Market Place
This week in Phispers, we have some good and bad news on Swiss drugmaker, Novartis. While it acquired gene-therapy company AveXis for US$ 8.7 billion, it also got embroiled in another bribery case in China. In France, President Emmanuel Macron committed US$ 1.8 billion in artificial intelligence until 2022, with healthcare at the center of this strategy. China, on the other hand, plans to transform its generic industry in order to provide affordable medication to more people. Teva suffered yet another setback as its partner Celltrion’s biosimilars got rejected by the USFDA. Also, Health Canada adopted ICH guidelines on drug substances.
As Novartis buys
US$ 8.7 billion gene therapy, another bribery allegation emerges in China
For Swiss drugmaker Novartis, this has been a week of both good and bad news. First, the good news — Novartis entered into a deal to acquire gene therapy company AveXis for US$ 8.7 billion. The deal is expected to be completed in mid-2018.
The acquisition of the Bannockburn, Illinois-based AveXis will give Novartis access to a promising drug to treat a rare disease that afflicts infants. Known as spinal muscular atrophy, this is an inherited neurodegenerative disease caused by a defect in a single gene. Avexis’ SMA drug, AVXS-101 is currently in Phase III trials. The takeover also marks Novartis competition with Biogen’s US- and EU-approved antisense oligonucleotide Spinraza (nusinersen), which has been marketed by Biogen since 2016 at an annual price of US$750,000 per patient. Roche is also working on an SMA drug, which is in pivotal clinical trials Moreover, Novartis has resumed Phase III trials for LMI070 — another drug to treat SMA.
According to Novartis, AveXis’ drug shows the potential to become a blockbuster.
The transaction is Novartis’s second deal in gene therapy this year. In January, Novartis had signed a licensing and supply deal with Spark Therapeutics to develop, register and commercialize Spark’s gene therapy Luxturna (voretigene neparvovec) outside the US.
This comes only a few months after Novartis received FDA approval for Kymriah (tisagenlecleucel), the first chimeric antigen receptor T-cell (CAR-T) gene therapy for B-cell precursor acute lymphoblastic leukemia (ALL). However, this is the first such deal led by new chief executive officer, Vas Narasimhan.
And now the bad news — Novartis is embroiled in another bribery case in China. An employee of Novartis International AG’s affiliate in China accused the drugmaker of money laundering by funding fake academic activities.
In order to promote the company's new drugs such as Benazepril and Diovan (valsartan) tablets, the company held fake academic activities and paid clinical doctors kickbacks, according to the website — www.eeo.com.cn.
Back in March 2016, Novartis had to fork out US$ 25 million to settle a Securities and Exchange Commission probe into bribery allegations in China. According to the SEC, Novartis had offered Chinese doctors several inducements, such as a junket to Chicago and Niagara Falls, to boost prescriptions of its drugs in the country. Novartis is still battling bribery charges in Greece.
France puts healthcare
at the center of its US$ 1.8 billion AI strategy
The President of France Emmanuel Macron has committed to investing US$ 1.8 billion in artificial intelligence (AI) until 2022. The spending plan will target the healthcare sector and is accompanied by a commitment to open up French data.
Macron discussed the AI strategy following the release of a report which called for France to make health a cornerstone of its AI policy. The goal is to start catching up with the US and China.
“Innovation that artificial intelligence brings into healthcare systems can totally change things: with new ways to treat people, to prevent various diseases, and a way—not to replace the doctors—but to reduce the potential risk,” Macron said.
“You can totally transform medical care making it much more predictive and personalized if you get access to a lot of data,” he added.
However, Macron does see a cost to taking that route. He knows AI needs patient data if it is to transform healthcare. But the same data can also be used by insurers to predict a patient’s medical risk. Or, it can be exploited for commercial gain without improving lives. The French President termed this as a major threat to France.
“The day we start to make such business out of this data is when a huge opportunity becomes a huge risk. It could totally dismantle our national cohesion and the way we live together. This leads me to the conclusion that this huge technological revolution is in fact a political revolution,” Macron told WIRED in an interview.
However, Macron is of the belief that, if done properly, opening up the data will bring net gain for the French economy and also to the lives of its citizens.
“The key driver should not only be technological progress, but human progress. This is a huge issue. I do believe that Europe is a place where we are able to assert collective preferences and articulate them with universal values,” Macron said.
China to
transform its generic industry through preferential tax rates
The Chinese government plans to encourage manufacturing of generics so that affordable medication is available to more people. As a step, the government has announced plans to implement preferential tax rates to generic drug makers.
As part of this strategy, the country’s State Council has announced that corporate income tax for generic makers that have been identified as a “high-tech enterprise” will be set at 15 percent. The current rate of corporation tax is 25 percent.
The new strategy, according to the State Council, is aimed at promoting research and development of generics and enhancing their quality and efficiency.
The State Council also plans to draw up new incentives aimed at encouraging the development and production of generic drugs in order to help safeguard public health, reduce medical bills and encourage innovation.
The Chinese government’s health department and drug regulator will compile and update a list of scarce drugs, to encourage drug makers to increase production.
China has been criticized for lacking protection for IP rights. In March, the US announced tariffs of up to US$ 60 billion on China in response to China’s alleged IP violations.
The Chinese pharmaceutical industry was valued at US$ 108 billion in 2015, and 95 percent of drugs approved by the China Food and Drug Administration were generics. However, many patients in China with cancers or rare diseases are forced to use expensive imports, due to lack of availability of effective generics in the domestic market.
Meanwhile, Chinese pharma companies are making it big in the international market. In 2017, the USFDA approved 38 abbreviated new drug applications (ANDAs) from Chinese pharma companies — 16 more than those approved in 2016.
Teva suffers
setback as its partner Celltrion’s biosimilars
get rejected by FDA
Israeli drugmaker Teva Pharmaceutical Industries is continuing to face setbacks. This time from its partner Celltrion.
In 2016, Teva had signed a licensing agreement with Korean company Celltrion Healthcare, which develops biosimilar drugs. Teva was supposed to commercialize the generic versions of best-selling oncological drugs Herceptin and Rituxan, which have annual sales in the United States of US$ 6.5 billion. The last week, however, brought in news of a delay.
Celltrion announced that the USFDA has issued Complete Response Letters (CRLs) for two of its products, CT-P10, a proposed rituximab biosimilar referencing Rituxan, and CT-P6, a proposed trastuzumab biosimilar referencing Herceptin. This follows a recent warning letter from the USFDA to Celltrion. The launch of the drugs from which Teva was meant to benefit has thus been postponed.
In recent years, Teva’s competitors have forged ahead in biosimilars, while Teva has lagged behind.
According to a statement on Celltrion’s website, the FDA has requested supplementary information about the products. Celltrion says it will work closely with regulators to address the issues that led to the CRLs, and that it expects to receive FDA approval of both drugs within this year.
In Europe, CT-P6 recently gained an EU marketing authorization, and Celltrion plans to launch it there under the name Herzuma. Similarly, CT-P10 has also been approved in the European Union.
Health Canada
adopts ICH guidelines
for drug substances
Health Canada has adopted the ICH’s Q&A guideline on the development and manufacture of drug substances as well as a separate guidance on residual solvents.
According to a Health Canada statement, the guidance has been developed by the appropriate ICH expert working group and has been subject to consultation by the regulatory parties, in accordance with the ICH process.
The ICH Assembly has endorsed the final draft and recommended its implementation by membership of ICH.
“It is recognized that the scope and subject matter of current Health Canada guidances may not be entirely consistent with those of the ICH guidances that are being introduced as part of our commitment to international harmonization and the ICH Process. In such circumstances, Health Canada-implemented ICH guidances take precedence,” a Government of Canada notice said.
“Health Canada is committed to eliminating such discrepancies through the implementation of a phased-in work plan that will examine the impact associated with the implementation of ICH guidances. This will result in the amendment or, depending on the extent of revisions required, withdrawal of some Health Canada guidances,” it added.
Last year, in an interview to PharmaCompass, Parul Oza, Managing Director of CRMO Pharmatech (an Ahmedabad-based company established with a vision to provide complete outsourcing solutions to the pharmaceutical industry) had said “the implementation of the ICH Q11 guidance has already started placing regulatory submissions of drug substances under the scanner as API starting materials now have to be justified against the ICH Q11 general principles.”
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