Friday, September 20, 2013

Deals Of The Week Watches GSK, Non-Profit Partner Adhere On Medication Management

On the face of it, GlaxoSmithKline PLC’s deal with the non-profit Community Care of North Carolina to improve medication management seems like a pro forma marketing initiative between an aggressive Big Pharma and a local provider of health care services.

The agreement, announced Sept. 18, calls for the drug company and the care network to develop health information technologies that help providers identify patients with medication management problems and determine solutions for them.

But look one step further and the tie up points to how Big Pharma is responding to changing dynamics among its core customer base. As reimbursement emphasis shifts from paying for volume to paying for value, biopharma has been working furiously to obtain more data on the effectiveness and cost savings benefits of the drugs in its R&D and commercial portfolios. But it is struggling against payer skepticism over bias built into its data, the rapidity of change, and a perception that, currently, reshaping of the health care system is largely in the hands of payers, providers and politicians. Many of the initial risk-shifting arrangements, endorsed by the Patient Protection And Affordable Care Act and now underway as Accountable Care Organizations, for example, were formed by providers and/or payers, with pharma limited to the role of supplier.

This new initiative places GSK in a different role entirely. While it is a small endeavor, it has endorsement of senior management, says senior director of U.S. payment and delivery reform, Jon Easter, who spearheaded the effort and whose job is to help the company learn from new health care delivery systems and payment models. The initiative is strictly about learning - there’s no marketing component and any independent business opportunity would be a secondary benefit.

CCNC coordinates care across roughly 1,000 health care provider types, including 110 hospitals and more than 1,700 primary care practices, serving 1.5 million people in North Carolina. GSK is dedicating data analytics experts and knowledge of comprehensive medication management to the collaboration, and CCNC is contributing experience in tailoring medication management interventions, gleaned from years of experience with patients with drug therapy problems. If all goes well, the partners, who began working on the project earlier this year, will  make a decision on whether their IT is marketable broadly to health care systems across the U.S.

The funding and staff time are shared evenly, as is ownership of any emerging intellectual property. The IT system will allow health care providers and payers to easily analyze individual patients’ medication challenges in real time and help determine which interventions in which setting of care would yield optimal results.

CCNC’s VP, Pharmacy Programs, Troy Trygstad, who has led his organization’s multi-year efforts to optimize medication management and resources, says a confluence of several trends made the timing ripe for such a relationship. “It was where we are at in the maturation of our medication management process. And, regardless of ACA, the larger system is going through a need to do more with less. Also, pharma is investing in figuring out how to work with healthcare ecosystems to maximize value.”

GSK, in a press release, distinguished the partners’ approach as relying on “small data,” as opposed to “big data” solutions. “Big data” currently dominates any conversation about the use of IT systems in health care, but the partners are banking on internally developed predictive analytics and algorithms to create customized approaches that allow doctors or other care givers to determine, sometimes in advance, what a patient’s specific barriers are to adherence, enabling them have meaningful conversations with patients in real time. Providers will have access to select information such as patient prescription fill history and hospital data.  Importantly, the system is also designed to work in a range of different settings, across multiple IT systems, avoiding integration and inter-operability issues that have been a drain on many big data approaches.

The collaboration does not involve specific patient information changing hands between the organizations and is independent of GSK’s core drug business. A recent favorable Office of Inspector General ruling in August on another manufacturer’s hospital discharge venture, designed to reduce hospital readmission rates, may have helped pave the way for the partners’ commitment. The ruling said that such a service did not run afoul of federal anti-kickback laws.

Pilot programs are underway. CCNC is already using the system across its network. The partners also have established a Community Medication Management Collaborative with the Indiana University Health Bloomington Hospital involving roughly 50,000 patients who use the hospital and its outpatient clinics and services. That pilot consists of two parts: the logistics and analytics platform supplied by the CCNC/GSK partnership and a pharmacy care arm, in which CCNC is providing its process and technical insights to Bloomington to incorporate into the latter’s own pharmacy care protocols as appropriate.

The deal points to how GSK – and potentially other drug companies – might leverage their expertise in drug-related data analytics to help various sectors of the healthcare system work with ‘adjacencies’ to adjust to an environment in which core constituents are increasingly driven by the need to demonstrate the value of their products and services in improving patient outcomes. Other companies, such as Merck & Co. Inc., have undertaken different approaches, establishing revenue-generating health care IT ventures; Merck's Vree Health helps hospitals deal with pressures of ACA’s emphasis on reducing hospitals’ 30-day readmission rates. The common thread: all  work with stakeholders on figuring out systemic value while remaining entirely separate from their core drug franchises.

Easter said GSK agreed to work with CCNC not only because the non-profit is a neighbor and already provides care to thousands of local GSK employees, but also because it is nationally known for its cutting-edge work in patient medical homes and medication management.

As GSK works to understand the big picture in medication management, select deals this week centered around the smaller, scientific universe.--Wendy Diller

Chiesi/Cornerstone: Italy’s mid-sized pharmaceutical company Chiesi Farmaceutici will purchase the 40% of North Carolina-based Cornerstone Therapeutics Inc. that it didn’t already own, according to a Sept. 16 announcement. Chiesi will pay $9.50 per share in cash, and, in exchange, obtain a sales organization based in the U.S.  According to an SEC filing in February, this transaction has been underway for some time. Months ago, Cornerstone revealed that Chiesi had been willing to pay $6.40 to $6.70 a share for the piece of the company.

The two companies paired up in May 2009 when Chiesi granted Cornerstone an exclusive U.S. license to sell its porcine-derived lung surfactant Curosurf (poractant alfa) for 10 years. The drug was first approved in the U.S. in 2009 for the treatment of respiratory distress syndrome in premature infants. At the time, Cornerstone also obtained the first right of refusal on any drugs or technologies that Chiesi plans to launch in the U.S. In return, Chiesi received 11.9 million Cornerstone shares valued at $70 million based on the company’s stock price at the time. Chiesi also gave Cornerstone $15 million in cash and agreed to buy another 1.6 million shares from Cornerstone’s CEO and EVP of manufacturing for $5.50 each, a transaction that totaled $8.8 million. As a result of the transactions, Chiesi became the majority shareholder.

This is Chiesi’s second acquisition in as many months – the company bought Denmark’s Zymenex AS in August for its Phase III rare disease therapy Lamazym (rhLAMAN). The structure and financial terms of the acquisition were not disclosed.--Lisa LaMotta 

Teva/Cancer Research Technology: Teva Pharmaceutical Industries Ltd. has teamed up with Cancer Research Technology Ltd. to study and develop cancer drugs that modulate DNA damage and repair response processes in cancer cells.

The three-year alliance between Cancer Research UK’s technology transfer arm and Israel-based Teva echoes one struck between CRT, AstraZeneca PLC and the Cancer Research UK Paterson Institute for Cancer Research at the University of Manchester to develop potential new drugs to target a key protein involved in DNA damage response (DDR), in a deal that would give AstraZeneca first rights to any molecules discovered and builds on an earlier 2010 collaboration.

No financial details were disclosed for either of CRT’s projects in DDR. Both reflect CRT’s expanding role as a bridge builder between research-based Big Pharma and academia.

Together with Cancer Research UK, CRT has created a hub of expertise in DDR-related basic, translational, and clinical research that is based on Cancer Research UK's extensive network of top UK universities, and its five cancer research institutes – Gray Institute, Oxford; Cancer Research UK Cambridge Institute; London Research Institute; Paterson Institute, Manchester; and the Beatson Institute, Glasgow. This hub will provide the foundations for CRT's and Teva's work towards developing novel therapies based on DDR-related targets for the treatment of cancer.

DDR plays a key role in protecting cancer cells from the damaging effect of chemotherapy – creating an in-built antidote to the toxic effects of the anti-tumor drug. AstraZeneca underscored the area’s importance to its oncology strategy by in-licensing Merck’s MK-1775 for study in certain types of ovarian cancer earlier this month.--Sten Stovall

Cleveland Clinic Innovations/Shield Biotechnology: Cleveland Clinic Innovations, the corporate venture arm of Cleveland Clinic, has spun off a company based on research from the Lerner Research Institute, Cleveland Clinic’s translational and clinical research center. The company, Shield Biotech, will complete preclinical development of a preventive breast cancer vaccine. It expects to file an IND and commence two proof-of-concept Phase I trials in women with triple-negative breast cancer within two years. The amount of investment capital raised from external sources was not disclosed. The trial will report out in approximately three years from initiation.

Triple-negative breast cancer has a high rate of recurrence and does not respond to current forms of adjuvant therapy. The research will be led by Shield’s CSO Vincent Tuohy, an immunologist at the Clinic’s LRI. “We have proposed that breast cancer may be effectively controlled by providing healthy cancer-free women with pre-emptive immunity against emerging breast tumors” said Tuohy. “We propose to provide women with an immune defense or shield.”  CCI has played an important role in the biomedical innovation landscape, particularly with the reduced involvement of venture capital in early stage funding and company creation.

CCI functions like a super-charged university tech transfer office, identifying promising research at its parent, licensing technology, launching companies, finding investors, and even helping with certain aspects of commercialization ([A#2012800153]). Since its founding in 2000, it has launched 63 companies that have received nearly $700 million in investment. Therapeutic or prophylactic medicines are the smallest category of inventions at CCI, and as such a rarity among its spin-off companies. Medical devices are by far the largest category.--Michael Goodman

ChemoCentryx/GlaxoSmithKline: In our “No-Deal” of the week, GSK, following the late August announcement that vercirnon missed the primary endpoint and a key secondary endpoint in the Phase III SHIELD-1 study, has returned the compound along with all data, back-up compounds and related intellectual property to ChemoCentryx. The Mountain View, Calif., biotech announced Sept. 18 that it will conduct a review of the unfinished trial data to determine if there is a different path forward for the CCR9 chemokine receptor inhibitor.

While the multinational pharma is ending development of the compound also known as Traficet-EN or CCX282, the disappointing outcome will not scuttle a larger collaboration between the two firms that dates back to 2006. GSK continues to develop a CCR1 inhibitor, CCX354, in rheumatoid arthritis that it licensed in 2011 under an option agreement, and is expected to make a decision about whether or not to exercise its option for CCX168, an inhibitor of complement receptor C5a now in Phase II for renal vasculitis.

On Aug. 23, GSK revealed that it had ceased dosing in the 2,500-patient four-trial SHIELD program testing vercirnon after one of the trials, SHIELD-1, failed to meet the primary clinical endpoint of induction of response in Crohn’s disease, as well as a key secondary endpoint of maintaining clinical remission ([A#14130823003]). ChemoCentryx hopes it can determine a clinical path forward for the candidate by evaluating design differences between its successful Phase II trial and the failed GSK study. --Joseph Haas

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