…and holds its hand in HIV, too.
Yesterday saw that rare thing in the drug industry: two Big Pharma creating a new company together, carving out both parents’ HIV assets from discovery through commercialization.
The new offspring (which, from the PR, doesn’t appear to have a name yet) will look far more like GSK than Pfizer, since GSK put in most of the booty, and thus owns 85% of the equity. But Pfizer’s minority contribution—basically Selzentry and some pipeline—will nevertheless make a business that’s “more sustainable and broader in scope than either company’s individually…with a 19% market share,” say the companies.
It’s still not going to make much of a mark on Gilead or Bristol, though, as we reported in the Pink Sheet DAILY yesterday. Thus given that GSK’s portfolio’s old, and Pfizer’s never really took off at all, it’s hard to believe this isn’t the precursor to a spin-off or sale—something that Pfizer’s R&D chief Martin McKay acknowledged was a possibility.
GSK and Pfizer aren’t just allied in packaging up sub-sized assets, though. They’re betting on similar R&D strategies, too. As the details emerge of Pfizer’s post-Wyeth reorg, (elaborated upon here) it’s clear that Pfizer’s copying GSK’s plan to create small, accountable biotech-like structures. At GSK they’re DPUs, at Pfizer they’re TA-focused units with about 100 scientists—or “no bigger than 150,” according to SVP worldwide discovery research Rod MacKenzie (who sits within the small-molecule half of Pfizer’s newly-divided operation).
The CSOs that head these units are being held accountable for delivering the right stuff. But “we’re moving away from metrics-based goals,” MacKenzie added during a panel at Windhover’s Pharmaceutical Strategic Outlook conference in New York earlier this week (so they might be keeping a good number of Wyeth’s senior R&D guys, but they aren’t taking Wyeth’s R&D productivity-booster idea). Success will instead be measured in terms of “value-based goals” including positive proof-of-concept.
Ok, we’re not quite sure either, but whatever the goals, “it’s certainly a possibility” that the accountable folk will be fired if they’re not met, said MacKenzie. That's akin to GSK’s DPU and CEDD chiefs who are on a three-year funding cycle and had better deliver if they want more after that. (Read this if you haven't already.)
But in this bid to re-create real-world biotech within Big Pharma walls, is it a case of the blind leading the blind? After all, GSK’s new model is hardly proven, just as its last iteration—the CEDDs Part I—wasn’t either.
And the two R&D head-structure Pfizer espouses--with Mikael Dolsten responsible for the large molecule universe and Martin Mackay responsible for the small molecule world--leads to some potentially unnecessary complexity, especially since those "empowered CSOs" will be developing mixed portfolios of compounds. One long-time industry consultant noted the structure "makes the accountability for productivity of those CSOs unnecessarily diffuse and undermines the power of the two heads". Mackay and Dolsten disagree, of course. To hear them in their own words, check out this podcast from last week.
The larger question, however, is why re-create biotech inside, when it’s working perfectly well outside? In response to that question on the panel on Wednesday, Pfizer' s Mackenzie noted “combining the spirit of small, with the power of scale—if you get it right--is the most powerful model you can have.”
If neither of them do get it right, the spin-off model might start looking pretty powerful, too.
image from flickr Adam Foster used under a creative commons license
Friday, April 17, 2009
…and holds its hand in HIV, too.