaps we will see indication or value-based models like this emerge in the future.
- What role should the FDA play in regulating the quality of a product once it’s left the manufacturing facility? FDA is very strict about manufacturing plant quality and inspections. Yet once a product leaves the dock standards are much looser. This is true for all sorts of products, not just injectables. It’s an issue in traditional pharmacies, compounding pharmacies, doctors’ offices and patients’ medicine cabinets. I still don’t know how safe repackaged Avastin is.
- When Genentech decided to develop Lucentis, it must not have expected Avastin to cannibalize the market so dramatically. In similar situations in the future, will companies go to the trouble and expense of developing and registering a new product or simply fall back on off-label use?
First, the statement from Genentech:
Genentech, in collaboration with the American Academy of Ophthalmology (AAO) and the American Society of Retina Specialists (ASRS), is pleased to provide an update on our joint efforts to address physician questions about access to Avastin® (bevacizumab) after Genentech’s January 1, 2008 change to the distribution of the product.
Since October, when Genentech announced it would no longer allow compounding pharmacies to purchase Avastin directly from authorized wholesale distributors, we have partnered with the AAO and ASRS to understand physicians’ needs related to their ongoing access to Avastin.
We are pleased with our collaboration and progress to date. Working together, we have determined that physicians can prescribe Avastin and purchase it directly from authorized wholesale distributors and wholesalers can ship to the destination of the physician’s choice, including to hospital pharmacies, compounding pharmacies or directly to the physician’s office. This process is one that the AAO and ASRS believe addresses the needs of their members. It is a significant step forward, reflecting the collaborative approach of Genentech and AAO and ASRS leadership.
Genentech continues to believe LUCENTIS® (ranibizumab injection) is the most appropriate treatment for patients with wet age-related macular degeneration (AMD) because it was specifically designed, formally studied, approved by the U.S. Food and Drug Administration (FDA) and manufactured for intraocular delivery for the treatment of wet AMD. At the same time, Genentech does not interfere with physicians’ prescribing choices and believes that physicians should be able to prescribe the treatment they believe is most appropriate for their patients.
We also remain committed to ensuring that eligible patients have access to Lucentis regardless of their ability to pay. Therefore, Genentech, the AAO and ASRS are working together to develop additional programs that will more efficiently facilitate and expedite patient access and physician reimbursement for Lucentis. Updates on our progress will be provided in early 2008. In the meantime, physicians or patients who have questions related to access and reimbursement services offered by Genentech can call 1-866-724-9394.
We would like to thank the AAO and ASRS for their leadership and collaboration over the past several months. We are encouraged by our progress to date and look forward to continuing our efforts with the common goal of helping patients with potentially blinding diseases.
Second, the statement from the American Academy of Ophthalmology and American Society of Retina Specialists:
Solution to Avastin Access Found through a Joint Effort by the Academy, ASRS and Genentech
The American Academy of Ophthalmology and the American Society of Retina Specialists (ASRS) are pleased to report that a solution has been found that addresses Genentech’s decision to no longer allow compounding pharmacies to purchase Avastin® (bevacizumab) directly from authorized wholesale distributors. The Academy and ASRS believed that this change in distribution could have impacted access to Avastin for some physicians and patients.
Since October, when Genentech made its announcement, the Academy and ASRS have been in discussions with the company to determine how physicians and their patients can maintain their access to Avastin. Working together, we have determined that physicians can prescribe Avastin and purchase it directly from authorized wholesale distributors and wholesalers can ship to the destination of the physician’s choice, including to hospital pharmacies, compounding pharmacies or directly to their office. This process is one that the Academy and ASRS believe addresses the needs of most of their members. It is a significant step forward.
Because laws differ from state to state, the implementation of this solution may vary. The Academy and ASRS recommend that physicians check with their legal advisors when considering this new option.
Genentech also remains committed to ensuring that eligible patients have access to Lucentis® regardless of their ability to pay. Therefore, Genentech, the Academy and ASRS are working together to develop additional programs that will more efficiently facilitate and expedite patient access and physician reimbursement for Lucentis. Updates on our progress will be provided in early 2008. In the meantime, physicians or patients who have questions related to access and reimbursement services offered by Genentech can call Genentech’s Lucentis Commitment™ helpline at 1-866-724-9394.
For questions about Genentech’s authorized wholesale distributors, please contact Genentech at 1-800-551-2231 or csordermgmnt-d@gene.com.
by David Williams
November 12, 2007 at 9:44 pm · Filed under Podcasts + Videocasts, Pharma and Biotech CEOs, Policy Makers
The transcript of the recent podcast interview with Alan Eisenberg is posted at the Health Business Blog.
by David Williams
November 1, 2007 at 3:21 pm · Filed under Pharma and Biotech CEOs, Policy Makers
I interviewed Genentech spokeswoman Dawn Kalmar today to get some more details on the company’s decision to stop distributing Avastin to compounding pharmacies. For background please see my prior posts: Avastin update: Still seeking answers and Latest developments in the Avastin/Lucentis saga raise new questions.
In summary:
- In its inspection of Genentech’s manufacturing site, FDA objected to the level of particulates in Avastin, holding Genentech to the higher ocular standard rather than the intravenous standard
- Genentech is hopeful that it won’t have to make Avastin to the ocular standard on an ongoing basis, but isn’t certain
- Genentech doesn’t know who filed the complaint against New England Compounding Center that led to a Warning Letter against that compounding pharmacy for repackaging Avastin
- Genentech seems unlikely to seek FDA approval to continue supplying Avastin to compounding pharmacies
In my view, this isn’t turning out too well for Genentech.
- Avastin repackaging will continue to stunt Lucentis sales
- FDA may force Genentech to make Avastin to ocular standards on an ongoing basis
- Ophthalmologists are unhappy with Genentech rather than grateful to it for the efficacy of Lucentis
For a transcript of the interview, please visit the Health Business Blog
by David Williams
November 1, 2007 at 8:12 am · Filed under Drug Development, Podcasts + Videocasts, Pharma and Biotech CEOs, Policy Makers
Since the early 1980s, the Federal Government has provided Small Business Innovation Research –or SBIR—grants to fund research and development projects. In 2003, the Small Business Administration ruled that companies that were majority owned by venture capital firms would no longer be eligible for such funding.
The biotech industry and its supporters complained that the policy was choking off biomedical innovation, and now a bill that would restore eligibility of companies whose majority owners are VCs is before Congress.
The Office of Management and Budget, National Small Business Association and Small Business Technology Council have come out against the legislation, arguing that it would allow large businesses and universities in the door and deny funding for many deserving recipients. SBIR grants represent only 2.5 percent of Federal research dollars, they argue, and independently owned, non-dominant players should be entitled to all of it.
I spoke today with Alan Eisenberg, Executive Vice President for Emerging Companies and Business Development at BIO, the trade association of the biotechnology industry, to get his perspective.
David Williams interviews BIO's Alan Eisenberg:
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by David Williams
September 19, 2007 at 4:01 pm · Filed under Pharma and Biotech CEOs
AstraZeneca has announced plans to outsource all pharmaceutical manufacturing over the next few years, according to The Times of London.
David Smith, AstraZeneca’s executive vice-president of operations, said that the company aimed to become a pure research, development and marketing organisation.
“Manufacturing for AstraZeneca is not a core activity,” Mr Smith said. “AstraZeneca is about innovation and brand-building . . . There are lots of people and organisations that can manufacture better than we can.”
It sounds like an obvious idea. Companies making low-tech items like shoes and high-tech items like computers and consumer electronics routinely outsource. Nike doesn’t make shoes, Apple doesn’t make iPods, and so on. They concentrate on their core competencies of R&D, design, distribution and marketing while leveraging outsourced manufacturing to achieve lower costs, higher quality, and greater flexibility.
Now that pharmaceutical companies are facing cost pressures they are finally catching up with the times. Right? Actually, no.
Manufacturing isn’t well understood within pharmaceutical companies. Top management and board members typically have little background in manufacturing and the head of manufacturing usually reports to someone in the commercial organization rather than directly to the CEO. It’s unusual for the head of manufacturing to sit on the executive committee at big pharma companies. When top management does examine manufacturing –usually at the behest of the CFO– they are surprised to find how much capital is invested and how low capacity utilization is. “Why don’t we jettison is?,” they ask.
There are a number of good reasons not to go down the AstraZeneca path. For example:
- It’s hard to dispose of the existing assets. Unlike in consumer electronics there are few companies capable of buying and running the facilities. Exceptions –like Cardinal and Patheon –are subject to acquisition by private equity funds or to screwing up their operations and getting into trouble with the FDA.
- Owning manufacturing plants can yield tremendous tax advantages, which are difficult to replicate in a purely outsourced model (though there are ways to achieve some of the benefits through tolling)
- There are increasing opportunities for tight integration between pharmaceutical development and manufacturing, and the interfaces between the two can be much more robust in an in-sourced model. Truly new drugs are rare within pharmaceutical company pipelines. New combination products and modified release formulations require advanced manufacturing knowhow
- Manufacturing costs are a very low percentage of revenue for pharmaceutical companies. Even in these tighter times it makes good sense to keep spare capacity and go overboard on spending on quality and support services. However contract manufacturers look at the world differently. What represents a mere 5 to 20% cost of goods sold for the pharma company is 100% of the contractor’s revenue. They are more prone to squeeze out spare capacity and take shortcuts elsewhere simply because they have a greater economic incentive to do so. That can lead to trouble.
However, I don’t advocate a purely insourced model either. In general, pharmaceutical companies should make greater use of third-party manufacturers. Left to their own devices, manufacturing divisions will look to keep everything in house. And with top management not understanding the fundamentals of the business, it’s easy for the manufacturing folks to exaggerate the dangers of third parties and present unfair cost comparisons. (A favorite approach is to compare the marginal costs of in-house production with fully loaded third-party costs.)
AstraZeneca says it will take 10 years to complete its transition to full outsourcing. My guess is they will pull back before they get there. If they do things right they’ll end up in a good place.
At MedPharma Partners we have substantial experience in working with pharmaceutical companies to evaluate their third-party strategies and with contract manufacturers to understand the mindset of big pharma. If you’d like to discuss how this topic applies to your situation, contact David Williams at dwilliams@mppllc.com or (617) 731-3182.
by David Williams
August 31, 2007 at 11:01 am · Filed under Pharma and Biotech CEOs, Policy Makers, Business of Health
Questcor Pharmaceuticals has announced “a new strategy and business model for H.P. Acthar Gel(R).”Translation: the company has obtained orphan drug status for a product that has been used for decades –including for the orphan indication– and is raising the price 20-fold, from about $1000 per vial to $20,000 per vial (according to my source).
The Orphan drug law has benefits. It encourages companies to pursue treatments for diseases afflicting small numbers of patients. In my opinion it shouldn’t be used in situations like this for an existing drug with a widespread existing use.
The press release is very defensive, as it should be. It cites the fact that the company has been losing money and is incurring costs for the new indication and for manufacturing upgrades. It mentions a program to make the drug available for those who can’t afford it, and talks about Questcor’s participation with patient advocacy groups.
If insurance companies are smart they’ll read this paragraph and react accordingly:
Questcor’s implementation of this new pricing model creates risks and uncertainties for Questcor, including risks associated with the possibility of lower unit sales, the refusal of third-party payors to provide reimbursement for purchases of Acthar, and the financial impact of the return to Questcor or sale to third parties of previously sold product. Questcor could receive negative publicity as a result of its adoption of this new strategy, and responding to inquiries from the press or patient advocacy groups, or dealing with litigation against Questcor, could divert the attention of key employees from operating Questcor’s business.
by David Williams
August 30, 2007 at 6:41 am · Filed under Pharma and Biotech CEOs, Policy Makers
In today’s NEJM, Richard G. Frank, PhD lays out some of the issues regarding generic biologics. He suggests using the Hatch-Waxman Act –which enabled the generic drug industry to flourish– as a starting point. The article, Regulation of Follow-on Biologics, is available free. His conclusion:
The prospect of the loss of patent protection for tens of billions of dollars’ worth of biopharmaceuticals increases the urgency of the need for a regulatory policy that promotes price competition and preserves the safety and efficacy standards that Americans expect from prescription drugs. In my opinion, the Hatch–Waxman framework is not sufficient to cover both relatively simple biopharmaceuticals and very large and complex molecules — a new regulatory framework is needed. Because of the need for complex, situation-specific judgments, the FDA should be granted a great deal of discretion. The conflicting goals of bolstering price competition in biopharmaceutical markets and preserving the incentives for innovation call for a nuanced policy that must be based on the best current science and key features of the economics of biopharmaceutical markets — not on the impassioned claims of the interested parties.
The problem with Hatch-Waxman is that its success has put blinders on policymakers and analysts. There’s a simpler and better solution as I’ve advocated several times over the past year. (See Paradox or Idiocy? for example):
Regulate the prices of biotech drugs once they go off patent. That eliminates safety concerns, lowers the regulatory burden, and guarantees lower prices, all without reducing the incentive for innovation. The only losers are the companies that would develop and manufacture generic biologics.
by Scott MacStravic
August 27, 2007 at 11:08 am · Filed under Employer CEOs, Pharma and Biotech CEOs, Pharma, Health Management
There is already an “official” field of medicine called “lifestyle medicine”, at least there is according to the American College of Lifestyle Medicine (www.lifestylemedicine.org). It is a: “…national professional society for clinicians who specialize in the use of therapeutic lifestyle interventions in the treatment and management of disease.”
At its narrowest, lifestyle medicine is used to promote lifestyle changes necessary to achieve optimal results in post-acute treatment of conditions such as heart disease, or post-surgery in cases of bariatric surgery for weight loss. In such cases, permanent lifestyle changes are needed to retain the benefits of the original intervention, and to prevent the recurrence of the original problem.
Lifestyle medicine is also an essential element of most chronic disease management efforts, since most require or at least benefit from patients’ lifestyle changes. Compliance with medications, for example, is a lifetime behavior change, while compliance with self-monitoring such as daily or even more frequent blood glucose monitoring for diabetes, weight monitoring for congestive heart failure, etc. is equally essential. Changes in diet, exercise, stress management, and other health-related behaviors are also recommended in most self-management efforts.
Specific lifestyle changes are also needed to reduce health risks, even before chronic or acute diseases arise. Ending the use of tobacco, the abuse of alcohol and drugs, unhealthy diets, physical and mental indolence, are generally recommended for everyone. Preventing or altering patterns of violent behaviors, unsafe driving, sexual practices, and behaviors in general, while adopting safe practices instead is equally a lifestyle approach to prevention.
Promoting healthy behaviors, such as those that promote physical fitness, mental acuity, social and spiritual health, can be equally included in lifestyle medicine. Physicians and other clinicians have special influence with most patients, and can prompt lifestyle changes in cases where other approaches have failed. [K. Murphy “Teaching Doctors to Teach Patients About Lifestyles” New York Times, Apr 17, 2007]
On the other hand, physicians are rarely trained or experienced in the art or science of altering patients’ lifestyles. While “medications” in the form of prescription or OTC drugs are often used in some lifestyle change efforts, such as nicotine replacement therapy for smoking cessation or drug antagonists for alcohol and illicit drug abuse, all lifestyle change efforts require “cognitive services” such as cognitive and behavioral therapy, motivational interviewing, for example. Such services are currently not paid for by most health insurance plans, and are not usually included in medical school curricula.
There are physicians who are actively engaged in lifestyle medicine, particularly those who market proactive health preservation and improvement as part of their “concierge”/“boutique” practices. Lifestyle medicine makes an almost ideal “extra services” category for physicians who are prohibited from charging patients more for normal primary care, and is attractive to large numbers of baby boomer generation patients who want to remain young, active, and independent as long as possible. The 150 or so MDVIP physicians in sixteen states use lifestyle medicine as a major element of their retainer practices, and report dramatic reductions in sickness care use as a result. (www.mdvip.com)
A number of physicians also use a kind of lifestyle medicine that includes “retail” sales of nutriceuticals products and services, from herbal and vitamin therapy to massage, hypnosis, acupuncture and other complementary/alternative therapies. The fact that these are not covered by insurance makes them ideal for retail purposes, while their widespread consumer acceptance helps make them popular as well. And at least some have proven effective in treating specific conditions.
The biggest challenge in lifestyle medicine, however, is the fact that physicians generally value their time at an “outlier” level compared to other clinicians, such as nurse practitioners and physicians assistants, and non-clinicians such as trainers and health educators. Where patients pay $1500 per year for retainer practices, physicians can afford to spend extra time with them, but most patients may, and certainly most employers and insurance plans would prefer lower-priced lifestyle coaches.
Large physician practices, and practices that are part of integrated health systems, or at least collaborate with hospitals in lifestyle medicine, can offer services through a team approach for providers, and group visits or remote communications methods for patients, in order to keep costs affordable. They will still be handicapped by the fact that they will tend to have patients who are covered by a wide variety and large number of different insurance plans or employers, hence have to deal with a large number of payors, with varying interest in and willingness to pay for lifestyle medicine, as well as varying notions about what is needed and will be paid for.
When the Family Physicians of Western Colorado in Grand Junction embarked on a diabetes management program based on the Chronic Care Model, for example, this practice found only one local insurer that would pay them. Though it paid enough to make the program a profitable one for those patients who were covered by that one insurer, only a minority of all patients were so covered, and the practice lost money on the program overall, since it chose to enroll all its diabetes patients in the program. [P. Mohler & N. Mohler “Improving Chronic Illness Care in a Private Practice” Family Practice Management, 12:10 Nov/Dec 2005 50-56]
Probably the best approach for physicians who are interested in lifestyle medicine to take would be to contract with or work for large employers who are willing to sponsor onsite medical clinics for their employees and dependents. The onsite clinics, because of their convenient location, should prove attractive to employees, at least, and can include whatever lifestyle medicine employers are willing to pay for. And since improving the health of employees returns as much as two to five times as much value to employers as it does to insurers, the revenue from such clinics may be significantly more profitable than is the case with insurer-paid sickness care, with far fewer hassles and overhead costs.
Of course, physicians may not wish to work for employers, though large numbers already function as employees of hospitals and integrated systems. And even in onsite clinics, physicians will rarely be the most effective or efficient source of lifestyle medicine services, given the high cost of their time. But for primary physicians who can bear the idea of being an employee, onsite practices for individual employers, or perhaps for groups of employers located in the same neighborhood, could represent one of the best opportunities to create true “medical homes” that combine proactive and reactive medical care, and the kind of medicine they want to practice.
by David Williams
May 22, 2007 at 9:43 am · Filed under Drug Development, Podcasts + Videocasts, Pharma and Biotech CEOs
Here’s the transcript of my recent podcast interview with iCardiac’s Chairman and CEO, Mike Totterman.
David Williams: This is David Williams–co-founder of MedPharma Partners and author of the Health Business blog.
Drug safety is a big issue these days. The FDA has been criticized for allowing drugs with safety problems to reach the market. Merck’s embroiled in thousands of lawsuits over heart problems allegedly caused by Vioxx, and not a month goes by without the cardiac safety profile of a marketed drug being questioned.
I recently joined the board of iCardiac Technologies, a start-up company that’s developing new tests using ECGs to find cardiac safety problems with drugs early in their development. iCardiac has already signed a research alliance with Pfizer and attracted investment from venture capitalists. I visited the company today in Rochester, New York and spoke with its chairman and CEO, Mike Totterman. Mike thanks for joining me today.
Mike Totterman: Thanks. Pleasure to be here.
David: Mike, tell me a little bit about iCardiac Technologies.
Mike: iCardiac is a leading developer of advanced ECG-based cardiac safety biomarkers. What we do is address what has become possibly the single largest bottleneck in pharmaceutical development today.
It’s estimated that roughly 80% of all delays and drug withdrawals currently are related to cardiac safety issues. What we do is we provide the next generation of cardiac safety biomarkers. And what this allows the pharmaceutical companies to do much earlier in the development phase is to determine the true cardiac safety profile of their in-development drugs.
Obviously this is significantly beneficial from an economic perspective; really allowing the companies to safely and confidently either move forward with development or identify very early on potential cardiac risks, and then move on to the next molecule to develop.
David: Now you use the term biomarker, can you explain what a biomarker is?
Mike: Sure. Biomarkers are essentially quantitative signals. In this case we derive them from the ECG signals. Today the commonly accepted marker for cardiac safety is QT prolongation. It is well known, and the FDA has also commented on this, that there’s a significant opportunity to improve upon the efficacy of QT prolongation.
This is really where iCardiac comes in. We provide markers that are more sensitive and more specific than the current QT prolongation methodology.
David: How long has the company been around?
Mike: In terms of the company, it is based on research that was conducted at the Heart Research Follow-up Program over a period of almost 30 years. The focus of the research was on something called the congenital long QT syndrome, which is very analogous to what is the acquired form of QT prolongation. This technology that was developed by the Heart Research Follow-up Program was then spun into iCardiac, and the company was founded in the early part of 2006, and we received our financing at the end of 2006.
David: I noticed that with the name iCardiac it sounds like something that I might plug in to my MP3 player or something. Was that just a coincidence that you called it iCardiac or is there some connection?
Mike: Some time was actually spent on thinking about the appropriate name, and there were a couple of different thoughts that we had in terms of what we wanted the name to communicate. Obviously we wanted to make sure that people understand that we’re in the cardiac space and really relate it to cardiac technologies. One of the many names that we played with was Intelligent Cardiac Technologies, and then ended up shortening that into iCardiac Technologies. We’ve been very happy with the choice, it’s an easy to remember name.
David: I saw on your website that you have announced a strategic alliance with Pfizer. Is Pfizer your only customer or is that the only company that you would work with?
Mike: We’re very excited about the Pfizer alliance. Let me say a few words about that. Pfizer is providing an equity investment as well as research and development funding, and has licensed certain of their internal cardiac safety technologies to us. Pfizer is quite visionary in terms of what their objectives are and they are very much in line with what we’re looking to do; and they recognize that this is really a problem that impacts the entire industry.
As a result, the decision was made collectively to ensure that this alliance is non-exclusive and there are no specific technologies that would be excluded from anybody else who would be looking to work with iCardiac Technologies.
In addition to that, Pfizer has been very encouraging of us working together in order to recruit other pharmaceutical companies into what we believe is a very pivotal effort for the industry.
David: Mike, when there is an actual clinical trial underway how are your tools actually used? What’s involved and what’s different compared to a trial that iCardiac is not involved with?
Mike: What’s very exciting about the tools and services that we offer is they plug very nicely into the standard clinical trials process. Frequently, early on in the development, electrocardiograms, or ECGs, are collected. Currently those ECGs are measured for the QT prolongation, which as I mentioned earlier, has a number of limitations. We can take essentially those same electrocardiograms and perform our advanced analytics on them and then report those results back to the pharmaceutical companies for decision-making.
David: What sort of results would the pharmaceutical company receive? Is it just a matter of “Yeah this looks safe; this doesn’t look safe”? How would the output actually be represented to them?
Mike: There are two sets of activities that we’re currently undertaking. As I mentioned earlier, that Pfizer alliance is focused heavily on the validation of the markers. So currently we’re engaging with a number of other pharmaceutical companies to look at retrospective data and analysis that they’ve done and collected as ECGs.
So the first step that generally we do with a pharmaceutical company is to demonstrate the effectiveness of the markers on historical data that has been collected. Then after that the pharmaceutical companies can start using the markers, initially for internal decision making on a go/no-go decision making process in terms of moving forward with the drugs.
The objective of the Pfizer alliance as well as a number of our efforts within the industry is really to influence the guidance and to be able to drive towards a set of markers that are industry accepted for decision-making in this area.
David: So, obviously cardiac safety has been in the news enough that the general reader would know about it. I’m wondering, if you think about a drug like Vioxx, which was on the market for a long period of time and then these heart problems were discovered; how would the Vioxx development and launch have been different if you’d been involved? If iCardiac had been involved would Vioxx have been kept off the market in the first place?
Mike: Excellent question. Just to clarify, there are a few different classes of cardiac problems that end up occurring with drugs. One of the big ones, which we address, is essentially electrical disturbances that occur with the drug.
There were also other issues that were very problematic with Vioxx, and that’s what ended up getting it pulled from the market. Subsequently there have been publications that in meta-analysis of the subjects who had taken Vioxx, that there may have also been some abnormalities in terms of the electrical properties of the heart. So while it’s hard to, with specificity, to say if we would have been able to prevent the Vioxx issues, there is some indication that we would have been able to lend some useful data to do some early decision-making regarding the product.
David: Now all the headlines that you read are about drugs that have made it to the market, and then a cardiac safety problem is discovered and the drug is pulled from the market, and sometimes there is some legal action. Are there also examples of drugs that maybe are killed in the product development stage that in fact weren’t particularly harmful and maybe should have been allowed on the market? Would you be able to detect those drugs and perhaps save them?
Mike: A very good question. That is one of the big challenges currently with cardiac safety testing–kind of the combination of both the false positives and the false negatives. Really there, with QT prolongation it is a well-known fact that by looking at QT prolongation alone you may be very well screening out drugs that actually do not end up causing torsade or any cardiac events. So our hope is obviously to be able to also address those issues.
This is definitely the case with a variety of different drugs. One of them in particular is used as the positive control in cardiac safety studies, which is moxifloxacin. That is a drug that’s well known to increase QT prolongation; it is actually used as the benchmark to determine if an analytical tool can detect the prolongation of QT. And it’s also a drug that is known to be safe. As a result of that it can be used as a positive control in these studies. So clearly we believe that we can use our tools to identify drugs that would have otherwise been unnecessarily killed in the development process.
David: So the FDA has obviously been under a lot of pressure in the post-Vioxx era to be more careful about approval. And then we saw yesterday the Senate passing legislation for more surveillance post-launch. What does the FDA think about what you’re doing? Do they know about it? What are its plans and its reactions?
Mike: It’s actually very exciting what’s happening with the agency, especially in this area. I think for a number of different reasons they highlighted cardiac safety relatively early on as an important area for development of new tools and better tools. In their critical path initiative, cardiac safety is prominently discussed. And I believe the quote goes something along the lines of that there’s an urgent need for better tools to identify some of the residual risk that current QT prolongation tools leaves in the development process.
In addition to that, there is a cardiac safety consortium that has been formed which has a number of participants from the industry, academia, and the agency. And we’re very much looking forward to participating in that set of activities.
David: You mentioned early on about the Heart Research Follow-up Program at the University of Rochester. What’s the connection between the company and the University of Rochester?
Mike: As I mentioned earlier on, the Heart Research Follow-up Program has been working in this area for a very long period of time, and started doing software tools for ECG analysis almost a decade ago. So the relationship really there is that the technology that was developed at the Heart Research Follow-up Program has been licensed over to iCaridiac Technologies for commercialization.
David: What kind of companies would you compete with? I know a lot about companies like eResearch Technology that have made a big business out of these thorough QT studies that need to be done as part of drug development over the past few years. Do you compete with them? Do you complement them? What other companies are out there that you think about as being in your space?
Mike: I think we’re very complementary to the current set of clinical research organizations that exist out there. Obviously QT prolongation will stay as a metric for some time to come. And where we are positioning ourselves is really the ability to deliver incremental information above and beyond the simple measurement of QT prolongation.
The other thing which is very exciting, and we feel quite proud of is, there are not too many commercial entities, whether it’s equipment manufacturers or small start-ups, that are working on specifically this problem and who have as much data that they have collected to validate their tools or as much technology or funding to drive this process forward. So we feel very fortunate to have the kinds of partnerships, for example, that we have with Pfizer.
David: You mentioned Pfizer as an investor. Are there other investors, and who are they and why did they think to invest in iCardiac?
Mike: Sure. We’re venture-backed, have several venture capital firms who have backed us–Advantage Capital as well as Stonehenge Capital and Trillium. These are actually individuals that to some degree parts of the management team had worked with before, so very good working relationships. In addition to that, clearly the investors recognize the significant market opportunity in terms of being able to provide these types of tools to the pharmaceutical industry. So we’re all quite excited about being able to provide these commercially to the marketplace.
David: Now what would you list as some of your key challenges? It sounds like there’s a lot that’s been validated, you’ve got Pfizer on board, you’ve got investors, it’s a clearly recognized problem, but what are some of the challenges that you face as a start-up company?
Mike: I think what is always the case, especially with the pharmaceutical industry, you want to make sure that you’ve been able to demonstrate your tools on as many different drugs and as many different situations as possible. So we’re actively working throughout the industry to identify–and we have done so already a number of critical data sets–that we can continue to move forward with the validation process. And it is quite exciting that the FDA recognizes that this is an important issue and has created a forum specifically for helping drive and move forward new guidance in this area.
David: Mike thanks very much for speaking with me today. I’ve been speaking with Mike Totterman, chairman and CEO of iCardiac Technologies, a cardiac bio-marker company located in Rochester, New York. Mike, thanks again.
Mike: Thanks a lot as well.
by David Williams
May 14, 2007 at 2:21 pm · Filed under Drug Development, Podcasts + Videocasts, Pharma and Biotech CEOs, Regulators
Drug safety is a major issue these days. FDA has been criticized for allowing drugs with safety problems to reach the market, Merck is embroiled in thousands of lawsuits over heart problems allegedly caused by Vioxx, and not a month goes by without the cardiac safety profile of a marketed drug being questioned. Recently, the Senate passed a bill granting the FDA greater authority to restrict the use of drugs when safety problems are discovered after launch.I recently joined the board of iCardiac Technologies, a start-up company that is developing new tests that use ECGs to find cardiac safety problem with drugs early in development. iCardiac has already signed a research alliance with Pfizer and attracted investment from venture capitalists.
I visited the company recently and spoke with its Chairman and CEO, Mike Totterman. Listen in and hear what he has to say.
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