The news that Merck is cutting 1,200 sales reps made headlines, but researchers who work on natural products in Madrid weren’t too thrilled either. That’s because the drugmaker is closing down the 50-year-old research effort, although the disclosure was a mistake - a Merck executive inadvertently included the plan in a PowerPoint presentation to an audience that included Merck employees.
The decision to shutter in-house natural products research will affect about 50 researchers in Spain and “a significantly smaller number” in Rahway, New Jersey, according to a Merck spokesman. “There has been no decision made on what is happening to those folks,” he tells Chemical & Engineering News. But “at the end of the day, synthetic chemistry has taken over.”
“The investment involved in finding these chemicals in the environment is significant. The products that came out of our effort have been significant as well, but that was over a 50-year period,” the spokesman tells the mag. The most recent Merck drug derived from a natural product is the Cancidas antifungal, which was introduced in 2002. Another was the old cholester pill, Mevacor.
For a view from the bench, check out Derek Lowe’s take at In The Pipeline
Now that Apotex has won a bid to produce and ship copycat AIDS meds to Rwanda, the generic drugmaker says it will never participate in the goodwill program again unless the federal government simplifies the process, The Toronto Globe & Mail reports.
Apotex became the first generic drugmaker in the world yesterday to be awarded a tender under a 2003 World Trade Organization deal to manufacture and supply copycats to AIDS-stricken nations. But Canadian legislation based on the agreement makes for such a cumbersome process that it took four years for Apotex to get this far, the paper writes.
“We’ve spent millions of dollars on the (research and development), we’ve spent lawyers’ time at our cost, just because it’s the right thing to do. It would be difficult to do again unless the legislation is made simpler,” Elie Betito tells the paper. “Imagine if…another country, like Malawi, comes forward asking for the drugs, we’d have to start this whole process again.”
Jeff Connell, a spokesman for the Canadian Generic Pharmaceutical Association, went further, saying none of the group’s members are willing to go through the CAMR process in its current form.
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The drugmaker reported disappointing first-quarter profit on weak US sales and slashed its 2008 forecast, pushing its stock down 23 percent to their lowest levels since 2004. Oral contraceptive sales fell short, and results were hurt by surprising competition and pricing pressure on a new generic of an osteoporosis drug. Sales of its Plan B emergency contraceptive were also lower than expected.
Barr reduced its 2008 outlook less than three months after issuing a forecast that also disappointed the market, Reuters notes. “It’s hard to imagine how they could get this so wrong in so many areas of their business in only the first quarter,” Morningstar analyst Brian Laegeler tells Reuters. “I think there’s a little bit of credibility lacking right now in the financial guidance.”
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A bi-partisan group of Congressional reps have introduced a resolution* criticizing the FDA for its recent move to warn compounders about their use of estriol in their bioidentical versions of hormone replacement treatments.
Last January, the agency questioned the safety and effectiveness of BHRT products, citing unsupported medical evidence, and false and misleading claims. The agency accused seven compounders of claiming their products are superior to FDA-approved menopausal hormone therapy drugs and prevent or treat such diseases as Alzheimer’s, stroke, and various forms of cancer, according to the FDA.
And last month, US Senator Tom Coburn, a Republican from Oklahoma, wrote a letter to FDA commish Andy von Eschenbach seeking agency data on actual adverse events and and to demand the agency reconsider its decision, because some insurers are supposedly no longer covering the products.
The issue has pitted compounding pharmacies, among others, against Wyeth, which in 2005 filed a citizen’s petition with the FDA in an effort to stop compounders from making bioidentical versions of Prempro, its controversial hormone replacement therapy. In lawsuits, some women claim Prempro has caused them to develop breast cancer.
* To view the resolution, go to Thomas.gov, click the little button that instructs you to search for bill number and type in H. Con. Res. 342.
Yes, we are trying something new today. With the enormous interest in DTC ads, in general, and the controversies surrounding the Lipitor and Vytorin advertising, in particular, we thought you would enjoy watching the hearing as it takes place.
Not only that - special just for you - we are including another feature that allows you to write some comments as the events unfold. For instance, if Deepak Khanna, senior vp of the Merck/Schering-Plough joint venture says something incredible, you can chime in. Sounds like fun, yes? Here’s the witness list. It’s over now - hope you enjoyed it. We’ll try it again some time.
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Five years after the HHS Office of Inspector General issued its compliance guidance for pharma, 92 percent of drugmakers surveyed say the guidelines “significantly impacted” the structure of their medical affairs teams - for instance, have since shifted medical science liasons and thought-leader development teams away from commercial development.
Meanwhile, 8 percent indicate the guidelines had caused a complete overhaul, according to Cutting Edge Information. And none of the 14 drugmakers that responded - a group that included Bayer, Glaxo and Novartis - believes the guidelines failed to have a serious impact.
Citing studies indicating the birth control patch increased the risk of dangerous blood clots, Public Citizen has petitioned the agency to withdraw the Johnson & Johnson product over a six-month transition period in which the healthcare giant is urged to release a newer formulation. (Look here).
The consumer group argues that Ortho-Evra results in 60 percent more estrogen on average exposure; greater variability in estrogen levels; a possible two-fold increased risk of venous thrombosis; increased risk of side effects such as breast discomfort, severe menstrual pain, nausea, and vomiting; a 50 percent increased likelihood of discontinuation, and no improvement in contraceptive outcomes.
The move comes four months after the FDA upgraded the warning on the labeling to include results of an epidemiology study that found that Ortho-Evra users were at higher risk of developing serious blood clots, also known as venous thromboembolism (VTE), than women using birth control pills. Lawsuits, meanwhile, have charged J&J with allegedly misleading docs and the FDA for years by altering and withholding medical data about the patch.
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When Schering-Plough shareholders show up in the oh-so convenient location of The University of Memphis next Friday for the annual meeting, their proxy statements won’t include one detail about Fred Hassan’s compensation. Although page 34 notes that the ceo received about $30 million in compensation last year, a more recent award of 836,000 options isn’t listed.
Now, the drugmaker may argue that an annual grant was also awarded last year after the proxy was filed and, unlike last year, there were no scandals causing shareholder and government scrutiny. So what’s the big deal? But consider that the latest options award, which we estimate are currently worth about $6.7 million based on the value assigned last year’s options award (see page 37), have an exercise price of just $18.85.
Why is this interesting? Well, 80 percent of the options aren’t based on performance critieria and can be exercised over the next three years - at what Fred himself insists is a low price. Schering-Plough stock closed yesterday at $18.18. Meanwhile, Fred has been complaining for months - ever since the Vytorin scandal sunk the $30 share price - that the stock is undervalued. Shearlings Got Plowed has picked this apart a couple of times now - here and here.
So why would the board’s compensation committee award him so much stock at this price? Or put another way - why wasn’t the exercise price set higher, since Fred himself has argued the stock is undervalued? Why is Fred getting so much at a price that doesn’t seem to depend on anything but showing up on Jim Cramer’s Mad Money to complain that the media is confused about cholesterol? We asked the drugmaker for an explanation and we received gobbledy-gook:
“If you look at the bottom of page 29 of the proxy, ‘Grant Prices for Stock Options and Other Equity Awards,’ you will see that Schering-Plough makes one annual grant on the same business date to all eligible employees which is the first business day of May. The closing price last Thurs May 1 on the NYSE was $18.85 and Fred Hassan received 836,000 options. Please note that these options are not yet vested and with today’s closing price on the NYSE would have no value. This stock option grant will be referenced in the next proxy which will cover 2008.”
Perhaps shareholders will receive more illuminating info next week in Graceland.
The Amgen ceo confronted an often testy group of shareholders Wednesday, his first annual meeting with investors since the biotech entered a prolonged crisis. “Last year was awful. I deeply, deeply regret that,” a calm and confident Sharer told the crowd of several hundred during an hourlong presentation at the Four Seasons Hotel in Westlake Village, California, The Los Angeles Times writes.
He also sought to reassure investors by maintaining Amgen was off to a good start this year and suggested many of Amgen’s woes should be viewed along with problems affecting all drugmakers. “I’m not making any excuses…but things are pretty stormy out there right now.” Some shareholders appeared unconvinced and the meeting turned contentious when investors were invited to make public comments, the paper writes.
One suggested Amgen should begin paying shareholders a dividend to make up for the stock’s steep fall over the last year. Another said she was disgusted with Amgen’s recent performance and was considering selling her shares. “You say you are looking out for the best interest of shareholders. I don’t believe you are,” she told Sharer, according to the Times.
Several questions focused on Sharer’s $13.2 million compensation last year, which included a car and driver and personal use of a company plane. In all, his pay was down 29 percent. Theodore Goldberg, a 73-year-old retired Los Angeles accountant, wants Amgen’s board to overhaul management. “The board has a fiduciary duty to protect stockholders,” Goldberg said before receiving loud applause.
Sharer said he was prepared for the scrutiny. “This is a democracy and I anticipated hard questions,” he said to one questioner. “I regret what has happened this past year, and I understand” your anger. He noted that his most recent annual compensation package was reduced from the year before and the value of his Amgen holdings fell as well. “I felt real economic pain.” Really?
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A federal judge has certified a class action antitrust suit that accuses Glaxo of using monopolistic tactics to boost profits of its Wellbutrin antidepressant, by delaying a generic version from coming to market, The Legal Intelligencer reports.
The suit was brought by direct purchasers who claim Glaxo devised a scheme to keep Wellbutrin prices high by making fraudulent assertions to the US Patent and Trademark Office and by engaging in “sham” patent litigation against generic drugmakers, the paper writes.
According to the suit, the plan worked because the patent litigation delayed the market entry of generic versions of Wellbutrin, and the direct purchasers were forced to pay unnecessarily high prices for the drug, because no generic versions of bupropion were available for nearly two years after Glaxo’s patent monopoly would have expired, according to the paper.
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