The UC San Diego Extension will be holding the series Biomedical Product Development beginning Tuesday, January 10, 2006 from 3-8 p.m. The course will run from January 10, 2006 through March 28, 2006 and take place each Tuesday from 3-8 p.m. The topics to be covered include: product development, management responsibility, quality system, contract review, design development and control, intellectual property, document and data control, among other issues.

South San Francisco-based Theravance Inc. has entered into a license, development, and commercialization agreement with Astellas Pharma, Inc., a Japanese corporation, for the development and commercialization of Theravance’s investigational antibiotic, Televancin.

Televancin is an injectable antibiotic, which is developed to be the first-line therapy for serious infections in hospital settings. Theravance seeks to establish in the trials that Televancin is superior to Vancomycin, the current standard of care treatment for such infections. Televancin is currently in phase 3 studies for the treatment of complicated skin and skin structure infections (“cSSSI”)and hospital-acquired pneumonia (“HAP”).

According to the Form 8-K, the agreement between Theravance and Astellas provides that on the effective date, Theravance will grant Astellas an exclusive license to develop and commercialize Televancin on a worldwide basis, except in Japan, and that Astellas will pay Theravance an up-front payment of $65 million. The Agreement also provides for Astellas to make clinical and regulatory milestone payments to Theravance of up to $156 million, including $136 million for completion of enrollment, filing, and approval in the ongoing Phase 3 programs in cSSSI and HAP, and $20 million if the Phase 3 data demonstrates televancin’s superiority over Vancomycin for patients infected with MRSA. Theravance will further receive royalties on global sales of televancin that range from the high teens to the upper 20s.

The Form 8-K also says that the terms of the agreement provide for Theravance to lead the development of Televancin for cSSSI and HAP and collaborate substantially with Astellas in marketing in the U.S. for the first three years. Astellas will lead all other development, regulatory, manufacturing, sales, and marketing activities worldwide, except Japan. Theravance will be responsible for all development costs for cSSSI and HAP, while Astellas will be responsible for substantially all costs associated with commercialization and further development of Telavancin.

Cambridge Health Talk’s Fifth Annual Pep Talk Conference will be held January 9-16, 2006 at the Hotel Del Coronado in Coronado, California.

In California’s November 8th Special Election, both measures on the ballot, which were of interest to the California biotech community, were defeated–Propositions 78 and 79.
The California Healthcare Institute (“CHI”), a biomedical industry advocacy group, provided this analysis of the results:

Both prescription drug initiatives lost by large margins. Prop. 78, sponsored by PhRMA and backed by Gov. Schwarzenegger and the business community, would have created a voluntary program for people with incomes up to 300 percent of the federal poverty level. It lost by 17 percentage points. Prop. 79 was sponsored by organized labor, mainly as an attack on the governor and his supporters. It would have created a prescription drug program extending to 400 percent of federal poverty level, with company participation tied to Medi-Cal. It also featured an anti-profiteering clause that would have encouraged lawsuits against manufacturers who charge “unreasonable prices.” It was defeated by 22 percentage points. At the same time, voters rejected Prop. 80, which proposed to make energy cheaper by imposing new regulations on public utilities. . . . Propositions 78 and 79 confused voters because they seemed to differ less on substance than on technicalities. Most of the more than $80 million industry spent on these initiatives went toward defeating Prop. 79. Still, in an election in which no initiative passed, and in which the governor’s support was unpersuasive, it is uncertain whether Prop. 78, on its own, could have garnered voter approval.

The defeat of Prop. 78 means that the underlying problem of access to drugs for low-income Californians awaits a solution. The Legislature is likely to revisit drug importation and various kinds of price controls in 2006.

BIOCOM, the biotech industry group which had strongly opposed Proposition 79, provided its own analysis of the special election results in its recent newsletter.

Regardless of their reasons, California voters have clearly spoken and elected to send lawmakers back to the drawing board. Californians will have to wait and see if lawmakers can come up with a better solution for dealing with providing better access to drugs for low-income Californians. As someone who moved to California from out-of-state and who has personally experienced some of the same access issues on a higher income salary, however, I cannot help but wonder if this is the kind of problem that can really be resolved by lawmakers alone. It seems to me that the problem is more complicated than that and will require more than a simple legislative fix to resolve the issue.

The Chiron board has accepted a $5.1 billion purchase offer from Novartis AG. Novartis already owned 42% of Chiron’s shares, and was unhappy with the recent direction of the company, following a string of manufacturing problems, including the contamination of last year’s supply of flu vaccines. Despite these recent problems, however, Novartis saw the potential for the vaccines business. As the San Francisco Chronicle reported:

Novartis sees Chiron as a springboard into an expanding international market, not only for next-generation flu vaccines, but inoculations for other illnesses like meningitis and even cancer.

Chiron is one of the manufacturers trying to sidestep the process of producing flu vaccines in live chicken eggs, an arduous and time-consuming method that makes it hard to adapt vaccines quickly as flu viruses mutate into different strains. Chiron is developing vaccines produced in cell culture, which may produce higher yields in less time, and thus higher profits. . . .

The move by Novartis, as the San Francisco Chronicle noted, is similar to the move taken by Roche Holdings, Inc., another Swiss pharmaceutical giant, which has held a majority share in Genentech, Inc. since 1990. Genentech and Chiron are two of the three oldest companies in the biotech industry.

This acquistion highlights how Novartis has taken the unusual step of positioning itself as both a brand-name and generics pharmaceutical company, having just recently purchased generics drugs makers Hexal in Germany and Eon Labs in the U.S. In Vivo wrote about the Hexal/Eon Labs purchase as follows:

[T]he significance of this proposed transaction extends beyond the generics sector. Novartis, whose core focus remains on patented drugs, is thereby making a statement about the role of generics in a wider environment where both pricing pressures and the hurdles to proving innovation are increasing. It’s also making a statement about pharma firms’ perceived image and credibility among payers, governments and patients.

It’s not clear whether Novartis will achieve the stated objectives of this deal, either on the credibility front, or financially. The Swiss giant paid a healthy price for businesses in two large, but tricky markets. It also faces the ongoing challenge of successfully managing the very different businesses of branded and generic drugs. . . .Whatever the outcome, Novartis’s move is bold, and it demonstrates this firm’s belief that Big Pharma needs to make some radical changes to its model in order to return to historical growth rates.

It is evident that Novartis is continuing to make bold moves in the biotech/pharmaceutical industry. We will just have to wait and see whether those bold moves reap the big benefits that Novartis is counting on.

The BioScience Forum will be sponsoring the event Year End Wrap Up: State of the Industry on Wednesday, December 21, 2005 at 6:00 p.m. The event will be held at The Clarion Hotel, 401 East Millbrae Avenue, Millbrae, CA. Scott Morrison, U.S. Life Sciences Director for Ernst & Young, Palo Alto, will be speaking.

The U.S. House of Representatives is currently considering legislation to reform U.S. patent law. The reform bill, H.R. 2795, was introduced by Representative Lamar Smith of Texas on June 8, 2005, and is the subject of intense debate in the House.

The proposed legislation would modify existing rules on such issues as first inventor to file; the definition of prior art; assignee filing; best mode requirement; willful infringement; venue for infringement actions; the apportionment of damantges for infringement; and continuation applications. The Intellectual Property Owners Association is tracking the debate on this legislation, which is updated regularly on its website.

The Intellectual Property Section of the State Bar of California has urged its members who have input on the legislation to contact their congressional representatives. California Congressman Howard Berman is the ranking minority member of the House Subcommittee on the Courts, the Internet, and Intellectual Property, and other members of the Subcommittee from California include Adam Schiff, Elton Gallegly, Darrell Issa, Zoe Lofgren, Maxine Waters, and Linda Sanchez.

Experts are predicting that the bill will pass in some form, although it is unclear which provisions will survive the current debate.