HEALTHCARE Evolving Trends in Biopharmaceutical Licensing Deal assessments, drivers and resistors By Melissa Zebrowski Table of Contents
Melissa Zebrowski Melissa Zebrowski has seven years of experience in healthcare and pharmaceutical policy research and analysis. During this time she has worked for five years as a consultant providing market research services in developed and emerging markets. Currently she is working as a pharmaceutical market analyst. Copyright 2008 Business Insights Ltd This Management Report is published by Business Insights Ltd. All rights reserved. Reproduction or redistribution of this Management Report in any form for any purpose is expressly prohibited without the prior consent of Business Insights Ltd. The views expressed in this Management Report are those of the publisher, not of Business Insights. Business Insights Ltd accepts no liability for the accuracy or completeness of the information, advice or comment contained in this Management Report nor for any actions taken in reliance thereon. While information, advice or comment is believed to be correct at the time of publication, no responsibility can be accepted by Business Insights Ltd for its completeness or accuracy. ii
Table of Contents Evolving Trends in Biopharmaceutical Licensing Executive Summary 10 Introduction to biopharmaceutical licensing 10 Biopharmaceutical deals and trends 11 Drivers and resistors facing biopharmaceutical licensing 12 Companies involved in biopharmaceutical licensing 13 The evolutionary pattern of biopharmaceutical licensing 14 Chapter 1 Introduction to biopharmaceuticals and licensing 16 Summary 16 Introduction 17 Overview of the biopharmaceutical industry 17 The Biopharma-Pharma relationship 18 The licensing process 21 Meeting the licensing challenge 22 Biopharma continues to shine 24 Chapter 2 Biopharmaceutical deals and trends 26 Summary 26 Introduction 27 Biopharmaceutical licensing trends 27 Number and average value of Biopharma licensing deals 28 Licensing deal partners 30 Biopharma s standing: out-licensing versus in-licensing deals Licensing deal types 31 32 Licensing trends in drug development 34 iii
The rising costs of early-stage licensing 35 Mid-stage deal-making: lucrative prospects Therapeutic focus in Biopharma licensing 40 41 Chapter 3 Drivers and resistors of biopharmaceutical licensing 44 Summary 44 Introduction 45 Overview of drivers and resistors in biopharmaceutical licensing 45 Key drivers 46 Generating cash 46 Pharma turns to Biopharma to maintain revenue growth; Biopharma gaining an upper hand 48 Risk sharing 50 Access to expertise Key resistors 50 52 Reduced control 52 Increasing complexity of licensing deals: positive for Biopharma but with a higher risk attached 52 Stricter regulatory and political environments 53 Future strategic direction 58 Chapter 4 Leading companies involved in biopharmaceutical licensing 62 Summary 62 Introduction 63 Who is looking to Biopharma and why? 63 Two sides of the Pharma coin: GlaxoSmithKline and Roche 64 GlaxoSmithKline: a Biopharma façade? 64 Roche: building upon an established presence in Biopharma 71 The Biopharma/Pharma dynamic 76 Amgen: the leading Biopharma 76 Gilead: diversification after market domination 80 Cephalon: a Biopharma out-licensor 83 Alnylam: a developer of novel therapeutics based on RNA interference 85 iv
Chapter 5 The evolutionary pattern of biopharmaceutical licensing 90 Summary 90 Introduction 91 The big deals of 2008: a sign of what is to come? 91 Who holds the future to ImClone? 91 The Roche and Genentech saga 92 Biopharma to Biopharma: Genzyme and Isis 93 Takeda looks to Biopharma for entry to the US market 94 Pfizer and Wyeth 95 Are M&As the new licensing? 97 Potential arrival of biosimilars: a catalyst for Biopharma M&A 98 The financial crisis and the future of Biopharma 99 The promise of emerging markets 101 Keys to future success 104 Recommendations and strategies for future Biopharma licensing deals and alliances 105 Chapter 6 Appendix 110 MedTRACK data 110 Index 111 v
List of Figures Figure 1.1: Number of NMEs and BLAs approved by the US FDA 19 Figure 1.2: Strengths of Biopharma and Pharma 21 Figure 1.3: Overview of the pharmaceutical licensing process 23 Figure 1.4: Global sales* of Biopharma vs. Pharma 24 Figure 2.5: Number and average value of Biopharma licensing deals, 2001 08 28 Figure 2.6: Number of top 20 Biopharma licensing deals by partner, 2001 08 30 Figure 2.7: Number of Biopharma in- and out-licensing deals by partner, 2004 08 31 Figure 2.8: Biopharma licensing by deal type, 2001 08 32 Figure 2.9: Biopharma out-licensing distribution by clinical stage, 2001 08 34 Figure 2.10: Early-stage deal models with associated pros & cons 36 Figure 2.11: Early-stage alliances number of deals and deal size, 2001 08 37 Figure 2.12: Trends in technology, Biopharma out-licensing, 2002 07 38 Figure 2.13: Number of Biopharma out-licensing deals ($100m+ nominal deal value) by clinical stage, 2005 08 40 Figure 2.14: Therapeutic focus in Biopharma licensing deals, 2005 08 41 Figure 3.15: Drivers and resistors facing biopharmaceutical licensing 46 Figure 3.16: Biopharma R&D spend 47 Figure 3.17: Biopharma funding 47 Figure 3.18: Progression of Biopharma s involvement in licensing deals 49 Figure 3.19: Estimated last patent expiry dates of selected proteins 56 Figure 3.20: Future strategic directions for Biopharma in meeting current challenges 58 Figure 4.21: Biopharma s transition via forward and downward integration 64 Figure 5.22: Announced number of Biopharma mergers & acquisitions, 2001 08 97 Figure 5.23: Drug patent expiries in the US, 2008-2012 100 Figure 5.24: Future licensing and alliance scenarios for Biopharma 104 vi
List of Tables Table 4.1: GSK s licensing and alliance activity, 2008 67 Table 4.2: GSK s licensing and alliance activity, 2007 68 Table 4.3: GSK s licensing and alliance activity, 2006 69 Table 4.4: GSK s licensing and alliance activity, 2005 70 Table 4.5: Roche s licensing and alliance activity, 2008 71 Table 4.6: Roche s licensing and alliance activity, 2007 72 Table 4.7: Roche s licensing and alliance activity, 2006 73 Table 4.8: Roche s licensing and alliance activity, 2005 74 Table 4.9: Amgen s licensing and alliance activity, 2007-08 77 Table 4.10: Amgen s licensing and alliance activity, 2005-06 78 Table 4.11: Gilead s licensing and alliance activity, 2005 07 80 Table 4.12: Cephalon s licensing and alliance activity, 2005 07 83 Table 4.13: Alnylam s licensing and alliance activity, 2005 07 85 Table 5.14: Sales in 7MM and pharmerging markets ($m), 2003-07 101 vii