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Personalized medicine:business strategies of pharmaceutical

and biotech companies

Dominique Dubois

June 16, 2014

Odgers Berndtson

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Extensive network in life sciences industry

Trends in the pharmaceutical industry

Personalized medicine latest buzzword

Effect on executive searches?

Odgers Berndtson

What is personalized medicine?

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What is personalized medicine?

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Targeted therapies (e.g. Herceptin)

Specific diagnosis (e.g. Her2)

Companion diagnostics

Effective treatment

Aspinall & Hamermesh, 2007;

Katsios & Roukos, 2010;

Woodcock, 2007

Subsets of patient groups = fragmented market

Blockbusters running out

More products but less profit?

So what’s in it for the pharmaceutical industry?

Problem statement

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Aspinall & Hamermesh, 2007

Blockbuster: drug with annual revenue >1 US$ billion

Conceptual model

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Leadership

Business Strategy

Adapted from Morris, 2011

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What is the effect of personalized medicine on the business

strategies of pharmaceutical and biotech companies?

Research question

Literature & desk research

In-depth interviews

n = 20

RQDA analysis

Methods

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Interview # Function Company

1 Market Access Director CRO*

2 CEO Biotech

3 Associate Medical Science Director Pharmaceutical

4 Medical Director Pharmaceutical

5 Medical Director Oncology Pharmaceutical

6 Vice President Global Scientific Affairs CRO*

7 CSO Biotech

8 Business Development Director Biotech

9 Vice President Research Laboratories Pharmaceutical

10 Group Leader (Oncology) Research institute

11 Medical Director Pharmaceutical

12 CEO CRO*

13 Medical Director Pharmaceutical

14 Principal Scientist Biotech (diagnostic)

15 Senior Director Molecular Diagnostics Medical devices

16 Senior Scientist Biotech

17 Medical Oncologist University Medical Centre

18 Business Unit Director Oncology Pharmaceutical

19 Medical Director Biotech

20 Head of Internal Oncology Department University Medical Centre

Strategic thinking

Collaboration

Drug <-> companion diagnostic

Solid scientific research

Communication

Society

Uncertainty about economic impact (cost-effective?)

Mixed feelings towards PM

Results

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“Communication is essential to make personalizedmedicine a success, to ensure everyone is aware of what is happening.”- Senior Director Molecular Diagnostics

Strategic thinking

Workforce

Portfolio management

Therapeutic area dependent

Different for biotech and pharmaceutical company

Results (continued)

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“I think you need a combination of medically educatedpeople and commercially educated people, so preferably a MD MBA.”- Medical Director

“You see that biotech companies are often focussed on science, whereas pharmaceutical companies are thinking more about how they can expand their market potential.”- Business Unit Director

Research & insight

Molecular biology

Innovation development

Complete product: drug & companion diagnostic

Both closed and open innovation

Results (continued)

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“Progress in research that is being conducted worldwide is used by pharmaceutical companies to develop applications. So they do depend on science.”- Group Leader Molecular Carcinogenesis

Market development & selling

Regulatory authorities and insurance

companies

Market is definitely shifting to PM

Most growth in oncology, diagnostics and

niche indications

Results (continued)

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“The companies that are able to make the change and develop medicine in a personalized medicine manner, they will survive.”- Senior Director Molecular Diagnostics

What is the effect of personalized medicine on the business

strategies of pharmaceutical and biotech companies?

More collaboration and communication

Uncertainty about economic impact

Diagnostic area is expanding fast

PM is not relevant for all therapeutic areas

It will not completely take over the industry

Preliminary conclusion

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PM = personalized medicine

Innovation & market development most relevant concepts

Health care also greatly affected by PM

Hamburg & Collins (2010)

Possible accelerated approval programs for promising drugs

Ferrara (2006)

Coverage policies of insurance companies might change

Companies still hesitant to fully adopt PM

Vogel et al. (2002); Branford et al. (2004); Kalia (2013); etc.

Oncologists remain optimistic about PM

Preliminary discussion

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Limitations:

No health care perspective (doctors or patients)

Telephone/face to face interviews

Time…

Future studies:

Health care perspective

Quantitative research

Start-ups, M&A, novel products, etc.

Pharmaco-economic analysis

Preliminary discussion (continued)

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Finish the report (conclusion/discussion)

Business development plan

Research assistant

The next 6 weeks

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Marit Fretz & Michaël Mellink

Dr Theo Groen

Odgers Berndtson

Acknowledgements

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Questions?

“It will revolutionize the diagnosis, prevention and treatment of most, if not all, human diseases. In

coming years, doctors increasingly will be able to cure diseases like Alzheimer's, Parkinson's, diabetes

and cancer by attacking their genetic roots.”

- Bill Clinton (CNN, 2000)

Aspinall MG, Hamermesh RG (2007). Realizing the Promise of Personalized Medicine. Harvard Business Review,

85(10): 108-117.

Branford S, Rudzki Z, Parkinson I, Grigg A, Taylor K, Seymoer JF, Durrant S, Browett P, Schwarer AP, Arthur S,

Catalano J, Leahy MF, Filshie R, Bradstock K, Herrmann R, Joske D, Lynch K, Hughes T (2004). Real-time

quantitative PCR analysis can be used as a primary screen to identify patients with CML treated with imatinib who

have BCR-ABL kinase domain mutations. Blood, 104(9): 2926-2932.

CNN (2000). Transcripts: President Clinton, British Prime Minister Tony Blair Deliver Remarks on Human Genome

Milestone. Retrieved March 17, 2014, from http://transcripts.cnn.com/TRANSCRIPTS/0006/26/bn.01.html

Ferrara J (2006). Personalized Medicine: challenges in assessing and capturing value in the commercial

environment. Expert Review of Molecular Diagnostics, 6(2): 129-131.

Hamburg MA, Collins FS (2010). The Path to Personalized Medicine. The New England Journal of Medicine, 363:

301-304.

Kalia M (2013). Personalized oncology: recent advances and future challenges. Metabolism, 62(Suppl 1).

Katsios C, Roukos DH (2010). Individual genomes and personalized medicine: life diversity and complexity.

Personalized Medicine, 7(4): 347-350.

Morris L (2011). The Innovation Master Plan: the CEO’s guide to innovation. Walnut Creek: Innovation Academy.

Vogel CL, Cobleigh MA, Tripathy D, Gutheil JC, Harris LN, Fehrenbacher L, Slamon DJ, Murphy M, Novotny WF,

Burchmore M, Shak S, Stewart SJ, Press M (2002). Efficacy and Safety of Trastuzumab as a Single Agent in First-

Line Treatment of HER2-Overexpressing Metastatic Breast Cancer. Journal of Clinical Oncology, 20(3): 719-726.

Woodcock J (2007). The Prospects for “Personalized Medicine” in Drug Development and Drug Therapy. Clinical

Pharmacology & Therapeutics, 81(2): 164-169.

Literature

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To describe what the effect of personalized medicine is

on business strategies of pharmaceutical and biotech

companies by providing insight into the opinions of

executives and R&D specialists of pharmaceutical and

biotech companies on personalized medicine

Research objective

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