This week in Phispers, read about the extortion cyberattack and how it impacted hospitals in the UK. There is news on GSK, and its plans to buyout Novartis’ stake in their consumer health JV. Its blockbuster Advair got a shot in the arm as another generic failed endpoints. There is also news on mergers, acquisitions and layoffs and how the US FDA’s new commissioner is reorganizing its inspection staff.
Ransomware attack cripples NHS in the UK; such threats likely to grow
The ‘ransomware’ extortion cyberattack took the world by a storm last week. And if the UK’s National Cyber Security Centre is to be believed, more cases of the ransomware are expected to come to light, “possibly at a significant scale”.
Last weekend, a
huge extortion cyberattack hit
countries across the globe, holding computer data for ransom at hospitals and
several firms.
Two security firms — Kaspersky Lab and Avast —said they had identified the malware behind the attack that impacted over 70 countries. Russia was hit hardest.
The attack hit National Health Service (NHS) — UK’s health service — forcing hospitals to close wards and emergency rooms. Across the country, hospitals found themselves without access to their computers and phone systems. Many patients were sent home as their records could not be accessed.
While there has
not been any fresh attack so far, according to a BBC news report, at least 16 trusts out of 47 of the NHS that were hit are still facing
issues, leading to further cancellations and delays to services.
Ransomware is a
type of malicious software that blocks access to a computer system until a sum
of money is paid, usually via bitcoin (the digital currency), to release
it. According to news reports, the
ransomware threats are likely to grow across private and public sectors.
Thermo Fisher
buys Patheon; INC merges with inVentiv; Paraxel plans layoffs
Thermo Fisher Scientific Inc continued its acquisition spree last
week with the US$ 5.2 billion purchase of drug-development technology company Patheon NV.
Thermo Fisher has emerged as one of the world’s
biggest manufacturers of diagnostic and testing equipment through deals. Over
the last five years, Thermo Fisher has made acquisitions worth US$ 22 billion.
It will pay US$ 35 a share in cash for Patheon — a 35 percent increase over Patheon’s closing price on Friday last.
Meanwhile, INC
Research Holdings Inc announced last week that it would merge with private
equity-owned inVentiv Health Inc, another contract research organization (CRO),
in a US$ 4.6 billion all-stock deal.
The deal is expected to help INC win contracts with large pharma companies.
Another CRO — Paraxel — plans to lay off staff, as rumors
of a potential buyout gather steam after the company projected lower revenues. In a filing with the SEC on May 4, the
Massachusetts-based company outlined plans to cut 1,200 jobs at the global
clinical trial operation.
Weeks after
staff plotted to destroy drugs, EU probes Aspen for price
gouging
Last month, Phispers
had carried a news nugget on Africa’s leading drug company — Aspen Pharmacare — and how its employees had reportedly plotted to destroy stocks of
life-saving medicines during a price dispute with the Spanish health service in
2014.
This week, the
European Commission initiated a formal probe into
concerns that Aspen Pharma is charging excessive prices for five life-saving
cancer medicines. The Commission will investigate whether Aspen has abused a
dominant market position and breached EU antitrust rules. If found guilty, this
could lead to a hefty fine for
Aspen.
The investigation is around Aspen's pricing practices for niche medicines containing the active pharmaceutical ingredients (APIs) — chlorambucil, melphalan, mercaptopurine, tioguanine and busulfan. These APIs are used for treating cancer
and are sold with different formulations and under multiple brand names. Aspen
acquired these drugs after their patents expired.
The investigation
will cover all of Europe except Italy, which hit the company with a Euro 5
million fine in October last year for price hikes up to 1,500 percent for some
key drugs.
Investors fume over GSK’s plan to buyout Novartis stake in consumer health
GlaxoSmithKline has informed its shareholders that it
plans to buy out Swiss drugmaker Novartis’ 36.5 per cent stake in GSK Consumer Healthcare.
GSK is planning to offer £8 billion (US$ 10.3
billion) to Novartis for this stake and industry observers say Novartis could
use the gains to fund a megatakeover.
And its potential target is AstraZeneca. Novartis’ buyout of AstraZeneca, if realized, could reshape the oncology landscape.
Buying out Novartis would give GSK control over the world’s biggest consumer health operations. And a firm control over its strong brands like Horlicks, Nicorette and Beechams. The move is in line with GSK’s new CEO Emma Walmsley’s recent statements.
However, GSK’s shareholders have not taken the news well. GSK’s star investor Neil Woodford was pushing for a company-wide breakup. GSK, however, preferred to hang onto the business, and Walmsley—who was the former head of the JV—confirmed the strategy on the company’s first-quarter earnings call. As a result, Woodford decided to sell his (£1.2 billion) GSK holding.
Woodford held his shares in GSK for more than 15 years. ‘The sum of the parts is significantly greater than the whole,” he said. “My viewpoint, and that of other like-minded institutional investors, has been heard but ultimately ignored – repeatedly,” he added. Woodford wanted GSK to split into more focused businesses.
New FDA
Commissioner reorganizing inspection staff
The US Food and Drug Administration’s new commissioner — Scott Gottlieb — wants federal inspectors to specialize in certain areas, in order to ensure the safety of America’s food and medical products.
In a memo,
Gottlied announced that workers in the US FDA’s Office of Regulatory Affairs will begin focusing on overseeing specific product areas — such as pharmaceuticals or medical devices — rather than activities in their US geographic regions.
“This organizational approach replaces a management structure based on geographic regions,” says the FDA website.
The US FDA’s staff of 4,000 probes consumer complaints, oversees imported goods, and inspects domestic and foreign facilities to ensure compliance with the agency’s standards.
The refocusing “will make our field programs more modern and responsive to today’s threats and challenges, while making sure that we are taking a risk-based and science-based approach to our work,” Gottlieb said in the memo. “We need to make sure that we are achieving the greatest degree of consumer protection with the resources that we have,” he added.
The initiative was
proposed four years ago, with implementation set to start this month.
Merck’s Keytruda approved for lung cancer; AstraZeneca, Roche suffer setbacks
Merck’s Keytruda got approved by the US FDA for treatment of advanced lung cancer, when used in combination with
chemotherapy. This bolsters Merck's lead position in the field of medicines
that help the immune system fight cancer.
Lung cancer is by
far the largest oncology market and the approval significantly expands the
number of patients available for the Keytruda therapy, in combination with Eli Lilly's Alimta.
Roche,
AstraZeneca drugs fail trial:
AstraZeneca suffered a setback last week when its Phase III asthma drug tralokinumab — IL13 — saw a late-stage failure.
This drug had
already failed a Phase IIb trial for asthma, raising questions why the company
went ahead with the trial and plans to continue a major late-stage effort. But
the researchers at the time said they were encouraged by a subgroup analysis
that pointed to success.
Roche too suffered a setback as its drug tecentriq (atezolizumab)
failed the late-stage confirmatory study in bladder cancer. The drug failed to
significantly improve overall survival. The blow raises questions about the
fate of this drug.
After Mylan, Hikma’s Advair generic runs into “major” problems
GSK’s blockbuster lung drug Advair may escape generic competition
in the United States this year. In March, Mylan’s application for a cut-price equivalent was turned down by the US FDA. And last week, the application of Hikma Pharmaceuticals and its partner Vectura was turned down by the American regulator.
Industry analysts
believe the generic threat has now been pushed back until mid-2018, providing
GSK with a short-term profit boost.
According to
Hikma, there were major issues with the application, which is why the US FDA
decided not to approve its version of the inhaled treatment for asthma and
chronic lung disease at this time. The firm said it was unlikely to receive approval
this year.
Hikma and Mylan have received complete response letters from the FDA that were categorized as ‘major’. Dealing with a major amendment to a generic drug application means a delay of 10 months for an FDA response.
Meanwhile, Mylan
President Rajiv Malik said last week that the company disagrees with US FDA’s reasoning behind not approving its generic for GSK’s Advair in March.
Malik said the FDA was asking it to comply with standards set out in draft guidance the agency had issued. But the company believes it is not required to do so. Mylan made the comments while reporting its first-quarter earnings.
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