DOTW: Save The Date

Miss the crowds? BIO’s just around the corner. This year there’s an added je ne sais quoi to the trade event as deal makers and execs converge on the regulatory swampland that is our nation’s capital. Amidst discussions of the state of the industry -- the strengthening IPO market (?), the venture financing climate, and the impact of both on deal making -- all eyes will be on FDA as it holds forth on Provenge and Avastin.

But while there’s no question BIO is a must-attend event, here at IN VIVO Blog, we’re admittedly biased in believing there’s another networking opportunity that is de rigueur for the industry’s top deal makers. That’s right: IN VIVO’s annual Pharmaceutical Strategic Alliances meeting, taking place September 22 and 23 in New York City at the Millennium Broadway Hotel.

Yes, we’re tooting our own horn, but once you’ve checked out our stellar line-up you’ll understand why. Key notes by Biogen Idec’s George Scangos and Bristol’s Lamberto Andreotti kick off the meeting. Then there’s an all-star discussion of biz dev on day 2 with help from Pfizer’s Kristen Peck, BMS’s Jeremy Levin, J&J’s Tom Heyman, Roche’s Joe McCracken, and Glaxo’s Ian Tomlinson.

You want deal making? We have it in spades. And not just at PSA. As we head into a summer time Friday, we bring you your weekly wrap up of the deal making headlines…

Boehringer Ingelheim/Zealand: Surprise! The Danish biotech Zealand pharma inked a deal this week for its Phase I-ready dual-acting GLP-1 and glucagon agonist for type 2 diabetes and obesity, ZP2929. But the partner, Boehringer Ingelheim, probably wasn’t the one folks expected given Zealand’s previous tie-up with Sanofi (the pharma formerly known as Sanofi-Aventis). This week’s deal, which includes a research collaboration, is worth €20 million in committed funding to the Danish biotech during 2011, and up to €41 million in the first two years. Zealand will conduct the first Phase I study with ZP2929, but Boehringer will pay for the research, development and commercialization of the compound, as well as any other additional GLP-1/glucagon agonists that eventually. Total biobucks for ZP2929, hailed by its inventors as a “next-generation GLP-1 agonist that improves on Byetta and Victoza, could reach €376 million. According to “The Pink Sheet” DAILY, Zealand, which raised nearly $60 million via the public markets in October 2010, had plenty of suitors for the compound. But with Zealand's most advanced compound, the GLP-1 agonist Lyxumia (lixisenatide) an increasingly important asset within partner Sanofi's diabetes pipeline, "we felt... it was better to diversify its partnership base," CEO David Solomon explained. Boehringer is a relative newcomer to diabetes, only unveiling its interest in the therapeutic area in 2008. Still it has moved rather quickly, and boasts a newly expanded late-stage pipeline thanks to the broad-ranging, risk-sharing deal it signing with Lilly in January of this year. As part of that tie-up, the two drug makers agreed to co-develop and co-commercialize up to five diabetes drugs, including Boehringer's DPP-4 compound Tradjenta (linagliptin), which FDA approved in May 2011, and a Phase III sodium-dependent glucose transporter-2 inhibitor. – EL

Vertex/Alios: Less than a month after FDA approval of its protease inhibitor for hepatitis C Incivek, Vertex Pharmaceuticals is looking to bolster its ability to offer potential combo therapies. Thus, it’s tie-up this week with Bay Area-based Alios Biopharma. The worldwide license to a pair of preclinical polymerase inhibitors, ALS-2200 and ALS-2158, is worth $60 million upfront to the privately-held Alios. In addition to the licensing agreement, the deal includes a research collaboration between the two companies: Vertex will provide undisclosed funding to Alios for discovery of additional polymerase inhibitors and retains an option on compounds unearthed via the collaboration. The bio-bucks owed Alios aren’t insignificant either: the biotech could earn up to $715 million in research and development milestones related to these two nucleotide analogs. Vertex has plans to move both molecules into Phase I trials during the fourth quarter of 2011. Longer-term, the big biotech intends to test the two molecules in varying combinations with telaprevir and VX-222, its Phase II non-nucleoside polymerase inhibitor, in an effort to find and develop an all-oral combo of drugs to treat HCV. Vertex said it expects to pay out $35 million in milestones this year, when both programs are scheduled to enter the clinic, but would not specify whether that also might cover other milestones to be met this year.—Joseph Haas

Sanofi/Audion: Sanofi has signed a two-year research agreement with Amsterdam-based Audion Therapeutics to discover and develop small molecule treatments for age-related hearing loss. Financial terms of the agreement weren’t disclosed, but Sanofi will have the option to license any compounds resulting from research done under the collaboration. Audion, a regenerative medicine play, aims to stave off deafness via developing compounds that protect and resurrect the inner ear hair cells, which are responsible for the amplification and transduction of sound waves to the auditory nervefor relay to the brain. As might be expected, Audion will work with Sanofi’s Aging unit, one of five new therapeutic strategic units established in the past year under the pharma’s revamped R&D model. Sanofi’s Early-to-Candidate Unit will also be involved. Paul August, U.S. head of the Early-to-Candidate unit, said his team aims to provide the Aging unit with a clinic-ready candidate by the end of the two-year collaboration. As this Start-Up feature noted, big pharma generally has stayed out of hearing loss, which has been dominated by med-tech firms providing hearing aids and, more recently, cochlear implants. Many venture capital firms and other investors see hearing loss as a potentially lucrative space, similar to ophthalmology, because of unmet medical need and demographic trends. The Sanofi/Audion tie-up is the first drug development partnership for hearing loss since Novartis licensed rights to a group of preclinical hearing loss and balance disorder programs from GenVec in exchange for a $5 million upfront payment and a $2 million equity investment last year.—JH

Pfizer/pSivida: Is Pfizer in or out of ophthalmology these days? This week’s amended deal between the big pharma behemoth and drug delivery play pSivida makes it clear Pfizer is willing to do what it must to protect its once daily glaucoma eye-drop Xalatan, which generated $1.75 billion in revenue in 2010 but lost key patent protection in March. Still, as Pfizer continues to redefine its innovative core (without, one hopes, experiencing a breach), it’s not so interested in ophtho that it wants to consider a broader deal with pSivida any longer. The Watertown, MA-biotech pSivida originally aligned with Pfizer in 2007 under a far-reaching deal that gave the big drug maker exclusive world-wide rights to its implant technology, as well as a 10% ownership stake. Under the revised agreement announced June 14, Pfizer will pay the biotech $2.3 million upfront for an option, which can be exercised at the end of Phase II, on an implant device that bathes the front of the eye with a sustained-release version of Xalatan. If Pfizer options the product, it will pay pSivida an additional $20 million and up to $146.5 million more in clinical and regulatory milestones. Despite Xalatan’s ability to effectively lower intra-ocular pressures without terribly onerous side-effects, compliance is a problem. (One main reason: Administering drops on a daily basis is a pain in the…er, eye.) As a result, there’s a lot of effort in the start-up community to develop implantable devices that improve adherence by obviating the need for daily administration. The 2007 deal revision provides significant potential upside for pSivida since it can now solicit partnerships with other drug makers. Among the most active deal makers in ophtho: Merck (which took out Inspire earlier this year), Novartis (via its Alcon group), Roche/Genentech, and of course specialty players like Allergan and Baush & Lomb. This wasn’t the only ophtho deal to be revised this week. On June 16 came news that Alcon was pulling out of its he collaboration with NovaBay, returning all rights to the first-in-class anti-infective Aganocide and back-up compounds. -- EL

Merck/Hanwha: Merck vaulted to the pole position in the race to bring a low-cost version of Pfizer and Amgen's rheumatoid arthritis blockbuster Enbrel to market this week, gaining rights to a late-stage biosimilar version of the biologic developed by South Korea's Hanwha Chemical. According to the June 13 partnership, Merck will develop and commercialize a biosimilar form of Enbrel, HD203, in all markets except Korea and Turkey, where Hanwha has retained marketing rights. In exchange, Hanwha receives an undisclosed upfront payment, and is eligible for milestones as well as tiered royalties on sales. Although financial terms of the deal were not disclosed in the official release, Hanwha Chemical spokesman Kwon HyukBum confirmed to PharmAsia News that the total potential cost of the collaboration to Merck is $720 million. Although Merck declined to confirm that figure, Merck BioVentures President Michael Kamarck said in an interview with “The Pink Sheet” DAILY that the deal is heavily back-end loaded. Nonetheless, the financial arrangement is "symbolic” of the huge opportunity for Enbrel biosimilars, he said. Merck has assembled a pipeline of biosimilar drugs since announcing the formation of Merck BioVentures in December 2008. Still, the company has revealed plans only for a couple of products, including a granulocyte colony-stimulating factor referencing Amgen's Neupogen and a pegylated version of Neulasta. Earlier plans to develop a biosimilar version of Amgen's Aranesp were scrapped in 2010, given emerging safety issues with the class. Merck continues to stand by its goal of having five biosimilars in Phase III by the end of 2012 and says it is mainly interested in harder-to-replicate monoclonal antibodies. – Peter Chang & Jessica Merrill

When Innovation Isn't Enough

There is always a self-congratulatory flavor to BIO’s annual meeting. Which is as it should be: it’s the lobbying group’s best venue for justifying its membership dues.

And I think they have – with exhibit 1 being their clever R&D tax credit, a $1 billion piece of reform money to provide a few hundred biotechs with non-dilutive cash most can’t get anywhere else.

And yet I still can’t shake the feeling that, by and large, BIO’s leaders – or maybe BIO’s members – are fighting the last war, over innovation, when the new fight is all about value.

Even a political idiot like me can get why Jim Greenwood reads gushing letters from patients about drugs that have saved their lives. And given just how few important biotech medicines have gotten approved lately, I understand why Dendreon’s Provenge gets a prominent mention. And I also get why Greenwood didn’t mention its cost ($93K for a full course of therapy). He would then have had to explain just how Dendreon calculated that Provenge will be cheaper than Taxotere per-month-of-life-saved (on theoretical average, Provenge gives you an extra three). Which would have been kind of boring.

But why wasn’t the Provenge price front and center in the more purely business speeches about cancer products (or frankly any biological therapy)? Given just how often people gave passing nods to the needs of payers (e.g., in Steve Burrill’s theories-of-everything talk), you’d figure that the Provenge price might be a relevant topic. Pricing is at least passingly important to a product’s commercial prospects and so apparently exceptional pricing might indeed be worth a chat, whether you think that price bodes well or ill for the industry (e.g., the Provenge price will be a) the straw that breaks the camel’s back or b) another gold nugget that shows just how strong the camel’s back still is or c) a meaningless topic because Dendreon, supply constrained, is only going to sell a few thousand therapies so total costs for any one payer won’t rise to a meaningful level). But I heard nothing about it.

Or let me put this another way. Greenwood said that "the recent recession and policy hurdles” hadn’t “diminished our passion to innovate.” First, I don’t think most investors or, frankly, executives would agree. For most VCs I know, passion for pharmaceutical innovation has turned into a massive case of indigestion (to continue the gastro-intestinal metaphor: VC portfolios are clotted with innovative companies).

But more importantly have Greenwood’s “recession and policy hurdles” increased our willingness to prove value – which isn’t the same thing as novelty and which Greewood’s r&ph will certainly require?

I don’t get the sense that drug companies have done much to show that they see the difference. (Full disclosure here: I’m now so interested in this subject that I’m part of a group exploring a new company focused on it.)

Innovation, by and large, can be judged pretty objectively. A new mechanism is innovative. A new compound too. But value is subjective – what’s valuable to you may be burdensome to me. Yet the industry’s main arbiter of value, clinical trials, too often proves value to only one audience: regulators.

That audience is certainly crucial. But everything we’ve learned over the last year says that a regulatory audience is hardly predictive of what other equally crucial audiences want: Lilly’s Effient, Bristol/AZ’s Onglyza and J&J’s Simponi and Ultram ER all provide customers with – well, given their commercial performance, very little they’re willing to pay the price for.

This isn’t to say that these drugs’ suppliers couldn’t create the necessary value. It’s to say that they haven’t, at least in part because they’re focused on just one audience.

Instead of simply proving that a pain drug reduces pain without causing other big problems, maybe the trial should prove that the pain drug does something the payer wants from it – maybe a reduction in follow-up visits to the doctor to get another pain drug. Or delays the prescription of an opioid. Or allows a generic to be used in most cases. Or shows that a GP, after a relatively low-cost visit, can prescribe the product without sending the patient along for specialist follow-up. Or can avoid an expensive diagnostic procedure. A me-too cancer drug (and there are plenty of them in development) could justify premium pricing by measuring, along with whatever purely clinical data it needs for approval, reductions in hospital-acquired infections, or length-of-stay.

I spoke with one CEO who told us that the nurses in hospitals testing his oncology drug loved it because they spent less time cleaning up after patients nauseated by the standard of care. I asked: Are you measuring how much less time they’re spending? No, he said.

Biotech wants to be paid like it’s always been paid: for promises of novelty. I’d be curious to hear a biotech claim that it should be paid, as the UK’s NICE pays for Millennium/J&J’s Velcade, when the drug delivers the value the payer and patients want. That value could be a particular medical outcome, or better quality of life, or lower medical costs. Or something that makes the payer’s services more attractive to the employers its competing with other payers to win as clients. But it isn’t necessarily whether it’s clinically better than placebo. Or even standard of care. Effient’s head-to-head trial against Plavix proved – in crude summary – that it’s clinically better. But payers clearly don’t see enough value to justify switching away from a drug soon to be generic.

So my suggestion: if BIO really wants to promote the long-term health of the biotech industry (and the broader pharma business as well), maybe the theme for the next convention should focus on customers.

How about “What’s In It for Me?”

image from flickr user zizzy used under a creative commons license

Deals of the Week Goes Global

This week's post features work from seven writers in five time zones on four continents. Sorry, we haven't quite cracked Antartica. EBI, the record-label-sounding acronym for the combination of Windhover and FDC Reports, is global. Why not IVB too? Just thought we'd get that out there.

So, another year, another BIO. What did we learn this year, besides all kinds of cool facts about Chicago architecture? On Wednesday this blogger chaired a panel of biotech bigshots to discuss how to build shareholder value in this time of financial duress, high-reimbursement hurdles, and risk-sharing partnerships.

The premise of our chat was that although good science and R&D are pre-requisite for building value in biotech, they aren't enough. A company needs an innovative business model as well. We didn't end up with commandments etched on stone tablets, as our panelists agreed that simply imitating what worked for one successful biotech wouldn't necessarily build value elsewhere.

There were, however, plenty of interesting takeaways:

• Anything that steers pipeline toward faster decisions is a good thing. Failure is fine, if you fail quickly and cheaply. Few biotechs, noted Ironwood CEO Peter Hecht, wind up scoring on their first try or with their lead asset.


• Despite the gloomy climate, there has never been a moment in biotech history as now, with so much available capital, experienced management, and promising technology. Not three years ago, not in the 1990s. So said Fate Therapeutics chairman John Mendlein.


• Deal strategies or service businesses designed to boost capital efficiency and slow down burn rates often crimp proprietary development plans. That isn't to say that these "side businesses" aren't more sustainable, but to avoid distraction they ought to be as close to the biotech's core business as possible, noted Venrock general partner Bryan Roberts.


• Going public has its advantages: potential liquidity for long-term investors, access to diverse sources of capital, and so on. But the sudden exposure can be a shock to management teams or companies that have been mainly insulated from dissenting opinions expressed by public investors betting against them, noted John Doyle, CFO of private biotech Achaogen. Doyle knows of what he speaks, as he's helped take two biotechs public and was a Genentech finance VP before the Roche takeover. Encouraging dissent among private company managers and board members can build backbone and help prepare for the IPO culture shock.

Not surprisingly, we spent much of the panel discussing the various deal structures, financing trends and business models that can boost or hamper value creation. Just the sort of discussion you can find here every Friday in...


Onyx Pharmaceuticals/S*Bio: Singapore-based S*BIO and U.S.-based Onyx Pharmaceuticals are expanding their existing development collaboration to include additional indications for S*BIO's novel JAK2 inhibitors, the companies announced May 4. Under the terms of the agreement, Onyx will provide $20 million to broaden the existing development program for S*BIO's Janus kinase inhibitors SB1518 and SB1578, also known as INX 0803 and ONX 0805, respectively.The two companies had inked a development collaboration and license option agreement in December 2008, which was considered one of the biggest biotech deals in Asia, especially for such early-stage compounds. Under the terms of the original agreement, S*BIO received an upfront equity fee of $25 million and is eligible for an additional $525 million in equity, options and license fees. Onyx has the option to develop both compounds or either one separately in the U.S., Europe or Canada. In exchange, S*BIO will receive double-digit royalties and retains rights on the compounds in the rest of the world.T he new contract does not change the terms of the earlier agreement, S*BIO CEO Jan-Anders Karlsson told PharmAsia News May 5, but rather "it adds new activities to what we have agreed. — Tamra Sami

Sanofi-Aventis/Glenmark: Sanofi-Aventis, which has been busy bolstering its diabetes business, this week inked a deal with Indian drug maker Glenmark Pharma to develop and commercialize transient receptor potential vanilloid (TRPV3) antagonist molecules. The Glenmark deal is the first ever research agreement in India by the French drug company. There are only a handful of domestic Indian companies--including Piramal, Biocon, and Cadila Healthcare--with drug discovery expertise solid enough to catch a multi-national’s eye. But Glenmark stands out when it comes to monetizing research assets. The pharma has signed several pacts for new chemical compounds, including earlier deals with Forest Labs in the respiratory space. According to sister publication PharmAsia News, Sanofi Aventis' head of R&D Marc Cluzel was in India in March and the finer contours of the deal with Glenmark were likely finalized then. Not that Sanofi put a ton of money down as part of the alliance; only $20 million of the potential $325 million deal value is up front cash. Sanofi-Aventis and Glenmark have carefully divided the marketing rights for the potential products with the big pharma retaining exclusive marketing rights for North America, the EU, and Japan, and the biotech getting rights in India and certain ROW nations. In what is seen by analysts as a coup for Glenmark, the Indian biotech will have co-promotion rights for any drugs that emerge from the collaboration in the US and five undisclosed Eastern European countries. — Vikas Dandekar

Endo/HealthTronic: Endo Pharmaceuticals has certainly embraced the diversification mantra: On May 5, it announced plans to buy HealthTronic, a provider of urological health services, diagnostics testing services, and devices, for $225 million, plus assumption of $35 million in debt—slightly more HealthTronic's 2009 sales of $185 million. The announcement came less than a week after analysts on Endo's quarterly earnings call pummeled its execs for being too slow to make deals that would reduce its dependence on the painkiller Lidoderm, which represents 50% of sales and which faces patent expiration in 2015. In response, CFO Alan Levin noted, "When we look at opportunities, we certainly have a predisposition for products with on market revenues in order to further diversify our top line." HealthTronic could do just that. For one thing, Endo isn't known for its R&D leadership, and the off-beat move enables it to sidestep direct competition with Big Pharma for pricey, high-quality R&D assets. Furthermore, the company gains additional expertise in urology, an area of interest since its 2009 Indevus buy-out. Endo didn't explain much about its plans to take advantage of HealthTronics' commercial model. Certainly, Endo reps will gain greater access to urologists and have more to talk about with them. And HealthTronic products will benefit from Endo's resources and management skills. Endo projects that HealthTronic will add $80 million to its 2010 revenues, which it now expects will total $1.63 billion to $1.68 billion. Even after the transaction, which Endo is paying for in cash, the company has plenty of cash on hand to pursue more deals. — Wendy Diller

Merck/Ariad: Nearly three years after partnering in a co-development deal for the mTOR inhibitor ridaforolimus, Ariad Pharmaceuticals and Merck revised the terms, giving Merck control of the program and full development and commercialization rights and Ariad a $69 million upfront payment. Even as the climate for biotech financing warms, Ariad’s decision to revise its deal with Merck is telling, showing the sacrifices certain companies must make to fill their coffers near-term. In Ariad’s case, the revisions extend the firm's cash runway into the second half of 2011.They also reduce Ariad's expenses, since the biotech is no longer on the hook for ridaforolimus’ development costs. Ridaforolimus, an oral mammalian target of rapamycin, has the potential to be the first targeted agent for the treatment of sarcoma. It is Merck's only Phase III oncology drug and Merck/Ariad could file an NDA later this year depending on the data in the pivotal trial. Under the revised deal, Ariad stands to gain $514 million if ridaforolimus meets certain regulatory and sales milestones in multiple indications. The original deal called for profit-sharing with Ariad receiving royalties on sales outside the US. The revisions call for Merck to book all sales of the drug and pay Ariad tiered double-digit royalties on global sales. — Jessica Merrill

Valeant Pharmaceuticals/Aton: Valeant Pharmaceuticals announced May 3 that it is shelling out $318 million to acquire Aton Pharma in a move to broaden its non-dermatology US business. But the price tag for Aton--roughly three to four times higher than the acquired company’s annual sales—is steep. For Valeant, the acquisition offers a means to buffer sales that will be lost when its epilepsy drug Diastat (which brings in revenues of about $70 million, or 10% of sales) faces generic competition later this year. In April, Valeant raised $400 million in senior unsecured debt notes, expected to mature in 2020, which "were needed" to acquire Aton – a N.J.-based specialty pharma that focuses on ophthalmology and orphan drugs. But Aton gave no inclination that it was up for sale on April 26, when it announced it was buying U.S. marketing rights to the Parkinson's disease drug Lodosyn from Bristol-Myers Squibb as part of a plan to broaden its niche product portfolio. Aton won’t get the money all at once; the deal includes an up-front payment and earn-outs based "on achievement of development and commercial targets for certain pipeline products still in development" although the two companies declined to disclose further details. In addition, Cerberus Capital Management, the private equity firm that owns Aton, agreed to reinvest a portion of its proceeds from the sale back into pipeline projects, as a partner, Valeant told investors. — Carlene Olsen

Intercell/Cytos: On May 6, Austrian biotech player Intercell announced it was buying Cytos Biotechnology’s monoclonal antibody discovery program for €15 million. In addition to the platform, Intercell’s money buys it certain undisclosed monoclonals in preclinical development and expertise, in the form of Cytos scientists who will join the Austrian firm’s staff. Cytos’s technology is deemed a strategic fit with work ongoing at Intercell, which will use the platform to develop vaccines for Group B Strep and other bacteria. In Cytos’s case, the agreement shows, again, the hard choices struggling biotechs are now forced to make. After receiving disappointing results in the Phase II trials of two of its development candidates—the nicotine vaccine, NIC002, which is partnered with Novartis, and its hypertension vaccine, CYT006-AngQb—Cytos earlier this year slashed headcount from 135 to 85 and announced a restructuring program. As part of those efforts, the Swiss biotech decided to put its monoclonal antibody technology up for sale and prioritize programs partnered with Novartis and Pfizer, as well as in-house discovery efforts related to allergic rhinitis and allergic ashthma. According to Reuters, Vontobel analyst Andrew Weiss called the announcement “excellent news for Cytos” befitting of a “leaner strategy.” — Ellen Licking


Image courtesy of flickr user caveman under a creative commons license.

Notes from BIO: Green Revolution

We've survived BIO and most of us are home, ready to relax after a loooooong week. But before you sign off, enjoy our favorite off-topic anecdote from the conference.

It was Monday evening, I believe, and half of IVB's BIO contingent was comparing notes from the day, not to mention the various lagers at a brewpub, and we had the good luck to sit next to an agricultural scientist from one of the large seed companies. Now, ag-bio is far afield from our various areas of expertise, but we know enough about monocultures, Michael Pollan and pollen drift to gin up a lively conversation. Even so, it took us a while to screw up our courage and ask the real burning question: How many ag-bio scientists grow their own? And we don't mean soybeans.

Our new friend, an avid home-brewer of beer by the way, thought about it for a few seconds, put on a straight face, and said, "Half probably know how. Thirty percent probably would give advice on the QT to those looking for it. And maybe five percent would actually do something to risk losing their jobs."

We all agreed that this was highly unscientific data. But seeing how the federal government has deprioritized prosecution of medical-marijuana cases, and a few Northern California municipalities have either decided to look the other way or move toward taxation of the medical marijuana dispensaries that have grown like, well, weeds, our interlocutor admitted looking forward to the day growing pot became a legitimate job in his home state. He might even consider a third career, brewing beer being the second. We know VCs are piling into green tech startups, but we're curious how, ahem, green they're willing to get.

Have a good weekend, everyone.

Photo courtesy of flickr user paraflyer.

Notes from BIO: Heal Thyself

The motto of the biotech industry's trade organization is "Heal, Fuel, Feed the World," and the group could start by getting us all a neck massage. Some genius decided to put the display screens in many if not all breakout sessions either far right or far left of stage, leaving audience members in their front-facing chairs to twist either their entire bodies or their necks to read slides. Sit through two or three breakouts a day, furiously scribbling notes, and it adds up to a lot of PowerPoint pain.

Oh, but we're not done. Normally IVB would be a great promoter of walking whenever possible, which at the McCormick conference center means marathon-length outings from one end to the other. But with so many attendees also toting laptops, binders full of presentation material, and pressing cell phones to one ear, the ergonomics of the long McCormick march are soon thrown out of whack.

Topping it off, we're in Chicago, which means various species of beef and booze are the mainstays of local cuisine. The most reliable food outlet in the McCormick Center, other than vending machines, is a McDonald's. (We, ahem, had a chicken snack wrap and fries.) We'd fret less about this if we could finish the day with a brisk walk back to the hotel. With the conference far south of the Loop and most hotels about four miles north as the crow flies, however, nearly all conferees grab cabs. Some even make fun of those who try valiantly to walk but give up half-way, sweaty outside Soldier Field and hopelessly late for a cocktail meet-up. We won't name names.

Next year, we're bringing our own neck pillows, jet packs, and salads.

Photo courtesy of flickr user paraflyer.

Notes From BIO: Pim's Cup Runneth Over

Greetings from Chicago! Fantastic weather for early May, an economy on the upswing, not to mention a certain conference that's in town, make the City of Big Shoulders particularly lively this week. One way to take the temperature of a conference -- and last year's BIO in Atlanta barely broke a sweat -- is to check in with the folks scrambling for deals and having hushed conversations in discreet corners.

Before BIO got fully underway Monday morning, it was already hard to find a quiet place to sit. One of our first chats was with Willem "Pim" Stemmer, the inventor of the DNA shuffling technology that underpinned Maxygen, which last year transfered most of its assets into a joint venture with Astellas Pharma, and the recently-IPO'ed biofuel firm Codexis. (Maxygen also birthed the next generation protein play Avidia, which Amgen bought in 2006 for $290 million plus earnouts.)

Stemmer's latest endeavor also aims to squeeze several companies from one. The parent, Amunix Inc., is working on two things. The first is an ion-channel research program, with Pfizer as the first customer. The second, which started as a side project, is a half-life extension technology called XTEN that adds a recombinant polypeptide chain to known molecules, without the manufacturing and safety concerns of pegylation. That's the claim, anyway, and it was enough to convince European VC Index Ventures to solely fund a spin-out, Versartis, charged with developing Amunix's lead compounds, the first of which is an XTEN-enhanced version of the diabetes drug exenatide.

Now comes a second spin-out called Ios, so newly dubbed that it doesn't have a Web site. Ios will hold Amunix's ion-channel program, which Stemmer told IVB he wants to become a "research hub" with several pharma partners and a goal of being acquired in the next two to four years. For drug leads, it is testing venom toxins against ion channel targets, using XTEN for half-life extension. Stemmer was in Chicago this week unfurling the Ios banner and scouting for discovery deals to replace or supplement the existing three-year deal with Pfizer that expires at the end of the year.

Unlike Versartis, which is strictly a product development company, Ios will include Amunix's microprotein platform technology, Stemmer said.

Photo courtesy of flickr user paraflyer.

Summing Up the Biotech Way: Beyond Borders 2010

One scorecard from 2009 is in: Ernst & Young's annual report on the global biotech industry, Beyond Borders. This Summing Up –which this fanciful blogger envisions as an annual, exhaustive biotech version of Somerset Maughan's eclectic memoir—is published annually just as the industry gears up for BIO, as a mix of sweeping generalizations, trend-spotting, and interesting statistics on financing.

Much of the 2010 report isn't news, especially to followers of IN VIVO Blog—how hard is it to figure out, after all, that biotech is an industry of 'haves' and 'have-nots?' or that the venture investment model is under pressure, resulting in new financing and R&D models (asset-based financing, options-based deals, FIPNets), and pharma companies are divesting assets? More importantly though, the report contains interesting datapoints, piecing them together to obtain a coherent picture of the industry at a given point in time, and providing fodder for BIO networking.

So what are some chatable points? Biotechs took their lumps last year but, overall, they fared better than E&Y or others had predicted. They've been aggressive about paring costs, cutting back on R&D, staff, and shelving non-core assets. They've been creative about finding new ways to finance operations as they slog through the long R&D tunnel. The number of public companies fell by only 11% in 2009 to 662 from 700 a year earlier, E&Y calculates--not healthy, surely, but far short of what E&Y last year predicted would be a 25% drop.

Industry global revenues fell by 9% from $86.8 billion to $79.1 billion in 2009, true, but that includes the impact of Roche's acquisition of Genentech. Without this acquisition, biotech revenues would have grown by 8% (An 8% rise is better than a 9% decline, but it still isn't up to growth rates of years past, EY points out). Tighter regulatory safety requirements have slowed new drug approvals, not only in the US but in Europe as well.

Other tidbits: Biotech companies raised $23.2 billion last year, up 42% from 2008, and while venture capital totals were flat globally, the US had its second-best venture funding year since 2000, while Europe had its worst. That said, about half of US venture capital raised went to only 45 companies, with Clovis Oncology the big winner. And companies with early-stage technology need more money than ever to carry their products through clinical development.

More to the point, industry R&D spending fell 21%, after years of double digit growth. It's hard to say if this is a self-correction or a true stab at improving R&D efficiency, but that drop helped biotechs in aggregate to post a net profit for the first time of $3.7 billion; in 2008, the industry lost $1.8 billion. Other reasons included a change in accounting rules, fewer public companies, since most of the acquired companies were losing money anyway, and other cost reductions. Asset sales, royalty and milestone payments also played a role, but even E&Y couldn't say by how much.

Another weight hanging over the biotech head: reimbursement: E&Y notes that companies, which traditionally viewed marketing approval as the finish line for deal-making, now must cross additional hurdles related to reimbursement. Nothing new for IV Blog followers here: Now, we've been tracking this still esoteric but increasingly talked about trend of setting special reimbursement milestones for deals and its counter argument: that traditional sales milestones cover reimbursement risk--an evolution we find fascinating.

The takeaway:

Life is getting tougher: Gaining an FDA approval alone is no longer an event worthy of popping the champagne, unless payers can be convinced of a product's value. This means, the earlier biotechs and big pharmas alike invest in pharmacoeconomic analysis, the better. As E&Y puts it – there needs to be a thought process of: "If you build it, will they pay?"

Easier said then done, in the eyes of some. E&Y however, notes the industry was built by entrepreneurs, who will find creative responses to pricing pressures. Just what will these look like? Even E&Y can't say right now.

image from flickr user nim used under a creative commons license

Notes from BIO: Getting Comfortable with REMS

No one wanted to use the word ‘albatross’ in the same sentence when describing REMS, or Risk Evaluation and Mitigation Strategy, at a panel session this week at BIO about the FDA Amendments Act of 2007. But the implication was hard to miss from the tone of some of the comments and the body language of some speakers.

A REMS, for those who may not recall, is the newly upgraded program to ensure a company has a strategy in place to manage and communicate a potentially serious risk with its medicine. And the implications are being gauged closely by industry, which is assessing whether REMS will wind up conferring a greater probability of approval or result in commercial dead-ends.

Drug makers, for instance, would like more guidance, according to Jeff Francer, assistant general counsel at PhRMA, who said REMS is the key issue to watch as a result of the FDAAA. “I would say it’s the effects of REMS on the approval process and post-marketing…We should continue to study how REMS and the implementation are affecting patient care. We, in industry, would like more formal guidance…For most of industry, it’s about REMS.”

A few feet away sat Jarilyn Dupont, director of regulatory policy in the Food and Drug Administration’s Office of the Commissioner, who said that “there’s always going to be tension” over the push and pull between industry and regulators over the requirements and implications. But she noted that the REMS program, which gives FDA some enforcement powers, is still new and that guidance will be forthcoming. “It’s really only out since September, so over time, you will see more guidance. But guidance development doesn’t happen over night.”

Another industry rep, Andrew Emmett, director of science and regulatory affairs for BIO, tried a more optimistic line by saying that, as “comfort levels are built and guidance” emerges, the REMS process should become smoother. Still, his comments about forthcoming REMS evaluations suggested an air of anxiety. The FDAAA requires that all REMS must include a timetable for assessments at 18 months, 3 years and 7 years after approval of a REMS. “There are a lot of questions in industry,” he said, “about what those are going to look like.”

Notes from BIO: Toast of the Coast--Incubator vs. Pfincubator

While an earlier session on raising capital in trying times was cancelled--as if to say "yes, it really is that bad!"--it was standing room only at yesterday morning's last-day session titled “Early Stage Investment Strategies: If Not Us, Who? If Not Now, When?"

Afterward, we overheard it called by several people in the audience the best of many sessions at this year’s BIO meeting devoted to getting technologies past the infamous valley of death and into the waiting arms of big pharma.

Of course these panelists didn’t exactly solve everyone's dilemmas, but attendees left feeling better after listening to Melinda Richter, Executive Director of the San Jose BioCenter, trade jibes with Mark Benedyk, who heads Pfizer’s La Jolla Pfincubator.

Richter good-naturedly claimed that Benedyk’s incubator companies are indentured while she shops for the best deals for her companies. Benedyk says his companies are grown in a hot house with no worries, while others have to make a go in wild fields.

Richter’s project was initially funded through San Jose’s economic development efforts, initially receiving $5-10 million from the city's redevelopment agency. In three years its fledgling companies from the BioCenter have brought around $3 billion to the area economy, she claimed.

The problem?"Our companies have been very successful at growing very quickly, but then they tend to leave the area," Richter said. "From an incubation perspective, very successful," but from the point of view of the incubator's investor, San Jose, not as successful.

So where are they going? San Jose's biotechs are forced to establish facilities further up the peninsula in the Bay Area – taking jobs and business with them - because the incubator has the only lab space in the San Jose area. --Shirley Haley

image from flickr user caveman 92223 used under a creative commons license

Notes from BIO: Merck's Take on Biomarker-Based Drug Development

Merck sees itself as a leader in biomarker-based drug development. "We are toward the extreme end" of peer companies in the field, Executive Director of Licensing & External Research Reid Leonard said during a BIO breakout session May 19.

"We actually have very aggressive internal goals for the requirements for a biomarker strategy that is coincidentally built up with the drug discovery strategy for any new target."

But before you put Merck down as an advocate of personalized medicine, listen to how he described the company's approach:

"Ultimately our goal, despite the overall objective of being able to stratify patients where its appropriate and necessary, given the choice, if we are going to find a therapy that will treat a disease that many people will have, our preference is to find a way of doing that that in fact doesn't require stratification, that in fact picks a target that is intrinsically less sensitive to genetic variation than another target. So its using all the same data to try to essentially come up with a drug that in fact the physician can have some confidence will work in 80% of the people."

It's not that Merck will ignore stratification if it appears appropriate in clinical trials. That's just not the goal.

Notes from BIO: Biotech's Voice in Health Care Reform

"PhRMA doesn't speak for BIO."

That message, says Bryan Cave LLC Partner Broderick Johnson, must be made very clear during the health care reform debate.

As we've noted, the Biotechnology Industry Organization has not been included in White House events on health care reform, while its Big Pharma brethren in the Pharmaceutical Research & Manufacturers of America have been.

Johnson doesn't necessarily think that's a bad thing. "A lot of these White House events get a lot of attention and that’s very important," he said during a May 19 BIO session. "But I think its just as important, if not more important, that BIO has a seat at the table at the roundtables being held by the Senate Finance Committee. That’s where a lot of the important decisions will be made...so don’t overlook the importance of being at that table."

Indeed, BIO's leadership is reassuring its members that not being at the White House is a good thing, since BIO has committed to nothing in health care reform, while PhRMA has found itself promising to play a role in delivering significant cost savings in the years ahead.

Of course, there's another way of looking at it: maybe the White House thinks it doesn't need BIO involved, or--indeed--that in dealing with PhRMA it is addressing BIO's interests as well.

It was that latter point that Johnson sought to address. BIO should be wary of "perhaps a misconception that...bringing PhRMA into the room will get BIO’s concerns addressed as well. Its really important to make the distinction clear that PhRMA doesn’t speak for BIO."

A strong point. Of course it might have been stronger if the panel discussion had included Biogen Idec CEO Jim Mullen. He was a late cancellation, replaced by Allergan CEO David Pyott.

Yep. Can't let those PhRMA guys speak for BIO.

Notes from BIO: A "Fire Drill" on Flu

When it comes to the "swine flu" outbreak (forgive the non-PC term), its hard not to look on the dark side. Either we are facing a catastrophic outbreak we are unprepared to prevent, or we have succumbed to yet another media-stoked panic that makes us all feel silly.

Clearly the zeitgeist has tilted heavily towards the latter view, and surely we can all agree that is the better of those two choices.

Still, we were pleased when Vertex' outgoing CEO Josh Boger offered a third way of thinking about the current outbreak during a BIO "Super Session" May 20: this is a "fire drill"--testing our pandemic preparedness rather than our evacuation procedures--and like any fire drill it is only effective if everyone takes it seriously. So, if, as we all hope, this flu outbreak proves mild and manageable, we can still feel good about taking it so seriously.

Only time will tell if this outbreak is or is not the hamageddon it sounded like a month ago, but we at least were heartened that others on the panel (including FDA's point person on the flu, Jesse Goodman) adopted the "fire drill" metaphor as well. We feel better already.

Notes from BIO: A Big Gap In Industry's Plan For Comparative Research

The biopharma industry has a big problem with the comparative effectiveness research provisions included in the stimulus bill enacted earlier this year.

As we noted in The RPM Report, it lacks several key elements that industry says need to be part of a functioning system, including an implementation process that they feel invovles their input. That sure makes a lot of folks at BIO very nervous.

Hence, an all-out lobbying campaign for new legislation to establish an independent institute to oversee comparative research.

The preferred approach was articulated by Senate Finance Committee Chairman Max Baucus in legislation introduced last year, and industry hopes to see that vision included in any health care reform bill this year, Foley Hoag Attorney Barrett Thornhill said during a breakout session May 20.

There's just one problem: even in the best case scenario, legislation won't change how the initial bolus of funding--$1.1 billion--gets spent.

Thornhill, whose firm represents the Partnership to Improve Patient Care--an association funded by BIO and PhRMA and other organizations to lobby on CER--puts the chances of getting the Baucus proposal into health care reform at just 50/50. But even it if is included and signed into law this fall, he notes, a new institute won't be set up until the end of 2010 at the earliest, with research projects beginning no earlier than 2011.

So "you have this gap between when the [stimulus] funding gets handed out until you have new framework even established," Thornhill noted. "So its hard for us to go out and lobby to have this Conrad-Baucus entity just control the funding. The pushback is 'What are we are going to do for two and a half years? Just sit on our hands?'"

"That's not what the House Democrats are interested in doing," Thornhill says, "and I guarantee that's not what they are going to do."

Notes from BIO: Positive Message from Anti-Infective Development

Cempra closed a $46 million Series C funding in mid-May. Any fund-raising in biotech these days is noteworthy, but there is an extra layer of significance to this one as a vote of confidence in anti-infectives drug development.

Capital is hard to come by for anyone, but the ability of an anti-infective development firm to raise capital from at least six private funding sources sends as strong signal that the uncertainty in anti-infective development stemming from regulatory delays experienced by projects like telavancin and ceftobiprole may be fading into the background.

Prabhavathi Fernades, the CEO of Cempra, told a BIO breakout session today that FDA's recent work on anti-infective development guidelines is starting to send a clearer message. The objectives and targets for anti-infectives are going to be tougher, she thinks, and skewed towards more serious disease, but that is adding a sense of clarity to development projects. The clarity is what is important.

Fernandes, who has extensive experience in antibiotic development at Bristol-Myers Squibb and Abbott (where she took a lead role in the regulatory development of Biaxin) prior to starting Cempra, also said that developers have learned some harsh lessons on accountability and keeping close control on clinical trials based on the non-approvable and complete response letters from FDA during the past 18 months.

Cempra's CEO thinks that sponsors were getting a little lax and failed to follow up on issues such as big geographical differences in efficacy in clinical trials. From that perspective, the reaction from FDA is not a full-stop to anti-infective development, just a reminder to sponsors to pay closer attention to the details of their applications.

To Fernandes and her backers, it looks like the period of regulatory uncertainty at FDA may be coming to a close. Cempra has a macrolide-ketolide compound, CEM-101 (oral and IV) headed into Phase II trials this year. With bacterial resistance and pandemic influenza alternating for headlines, it might just be a good time to be developing a new generation of anti-infectives -- especially with clearer guidance from FDA and a new public health-oriented team leading the agency.

Notes from BIO: NCI's Bridge Over FDA Troubles

"We're from the government and we're here to help you."

Here's a twist on that cliche: a government program that really might help. The National Cancer Institute's $100 million SBIR (Small Business Innovation Research Program) is promoting a new "bridging" program to try to carry projects that it has previously funded in early formation through the ominous "valley of death" period as the developers face the first tough requirements of preparing for contact with the Food & Drug Administration.

The NCI program's program director for therapeutics development, Ali Andalibi, was at a BIO breakout session in Atlanta on May 21 to spread the word about NCI's new largess. Andalibi was quite convincing: the center has money allocated to the bridging program (up to $10 million during the current fiscal year) and a practical model that involves trying to bring in private money and regulatory skills to make sure that projects don't die on the vine after two rounds of initial NCI funding support.

Andalibi, who has worked in academia, the biotech sector and for the National Science Foundation's SBIR program prior to joining NCI, has the range of different perspectives on government funding and resource support that could be very valuable to cancer start-ups.

As close FDA watchers, it particularly impressed us that NCI is adding regulatory consulting into its package of assistance for the start-ups. That's often a missing ingredient at that point in development. NCI wants to help the start-ups get through IND filing and safety testing before turning them loose for full private funding.

NCI and FDA have not always seen eye-to-eye on commercialization requirements, but they have been much closer partners in recent years. It cannot hurt fledgling private companies to have the assistance of NCI in finding the right advisors and coaching on regulatory strategies.

NCI is selling this new funding proposal to a relatively small group of potential prospects: only those firms that have received previous awards: Phase I (R41, R43, six-month feasibility studies) and Phase II (R42, R43 up to two-year projects with commercialization plans). The bridging grants are patterned after Phase IIB funding from NSF.

The government expects the developers to raise private money to supplement the new bridging loans. Andalibi says NCI will try to help locate angel funding sources. The private money is important to NCI as it also brings in the closer oversight and rigor of the investor community.

NCI has been selling the idea of bridging funding for at least eight months. It will be interesting to follow the projects that take advantage of the funds and to see whether a little help and advice from one of FDA's government cousins can move more projects through the IND and early human trials period.

Notes from BIO: Vaccine Applications to FDA Booming

The Food & Drug Administration expects to receive as many biological license applications for new vaccine products in a four-month period later this year as the agency has ever received in a full year.

The onslaught of applications suggest a big year for vaccine approvals in 2010.

“It is going to be a busy year” for the agency’s Center for Biologics Evaluation & Research, the head of the agency’s biologics review management, Robert Yetter, told an FDA Town Hall meeting here at BIO. FDA is planning for the uptick in applications based on conversations with sponsors and indications from the sponsors of projected filing dates.

The ramp up in applications is tangible evidence of the past five years of accelerated activity in the vaccine field. In 2008, FDA approved three new vaccines: two were new mutli-component products Kinrix (DTaP with polion from GlaxoSmithKline) and Pentacel (DTaP with polio and Haemophilus B from Sanofi-Pasteur); GSK also received approval for its rotavirus product (Rotarix).

The bolus of review applications will hit FDA at an awkward time as FDA deals simultaneously with efforts to support the preparations for a potential return of the H1N1 flu with the next northern hemisphere flu season.

Yetter reported that CBER is already looking at ways to move license applications and supplements for pandemic vaccines “as quickly as we can.” He noted that the agency has developed experience with dealing with emergency licensing procedures for vaccines in recent years. FDA licensed a Sanofi-Pasteur avian flu vaccine in 2007 to allow the federal government to purchase it for the national stockpile. Yetter said that the agency will “use every pathway” to speed vaccines for the H1N1 outbreak.

Yetter pointed out, however, that FDA is patently aware that it cannot take risks or appear to take short-cuts on vaccine approvals in an emergency. He noted that the agency has to be able to convince the public that a vaccine is safe or they went take it even if FDA gets it out for use.

At least two major vaccine manufacturers, Novartis and Wyeth, have important vaccine projects under review which also could get caught up in the increase of workflow at CBER. Novartis has its first meningitis application for Menveo for people 11-55 pending from last August. Wyeth has the key generation shift for the pneumoccoal conjuate franchise active at FDA in a BLA for Prevnar-13 since March 31. The application was okayed for a priority review in early May.

Notes From BIO: Josh Boger Goes Back to Merck

Okay, no, this isn't a news flash. We don't have a scoop on what Vertex' outgoing CEO Josh Boger plans to do once he officially leaves the company he founded at the end of this week. And we certainly aren't predicting that he will return to Merck, where he began his career in pharmaceutical R&D before leaving to found Vertex in 1989.

But we do know what Boger did when it was time to step down as chairman of the Biotechnology Industry Organization: he returned to the legendary vision statement offered by George Merck in 1950, which served as the touchstone for Merck's vision of leadership for the rest of the 20th Century.

George Merck's famous advice--usually paraphrased as "putting patients first"--is not just a slogan, Boger observed, but a business plan, complete with the assertion that the "better" industry remembers that medicine is "for the people...not for the profits," the better the profit ultimately is.

It is also a mission statement for the future: "We cannot rest until the way has been found to bring our finest achievements to everyone."

Notes from BIO: Swag Review

Although overall it's probably true that companies have toned down their exhibit hall shenanigans this year at BIO, there are still some stand-outs in the giveaways department.

Late yesterday afternoon (after a long day of working very hard, of course) we ventured into the Exhibits for the first time. We know you're curious, so here goes.

Re Louisiana: "The beer coozy technology they're developing down there really surpasses anything I could have possibly imagined," said one biotech CEO. We couldn't agree more.

Novo Nordisk was giving away drumsticks. Not the chicken-leg kind either. Proper drumsticks. We didn't pick up on why, but this will certainly make a lot of children happy and a lot of attendees eventually wonder: why on earth did i pick those up?

Argentina takes top honors for the best metaphorical exhibit, running tango demonstrations that drew large crowds. After all, everyone at BIO is interested in learning how to dance in lock-step with an attractive partner.

We couldn't pass Haiwaii by, of course. Who among us wouldn't rather our business be based there. Greeters offering leis amid the lovely strains of the hula made it seem so possible--but the gentleman in native garb looked positively frigid in the overcooled Atlanta exhibit hall.

Hungary was offering some kind of apricot cocktail. Is there a laetrile angle there?

Finally we should mention that Merck-Serono's booth lacks tchotchkes entirely--they're making a $5 donation to the National MS Society for each person who drops by their booth. Any other companies doing something similar?

We'll try to stop by the exhibit hall again today, so let us know what we missed. Also swing by the lovely Elsevier Business Intelligence booth (1737) where you can pick up some magazines and get a database lesson or two ... OK yes we're giving away puzzles.

Notes from BIO: Meet Merck-Serono's Portfolio Guru

While Big Pharma grapples with its business model dilemma and R&D structures, some of its mid-sized competition is busy reaching out in an effort to boost externalization at the early stages of the research continuum.

On Tuesday afternoon we talked with Merck-Serono's executive vice president of portfolio development Vince Aurentz, also a member of the company's executive board, who is essentially tasked with making sure the company gets value from the R&D investments it makes.

It's a unique role. "I don’t think anyone else in industry has this job description," says Aurentz, who is responsible for all business development and licensing, as well as mergers and acquisitions. If that wasn't enough, all R&D project heads report into Aurentz as well.

He has been busy. Merck-Serono has been reviewing its pipeline and deciding what to prune. Of the recent agreement to end a collaboration with NovImmune, for example, Aurentz says "These compounds just didn’t fit where we were going. We’re trying to be a good partner, and sometimes that means you need to untangle relationships." Overall he says that Merck-Serono has looked at trimming about forty ongoing projects since 2007 as part of a portfolio review.

There has also been a decided shift toward earlier stage opportunities. Merck-Serono has in the past few months announced two separate corporate venture capital initiatives and is busy funding R&D within academia as well.

The timing was right to start the corporate venture funds, says Aurentz, partly because of the lack of early-stage funding for projects that aren't quite at the licensing stage. It also reflects a dearth of quality clinical assets available for in-licensing.

"Part of it is because of the lack of [later-stage] opportunities. But it is also because it doesn't make sense for us to build these capabilities out internally," in terms of research infrastructure, says Aurentz. At this point at least 60% of the company's projects are externally sourced, a figure that is only likely to grow.

In fact, he says, "we're passed the point as an industry where recreating all these research capabilities in-house makes sense. It's inefficient. Right now it’s hard not to view business development as the natural source of our product candidates."

Other companies are coming to similar conclusions. Bayer-Schering has also redoubled its academic outreach efforts, with a grant program that is part of a broader effort to drive innovation. Though in our interview with that company's BD head Michael Yeomans on Monday he noted that Bayer's shift toward accessing earlier stage assets hasn't extended to the venture capital arena. “We don't have a corporate VC fund,” says Yeomans. “But we do make investments as a limited partner in certain cases."

Notes from BIO: BIO, Meet Sanofi; Sanofi, Meet BIO

Sanofi-Aventis, which now calls itself a US and European company, is searching aggressively for partners, according to remarks made at a press conference on Tuesday.

“The message we want to pass on at this BIO conference is we are partnering more and we wish to do more,” said Jean-Claude Muller. Muller is VP for R&D, prospective and strategic initiatives in CEO Chris Viehbacher’s plan to grow the proportion of Sanofi’s business that comes from external relationships - currently at 27 percent. The announcement was a first for Sanofi at BIO.

“Our key message is the proportion [of business] will grow through partnering because value comes from partnerships,” Muller said. With a partnering word cloud like this (see pic) it's hard to argue isn't it?

Muller and Philippe Goupit, who is VP for business development and corporate license, are charged by Viehbacher with reshaping the company’s R&D to make Sanofi a diversified global leader in health care. Viehbacher “is really turning the page and entering into the 21st century,” said Goupit, who also testified the CEO has pledged to spend 20 percent of his time on personally exploring new business opportunities. --Shirley Haley