Sunday, May 3, 2015

"Look In The Mirror, Much?" London's Financial Times Has Story Of German Merck CEO's "Frustration" With Ongoing Merck "Internet-Driven" Name Confusion

This fine Spring Sunday morning, the London edition of The Financial Times has an interview with Karl-Ludwig Kley, German Merck's CEO (registration required), in which he again laments how hard it is to handle the name flap, in this, the digital age. Geographic borders no longer even remotely define consumer and customer borders. So it goes. At the end of the interview, perhaps worryingly, he suggests that while he and Kenilworth are on friendly terms, German Merck intends to step up its efforts to control its brand globally -- including inside the US and Canada. I have repeatedly written that a separation -- complete separation -- of names, is probably the only sensible way to go. And that is still so. Here is more of my background on it all, over the years 2010 to 2014 -- firmly establishing that the confusion is real:

In February 2014, I poked a little fun at the capitalists' paper of record -- for the German-US naming confusion to which they also more than occasionally have fallen prey. [At least a little more than. . . a little. Heh.]

So many, many people -- and organizations -- make this same mistake: including the Wall Street Journal (proof under that link). The list would include Facebook, in granting short-hand named commercial page rights (three separate times). And CNBC -- in its graphics department -- continuously since 2009. So, it now seems fair to lay part of the blame at the feet of the companies themselves.

But that doesn't mean that we should believe, as some at Kenilworth (then Whitehouse Station) claimed -- in the Facebook name flap -- that people at US Merck forget that they aren't. . . living in Germany. [Yes folks, that was US Merck's first defense (circa 2011) -- to having poached German Merck's page -- on Facebook. Preposterous.]

In any event, here is a February 2014 vintage Exhibit A -- from the WSJ Blogs lead page (do read it all, there). All I ask? Please just understand, many, many smart people have done it too. See here:

. . . .There was some head-scratching [in February 2014] at Merck KGaA, the German pharmaceutical company, as protesters from STOPAIDS gathered outside its north London office.

The protest was over leaked plans for pharmaceutical industry lobbying against proposed reforms to South Africa’s intellectual property laws. Trouble was, those plans came from Merck & Co. of the U.S.; it and the German company aren’t connected. . . .

The leaked document, which referred to South Africa as “ground zero” in the debate over intellectual-property protection, was only a proposal and was rejected, said U.S. Merck. . . .

And so, given the benefit of my documented perspective, above -- one might understand why some AIDS activists might get confused about which set of signs, and regional HQs. . . belong to. . . which. This is not at all to be charged as any one journalist's error -- but it nicely points up why each of these companies ought to rethink their brand identity. These two need to become more distinguishable, one from the other.

Now I'm off to enjoy a mountain bike ride -- in the clear Spring air.

Saturday, May 2, 2015

UPDATED Analysis: Sovaldi® Patent Battles Still Very Likely To Settle -- Via ADR -- ALSO EXCLUSIVE

Upon a little more reflection this morning, over coffee, OJ and a banana, it occurs to me that even though Merck has been granted a broad patent claim construction victory here, at the trial level, Gilead is now increasingly likely to be persuasive on the notion that Merck's claimed patent is so broad, as to be invalid.

Thus, the very wise Judge Freeman has (I think) drafted an opinion that is absolutely correct on the law, and which not entirely coincidentally, encourages both sides to settle via the ongoing ADR process, rather than leave it in a "winner take all" binary outcome, at trial. I mentioned her sublime footnote four last night, and here it is, in full:

. . . .4. The Court notes that Merck’s preferred construction could pose invalidity problems for Merck down the road. It rejects, however, Gilead’s argument that it should adopt Gilead’s proposed construction in order to preserve the claims’ validity. See Gilead’s Br. at 24; see also Phillips at 1327 ("[W]e have certainly not endorsed a regime in which validity analysis is a regular component of claim construction."). . . .

This is just excellent judicial draftsmanship. Simply excellent. So, I would expect that both sides will continue to look for ways to resolve this without having a judge take all -- from one, or the other.

Friday, May 1, 2015

EXCLUSIVE: Merck's Preferred Claim Construction Prevails, In Sovaldi® Patent Battles -- Potentially Materially Good News For Kenilworth

Merck has tonight won an important victory from Gilead, in the running patent battles about whether Gilead's Sovaldi® infringes a Merck patent. [My last backgrounder here.]

Having said that, I must also note that even the very able US District Court judge who accepted Merck's construction of two phrases in the patent at issue sees a potential invalidity problem with Merck's preferred -- and now controlling -- construction. [See footnote 4 to her fine opinion, below.]

In sum, Merck's construction apparently claims such a broad invention that it may itself be invalid, as unpatentable. But that issue has been raised in other pleadings filed by Gilead -- and will be decided on another day. So for now, it would seem that Merck's claim to some level of patent royalty on sales of Sovaldi (a multi-billion dollar Hep C juggernaut) has been well-bolstered here. Whether it ever translates into dollars is entirely another matter, however, given that the Merck patent claims are now so broad that they may well end up being tossed, in total. We will keep you apprised. Here is the 11 page PDF order and opinion -- and a bit:

. . . .In sum, Gilead fails to show prosecution disclaimer, and the intrinsic record shows that Merck did not intend to limit claim 1 to include only those prodrugs expressly referenced. The Court rejects Gilead’s attempt to read the additional limitation "the phrase ‘prodrug of a compound’ means those prodrugs that are expressly claimed" into the definition of "administering" found in the ’499 Patent.

Accordingly, the Court adopts Merck’s construction of "administering" and construes the term to mean "providing a compound of the invention or a prodrug of a compound of the invention to the individual in need." As is clear from the Court’s analysis, this construction does not include the two limitations that Gilead sought in its proposed construction. . . .

While this piece of news, breaking after NYSE close today, Friday, may have the potential to move both companies' stock price, I will note that no specific legal advice is offered hereby. I am not a licensed patent lawyer. Truly, do consult your own patent expert(s) before trading on this news item. But I will take a bow, for having it first -- as a global exclusive here. Smile.

Wednesday, April 29, 2015

Express Scripts Is Already "Talking, Razor Sharp" -- On Keytruda® Pricing -- Even BEFORE Any US FDA NSCLC Approval(s)

In a cleverly nuanced, but multi-faceted approach, the PBMs/payers are already sowing the seeds to drive down immuno-oncology medication (think Anti-PD1L monoclonal antibodies like Merck's pembrolizumab, branded as Keytruda®) pricing in the US. And those prices are presently very heady. No doubt about it. [Just as Gilead's Hep C pricing was very, very high, for Sovaldi®, when it entered the US market as a world class life saver.]

So FiercePharma's Tracy Stanton makes a great story, this morning -- of the accelerating, muscular and relentless effort to rein in pricing -- perhaps even in advance of first approvals in lung cancer, for our friends at Kenilworth, NJ. Here's a bit:

. . . .The fact that Miller is talking about a "slower" effort doesn't mean it's not imminent. In January, Miller told Bloomberg that Express Scripts wants to see results by next year. "We want to be able to start influencing the market by 2016," he told the news service. "We are accumulating all the keys to the puzzle to be able to do this."

Ironically enough, Miller's comments come on the heels of some pharma earnings reports that include big sales for expensive new cancer drugs. Merck & Co.'s Keytruda is off to a roaring start with $83 million in Q1 sales, and the $150,000-per-year melanoma drug is up for a much bigger use in lung cancer.

Rival Bristol-Myers Squibb already won a second nod in lung cancer for Opdivo, which brought in $40 million for the quarter; it's also a $150,000-per-year med. And Pfizer's Ibrance, launched in February for relapsed breast cancer at $9,850 per month, brought in $38 million in what was left of the first quarter, and it's already making inroads for first-line use.

And these are just three of the newest cancer drugs on the market; as Reuters points out, Amgen's Blincyto for a rare form of leukemia has a list price of $178,000. . . .

We will keep a close eye on all of it. Trust that.

In India -- Glenmark May Continue To Make And Sell Generic Januvia®/Janumet® Until At Least May 12, 2015

As we've been reporting for just under three years now, the burden of diabetes in India is staggering.

There are just so many people in India, and over 62 million people are afflicted, there -- most of them very poor, by Western standards. And so, there is a move afoot to have sitagliptin declared an essential medicine -- and either remove patent protection there, or broadly empower sales of it -- at "access priced" manufacturers, and outlets. To counteract this, Merck is vigorously protecting its patents in country, alleging infringement. [Just search "Glenmark" in the box above for all the dozens of background posts and history, here.]

The latest development this morning, US time, has Glenmark authorized by Indian courts to continue -- past April 28, 2015 -- to sell its generic sitagliptin salt, in country, despite Merck's trial court level win, in a patent infringement suit, there. Here is the Financial Express item, overnight:

. . . .A bench headed by justice Ranjan Gogoi while posting the matter for further hearing on May 12 continued its stay order that in effect allowed the generic pharma major to make and sell its anti-diabetes drugs Zita and Zita-Met, which allegedly amounts to infringing the patent rights of US drug major Merck Sharp and Dohme (MSD), which manufactures sitagliptin under the brand names Januvia and Janumet. . . .

We will report again, after the May 12 Indian court hearings. Onward!

Tuesday, April 28, 2015

Sales Decline Was Little Smaller (Better) Than Expected; Januvia® Doing Well; Keytruda®: Next Big 2015 Variable

Currencies, with the effect of some smart hedging, took only 5 per cent away from the revenue line.

But that will still be a year long factor. And. . . EPS Guidance was raised. Sweet.

. . . .First-Quarter 2015 Worldwide Sales Were $9.4 Billion, a Decrease of 8 Percent, Reflecting Net Unfavorable Impact of Acquisitions and Divestitures and a 5 Percent Negative Impact from Foreign Exchange. . . .

Onward. Busy day ahead.

UPDATED 04.28.2015 @ Noon EDT: So, I had guessed at a 6 per cent headwind for Merck and Pfizer, from currencies. Merck ran some smart hedges, and came in at 5 per cent. Pfizer, on the other hand broke the opposite way, and suffered a 7 per cent headwind, in the quarter (it says). In fact, Mr. Read dropped full year EPS guidance, purportedly solely for the deleterious currencies' effects. That seems very odd to me, because Pfizer should have large property, plant and equipment assets in Europe (naturally denominated in euros), that should in turn be a natural hedge against the strong dollar, on the asset side, and thus mostly wash the effect away, long before it reaches the EPS line, on the income statement, through a non-operating adjustment (largely absorbing the revenue headwind into a correlative euro asset values adjustment, all non-cash).

Said another way, I think Mr. Read is using a little shine-ola, here (again). Or he just flat out underestimated how ferocious the effect is/was always looking to be, throughout 2015 -- when he made guidance predictions in January 2015. But Messrs. Frazier (and Davis). . . nailed it. Now you know. [END UPDATED PORTION.]

Larry Husten, Writing For Forbes, Nicely Summarizes TECOS: Lightens Merck's Januvia Load

Well, this likely just means that Merck may pick up some of the slack spooling at AZ's feet, now -- related to its Onglyza diabetes medication. But the larger issue for the Kenilworth franchise, here, is "genericization" of sitagliptin, which is leading to price erosion, globally. Still, this TECOS outcome removes a smallish overhang, for the franchise. [That is, the nearly 4 per cent leap after-hours on the NASDAQ is an over-reaction, I feel.]

Do go read all of what my buddie Larry has written -- he is spot on, here:

. . . .Late Monday afternoon Merck released the top line results of TECOS, the cardiovascular outcomes trial with its blockbuster diabetes drug Januvia (sitagliptin). The company said that the trial “achieved its primary endpoint of non-inferiority for the composite cardiovascular (CV) endpoint.” Merck announced only one additional detail: “Among secondary endpoints,” they reported, “there was no increase in hospitalization for heart failure in the sitagliptin group versus placebo.”

The FDA has been wrestling for a number of years now with the problem of the cardiovascular effects– whether positive or negative– of diabetes drugs. . . .

Earnings tomorrow, early -- buckle up! Forward, as ever. . . .

Sunday, April 26, 2015

Condor Predicts: Double Doses -- Of Foreign Exchange Down-Bubbles, In Big Pharma -- Come Tuesday

Come Tuesday morning, both Merck and Pfizer will reveal just how much damage the strong dollar is doing -- at the revenue line -- in 2015. Last week, mini-major Baxter International flashed a six per cent negative effect, at the global sales line -- due to currencies (primarily a strengthening of the US Dollar).

I'd expect Merck's to be in line with that. So, instead of $9.11 billion in global sales, I'd look for something like $8.56 billion, in currencies adjusted sales. May turn out to be a little better than that, but not likely to be much worse. We will tune in and listen -- for certain.

I'd also look for pembrolizumab (the Anti PD-1L immune-oncology juggernaut) to be a big story. We shall see how big -- come that morning.

A bit, then from Benzinga, this morning:
. . . .Rival pharmaceutical giants Merck and Pfizer will share their results before the markets open. EstimizeTM forecasts call for EPS of $0.78 (15 estimates) and $0.51 (24 estimates), respectively. That is a year-on-year decline of more than 10 percent from each of them.

As far as revenue, the consensus forecasts have Merck posting $9.11 billion, a more than 12 percent year-on-year decrease, and Pfizer offering up $10.96 billion, or a decline of more than 5 percent. . . .

We will keep "a weather eye on the horizon for approaching squalls. . ." by which I mean foreign currencies' gyrations, mostly. Smile. Onward.

Friday, April 24, 2015

And Merck Keeps Posting Very Impressive Next Gen Hep C Study "Wins" -- This Time, In HIV/HCV Co-Infected Patients

Once again, overnight, Merck has made headlines in Vienna Austria, at EASL -- this time blowing the doors off of its own prior generation successes in treating Hep C patients who also happen to be HIV positive. And that is a not-too-surprisingly common occurrence -- that sort of co-infection.

Again -- as we said yesterday, AbbVie is steadily grabbing US market share from Gilead, by convincing the payers (and benefit managers like ExpressScripts) to steer patients toward, and effectively choose a less convenient, longer course, at a cheaper all-in price -- over the shorter duration, but higher priced offering from Gilead. Both of them will soon likely have to face Kenilworth in the market, too. Prices will head south. That's a certainty. Here's a bit:

. . . .Merck today announced the first presentations of data from the company’s ongoing C-EDGE pivotal Phase 3 clinical trial program evaluating the investigational once-daily tablet grazoprevir/elbasvir (100mg/50mg) in patients with or without cirrhosis who are infected with chronic hepatitis C virus (HCV) genotypes 1 4 or 6 (GT1 4 or 6).1 Patients in both the HCV infected treatment-naïve (C-EDGE TN) and HIV/HCV co-infected treatment-naïve (C-EDGE CO-INFXN) trials treated for 12 weeks achieved rates of sustained virologic response 12 weeks after the completion of treatment (SVR12) of 95 percent (299/316 and 207/218 respectively). In addition HCV infected treatment-experienced patients (C-EDGE TE) treated with or without ribavirin (RBV) for 12 weeks achieved SVR12 rates of 94 percent (98/104) and 92 percent (97/105) respectively and those treated for 16 weeks achieved SVR12 rates of 97 percent (103/106) and 92 percent (97/105) respectively. These data were presented at The International Liver CongressTM 2015 – the 50th annual congress of the European Association for the Study of the Liver (Abstract #G07 E-Poster P0886 and E-Poster P0887). A paper detailing the findings of C-EDGE TN was published online in the Annals of Internal Medicine today. . . .

So have a great Friday -- and watch Merck tear it up, here. . . a lil' late to the party, but posting entirely stellar results.

That Gent, Ed -- Over At Pharmalot -- On Gilead's Latest Hep C "Social Experiment Cure" In Former Soviet Nation

I think it is laudable that Gilead is even thinking of doing this. The immediate commitment is to 5,000 patients, but the goal -- in this rugged, rather isolated mountainous region -- is to arrest the virus, and perhaps eliminate it -- along with the debilitating secondary effects, from an entire country. That's going to be over 120,000 free courses of treatment.

I'm no epidemiologist, but perhaps Gilead picked Georgia because not many people travel there, and then leave, given the rugged terrain. Thus reinfection rates, from tourists, for example, might be minimized. [Rather sadly, I do have to wonder why a similarly rugged region of Africa was not chosen, for this social experiment. Certainly, the burden of disease is similar, in some Africa nations.]

Gilead I gather thinks governmental forces in Georgia might ultimately reimburse it, or that other Central Europeans might take note -- and reimburse, country, by country. As we've reported -- the company in March of 2014, dropped its price from $1,000 a pill to $10 -- in Egypt and up to 91 poorer nations. [Of course, some generic manufacturers are launching "at risk" in many of these countries at prices even below that.] I will keep track of this, as it would be quite a feat to eliminate the scourge of Hep C from an entire geography. Here's a bite from Ed Silverman -- do go read it all:

. . . .Nearly 7% of adults in Georgia are estimated to be infected with hepatitis C, according to the World Health Organization. Alton believes as many as 120,000 people may be infected, which is a sufficiently small population to gauge the effects of the program in a few years.

Alton maintains this is "not just a charitable project. We really see value in the data that can come out of this. . . We want to show if you treat everybody you’ll reduce prevalence of the disease."

Alton acknowledges, though, that the results may favorably influence reimbursement decisions and guidelines formed by government agencies. The program, by the way, has the backing of the U.S. Centers for Disease Control and Prevention. . . .

I genuinely applaud Gilead management here. Scantly sleeping, of late. Oh well. Onward.

Thursday, April 23, 2015

Euro UPDATE: Merck's All Oral, Ribavirin-Free Combo Pill -- For Type 1 Hep C Patients, With Advanced Kidney Disease Hits A Home Run!

Well, I think it is finally time to say that Merck is serving notice -- on Gilead's Sovaldi® run-away lead in the Hep C market. This will, in time lead to solid head to head competition, for all genotypes of Hep C patients, I'll brashly predict.

Just a few minutes ago, in Vienna, Austria at EASL -- in the middle of the night here in the US -- Kenilworth announced that 99 per cent of these studied patients achieved SVR (or sustained viral response) at 12 weeks. A few weeks ago, I had guessed it would be over 90 percent -- but I didn't see the cure rate hitting the 99th percentile. [The Abbott spin-off has an solid entrant here, as well -- so prices are destined to come down, for certain.]

C-SURFER is the name of the late breaker EASL presented study, and since Merck has re-won breakthrough status at FDA (on a subset of genotype 1, and genotype 4), this could lead to an approval, in these subsets, in just a few weeks' time. No promises, but it could -- sporting a nearly-perfect cure rate.

. . . .Merck today announced the first presentation of data from C-SURFER, the company’s Phase 2/3 clinical trial evaluating the investigational once-daily treatment regimen of grazoprevir (100mg) and elbasvir (50mg) in patients with advanced chronic kidney disease (CKD) infected with chronic hepatitis C virus (HCV) genotype 1. . . .

Of the 122 patients who received grazoprevir plus elbasvir, 83 percent were treatment-naïve, 36 percent had diabetes, 18 percent had stage 4 CKD, 82 percent had stage 5 CKD, 75 percent were receiving haemodialysis and 45 percent were African-American. Among those patients who received at least one dose of grazoprevir plus elbasvir, five percent (6/122) were excluded from the pre-specified primary efficacy analysis population, or modified full analysis set, due to missing data caused by death or early discontinuation for reasons unrelated to study drug. In the modified full analysis set, 99 percent (115/116) of patients receiving grazoprevir plus elbasvir achieved SVR12. One GT1b infected, non-cirrhotic, interferon-intolerant patient showed a viral relapse at follow-up week 12. Within the modified full analysis set, efficacy was consistent across the patient sub-populations assessed. In a supportive analysis of all 122 patients who received at least one dose of grazoprevir plus elbasvir in the ITG arms, including patients who did not complete the study for reasons not related to study drug, 94 percent (115/122) of patients achieved SVR12. . . .

Onward -- it is truly a new day (well. . . almost). Yeah, this news roused me from a sound sleep. It was entirely worthy of the ungodly early wake-up call!

Wednesday, April 22, 2015

Fascinating "DIY" DNA Sequencing Battles: Upstart Color Genomics Vs. Upstart 23andMe Edition

You will recall that I have been paying rather close attention to the winding path the $99 DNA spit test company called 23andMe is now traversing at FDA. I was an early adopter in mid 2013 -- prior to the FDA clamp-down on health related DNA data, there.

Fast forward to this week. Color Genomics has launched a more expensive spit test -- at $250 per kit -- and is focusing on heritable breast cancer risks (and thus targeting women). [Color is backed in part by Steven Jobs' widow -- ironic that 23andMe is led by the separated wife of a Google founder.] In any event, even as 23andMe seeks FDA approval to once again provide that very same data to people who've previously bought its spit kits, Color has launched using on-staff doctors to "administer", and then refer test results to the "patients" who've bought their kits.

The claim here is that the staff doctors are using a medical test, inside their own offices, and are thus exempt from the more stringent FDA approvals -- for a new so-called 410K diagnostic device (under FDA's jurisdiction). I truly will enjoy watching this, but it will likely be "game over" for Color, should 23andMe ultimately get an FDA green light -- on their DTC (direct to consumers) health data related to these same breast cancer risks. Here is a bit of the blogosphere, on Color's launch -- for background mostly:

. . . .Color Genomics, is backed by well-regarded industry investors, including Khosla Ventures, and Laurene Powell Jobs, Steve Jobs’ widow. The story of a well-connected Silicon Valley personality diving into direct-to-consumer genetics testing is of course a familiar one. Anne Wojcicki, wife of Google co-founder Sergey Brin, launched 23andMe to offer a nearly identical service, only to be shut down by the FDA for presenting consumers with risk profiles that the FDA said had not been exhaustively validated. 23andMe’s regulatory [path is] ongoing, and the company is actively pursuing new monetization strategies that minimize its reliance on consumer-generated revenue. [Ed. Note: Actually 23andMe is relatively close to validating their tests -- and clearing FDA, to provide the same service Color claims to provide, at 40 per cent of the price of Color -- with a wider array of test results.]

. . .Color Genomics is attempting to circumvent the. . . direct-to-consumer FDA requirements by insisting that only doctors order their genetics tests, putting them in the same class as other private laboratory providers like Quest Diagnostics. What differentiates Color Genomics from Quest Diagnostics is that if a consumer wants a genetic screening from Color Genomics, the startup has doctors on staff that can order the test on behalf of consumers, providing a loophole that will essentially allow them to market their genetic testing direct to consumers via an employed physician that will order the test and then explain the results. . . .

We will stay tuned -- and I do generally applaud the idea of democratizing our own genomic data -- but I think the pitch Color is using is a little over the top. Color argues that every woman over 35 in the US ought to pay out of pocket to get their spit test. In families with a history of breast cancer, I might agree. But clearly Color simply wants to cut a wider market-swath -- with that breathy rhetoric. Anyone care to take the other side of the argument? Anyone? . . . Bueller. . . Bueller. . .

BREAKING -- Whitehouse Station (Former HQ) Is Now Under Contract:

This is good news -- we all should hope it proceeds to a closing. Let us also hope that the buyer(s) will not remove it from the local taxable census of properties. In 2014, taxes on Merck's portion were about $5.8 million -- the single largest taxable property in that New Jersey township.

Here is a piece on it:

. . . .The company placed the hexagonal-shaped main building and less than half of its 1,000-acre corporate campus on the market in October 2013, listing it with real estate company Cushman & Wakefield. Merck retained a smaller office building and about 550 acres at routes 22 and 523 near Route 78.

Since then, Merck also listed its Summit facility, consolidating operations at its Kenilworth site. . . .

In late 2012 Merck announced that it would move its global headquarters from Readington.

The main building is a five-story granite and glass structure with a five-acre courtyard. It includes a 900-seat dining area overlooking the courtyard, a 250-seat auditorium, a full fitness center and 35,000-square-foot data center.

The corporate campus includes a 17,000-square-foot childcare center, a solar "farm," basketball and tennis courts, a ball field and a helipad. . . .

As my recent (2015) bylines repeatedly suggest, Merck now uses the legacy Schering-Plough HQ in Kenilworth as its home. The Kenilworth property was, about five years ago, now -- also on the market. But that selloff plan was abandoned. Overall. . . most encouraging! Onward.

Sharp Overall Two Year Decline, In Lobby Spend Continues, At Kenilworth, In Q1 2015

While the first quarter of 2015 is up, just marginally, from the first quarter of 2014, the four year trend is unmistakable: Merck is decreasing its lobby spend, to about half of the all time highs seen in 2012 and 2013 (six full years' data background here). The first quarter data clearly backs this general thesis. [Even so, Merck this quarter spent well over double what Apple spent, in Q1 2015 -- a trend I've also noted before.]

Here is what the bulk of the Q1 2015 spend went toward:

. . . .Issues relating to the further development of antibiotics and antimicrobials for serious and unmet medical needs; H.R. 512, DISARM Act of 2015 (Developing an Innovative Strategy for Antimicrobial Resistant Microorganisms Act of 2015). . . .

Medicare Coverage and Reimbursement issues; Medicare access to DXA services; Medicare reimbursement for antimicrobial drugs, including related provisions in HR 4187. . . .

Diabetes Prevention & Treatment, including related provisions of HR 3322, The Eliminating Disparities in Diabetes Prevention, Access and Care Act of 2013 and HR 074, The National Diabetes Clinical Care Commission Act. . . .

Potential legislation or legislative provisions relating to Medicare Part D and the establishment of a Medicaid style mandatory rebate on prescription drugs); H. Con. Res. 27, Establishing the budget for the United States Government for fiscal year 2016 and setting forth appropriate budgetary levels for fiscal years 2017 through 2025 (potential provisions relating to Medicare Part D and the establishment of a Medicaid style rebate, NIH funding provisions drawing funds from BIO/PhRMA industry government settlements, or other Medicare revenue raising provisions); S. Con. Res. 11, An original concurrent resolution setting forth the congressional budget for the United States Government for fiscal year 2016 and setting forth the appropriate budgetary levels for fiscal years 2017 through 2025 (potential provisions relating to Medicare Part D and the establishment of a Medicaid style rebate, NIH funding provisions drawing funds from BIO/PhRMA industry government settlements, or other Medicare revenue raising provisions). . . .

H.R. 2 - Medicare Access and CHIP Reauthorization Act of 2015; H.R. 1470/S. 810 - SGR Repeal and Medicare Provider Payment Modernization Act of 2015; no specific bills, access to contraception, biosimilars guidance, immunization access; general budget resolution, reconciliation, deficit reduction, debt ceiling; H.R. 83 - Consolidated and Future Continuing Appropriations Act, 2015; H. Con. Res. 27 - House budget resolution; S. Con. Res. 11 - Senate budget resolution. . . .

Trade Promotion Authority; Trans-Pacific Partnership; Issues relating to vaccines; Orphan drugs. . . . .

Separately, for the first time (if memory serves) Merck disclosed that it had hired the Barbour Griffith & Rogers, LLC lobbyist firm (yes that Barbour!). That firm will provide "guidance and strategic counsel with regard to regulations and legislation that could impact the pharmaceutical industry generally, and Merck, specifically." So they are sort of a quarterback for the others, I gather. Or maybe, that engagement comes as a package as Mr. Frazier accepted the Chairmanship of PhRMA for 2015-2016. Now you know -- or, at least, my best guesses. Busy day -- in the real life gig, here -- will likely be silent for the balance of the day.

Orion Has Captured Half The Norwegian Market For BioSimilar Remicade® -- In Two Months!

This very morning, Bloomberg claims Kenilworth is being bullied, in Norway. Me? I'm not so sure (i.e., how big is Norway, to the full EU, anyway?). First off, we do know that both Hospira and Celltrion had long ago entered, with their biosimilar (or "bio-better"!) versions of infliximab (which Merck and J&J brand as Remicade®), in the EU more broadly. So, one other perspective would be that Orion is simply doing in Norway what a generic would normally do, there -- as the third party in. Orion is grabbing share by slashing price. And even so, this is likely immaterial to Merck -- since the decline was previously well-baked into Merck's NYSE price, two months ago (per our coverage in real time, then).

As additional evidence of this, here is Ed Silverman's nuanced and experienced analysis:

. . . .A price war is under way in Norway where Orion Oyj slashed the price for a copycat version of the Remicade arthritis medicine that is also sold by Merck and the 69% reduction paid off swiftly: by last month, Orion grabbed half the market, Bloomberg News reports. The discount has irked rivals. Hospira, which sells the same copycat version of Remicade under a different name, says the markdown will prove too massive to sustain. Hospira and Orion both license the drug from South Korea’s Celltrion.

Merck is urging doctors to be cautious about switching patients. . . .

Even if Orion can't stay at a nearly 70 per cent discount to Merck forever, it is certain that sales of Remicade will never recover, for Kenilworth. This is a melting ice cream cone, at the revenue line. Even so, Merck will be fine without the full muscle of Remicade on the oars. . . the sculling will continue, no matter what. Onward. Life is indeed. . . just. . . too short -- to spend any more time worrying -- about the things outside our grasp.

Tuesday, April 21, 2015

After A Rather Checkered Past Five Years, Merck Makes Important New Vaccine Investment -- In Ireland: Carlow

We have covered the fallout from Fred Hassan's overpromise/underdeliver antics, on the Emerald Isle, lo' these past seven years, at least.

So it is wonderful to see Kenilworth putting even a modest amount of new capital to work, inside Carlow -- a world-class biologics facility -- and now, a fine vaccines facility. [A few years ago Merck put almost $335 million in to modernize the facility, as legacy Schering-Plough withdrew from Rathdrum, in County Wicklow.] It would make sense to manufacture the Ebola vaccine there, inasmuch as that is a low cost jurisdiction, and Merck will need to get the very lowest cost structure for that candidate to make a profit, in the still-developing world -- where the bulk of it will be sold. No published report indicates that this is behind Merck's thinking -- it is purely my (experienced) conjecture. Here's a bit, from FiercePharma Manufacturing -- do go read it all:

. . . .Merck, known as MSD outside of the U.S., said last week that it would invest €11.5 million ($12.4 million) in the Carlow facility. In an announcement, the company didn't specifically line out how it would invest the money at the site where it has a 200,000-square-foot manufacturing facility but in an email, a Merck spokesperson said the "infrastructure" investment" will include a training facility. There are no new jobs coming at this time from the "phased project," the spokesperson said but about 440 people currently work there.

MSD pointed out Carlow is its first standalone human vaccine facility. . . .

Carlow is also supporting the Kenilworth effort to ramp up Keytruda®, a very promising oncolology monoclonal antibody -- and that tech will lever nicely, in manufacturing an engineered Ebola vaccine inserted into a cold livestock virus container/casing. Onward, one and all!

Monday, April 20, 2015

Will Roche/Genetech Pivot Hard, Drive The Lane -- And Snag "First Mover" Anti-PD1L Rights In Certain Breast Cancer(s), This Fall?

To be sure, Merck's three pieces of monoclonal antibody Anti-PD1L good news created quite the buzz at AACR, yesterday afternoon. I do still believe that BMS's Opdivo® has the lead in all cancers, for at least the next 12 months. I'll explain why, at the bottom of this post.

In the mean time, though -- there is some very exciting news for Roche. It seems that Roche's early results with its MPDL3280A, also a PD1L monoclonal antibody (like Merck's) -- in breast cancer -- will allow Roche to take its breakthrough designation straight to an approval filing at FDA as early as this summer. So, will Roche be able to crash the lane, and lay one in (or even throw down a dunk?!) in some of the most aggresive breast cancers, effectively "posterizing" both Merck and BMS -- for at least this $5 billion segment? We shall have to watch and see. Here is the latest Bloomberg note on it all -- do go read it:

. . . .In an early-stage trial of people with an aggressive form of breast cancer who took the experimental Roche drug called MPDL3280A, tumors shrank in four of 21 patients, with cancer disappearing in two cases, according to findings announced Monday at an oncology meeting in Philadelphia. . . . While Merck and Bristol have already won regulatory approval for immunotherapies -- Keytruda for melanoma in Merck’s case and Opdivo for melanoma and lung cancer in Bristol’s -- Roche has a strong track record in cancer research and development that “may translate into commercial differentiation,” said Tim Anderson, an analyst at Sanford C. Bernstein & Co. . . .

About 15 percent of breast-cancer patients have the triple-negative type studied in the trial. In that form of the disease, tumor cells don’t have estrogen and progesterone receptors, and lack extra HER2 proteins. MPDL3280A would be used along with chemotherapy, which is now the primary treatment option. . . .

Even so, as I said at the top, BMS is the one to beat. I am increasingly hearing from oncologists at teaching hospitals that a few government programs are agreeing to cover so called "off-label" use of nivolumab.

It is that good -- and it is being used, right now, to fight a wide array of cancers, in clinics all over the nation. While the government payers (Medicare/Medicaid) aren't reimbursing at full retail rates, for the off-label cancers, the trend is in the right direction. I wonder how long it will be before private insurers will no longer be able to resist coverage for these revolutionary agents -- even prior to full FDA approval of them for -- say end stage kidney, liver or breast cancer.

I think the field is wide open, but BMS's Opdivo has the clearest lane to the hoop, and victory now. Merck had better get its specialist detailers in gear, and offer the oncologists the recent evidence that reimbursement is happening, even off-label. That would be very good for Kenilworth's Keytruda® ramp up, here in the latter parts of 2015. [Ed. note: fair use, and transformative/derivative use claimed (under applicable US common law) for Jill Laufer's fine CGI (a video, from which that single antibody still was derived, in my image), all on the Roche candidate called MPDL3280A, above.]

As ever, we shall watch and see.

Sunday, April 19, 2015

As Predicted, Merck Has Filed Its sBLA With FDA -- For Breakthrough NSCLC PD-L1 Indication, On Keytruda®

On the heels of the disclosure of its strong NSCLC data -- in patients whose tumors predominantly express PD-L1, at AACR in Philadelphia this morning (and in the prestigious New England Journal of Medicine) -- Kenilworth just said it had recently filed a supplemental biologics license application with FDA, for those sorts of patients, with that variant of lung cancer.

This is exactly as I suggested Merck would, the day after St. Patrick's, this year. And yes, this is good news. Here's a bit:

. . . ."In this study, NSCLC patients whose tumors express PD-L1 in the majority of their cells experienced the highest response rates to KEYTRUDA treatment," said Dr. Roger Perlmutter, president, Merck Research Laboratories. "The results from this study formed the basis for our Breakthrough Therapy designation and our recent FDA submission for advanced NSCLC, and indicate that tumor PD-L1 expression may be a relevant biomarker to identify patients more likely to have higher rates of response to KEYTRUDA in this tumor type. . . ."

Merck recently announced that the company submitted a supplemental Biologics License Application (sBLA) for KEYTRUDA in advanced NSCLC with the U.S. Food and Drug Administration (FDA). Under PDUFA, the FDA has 60 days from submission of the sBLA to determine if the application will be accepted for review. KEYTRUDA was granted Breakthrough Therapy designation in advanced NSCLC by the U.S Food and Drug Administration (FDA) in October 2014. . . .

In addition, Merck expects to file by June 30 with FDA to list Keytruda® as a first line melanoma therapy. [Merck does hold third line FDA approval already, in melanoma, for Keytruda.] All good -- and still, BMS holds a clear timing lead here. And so. . . Onward! Do have a blast, one and all.

Sovaldi® Patent Battle Twists -- Northern California Federal District Court Edition

At the outset, I'll note that -- in general -- when a company files a New Drug Application with the US FDA, it does so assuming that all the supporting materials will remain private, except for certain limited portions, which the FDA makes public during its Advisory Committee proceedings, as well as the label copy and related product data. Of course, for the last few years at least, the candidate's clinical trial results are made available on [Some fascinating background, here.]

But other than those truncated bits, drug companies use the NDA submission process to help FDA staffers understand how it is thought the drug works in humans, its safety profile, and why it is novel enough to warrant approval. The NDA also covers how the company plans to ensure uniformity, sterility and purity in large scale drug dose manufacturing.

So it was with great interest that I reviewed recent letters between the lawyers in the Merck v. Gilead patent fight over how sofosbuvir (branded as Sovaldi®) is metabolized in each human's system, as their bodies absorb the drug, this past week. To greatly oversimplify, Merck claims that its prior patents teach that metabolization process. Gilead replies that what all human bodies do naturally -- when sofosbuvir is introduced to their systems -- cannot properly be patentable, let alone patented by Merck. And so the battle rages, across at least seven countries, and about 12 court-rooms, globally. Most recently, a letter dated April 9, 2015, from Merck's lawyers makes it clear that Kenilworth wants Gilead to disclose all "the secret stuff" in Gilead's FDA NDA -- about Solvaldi (and Harvoni®, too apparently). Slick.

Truly, billions are at stake. And to be fair, the NDA might well indicate that Gilead was aware of Merck's likely claims on metabolization patents. But being aware of a patent that one (Gilead) believes was improvidently granted -- is not the same as being liable for billions in patent infringement royalties. Not even remotely. So, Merck has been able to compromise with Gilead, and learn about module 3 of Gilead's NDA. Perhaps that is what Kenilworth scientists were after, right along. We shall see. [But as I've said, I do not foresee Merck receiving billions from Gilead -- not by a long shot, here.]

So here is the back-door language intended to get Merck a peek, under Gilead's FDA NDA kimono (click to embiggify):

. . . . As we explained, disclosure in [Gilead's FDA NDA submission] Module 3 that synthetic techniques that were known in the art before January 18, 2002 are used for Gilead's synthesis of the "methyl-up, fluoro-down 2"-Me-F moiety in sofosbuvir would serve to rebut Gilead's contention that Merck's specification did not enable the synthesis of that structure as of January 18, 2002. . . .

Fascinating. Now go out and enjoy a beautiful Spring Sunday, one and all! I certainly plan to do so.

Saturday, April 18, 2015

Scotland's Life Sciences Industry Continues To Recover -- From Being "Fast Freddied". . .

A quiet weekend evening allows for. . . soup, and look-back reflections: the good news, here is that Scotland, near Glasgow, continues to rebuild its strong science driven employment base. It was kind of Merck to donate the legacy facility, as well.

I highlight the feel good story, out of our sturdy, even tempered relatives across the pond, though -- to remind the readership of just some of the sorts of damage the wrong kinds of CEOs inflict, on regular human beings -- scientists. [Here I would encourage the readership to consider the growing collateral damage path of one Ian Read -- still on top of Pfizer, as well.]

Out of the Herald Scotland, then -- a bit:

. . . .Confirmed partner companies for the hub include multinational pharma company Johnson & Johnson, venture capital firm Epidarex Capital and technology giant Toshiba.

Diane Harbison, BioCity Scotland's managing director, said she hoped the innovation hub would "help to catalyse new company creation and really benefit the life sciences sector in Scotland".

"We are basically trying to engineer serendipity that will help grow the sector," she said. "Life sciences is a key growth sector of the Scottish economy and is set to double in size in the next five years."

"Offering support to Scottish universities and industries by partnering with major healthcare practitioners, entrepreneurs and scientists will provide a tremendous boost to the life sciences sector in Scotland."

Harbison added that BioCity's central location on the M8 at Newhouse made it the ideal place to attract talent from across the country. . . .

Just for the record, as a historical footnote, in mid-2009, Schering-Plough EVP Thomas Koestler was, as an executive of legacy Schering-Plough, holding forth on his hopes for additional significant Lanarkshire investment and "sharing his zeal for the company’s Lanarkshire operations. As Dr. Thomas Koestler enthused about Scotland’s talent in pharmaceuticals, earthmoving equipment shuddered outside the window of the Newhouse plant, laying the foundations for a state-of-the-art new compound store. . . ." But none of that ever came to be. It was all closed one year later, in mid-2010. So it goes.