Monday, February 04, 2008

Perlmutter: We're Not Abandoning Japan

Signing over Japanese rights to 13 development assets and selling the Japanese subsidiary doesn’t mean Amgen is abandoning Japan, insisted Roger Perlmutter, EVP R&D, in a phone interview with IN VIVO Blog a few hours after the Big Biotech announced its $300 million up-front double-deal with Takeda (see our post below). “We’re just saying that partnering is the right way for us now."

But Perlmutter acknowledged that most Western firms haven’t exactly sailed into the world’s second-largest market, where local knowledge and relationships still count for a lot. “Japan is a very special market, requiring special expertise. The process of getting into Japan [for a foreign company] takes decades, and requires a large investment.”

The money bit’s the problem: Amgen can’t afford large investments, since its annus horribilis in 2007—which may be repeated, possibly even more horribly, in 2008. Indeed, Amgen’s taking a “more strategic look” at its wider international expansion plans, according to Perlmutter. In other words, Japan might not be the only place Amgen pulls back, or partners. “Things we had anticipated we could do…we now can’t do in the same time-frame.”

But at least there are scores of willing collaborators standing by. Takeda apparently won a highly competitive bidding process for the broad alliance announced today—perhaps made more attractive since Amgen hadn’t insisted on any particular structure. “We let potential partners suggest the best way to ally” in Japan, insists Perlmutter. (Given its sellers’ advantage, Amgen would have called the shots, mind you—it has kept a co-promote option in Japan, for instance, should its fortunes change down the line.)

Worldwide rights to Phase III cancer candidate motesanib weren’t originally part of Amgen's Japan proposal--these were being advertised separately. "The compound needed more investment," clarifies Perlmutter--not least, one assumes, to help distinguish this VEGF-targeting multikinase inhibitor from its on-market competitors. Still, Takeda’s interest in that, too, helped it secure the lot: one partner’s easier than two.

Perlmutter isn’t expecting any more multi-molecule, broad ranging deals like this one anytime soon. But the party still isn’t over for those seeking biotech pipeline assets, and who have the money to pay for them. Amgen's currently partnering some of its earlier-stage molecules, too, for which it expects more valuable cash. After all, noted Perlmutter, "not a lot of folk have assets like ours."

And while not a lot of folk face quite the same near-term revenue risks, they aren’t home free, either. Big Pharma will see products with $73 billion worth of US sales lose patent protection by 2012. Which means that the kind of out-licensing and risk sharing Amgen is now doing is likely to be increasingly common among other large drug companies, too.

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