Pharma Looks to Outside Talent

by Andrew Jack in London

Drug companies are stepping up recruitment of specialists from outside their own ranks as they attempt to adapt to tougher market conditions, say senior industry executives and headhunters.

Last year, at least one chief executive, one head of pharmaceutical operations and three chief financial officers with careers outside the industry were appointed to leading companies in the search for new skills.

Executive search firms are also reporting rising demand for their services, as companies seek ways to draw in fresh experience from other sectors and to reduce costs.

Jacques Bouwens, head of the European healthcare practice at Russell Reynolds, the recruitment company, said there was growing recognition of the need for “hybrid” hirings from outside pharmaceuticals, including marketing, supply-chain work and communications.

From a survey of 25 leading industry executives his company recently conducted, highlighting the need for more external recruitment, it identified a focus on cost as the top strategic priority for the next five to ten years.

In considering the skills that future top executives needed, most believed governments were the most important growing influence over the sector, while doctors’, regulators’ and investors’ power was waning.

The company’s mandates to find pharmaceutical executives have risen sharply in the past five years, with the greatest jump in demand for senior human resource executives, followed by finance, manufacturing and supplychain, and legal and communications specialists.

James Cornelius, formerly head of Guidant, the medical devices company, was ratified last spring as chief executive of US-based Bristol-Myers Squibb, where he had been interim chief after a shake-up triggered by a court-appointed monitor.

Most of the spate of newly appointed chief executives from rival pharmaceutical companies in recent months have been hired internally, but the next level in the hierarchy has been more open to outsiders.

Peter Kellogg, the new head of finance at Merck, previously worked in the sector at Amgen and Biogen, but before then was based at PepsiCo. Frank D’Amelio at Pfizer formerly worked at Alcatel-Lucent, while AstraZeneca hired Simon Lowth from Scottish Power.
Joe Jimenez, who now runs pharmaceutical operations at Novartis of Switzerland, briefly ran its consumer health division but only joined last year from Heinz in Europe.

Peter Levin, head of the North American life sciences practice at Egon Zehnder International, said: “There is a clear drive to hire people with different experiences, particularly at the executive levels.”

© The Financial Times Limited 2008

TV drug ads should list FDA hotline, lawmakers say

The information would allow consumers to report serious side effects from prescription medication.

By Ben DuBose, Staff Writer for the Los Angeles Times

WASHINGTON — Citing a new Consumer Reports poll, two members of Congress urged the Food and Drug Administration on Wednesday to mandate that all television advertising for prescription drugs include information for consumers to report serious side effects to the agency.

The poll found that 16% of respondents who had taken a prescription drug had experienced a side effect serious enough to send them to the doctor or hospital, but only 35% were aware that such side effects could be reported to the FDA.

The FDA “is failing to serve its most vital supervisory responsibility,” said Rep. Rosa DeLauro (D-Conn.), who chairs a House subcommittee with oversight of the agency. “The more we know about serious drug side effects, the more we can do.”

Through a program known as MedWatch, the FDA is responsible for tracking side effects from prescription and over-the-counter medication. It uses the reports to detect problems with drugs. But agency officials estimate they learn about fewer than 1 in 10 drug reactions.

The poll results reflected that statistic, with 7% of respondents naming the FDA as a place where they would report a serious drug side effect.

Consumers Union, the nonprofit organization that publishes Consumer Reports, sent the FDA a petition with more than 55,000 signatures requesting that a toll-free number and website address be included in television drug advertisements to make it easier for people to report side effects.

“We have received the petition and are in the process of reviewing it at this time,” said FDA spokeswoman Rita Chappelle.

In FDA-related legislation passed last year, Congress required that contact information for the agency be included in all print drug ads and called for an FDA study to be completed by the end of last month to assess whether a similar requirement was needed for television ads. Chappelle said the study was still in progress.

In the poll, television was identified as the medium where consumers were most likely to be exposed to a prescription drug ad. Of respondents who had recently seen at least one such ad, 98% said they had seen it on television; 59% said they had seen it in print.

BenDuBose may be reached at ben.dubose@latimes.com.

© Los Angeles Times

Schering plans $1B cutback as Vytorin, Zetia fall

10% layoffs, plant closings due

by George E Jordan and Susan Todd, Star-Ledger Staff

Faced with a crushing blow to its top-selling medicines, drugmaker Schering-Plough announced in early April more than $1 billion in spending cuts, including plans to lay off 10 percent of its work force and shut manufacturing plants over the next two years.

Fred Hassan, chairman and chief executive of the Kenilworth-based company, used tough language to describe the cuts that he said were precipitated by calls at the American College of Cardiology meeting in Chicago to halt the widespread use of the cholesterol tablets Vytorin and Zetia.

“No area will be exempt,” Hassan said. “Hard new realities are requiring the hard new actions.”

Rosemarie Yancosek, a spokeswoman for Schering-Plough, could not offer a timetable for the approximately 5,500 global layoffs. Neither could she identify which facilities around the globe would be closed or would eliminate jobs.

Schering-Plough has 8,000 employees in New Jersey and another 47,000 workers scattered around the world, she said. It also operates 60 manufacturing plants, including production lines in New Jersey.

“We are going to be taking down the cost basis for the entire company,” Hassan said in a teleconference with Wall Street analysts last night.

The company had already been in the throes of making layoffs and $500,000 in cuts since its $14.4 billion acquisition last year of Organon BioSciences, which gave Schering-Plough a stable of potential new drugs.

The lion’s share of the layoffs and plant closings announced will occur by 2010, while the rest would happen by 2012, Schering-Plough said in a news release.

The recommendation to curtail use of the drug by an ACC panel, and in an editorial in the New England Journal of Medicine, was prompted by a study released partially in January that found Vytorin worked no better than Zocor — a generic drug five times less expensive — at reducing blockages that cause heart attacks. The drugs’ safety was not questioned.

The full study results were released at the ACC meeting.

George E. Jordan may be reached at gjordan@starledger.com or (973) 392-1801.
Susan Todd may be reached at stodd@starledger.com or (973) 392-4125.

© 2008 The Star Ledger and © 2008 NJ.com

Bill Gates Encourages New Health Ideas

by Donna Gordon Blankinship, Associated Press Writer

If you have an unorthodox, unproven idea that can prevent HIV infection or help protect against infectious diseases, one of the richest men in the world wants to hear from you.

The Bill & Melinda Gates Foundation has set aside $100 million to encourage innovation in global health research, offering grants to those with innovative ideas on four topics: Tuberculosis, HIV, infectious diseases and drug resistance.

The foundation’s new Grand Challenges Explorations program plans to give $100,000 each to about 60 projects in the first round of what is expected to be a five-year program.

Proposal applications are short — only about two pages long — and preliminary data is not required for the applications due at the end of May.

Of course, each applicant will need to be a scientist and have a lab in which to do the work, foundation officials said. But there won’t be many more restrictions.

Foundation officials say it’s one of the most open-ended requests for proposals they’ve ever issued, but it fits well with the organization’s quest to be innovative.

“We push ourselves to be as creative as we can,” said Martha Choe, who is slated to become the foundation’s new chief administrative officer.

The foundation has no plans to open the door to unorthodox ideas for its other focus areas — global development, libraries, education and support for children and families in the Pacific Northwest — although unsolicited grant requests arrive in the mail daily.

The world’s largest philanthropy, which was established by Bill Gates, the co-founder of Microsoft Corp., paid out 1,322 grants totaling more than $2 billion in 2007, compared to 1,283 grants totaling more than $1.54 billion in 2006.

The Grand Challenges Explorations program is an outgrowth of an effort launched by the foundation in 2003 to help foster innovation in global health discovery.

The foundation is already spending about $450 million to support 40 bigger projects focused on preventing infectious diseases, creating drugs or delivery systems that limit resistance, creating new ways to prevent or cure HIV infection, and understanding latent TB infection.

The smaller grants announced will focus on the same research areas. The foundation expects to make several requests for proposals each year, officials said.

Gates Foundation official website: http://www.gatesfoundation.org

Justices Shield Medical Devices From Lawsuits

By Linda Greenhouse

WASHINGTON — Makers of medical devices like implantable defibrillators or breast implants are immune from liability for personal injuries as long as the Food and Drug Administration approved the device before it was marketed and it meets the agency’s specifications, the Supreme Court ruled in February.

The 8-to-1 decision was a victory for the Bush administration, which for years has sought broad authority to pre-empt tougher state regulation.

In 2004, the administration reversed longstanding federal policy and began arguing that “premarket approval” of a new medical device by the F.D.A. overrides most claims for damages under state law. Because federal law makes no provision for damage suits against device makers, injured patients have turned to state law and have won substantial awards.

The Bush administration will continue its push for pre-emption in another F.D.A. case that the court has accepted for its next term, on whether the agency’s approval of a drug, as opposed to a device, pre-empts personal injury suits. Drugs and medical devices are regulated under separate laws.

The case before the court concerned only medical devices that had gone through the pre-market approval process specified by the Medical Device Amendments of 1976. Most devices now available reached the market through a different process, under which the F.D.A. found them to be “substantially equivalent” to those marketed before the 1976 law took effect.

The Supreme Court ruled in 1996 that this less rigorous approval process does not pre-empt state damage suits against the manufacturers of “grandfathered” devices.

Devices subject to the pre-market approval process, and thus affected by the court’s opinion, tend to be more technologically advanced, expensive and, in some instances, risky.

Examples of devices that have been the subjects of recent lawsuits include an implantable defibrillator, a heart pump, a spinal cord stimulator, a drug-coated stent, an artificial heart valve, and prosthetic hips and knees.

It was not immediately clear how many of the thousands of lawsuits against medical device manufacturers would be affected, though some pending cases will almost certainly be nullified.

The decision, for example, does not foreclose lawsuits claiming that a device was made improperly, in violation of F.D.A. specifications. Cases may also be brought under state laws that mirror federal rules, as opposed to supplementing them.

A jury, looking only at the injured plaintiff, will tend to weigh only the dangers of a device and “is not concerned with its benefits,” Justice Scalia said, adding, “the patients who reaped those benefits are not represented in court.”

Barnaby Feder contributed reporting from New York and Gardiner Harris from Washington.
© New York Times

Co-Payments Go Way Up for Drugs With High Prices

By Gina Kolata

Health insurance companies are rapidly adopting a new pricing system for very expensive drugs, asking patients to pay hundreds and even thousands of dollars for prescriptions for medications that may save their lives or slow the progress of serious diseases.

With the new pricing system, insurers abandoned the traditional arrangement that has patients pay a fixed amount, like $10, $20 or $30 for a prescription, no matter what the drug’s actual cost. Instead, they are charging patients a percentage of the cost of certain high-priced drugs, usually 20 to 33 percent, which can amount to thousands of dollars a month.

The system means that the burden of expensive health care can now affect insured people, too.

No one knows how many patients are affected, but hundreds of drugs are priced this new way. They are used to treat diseases that may be fairly common, including multiple sclerosis, rheumatoid arthritis, hemophilia, hepatitis C and some cancers. There are no cheaper equivalents for these drugs, so patients are forced to pay the price or do without.

Insurers say the new system keeps everyone’s premiums down at a time when some of the most innovative and promising new treatments for conditions like cancer and rheumatoid arthritis and multiple sclerosis can cost $100,000 and more a year.

But the result is that patients may have to spend more for a drug than they pay for their mortgages, more, in some cases, than their monthly incomes.

Read more: New York Times Article

© New York Times