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OVERVIEW, PROSPECTS AND COMPETITIVENESS CHALLENGES
CONTENTS 1. 1.1 1.2 1.3 1.4 1.5 SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Highlights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Canadian Context . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The Bottom Line . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. 2.1 2.2
2.3 2.4 2.5 2.6
THE BIOPHARMACEUTICAL SECTOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Definition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Global Context . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Products and Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Industry Size . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Industry Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Strategic Alliances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . North American Context . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Canadian Policy Framework . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Canadian Industry Snapshot . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Performance and Competitiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3. 3.1 3.2 3.3
COMPETITIVENESS ISSUES AND COMMERCIAL CHALLENGES Access to Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Human Resource Gaps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Maximizing Commercial Benefits Manufacturing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Technology Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Market Access Challenges Intellectual Property and Freedom to Operate . . . . . . . . . . . . . . . . . . . . . . . . . . . Increasing Clinical Timelines . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Regulations and Approval Times . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Trade Barriers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Biosafety Protocol . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Pricing and Pharmacoeconomics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Bioethics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Technologies Drug Discovery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Pharmacogenomics and Personalized Medicine . . . . . . . . . . . . . . . . . . . . . . . . . . Drug Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Emerging Biopharmaceuticals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Molecular Farming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4. 4.1 4.2 4.3 4.4 GROWTH PROSPECTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Demand Outlook . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Current Industry Strengths . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Current and Anticipated Challenges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . The Bottom Line . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ANNEXES A. Glossary of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B. 1998 Global Biopharmaceutical Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C. Canadian Biopharmaceuticals in Clinical Development . . . . . . . . . . . . . . . . . . . . . . . . .
Biopharmaceuticals Overview & Prospects Page 3
The discovery of recombinant DNA and monoclonal antibody technologies in the 1970s marked the birth of the biopharmaceutical industry. Biopharmaceuticals are complex macromolecules derived from recombinant DNA technology, cell fusion, or processes involving genetic manipulation. They include recombinant proteins, genetically engineered vaccines; therapeutic monoclonal antibodies; and nucleic acid based therapeutics (i.e. DNA based drugs), including gene therapy vectors. Unlike orally delivered small molecule drugs that underpin the traditional pharmaceutical industry, biopharmaceuticals are usually administered by subcutaneous, intravenous, or intramuscular injection. The first drug produced via genetic engineering was human insulin which appeared on the market in 1982. By mid-2000, 84 biopharmaceuticals had been approved for marketing with almost half launched during the past three years. Worldwide sales have grown more than seven-fold over the past decade to reach US$15 billion by 1998. The US represents 46% of the market, compared to 36% for conventional drugs, due to a combination of earlier regulatory approval, easier market acceptance, and greater pricing flexibility than other countries. Although biopharmaceuticals comprise only 5% of world prescription drug sales, they account for six of the top 50 selling drugs, 13% of new medicines approved by the FDA in the 1990s and about 18% of all drugs in development. At the end of 1999, there were 369 biotechnology drugs in US clinical development against 438 disease indications with 25% in Phase III. It is important to understand the distinction between biotechnology as a new process technology and as a drug discovery research tool. The first uses genetic engineering to manufacture large molecular weight drugs that cannot be directly synthesized or extracted. The second involves the search for new therapeutic targets, with most of the focus on small molecule drugs that interact against those targets, using techniques such as cloned receptors as screens or gene knock-out technologies in the creation of transgenic organisms to determine protein function. The pharmaceutical industry will likely maintain its dominant position in small molecules through the use of biotechnology in drug discovery, but the development and manufacture of protein based drugs requires a completely different set of core competencies. 1.2 Technology
Modern drug discovery is built on four core technologies: genomics (source of novel targets), combinatorial chemistry (source of molecules that interact against those targets), high-throughput screening (testing one against the other); and bioinformatics which is crucial to the analysis of the vast amounts of data generated. While current pharmaceuticals are active against some 500 biological targets, genomics is expected to lead to the identification of up to 10,000 new targets for development. Whether these will be amenable to small molecule intervention or require protein and nucleic acid based therapies remains to be seen. Despite the heavy investment in genomics, only a handful of genomics-based drugs (defined as those based on the identification of an unknown gene sequence followed by elucidation of its function and therapeutic potential) have
Biopharmaceuticals Overview & Prospects Page 4
700 people of which 20 firms have biopharmaceuticals in clinical development.5 months in the late 1990's. Many of the earlier products were recombinant versions of natural hormones with relatively well understood properties compared to newer biopharmaceuticals with more difficult therapeutic targets and undefined disease mechanisms.. royalty-based companies. The industry predominantly consists of research-oriented. there has been a substantial increase in the time biopharmaceuticals spend in clinical development. public equity markets. and strategic alliances used to share development costs and spread risk. Most firms do not have a product on the market that can be used to generate cash flow and instead are dependent on funds from venture capital. it will take court precedents to ultimately clarify the issues. Product rights are usually licensed at an early stage with multinational pharmaceutical partners gaining most of the commercial benefits. building this capability internally so it can move from traditional screening and medicinal chemistry capabilities to the front end of drug discovery research. Also. 1. At the same time. Access to capital is critical due to the high costs of drug development and length of time it takes to get a product approved. A large number have also been discontinued in Phase III. from 39. Genomic companies have filed for patent protection on thousands of genes including the proteins associated with them which is a major area of concern. Although the US PTO has recently tightened gene patents. With the exception of recombinant insulin. some of which take the form of quality of life improvements. there is a need for governments to recognize the overall health care and social economic benefits in evaluating formulary inclusion. the hurdle for discontinuing development is higher for a biotechnology company because it only has a handful of products in clinical development and its stock price is largely determined by its lead product. 1. The biotechnology industry has been characterized by significant litigation involving intellectual property rights. biopharmaceuticals firms are much more expensive than traditional drugs.4 Canadian Context The human health and bioinformatics sectors consist of approximately 168 dedicated biotechnology companies employing some 5. All are protein drugs.4 months for products approved in the 1980's to 61.3 Challenges The pharmaceutical industry is investing heavily in new biotechnologies. There is difficulty developing the data needed on long-term outcomes and evaluating benefits. in direct competition with biotechnology firms. Canada ranks among the world leaders in the creation of biotechnology companies relative to its population but has a less mature industry than the US Biopharmaceuticals Overview & Prospects Page 5 . Despite decreases in regulatory approval times in the US and the EU.reached the clinical stage.
Regulatory Framework: Canadian drug approval times are significantly longer than the US or the EU. will be particularly difficult to recruit as most graduates lack such inter-disciplinary training. federal and provincial R&D tax incentives are among the most generous in the world. with six indications in Phase III. In addition. Additionally. antibiotics. US deals . Financing: Drug development is extremely long and expensive. shortfalls are expected to arise in certain research areas. a field that requires a background in genetics. Initiatives to strengthen research capability include the creation of the Canadian Institutes of Health Research in 2000 with a budget of $475 million compared to the $271 million of its predecessor organization Medical Research Council. but competition for such skills is intense. Although no Canadian developed biopharmaceuticals have yet been approved for marketing (excluded are traditional biologicals such as classical vaccines. Unlike the US or the EU. with the possible exception of Apotex.The international pharmaceutical industry has been the prime source of such expertise. as well as small molecule drugs such as 3TC and Visudyne which are not based on recombinant DNA technologies). Although capital is much more plentiful than a decade ago. people with manufacturing expertise. 14 companies have 27 products in human clinical trials against a variety of diseases. as firms mature. and $300 million for the creation of Genome Canada. Strategic Alliances : Maximizing commercial benefits in the life sciences sector is a major challenge for Canada. Human Resources: In coming years. mathematics. Public R&D Government support for basic medical research lagged significantly behind other industrialized countries in the 1990s. and computer assisted drug design. that have the necessary financial and international marketing capability to serve as strategic alliance partners. IPOs. and senior managers who can lead firms through product development. $100 million in additional funding to the research granting councils. Industry growth and performance is dependent on a number of factors: Industry R&D: Canadian public companies are significantly smaller and spend far less on R&D than their US counterparts. and products in commercialization.whether venture capital.as measured by revenues. There is a fledgling industrial effort in bioinformatics. there are no Canadian owned pharmaceutical companies.are much larger than those in Canada. People with expertise in bioinformatics. there will be increasing need for regulatory clinical personnel. The pressing need is patient capital for R&D rather than investment in manufacturing. employees. leading to an outflow of commercial benefits and technology.. or follow-on offerings . protein and DNA drug delivery. alliance negotiations. and computers. $90 million over three years for expansion of the Network Centres of Excellence Program. and blood products. This could result in the later introduction of breakthrough therapies compared to other Biopharmaceuticals Overview & Prospects Page 6 . and commercialization.
! improving information on research programs in federal laboratories. The major challenges for government and industry include: ! increasing R&D investment by both government and industry. Biopharmaceuticals Overview & Prospects Page 7 . capabilities to solve specific problems. ! strengthening technology intelligence and forecasting initiatives in firms.countries. ! improving regulatory efficiency. ! optimizing commercial benefits for Canada from government and industry investment in R&D. Canada’s performance declined relative to the US as a result of greater efficiencies at the FDA and because user fees are not being fully used to improve regulatory efficiency. and ! addressing human resource requirements through expanded immigration and better co-ordinated education and training programs.5 The Bottom Line The biopharmaceutical industry is a key part of the knowledge based economy. lacks a major success story in which a firm has been able to get a product to market successfully. ! encouraging the formation of academic spin-off companies through technology clusters and incubator facilities. teaching hospitals and government laboratories and by improving access to technologies available for licensing. ! fostering technology transfer through training of such officers in universities. and technologies available for licensing. ! ensuring Canada’s patent regime is competitive with other jurisdictions. but as in other countries. Canada has internationally recognized research capabilities and many promising companies. ! establishing pricing and reimbursement levels that contain health care expenditures without damaging the viability of the industry. 1.
The first recombinant protein (human insulin) was launched in 1982. No gene therapy product has yet been approved. 84 biopharmaceuticals had been approved for marketing with almost half launched during the past three years.e. interferons (20. and ! oligonucleotides (short sequences of DNA or RNA) such as antisense molecules which interrupt the production of disease causing proteins by inhibiting gene function and gene therapy which can enhance the production of a missing protein through the addition of a synthetic gene. the first recombinant vaccine (against hepatitis B) in 1986. but these are more in the realm of traditional medicinal chemistry research based on the random screening of natural compounds. biopharmaceuticals or drug targets). and Factor VIII and several monoclonal antibodies (close to a million).g. 2. The biopharmaceutical category also often includes drugs derived from plants. fungi or marine organisms. and classical vaccines based on live or killed viruses. but these long predate the emergence of recombinant DNA and monoclonal antibodies. are identified as biopharmaceutical companies to differentiate them from the mainstream pharmaceutical industry. and international data are difficult to compare. The biopharmaceutical industry cannot be identified using the Standard Industrial Classification which distinguishes firms on the basis of their output rather than their technology or production process. an area that consists of blood derived polyclonal antibodies and clotting factors. antibiotics. Biologics.1 Product Definition Unlike chemically synthesized small molecule drugs that have long underpinned the traditional pharmaceutical industry. the first therapeutic monoclonal antibody (against kidney transplant rejection) also in 1986. ! therapeutic monoclonal antibodies.2 Global Context Products and Markets By mid-2000. ! recombinant antigen vaccines and vaccines crafted from genetic material such as DNA. was originally obtained from porcine or bovine pancreas while human growth hormone was extracted from the pituitary glands of cadavers. for example. interleukins (15. SECTOR DESCRIPTION AND MARKET CONTEXT 2.2.000). Insulin. In terms of product type. are frequently classified as biopharmaceuticals. Recombinant proteins dominate the biopharmaceutical market accounting for the bulk of sales to date. or cell fusion technologies. Many biotechnology firms. Worldwide sales in 1998 totalled US$15 billion (Annex B). biopharmaceuticals are complex macromolecules 1 created through the genetic manipulation of living organisms using gene cloning. recombinant DNA (gene splicing).000). and the first and only oligonucleotide in 1998 (against cytomegalovirus retinitis in AIDS patients). tPA (70. Biopharmaceuticals Overview & Prospects Page 8 . but their prime focus are small molecule drugs targeted against proteins thought to be important in the disease pathway (proteins can be used both as drugs i. these include: ! recombinant proteins. Although representing only 5% of world prescription drug sales of $300 1 Conventional drugs have molecular weights on the order of several hundred daltons but biopharmaceuticals are 100 times or more larger e.000). for example.
and 11% of all drugs in development. and Bio-Technology General (Israel). The segment involved in biopharmaceuticals numbers about 150 firms. The total market capitalization of all public European biotechnology companies. either activating it or block it from working. The boundary between these three groups has blurred. and a specialized tier of companies serving both the pharmaceutical and biotechnology industries with platform technologies that can speed up the drug discovery process or improve drug delivery. for example. As the pharmaceutical industry is using biotechnology in drug discovery.000 dedicated biotechnology companies worldwide employing 230. Biopharmaceuticals Overview & Prospects Page 9 . with the industry primarily consisting of large food and pharma firms with historic strengths in fermentation attempting to diversify into biopharmaceuticals. Europe and Japan are the next most important markets. biopharmaceuticals comprise six of the top 50 selling drugs. most of the focus is on small molecule drugs that interact against those targets. Chiron. The industry as a whole continues to experience major losses because of high R&D costs. accounting respectively for 30% and 17%. easier market acceptance and greater pricing flexibility. The first uses genetic engineering to manufacture large molecular weight drugs that cannot be directly synthesized or extracted. Amgen. accounting for 46% of sales.number approximately 460 of which 74% are based in the US and 18% in the EU. Publicly traded firms . but the development and manufacture of protein based therapeutics requires a completely different set of core competencies. it will likely maintain its dominant position in small molecules. traditional pharmaceutical companies (“big pharma”) marketing drugs developed by biotechnology firms.have a product on the market. reflecting their later startup dates. Biogen and Genentech) are mainly US based. reflecting a combination of earlier regulatory approval. Big pharma is investing heavily in molecular biology and genomics. a protein can also be used as a drug e. researching disease mechanisms at the molecular level. Japan has few dedicated biotechnology companies. Only a handful of biotech firms . The US is the largest and most rapidly growing market. few non-US firms have brought a biopharmaceutical to market. The second involves understanding the molecular basis of disease and the search for new therapeutic targets 2 using techniques such as cloned receptors as screens or transgenic organisms created through gene knock-out technologies to determine protein function. and platform companies are entering the drug development field because of the prospects for higher returns. With the exceptions of Serono (Switzerland). 2 Proteins expressed by genes are the targets of most drugs on the market and in development. is only a little larger than Amgen. It is important to understand the distinction between biotechnology as a new process technology and as a drug discovery research tool. The largest and most successful (e. usually university spinoffs. insulin or human growth hormone. Industry Size There are approximately 3.including an estimated 100 that floated IPOs during 2000 . Celltech (UK).g. compared to 36% for conventional prescription drugs. Industry Structure The biotechnology industry consists of three groups: dedicated biotechnology firms.g.primarily those involved in biopharmaceuticals.000 people with the US accounting for 40% of firms and 70% of employment. Companies look for a compound that binds to a protein. 13% of new medicines approved by the FDA in the 1990s. biopharmaceutical firms are moving into small molecule therapeutics because of production and delivery advantages.billion. In some cases.
the biotech industry is not as dependent on big pharma for clinical expertise. availability of competitive technologies. Over half of alliances are renegotiated or cancelled prior to project completion and only 10% meet the expectations of pharmaceutical executives. The royalty rate negotiated depends on a number of factors: the inherent risk.Strategic Alliances Drug development is extremely capital intensive. most of the risk is borne by the biotechnology company who will only collect the full amount if all milestone targets are met and the project proceeds to conclusion. Most biotechnology companies have no product sales (oft-quoted revenues and exports consist mainly of interest income from invested capital and income earned from alliances) and lack the resources to exploit the products they are developing. costing an estimated $500 million and taking 10 years or more to bring a product to market. By advancing products further down the pipeline. For biotech firms. size of up-front payments. most of the commercial benefits (profits) flow to big pharma. and royalty stacking (any sharing of third party royalties such as drug delivery licenses). therapeutic field of use. Few have the ability or resources to manufacture or market their own products. Because the majority of deals are signed at a very early stage (Chart 2). any sharing of clinical trial costs. and milestone payments geared to technical and regulatory accomplishments. The biotech industry predominantly consists of royalty based companies. These average US$55 million for contracts signed at the early stage to US$76 million for late stage projects (Chart 1). The earlier a collaborative partner becomes involved the lower the returns (Chart 3) because of the greater risks that the product will never reach the market and the greater the investment required by the partner. a firm will not only derive higher Biopharmaceuticals Overview & Prospects Page 10 . With the emergence of contract research organizations. Because agreements are primarily structured towards milestones. Pre-commercial payments over the life of an alliance typically consist of a combination of upfront licensing fees (cash and usually equity purchases). The multinational pharmaceutical industry in turn gets an infusion of new products and technologies to sustain earnings at a time it is suffering from a dramatic decline in new chemical entities. whether manufacturing rights are included. extent of territorial rights granted. R&D remuneration. licensing brings in much needed income and improves access to the equity markets by validating their commercial potential to outside investors.
Biopharmaceuticals Overview & Prospects Page 11 . The demand side is strongly influenced by federal and provincial price controls and government sponsored vaccine programs.3 North American Context A number of government policies are important in shaping the pharmaceutical and biotechnology industries. 2. regulatory approval. these include public funding of biomedical research. tech transfer initiatives. orphan drug legislation. On the supply side. Although Germany now leads Europe in terms of numbers. most of the firms are very small and the country lags well behind the UK in market capitalization and drugs in clinical development. R&D incentives.3 and capital gains tax policies that bear on venture capital. intellectual property laws (weak patent protection policies hamper investment and innovation by removing incentive for research while too strong policies hamper innovation by stifling competition). education and immigration. an estimated 80% of German companies received public monies. 3 Government subsidies were the prime factor in the growth of the German biotech industry.royalty rates but may also be rewarded with a higher market valuation allowing it to raise more cash with less dilution. The present strategy is to take a product through to Phase II to show proof of concept and then find a partner to conduct the more comprehensive Phase III studies.
Canadian trials until recently were subject to a 60 day default period (the company may proceed with the trial unless it was notified within 60 days that its application was deficient) whereas the default period in the US is 30 days. timeline performance goals for each phase.000 per application) which raised over US$700 million since 1993 and allowed the hiring of 660 additional staff (exempted from user fees are orphan drugs. the landmark Supreme Court ruling in 1980 that allowed the patenting of genetically engineered bacteria. FDAMA helped shorten drug development times through initiatives such as industryFDA meetings to review clinical research protocols. with hospitals assuming a much stronger research function than in continental Europe (this advantage also applies to Canada). strong venture capital market and easier stock exchange listing requirements. To shorten review times and make clinical trial applications internationally competitive. or reproductive or genetic technologies). Over 60% of all clinical trials are performed overseas with the majority conducted in the UK. new regulations came into effect in Canada on September 1. As a result. followed by the US and Canada. Canadian review times on the other hand are on average six months longer. Improved efficiencies at the FDA were due to the1992 US Prescription Drug User Fee Act (PDUFA) which addressed drug approval times and the Food and Drug Modernization Act of 1997 (FDAMA) improved the clinical development process. Since 1997. and a seven day target for the review of bioequivalence trials and Phase I trials in healthy volunteers (excluded are Phase I studies using somatic cell therapies. Biopharmaceuticals Overview & Prospects Page 12 . and so called “fast track designation” for those products offering a significant improvement over drugs already on the market or for treatments for serious and life-threatening diseases. limits Canadian clinical experience. greater entrepreneurial culture. a large domestic based pharmaceutical industry able to commercialize research results. differences in the institutional structure of medical research. pediatric indications. PDUFA implemented specific review time frames and established user fees (currently about US $290. by the end of the 1990s 50% of biotech drugs were first introduced on the US market compared to only 20% 10 years earlier. encouraging firms to undertake Phase I trials there and to use the data to subsequently file in North America (a new EU directive mandating a 60 day default review period across member jurisdictions will erode this particular advantage). use of surrogate endpoints such as white blood cell counts in the evaluation of antiviral drugs in AIDS patients as substitutes for survival time. and the first application from a qualifying small business). 2001: a 30 day default period from Phases I through III. Investigational New Drug applications in the UK have been exempt from regulatory review. and diminishes the availability of new drug therapies. greater mobility of research scientists. gene therapies. about 80 biologicals had requests for fast track designation and were likely to be priority reviewed because of their orphan drug designation. vaccines. There has been a substantial reduction US drug approval times over the last decade so that they are now similar to Europe. resulting in initial public offerings about a decade ahead of Canada and Europe. xenografts.The US’s predominant position is due to a combination of factors: intensive federal funding for the National Institutes of Health (budget of US$ 20 billion for 2001). This places Canadian contract research organizations at a competitive disadvantage. making it easier to raise investment capital. the world’s premier medical research organization and a source of highly trained employees for the private sector. and strengths in information technologies critical for life sciences research. the 1980 Bayh-Dole Act to encourage commercialization of research at federal agencies and in universities funded with federal monies.
fungi. are considered to be methods of medical treatment and are therefore not patentable in Canada. it can be used to pursue claims broader than those of the issued patent. algae. Also. and the EU (2000). An Biopharmaceuticals Overview & Prospects Page 13 . and plants designed to carry therapeutic proteins. but processes to modify the cells outside the body are patentable. Orphan drug laws will become increasingly important as companies use genetics to define disease subtypes. yeast. pigs for human organ transplants. the Federal Court of Appeal ruled that the oncomouse can be patented. the US. and since 1998 70% of orphan designations went to biotechnology firms. Australia (1998). applications filed before this date will continue to be secret until the patent is issued. assuming the treated cells are returned to the host. has been available in the US since 1988 and subsequently in Japan and Europe. • bioinformatics algorithms can be patented in the US but not in Canada or the EU.The 1983 US Orphan Drug Act provides a seven year period of market exclusivity and financial incentives for the development of drugs against diseases affecting small patient populations (defined as less than 200. but the Canadian government has appealed the judgement to the Supreme Court. Gene therapies. The change reduces the commercial risk for competitors who previously could not be certain if others had filed first. • unlike the US or EU. However. The Canadian Intellectual Property Office (CIPO) has only allowed microbial life forms such as bacteria. and viruses to be patented. Canada has no orphan drug program. In August 2000. a transgenic strain with a predisposition to cancer used in cancer research. cell lines. The ultimate decision will have a wide ranging impact on patents on mammals which are being genetically modified to secrete biopharmaceuticals in their milk. There are some significant differences in patent laws between Canada.the FDA will not approve another application for the same drug treating the same indication during the seven year period. Additionally. Canada does not offer patent term restoration to compensate for regulatory delays. • US patent applications filed after November 29. a reissue procedure is available in the US where claims of a recently issued patent can be broadened under certain conditions. Similar legislation has since been enacted in Japan (1993). bringing the US system in-line with other countries. 2000 will now be published 18 months after filing (provided the application is also filed in a foreign jurisdiction) rather than at the time the patent is issued. patent term extensions are now available in the US for PTO delays. after nine months. and the EU: • the US system is based on first-to-invent while rest of the world follows first-to file.000 people). antibodies. Methods for organizing and searching on-line genomic databases and for processing data provide an important means of intellectual property protection in the genomics field. • a patent “opposition” procedure is available at the European Patent Office (EPO) whereby third parties can challenge the validity of a patent within nine months following grant for a small fee. • methods of medical treatment can be patented in the US but not in Canada or the EU. (Market exclusivity does not protect orphan drugs from the approval of clinically superior drugs and a company can lose exclusivity if it cannot produce enough product to meet demand). • the patenting of higher life forms as represented by the Harvard oncomouse. The most important feature of the program and a major factor in attracting venture capital investment is market exclusivity . and vaccines. 56% of biopharmaceuticals launched in the US between 1982 and 2000 were first approved under this designation compared with only 14% for conventional drugs. or if a related application is still pending. Singapore (1999). a competitor will have to attack the patent in each jurisdiction separately. but not in Canada.
factors such as Canadian research excellence. Opposition procedures are not available in Canada or the US. continuous cell lines. melanoma. and Amgen. gene therapy. About 8. Cancer. A number have also executed major alliance deals attesting to the commercial of their technology: SemBioSys/Dow AgroSciences (US$12 million) for molecular farming.granulocyte-macrophage colony-stimulating factor (Cangene). and prostate. and gene therapy (7%). placing the burden on the courts for adjudicating patent disputes which is a much more expensive process. and Xenon Genetics/Warner Lambert (US$58 million) for elevating high-density lipoprotein to clear cholesterol from blood. monoclonal antibodies. The three largest categories were vaccines (27%). and anticancer oligonucleotides (Inex). an EPO patent must still be enforced at the national level. stress protein against papillomaviris-related dysplasia (StressGen). 4 Defined as products based on recombinant DNA.opposition with appeals can delay enforcement by two to six years. and access to capital for Québec based startups proved instrumental in attracting companies such as Intellivax. As the major European pharmaceutical companies have research operations in the US and are therefore closely tuned to US technical developments. Inflazyme/Aventis Pharma (US$91 million) for respiratory diseases. group A Strep vaccine (ID Biomedical). they have looked first to the US biotech industry for collaborative venture. monoclonal antibodies (16%). lower wages and infrastructure costs. 369 biotechnology drugs4 were in US clinical development against 438 indications (Chart 4) at the end of 1999. breast cancer vaccine (Biomira). and cellular therapy Biopharmaceuticals Overview & Prospects Page 14 .5% of biotechnology and pharmaceutical patents are subject to such challenges. accounted for 40% of indications (Chart 5). However. has a more rapid uptake of new drugs. with one quarter in Phase III. and the national cost of patenting in the EU is about 10 times that in the US for roughly a similar size market. Canadian products in the survey included human parathyroid hormone for osteoporosis (NPS Allelix). making it difficult to attract investment to Canada. Methylgene. However. GMCSF . • patent protection in Europe can be obtained by filing national applications in each country or through the EPO designating the states that protection is desired (the latter is cheaper if protection is sought in more than three countries). mainly breast. DSM Biologics. There has been been a steady migration of European R&D to the US because the US is the most profitable pharmaceutical market in the world. GlycoDesign/Seikagaku (US$56 million) for anti-inflammatory agents. and pricing is largely unregulated by the federal government.
Almost 47% ($185 million) was performed directly by government laboratories. cancer. there has been an injection of funds for R&D in the last few budgets. cardiology and neurosciences. supported in large part by MRC. The Canadian Institutes for Health Research (CIHR). MRC (Medical Research Council) provided $128 million to higher education followed by NSERC (Natural Sciences and Engineering Research Council) with $40 million. the largest recipients were the higher education sector ($169 million) and business enterprises ($35 million).4% of overall federal S&T). Within its 16 medical faculties and associated teaching hospitals. will have a budget of $402 Biopharmaceuticals Overview & Prospects Page 15 . After a period of cutbacks in the 1990s. Canada has research strengths in genetics.4 Canadian Framework Public Policy Public R&D Investment: Excluding regulatory activities. created in June 2000 as a replacement for MRC. federal expenditures on biotechnology R&D in 1999/00 reached $392 million (about 6. with the National Research Council (NRC) accounting for the largest share at 56% followed by Agriculture and Agri-Food Canada (30%).2. Of the $207 million/53% performed outside of government.
financial support is also available through Technology Partnerships Canada (TPC) and NRC’s Industrial Research Assistance Program (IRAP). the credit for public firms is lower (20%) and non-refundable so that companies can only take advantage of the credit if they are in a profitable position. but the number and size of biotechnology applications far exceed the resources of both programs. Protein Engineering Network. Because most public biopharmaceutical firms continue to operate at a loss after 10 years. a renewed Canadian Biotechnology Strategy identified a number of themes for government and industry action such as consumer confidence and new R&D initiatives. determining repayment provisions. many of these accumulated credits are starting to lapse.million in 2001/02. this provides Canadian firms with among the most generous R&D incentives in the world. Canadian Stroke Network. helped support over the years increased research funding. human resource development. while countries such as Singapore (US$1 billion over five years) and Taiwan (US$870 million since 1997) are making major investments in biotechnology. Canadian Arthritis Network. the biotechnology industry cannot ensure where any future products will be manufactured).g. and the establishment of a regulatory framework. and the Stem Cell Genomics and Therapeutics Network. ineligibility of costs pertaining to the development and preparation of clinical trial material in Canada for use outside of Canada. Cancer Immunotherapeutics and Chronic Viral Diseases. regulation of genetically modified food. lack of timely decisions) as well as a number of interpretational issues: the eligibility of clinical trials (of all phases) which were not conducted in their entirety in Canada (companies claim that the size of the Canadian patient sample is insufficient for drawing statistically valid conclusions). Technology Transfer The Networks of Centres of Excellence Program was launched in 1989 to strengthen Canadian science-industry links and build critical mass in areas of strategic importance. The government also made a major investment in genomics. A unique feature of Canada's 35% tax credit for Canadiancontrolled private companies is that this is refunded to firms as cash. up from $365 million in 2000. Network for Vaccines. and exclusion of pharmacoeconomics studies. support for medical research is less than one fifth of the US level on a per capita basis. In addition to SR&ED tax credits. Industry has expressed many concerns about Revenue Canada’s administration of the program (e. Despite these funding increases. and use of genetically based interventions. an arm's length advisory body. Combined with provincial credits. Industrial R&D Incentives: The federal government's main vehicle for promoting industry investment in innovation is the Scientific Research and Experimental Development (SR&ED) tax incentive. In 1998. Industry concerns about TPC centre on the excessive time it takes to process applications. first drafted in 1983. Canadian Biotechnology Strategy: A National Biotechnology Strategy. Canadian Genetic Diseases Network. social and ethical considerations relating to biotechnology. Biopharmaceuticals Overview & Prospects Page 16 . and meeting the requirement for substantial domestic manufacture (because of alliances. Seven networks are currently involved in biomedical research: Canadian Bacterial Diseases Network. providing $300 million towards the creation of Genome Canada in support of the creation of five genome centres. The Canadian Biotechnology Advisory Committee (CBAC). plus $55 million for genomics research in federal laboratories. genetic privacy. However. was created in 1999 to advise the federal government on a broad range of policy issues that cut across various government departments such as the patenting of higher life forms.
for pre-1989 applications. the government tabled amendments which will implement a WTO ruling that the 20 year term should apply to these patents as well. the introduction of innovative medicines may be delayed compared to other countries. 2001. increasing from 11. Canada’s policy was to maintain the old term of protection. due mainly to the increased utilization of new therapies. 17 years from date of grant. but manage prices for these drugs through the use of formularies. The first generic biopharmaceuticals are expected to hit the North American market within five years. Without a more flexible pricing policy. and limits on markups and dispensing fees. i. established in 1987 in conjunction with the amendments to the Patent Act. price freezes. As a result of a EU challenge at the WTO. insurance companies). The industry feels that the Board is overly restrictive in designating medicines as breakthrough therapies which could be particularly difficult for biopharmaceuticals as they tend to be much more expensive than new chemical entities. 2. monitors the pricing of patented drugs and R&D of pharmaceutical companies. On February 20. pharmaceuticals have been the fastest growing component of health care costs in Canada. At the federal level. The guideline for breakthrough drugs and those offering substantial therapeutic benefits are the median of the prices charged for the same drug in other industrialized countries.Pharmaceutical Price Controls: Over the past decade.e.5 Canadian Industry Snapshot According to a 1999 survey undertaken by Statistics Canada. private insurers (e. mandatory generic substitution. the Patented Medicine Prices Review Board (PMPRB). Drug prices are reviewed in relation to changes in the Consumer Price Index and the range of prices of related products to treat the same disease. 1992 (Bill C-91) eliminated compulsory licences for the production of generic copies of patented drugs. Provincial governments provide some form of publicly funded drug coverage for seniors. the prices paid by these groups are influenced by provincial formularies. 1989. the federal and provincial governments have instituted a number of price control mechanisms.5% in 2000. Biopharmaceuticals Overview & Prospects Page 17 . Although most drugs are purchased or paid for by health care institutions. stockpiling is no longer allowed but the research and testing provision was found to comply with WTO regulations. About 85 % of the industry was concentrated in three provinces: Quebec (38%).g. To control rising drug costs. those requiring social assistance. the Act did not prevent generic manufacturers from developing and testing a generic equivalent prior to the expiration of the patent or from stockpiling the generic so that it was ready for shipment once the patent expires. the human health and bioinformatics sectors consisted of 168 dedicated biotechnology firms employing some 5. like other countries subscribing to the 1994 WTO Agreement on Trade Related Aspects of Intellectual Property (TRIPs). However. and individual patients and while hospitals are able to negotiate bulk discounts with suppliers.3% of health care expenditures in 1990 to 15. The EU provides data exclusivity in product submissions for regulatory approval because such information is considered proprietary whereas Canada has a less generous regime. and those suffering from certain diseases such as cystic fibrosis and multiple sclerosis. provides 20 years protection from the date of application for product and process patents applied for on or after October 1. Although the Patent Amendment Act.1 billion and $723 million respectively.700 people with revenues and R&D expenditures totalling $1. Intellectual Property: Canada. unions. Ontario (27%) and BC (21%).
TGN Biotech. Toronto .antisense drugs against various cancers • Viventia. research is primarily conducted in teaching hospitals and universities such as The Hospital for Sick Children (Toronto) and the Samuel Lunenfeld Research Institute at Mt. (Excluded are conventional vaccines with an estimated value of CAN$150 million which account for the bulk of domestic biotechnology production. Mississauga . granulocyte macrophage colony stimulating factor for bone marrow transplants • Methylgene. and Base4 Inc in bioinformatics. and Chromos’s gene delivery system for ex vivo gene therapy .heat shock (stress) proteins for activating the immune system focusing on vaccines against cancer and infectious diseases • Synsorb Biotech. Foy . As of mid2001.are foreign owned. Box 1 Selected Canadian Biopharmaceutical Companies • Biochem Pharma. Imaging Research (image analysis systems for microarrays and high throughput screening). Intellivax (nasal/oral vaccine delivery based on proteosomes). has been instrumental in the creation of a large biotechnology cluster in the Montreal area. St. Montreal . with six indications in Phase III (Annex D).The two largest firms .recombinant vaccines against meningitis. and Virtek Vision (DNA microarrayers and laser scanners) are major suppliers of specialized instrumentation used in drug discovery and genomics. tax holidays for key staff. Not only has the province been the most aggressive in cultivating a biotechnology industry via mechanisms such as government-backed venture capital funds. Biopharmaceuticals Overview & Prospects Page 18 .anticancer vaccines • Stressgen Biotechnologies. Domestic sales of imported biopharmaceuticals in 1999 totalled C$325 million.recombinant parathyroid hormone for osteoporosis • Aventis Pasteur.cancer vaccines • Cangene Corporation. accounting for about 25% of employment.carbohydrate based therapeutics against recurring antibiotic associated diarrhea The genomics area is represented by companies such as MDS Proteomics. the population genomic firms SignalGene and Xenon Genetics (identification of disease causing genes based on founder populations). Companies involved in molecular farming (use of transgenic plants and animals to manufacture recombinant proteins) include Nexia.14 companies had 27 biopharmaceuticals in the clinic against a variety of diseases. No Canadian biopharmaceuticals have yet reached the marketplace. there are few dedicated gene therapy firms. Winnipeg and Mississauga . up from C$209 million in 1997. Canada’s largest dedicated proteomics firm. Sinai (Toronto).Aventis Pasteur and Biochem Pharma . the pharmacogenomics company Visible Genetics (DNA sequencing systems to identify HIV mutations that confer drug resistance in order to determine the most appropriate antiviral therapy). Medicago and SemBioSys. There is also a fledgling industrial effort in gene and protein delivery technologies: Generex (aerosol delivery system for absorption of insulin through inner cheek walls). and enhanced R&D tax credits. pneumoniae. established in the mid1980s. Edmonton . Victoria . Chromos Molecular Systems has developed a gene delivery method to generate transgenic animal herds. In contrast to the US. and products such as 3TC (BioChem Pharma) and Visudyne (QLT) because these are not based on recombinant DNA technologies). NRC’s Biotechnology Research Institute.human growth hormone. MDS SCIEX (mass spectrometers). The highest rate of new company formation has occurred in Quebec. S. Calgary . and Group B Streptococcus • Biomira.human monoclonal antibodies against non-Hodgkins lymphoma and malignant melanoma • NPS Allelix. Toronto and Winnipeg .
export growth. and Synsorb (glycotherapeutics) have in-house manufacturing capability certified to cGMP (current Good Manufacturing Practices) standards. This is partly due to Canada’s earlier stage of development and the tendency in going public sooner. Aventis and BioChem Pharma (vaccines). generate far less revenue. market share. Also.Cangene (proteins). Instead. and more diversified technologies. larger capitalization and better liquidity. There are no domestic FDA licensed suppliers of monoclonal antibodies or oligonucleotides. biotech mergers and acquisitions are much more common in the US (approximately 140 deals over the last 24 months compared to a handful in Canada). Contract cGMP ferementation capacity is available from DSM Biologics and Intelligene. it is not possible to assess industry performance using measures such as output. Additional contract fermentation capacity will be available in 2002 when Cangene’s new facility is validated. benefiting the sector by creating companies with more critical mass. while Cangene and Draxis provide fill and finish services including protein lyophilization (freeze drying).6 Performance and Competitiveness Because only a handful of firms in the world produce biopharmaceuticals or have a biotechnology derived product on the market. It can be seen that in all size categories Canadian publicly traded firms are smaller than their US counterparts. Table 1 uses data based on measures such as R&D and revenue for public companies. 2. Canada also trails most countries in the number of biotechnology patents (a broad indicator of technological activity) and in patent citations (a measure of the importance of the underlying invention) at the European Patent Office as illustrated in Chart 6. or productivity gains. Biopharmaceuticals Overview & Prospects Page 19 . and invest much less in R&D.
8 4.1 15.3 106.7 10 111000 92500 140000 208500 Biopharmaceuticals Overview & Prospects Page 20 .1 89.7 113 30 29 54 5.2 14.9 224.3 14.Table 1 Public Biopharmaceutical Companies (US$ millions) Canada Number Large (over 150 employees) Medium (101-150) Small (up to 100) employees) Number Profitable Large Medium Small Total Employment Large Medium Small Revenue Large Medium Small Revenue per firm Large Medium Small R&D Large Medium Small R&D per firm Large Medium Small R&D per employee Large Medium Small 22 2 2 18 2 2 0 0 2203 1017 362 824 248 213 22 13 11.4 4756 3045 730 982 28.6 19.5 2.5 11 0.9 51000 29900 80300 64300 US 169 34 37 98 16 8 5 3 42849 32926 5214 4709 8603 7625 547 431 50.
A major challenge for Canadian firms is the dramatic disparity in deal size making it difficult to forge a sustainable business.6 110 (8) 14/16 674 15/15 1118 1 66 18300 27% 48% 25% US 3198 13. the constant search for new capital is a considerable drain on management time that can interfere with scientific milestones.6 6. more than in the previous five years combined. with most living on invested capital. Table 2: Estimated Biotechnology Equity Financing 2000 (US$ millions) Type Venture Capital Average Deal Size IPOs ( #) Average/Median Deal Size Follow on Average/Median Deal Size Total # Deals over US$100 million # Public companies Market Capitalization % Years cash >4 years 1-4 years <1 year Canada 334 2. COMPETITIVENESS ISSUES AND COMMERCIAL CHALLENGES 3. classification of industries may not correspond. Ernst & Young. Biopharmaceuticals Overview & Prospects Page 21 .3.1 Access to Capital Few biotech firms are profitable. The US market benefits from well established networks of alumni and business angels and a 5 Caution should be exercised when making comparisons: figures are from different sources. particularly for seed and early stage financing. However.773 (39) 71/52 2300 105/25 5769 14 105 70500 60% 27% 13% Source: PricewaterhouseCoopers. the year 2000 saw the industry raising over US$26 billion on a global basis (Table 25). the near term window for IPOs and follow-on offerings has closed and the supply of venture capital is expected to decline. than in Canada where such investors are in short supply or difficult to find. with the collapse in the public equity markets at year end . and Recombinant Capital “Angel” investors play a much more important role in US venture capital. and US venture data exclude investments in public companies and unsecured debt.485 (63) 103/86 9710 202/105 19393 49 300 353000 40% 39% 21% EU 696 1 2. MacDonald & Associates. reducing the amount of cash to be recirculated to new startups. With no IPO exit route. venture capital funds will be forced to carry their existing investments longer in their portfolios. Whereas the mid to late 1990s period was characterized by low stock prices and drastic decline in public offerings.
physics. biochemistry. There are also some important differences in the public equity markets. Mid-size pharmaceutical companies keen to develop and market drugs for niche disease areas will probably be more attractive partners. In the area of strategic alliances. however. The educational system appears to produce enough graduates to meet demand for entry level positions but skill shortfalls exist in a number of specialized research areas (e. Skill shortages also affect the ability of regulatory agencies to keep abreast of scientific advances and to efficiently review the increasing number of new products. to following New Jersey’s lead in allowing local biotech firms to sell net operating losses. The US association BIO is advocating a number of initiatives to improve access to capital ranging from reduction in federal capital gains taxes for investments in early stage companies. Canada has few platform technology firms so it has not been able to capture a significant share of this R&D investment. Canadian firms go public sooner than their US counterparts (similar size deals in the US would be financed via venture capital). and computational chemistry). however. overlaps in alliances.g. Pension funds. 3. Existing collaborations will be at risk if the merged entity discovers redundancies in its R&D programs.3 billion earned by the biotech industry from alliances during the period 1997 through to 2000 compared to only 32% for products.rollover tax provision which allows investors to defer capital gains taxes from one investment if the proceeds are invested in another qualifying business (a similar Canadian tax policy was only recently initiated). most of these skills are in short supply and must be imported. and when public. or decides that the product under development no longer fits its corporate strategy. The other end of the technology spectrum requires expertise in process engineering and industrial scale-up (fermentation and downstream recovery and purification) and regulatory affairs (documentation and validation of manufacturing processes and quality control assurance). buy and sell significant blocks of shares and prefer minority ownership. The diverse range of skills required along with the dramatic pace of change is not reflected in Biopharmaceuticals Overview & Prospects Page 22 . for example. prefer private placements (bought deals) with selected buyers over conventional follow-on offerings because of quicker access to cash. The most financially lucrative deals have involved genomics combined with target validation and pre-screened small molecules. microbiology. legislation at the state level to encourage state pension fund managers to invest in local high-tech firms. carbohydrates. molecular biology. small and mid cap stocks are thinly trade so it is difficult to take a stock position without affecting the price or acquiring control. and information technologies. These accounted for 68% of the US$7. There will also be fewer companies available for partnering and the larger entities that remain will have higher threshold sales targets. The shortage of large cap stocks (four firms account for over 90% of the market capitalization of the Canadian life sciences sector) results in an industry unable to attract the broad institutional market because of liquidity and earnings concerns. pharmacology. Mergers and acquisitions in the pharmaceutical industry could result in a slowdown in alliance activity.2 Human Resource Gaps Biopharmaceutical research encompasses a wide range of scientific disciplines: genetics. platform technologies are more important to big pharma than inlicensed products. without the time and expense of investor road shows. biophysics.
Amgen. tax credits for training. a career awareness program for senior high school students. When US employees are attracted to Canada. bioinformatics requires a background in genetics. there are no Canadian undergraduate degree programs in bioengineering.3 Maximizing Commercial Benefits Most biotechnology firms do not have the interest or resources in bringing a product to market. Federal funding through the Research Chairs Program should enable Canadian universities and teaching hospitals to attract and retain renown researchers. most of these efforts are long term and not immediately relevant to industry. and mentor younger managers. a compensation survey. companies face difficulties in integrating their higher pay into their salary structure. The international pharmaceutical industry has been an important source of managerial talent but there is intense competition for such managers worldwide. 3. a large proportion of which may decide to remain after graduation. specialized training programs. has initiated a number of services to strengthen human capital needs of the biotechnology sector: an inventory of biotechnology-related programs in colleges and universities.current university courses. and enhanced research budgets for star scientists. Canada faces a number of challenges: countries such as the UK. a job bank. Biogen) have in-house manufacturing capability. Canadian industry has not yet reached sufficient maturity to find managers with the necessary expertise. and software development. The industry will also face an increased demand for experienced senior managers who can lead firms through strategic alliance negotiations and commercialization. preferring instead to focus on research and early clinical development where they feel they can add the most value. Ireland. but most graduates lack such multi-disciplinary training. Manufacturing Only a handful of companies (e. The majority contract out their production needs because it is faster and Biopharmaceuticals Overview & Prospects Page 23 .g. statistics. Also. specialization options are normally offered within more traditional engineering programs. a job skills inventory. commercialization for these companies means developing the technology to a point where it can be licensed out using royalties to fund the next generation of products. Canadian immigration programs should perhaps target the Far East where sciences are more popular with students than in the west. The Biotechnology Human Resource Council (BHRC). Singapore is allocating considerable funds into biotechnology and recruiting prominent foreign scientists. The shortage of qualified personnel is universal with all countries pursuing similar policies such as early science education. and its graduate schools draw many foreign doctoral students. and skill training programs and workshops. Genentech. and the US offers greater opportunities. job posting sites. better career prospects and higher salaries. Germany and Australia are increasing their R&D budgets to entice their expatriates back. Initiatives to fill these skill gaps. a partnership between industry and Human Resources Development Canada. For example. include a post degree certificate program in bioinformatics launched by the Canadian Genetic Diseases Network and course requirements for an accredited degree program in bioengineering being developed by the Professional Engineers of Ontario in conjunction with the Canadian Engineering Accreditation Board.
Technology Transfer Universities. or the lack of other marketable products makes setting up a sales force for a single product uneconomical. It is noteworthy that Toronto. teaching hospitals. Because dedicated specialized facilities are important to spinoffs in their formative years. and a meningitis C vaccine developed at NRC. and the success of molecular farming technologies. Some biopharmaceuticals may not be suitable for a company to market on its own: the prescribing physician base could be very diverse. hepatitis B vaccine (University of California. industry collaborations. monoclonal antibody against respiratory syncytial virus (NIH. appointment of academia to company scientific advisory boards. particularly if there is only a single product in advanced stages of clinical development. reimbursement policies may be complicated. resulting in high sales expenses. several provinces and many US states are using public funds and foundation grants to build incubation centres located on or near campuses and teaching hospitals. the possibility of improving existing manufacturing yields. Successful tech transfer capacity requires well staffed offices with personnel experienced in Biopharmaceuticals Overview & Prospects Page 24 . gene therapy) or products geared to smaller patient groups may be more expensive to promote. The contract biomanufacturing industry is facing capacity constraints due to the large number of protein-based drugs in development combined with the market success of monoclonal antibodies and their great demands for mammalian cell culture. complex therapies (e. licensed to Merck). customized. Proteins are more difficult to manufacture than conventional drugs. threatening to increase the time and costs of product development. Maximizing commercial benefits is a major challenge for Canada because of the shortage of Canadian owned pharmaceutical firms that have the resources to serve as alliance partners. Examples include the Cohen-Boyer patents on recombinant DNA technology (Stanford). and creation of spinoff firms. employment of graduate students. does not have a biomedical incubator. Because multinationals generally assign little value to Canadian distribution rights due to the size of the market. and government research institutes have contributed to advances in biotechnology and innovative approaches to disease intervention. Canadian companies should be encouraged to carve out Canada for themselves during licensing negotiations as a means of gaining additional value. leading to the formation of biotech clusters. requiring large marketing resources. one of the world’s top medical research centres. facility expansions. An added challenge for Canadian companies is the scarcity of bio-chemical engineers with expertise in taking products from the bench through to pilot and commercial scale. Biotech firms are beginning to queue up for production time and long lead times are expected over the next few years. licensed to Medimmune). Spinoffs not only fill a critical gap because many technologies may remain unlicensed they also contribute to regional economic development by attracting related firms to the area. Marketing Control over marketing and sales can lead to substantially higher profit margins than royalty income but pre-launch expenses on sales staff and promotional expenditures is significant for a new drug. actual dose levels of these drugs. A number of factors will affect future capacity: the success rates of the products presently in the clinic. costing up to US$10 million. Research is transferred to the commercial arena through licensing.less risky than building a facility and ramping up expertise in-house.g. and the time and cost of building and validating a facility certified to current Good Manufacturing Practices (cGMP) standards (up to three years and US$100 million) is a costly and risky commitment. not including any Phase IV post-launch activities that may be required.
Vancouver and Calgary are not adequately covered. Despite the amounts earned. sequences of cloned pieces of DNA. IRAP has also begun to place a number of its Industrial Technology Advisors at or near teaching hospitals to help commercialize biomedical technologies. but because of aggressive patent protection. The NIH ranks the fostering of scientific discoveries and rapid transfer of new technologies to the bedside well ahead of royalties when evaluating returns. Apart from protracted negotiations. US Cooperative Research and Development Agreements allow each laboratory director the authority to negotiate licenses with an industrial partner. tissue samples. tool developers now often require formal agreements from universities specifying conditions under which these tools can be used. however. NRC’s institutes such as BRI offer industry research collaborations and provide incubation services to a number of firms. Many include “reach-through” claims demanding rights to any future intellectual property facilitated by the use of their tools.business startups. NRC IRAP has a pilot project to enhance technology diffusion by “bundling” (strategic matching) related firms in a specific niche e. market needs assessment. 4 Biopharmaceuticals Overview & Prospects Page 25 . patents. Past practises allowed for relatively free exchange of this material. Economic development can be enhanced by increasing seed financing for spinoffs. A Canadian difficulty is the relatively low industrial receptor capacity which results in many technologies being licensed to multinationals. and revenue sharing with research scientists. US federal labs provide tech transfer training to government scientists and provide a centralized on-line database of licensing opportunities to small businesses which can also identify which federal agencies have expertise in specific technologies.g. UK’s Biotechnology Exploitation Platform Program have been proposed as possible solutions. their focus tends to be regional with the result that areas that have considerable biotechnology activity such as Toronto.4 Market Access Challenges Gross license income earned by US universities. Although Canadian academic institutions are now quite active in pursuing commercial opportunities. photodynamic therapy. The emergence of university technology transfer offices occurred about a decade earlier in the US than in other countries. the bulk coming from a handful of blockbusters. largely due to the 1980 US Bayh-Dole Act which led to a substantial increase in academic patent filings and university spinoffs as these institutes were allowed to retain title to inventions created under federal research grants4. receptors. operating expenses. and research institutes in 1999 totalled US$935 million. tech transfer offices are undermanned and poorly funded by comparison. negotiation skills. many tech transfer offices operate at a loss because of patent prosecution costs. royalties received remain within the laboratory that develops the technology. 3. methods for introducing DNA into cells. and knowledge of faculty research areas and companies with an interest in these areas. hospitals. and combinatorial chemistry libraries. The Networks of Centres of Excellence Program has led to over 70 company spinoffs. or the insistence on exclusive rather than non-exclusive licensing. For NIH license revenues from 1995 to 2000 totalled US$200 million. Medical research depends on ready access to research tools such as transgenic mice genetically predisposed to contract specific diseases. with a portion going to the government inventor.g. Genome Canada will likely spur the creation of biotechnology clusters around the five regional centres. cell lines. pre-commitments to future discoveries can undermine a university’s ability in seeking research funding from other companies or interfere with technology transfer opportunities. A small levy on government grants or a special university targeted program to help recruit tech transfer staff e.
patented a gene which produces a protein that acts as a docking site (receptor) on immune system cells . US courts have yet to issue any significant decisions pertaining to patent claims directed to ESTs. US PTO utility rules for obtaining gene patents were tightened but ultimately court precedents will be necessary to clarify the issues.Intellectual Property and Freedom to Operate The biotechnology industry is characterized by widespread litigation involving intellectual property rights. complicating licensing arrangements. others identified the gene’s precise role in HIV infection which appears to be covered by the original patent. today scientists begin with the genetic sequence and work forward using automated DNA sequencing techniques to identify genes via an in silico approach6. Whereas the first approved gene patents were obtained by starting with a known enzyme or protein having clear medical utility e. for example. Infigen’s nuclear transfer technology for cloning mammalian cells. insulin and working backwards to find the gene that produces that enzyme. In early 2001. Broad patents were much more prevalent in the early days of the industry because of the pioneer nature of the technology.blocking that site might form the basis for a wide range of medicines. Wicell’s stem cell patents using cloned embryos. Examples of broad patents with the potential to stifle competition include Prodigene’s edible vaccines which cover the development of vaccines in all plants. The accelerated interference period dictated by the new US 18 month publication law (one year from publication as opposed to one year from issuance) may encourage applicants to strategically draft broad claims and publish early to narrow the window within which competitors must initiate an interference or lose the chance to do so. By comparing this hypothetical protein with known proteins. Human Genome Sciences. 5 Biopharmaceuticals Overview & Prospects Page 26 . A related concern is a 1998 US PTO ruling that partial gene sequences (“expressed sequence tags”or ESTs) could be patented based on their utility as probes for the corresponding full length gene.000 gene patents have already been issued by the US PTO and another 20. and that they lie more in the realm of discovery than invention because gene isolation and cloning are now well established techniques. 6 Gene sequences are entered into a computer data bank which predicts the amino acid sequence of the resulting protein. The biggest challenge facing gene patents is the utility criterion. unaware of this. or drug targets which often claim any molecules that may act on the target. of the compounds or sequences claimed) or inadequate enablement (insufficient detail disclosed to enable the claimed invention to be reproduced by others).g. an educated guess is made at what the underlying gene sequence does and how it might be useful in developing a drug or diagnostic. evolving patent policy and precedents.000 are pending. Over 6. that they do not meet the traditional non-obviousness and utility standards. Many have broad claims related to gene families or any medical application (a threat to competitors because a gene can express different proteins depending on the physiological condition).g. but US courts now require much more stringent disclosure requirements. invalidating patents with exceedingly broad claims on grounds of either an inadequate description of the claimed subject matter (e. affecting the production of therapeutic proteins in animal milk. Many believe gene patents will impede innovation5. Monsanto’s patents on all genetically engineered brassica plants which prevents others from using transgenic canola to carry therapeutic proteins. The patenting of genes is a major area of controversy. the patenting of gene fragments could lead to several parties holding title to part or all of the same gene. Disputes are more common than other fields because of overlapping research efforts. and the use of lawsuits as a commercial strategy.
Nearly 80% of trials fail to enrol the required number of patients within the appropriate time 7 For example. Increasing Clinical Times The time biopharmaceuticals spend in clinical development has substantially increased over the last 20 years so that they are now on par with traditional drugs. but inhibition of blood vessel growth is more effective when tumors are smaller. Biotech products also have a high failure rate in Phase III (at least 36 products from 1983 to 1998. for example.705 in 2000.5 months during the period 1990-94 and then to 61. many early setbacks in the development of angiogenesis inhibitors against cancer were due to the enrollment of patients with advanced stages of the disease.695 in 1996 to 32.a common practice in negotiations with the US PTO . Whereas products approved in the period 1982-89 spent an average 39. This is due to the pioneer nature and complexity of the subject matter.A November 2000 ruling by the US Court of Appeals (Festo vs SMC) which is under appeal to the US Supreme Court has important ramifications for the biotech industry. there is a concern that Festo will diminish the value of existing biotech patents to the benefit of big pharma and result in a longer and more expensive patent application process as companies spend more time drafting claims that would not need amendment later. Biotechnology patent applications usually take a long time to grant compared to other technologies.excludes the company from claiming protection under the “doctrine of equivalents”. the breadth in the scope of protection being sought by applicants. the time lag in understanding any new technology by a country’s patent office.5 months from 1995-99. often targeting indications with low incidence. Biotech patent applications at the US PTO. often leading to long prosecutions to ensure the claims are properly supported. have grown from 18. Because a competitor will be now able to examine which claim provisions have been amended and then design an invention with minor alterations. Long delays cause uncertainty as to the scope of patent rights that will ultimately issue and reduce the effective length of patent protection. and the ever-increasing number of patent applications from the fields of genomics and combinatorial chemistry.g. it could also introduce more certainty in biotech patent law by encouraging the drafting of tighter and clearer claims. and were based on standard end points and doses typical of chemotherapy. slight differences in amino acids) if the end result was functionally equivalent. Many of the earlier successes were recombinant versions of natural hormones with relatively well understood properties and defined mechanisms of action compared to newer products targeting increasingly complex pathologies. or about 43% of products approved). most firms have only a handful of products in the clinic and because their stock price is largely determined by the lead product. Patent pendency .the amount of time between filing an application to issuance or abandonment averages about 45 months in Canada compared to 25 months in the US and the EU. Biopharmaceuticals Overview & Prospects Page 27 . On the positive side. Many early stage biotech trials are based on small patient populations. Under Festo.4 months in the clinic. The doctrine had long prevented others from duplicating a patented invention through minor alterations (e. larger populations would enhance statistical power but stretch the resources of undercapitalized companies. the time increased to 46. Trial failures may be the result of poor trial design such as neglecting to identify optimum patient subgroups or the most appropriate clinical end point7. any amendments or narrowing of claims during examination . they have a high hurdle for discontinuing development. largely due to resource differences (CIPO only has 15 biotech examiners). Finally.
Web-based information on ongoing and upcoming clinical trials. and an interactive on-line pre-screening service to identify interested candidates is already available in the US. During 1997/98. On the other hand. This is due to concerns about differences in trial designs and adherence to clinical protocols by foreign investigators. adding one to three years to the process. difficulty in reviewing foreign clinical records.frame.could translate into savings and faster market introduction. the mean approval time for biopharmaceuticals was 12. A significant proportion of discovery events occur in the clinic. The ultimate goal is the mutual recognition of approvals to reduce certification costs and to facilitate the simultaneous launch of new drugs in multiple markets. diagnostic procedures. was originally developed as an anti-hypertensive while human growth hormone was found to improve muscle strength and reduce opportunistic infections in AIDS patients. Any improvement in the pace of clinical trials . Viagra.2 months at the US FDA and 10. To improve approval times. There is a three year transitional period with the expectation that as of December 1. The lack of a competitive regulatory climate in Canada could lead to a decline in domestic clinical trial activity and the later introduction of breakthrough therapies. However.e. and differences in population characteristics. The International Conference on Harmonization (ICH) has been working since 1990 towards standardizing test protocols and drug registration procedures. for example. 2002 the parties will mutually accept each others’ GMP certification. and therapeutic practices. which will eliminate the need for pharmaceutical companies to seek certification of manufacturing facilities in various markets (the agreement would not affect the approval of individual drugs). inclusion/exclusion criteria. The ICH recently reached agreement on a Common Technical Document which outlines a common format for a registration dossier yet accommodates country-specific administrative requirements. As a first step. Clinical trials are important in keeping a country’s medical system at the forefront of modern treatment8 .g. the European advantage disappears because companies must then negotiate prices with each country before the products can be marketed. using the internet for e-recruitment of investigators and patients to web-based capture and analysis of trial data . the EMEA plans to establish a new 150 day approval for “fast track” products and initiate meetings with industry to review clinical trial design. has relaxed requirement that the trials be repeated as long as they are supported by a “bridging study” demonstrating its relevance to Japanese patients. Japan. The web can also streamline the collection and management of clinical trial data in real time across multiple trial sites by eliminating the need to transcribe and process paper data forms which can take three months or more. The FDA permits drug sponsors to include clinical data conducted in other countries but there must be at least one US trial in order to validate the foreign data. Japanese clinical trial practice will have to be raised to international standards because of their looser efficacy requirements. a Mutual Recognition Agreement on cGMP inspections has been negotiated. Regulations and Approval Times Biopharmaceutical companies are more sensitive to approval times than big pharma because of their cash constraints and pressures from investors for positive news. 8 Biopharmaceuticals Overview & Prospects Page 28 .6 months at the EMEA. long reluctant to accept foreign clinical data because of perceived differences in diet and race. The FDA plans to establish a paperless electronic filing system for drug applications by 2002 which will save the industry millions of dollars in copying costs and document storage.
Blue Shield) have instituted mandatory costeffectiveness submission guidelines. decreased mortality. UK. Blue Cross. Governments and third party payers are increasingly demanding evidence that pharmaceuticals generate benefits commensurate with their high costs (e. Clinical trials have generally not been aimed at demonstrating long term health outcomes and cost savings so the need to capture this additional information will increase trial costs and extend development times. regulatory and patent issues can still hamper and distort trade flows. Biosafety Protocol Biopharmaceutical firms take special precautions to limit the environmental risk posed by their activities. for example. Brazil. estimates for ex vivo gene therapy are over US$100. Developing countries which tended to use patent policy to protect local industries were given until 2005 to bring their patent systems into compliance with TRIPs. for example.Trade Barriers While there has been international progress in harmonizing policy areas affecting trade in pharmaceuticals. and in accounting for differences in the cost of health care inputs from country to country. Pricing and Pharmacoeconomics Biopharmaceuticals with the notable exception of insulin are much more expensive than small molecule drugs. Monoclonal antibodies. marketing and labeling) may constitute barriers to trade. reduced public health care expenditures. Certain countries. Norway and the Netherlands). problems in measuring quality of life benefits and improved workplace productivity. Safety measures include the design of secure containment facilities for biological substances posing significant risk and the use of microorganisms that are disabled so as to limit their ability to survive or reproduce outside the vessel in which they are held. Actions are also being taken to address concerns that health. Bioethics The biopharmaceutical industry has remained unscathed by the by the hostile public Biopharmaceuticals Overview & Prospects Page 29 .000 per year.000 to $25. safety and environmental regulations (including certification. threatening to issue a compulsory licence under a “national emergency” clause. the use of placebos in clinical trials. However. is feuding with multinationals over the high cost of AIDS drugs. France. Another controversy concerns poor and developing countries that need to import medicines against major epidemics. For example. Some believe that Japan still has a regulatory bias against their medicines. increased quality of life. a number of countries (Australia. France appears to discriminate in favour of its own firms. only for their manufacture. Finland. but allows countries some significant areas of discretion such as the patenting of higher life forms. and several US managed care groups (e. the World Trade Organization Agreement on Trade Related Aspects of Intellectual Property (TRIPs) establishes certain minimum protections for intellectual property. do not offer patent protection for therapeutic substances. Italy. functional improvement. New Zealand. The new generation of vaccines will not be affordable outside industrialized countries.000. No final decision has been reached on whether this will be sufficient to exclude these medicines from the scope of the Biosafety Protocol. but whether they will be able to set up the appropriate legal mechanisms by that date remains to be seen. while certain orphan drugs e. most notably India and Israel.g. comparisons are difficult because of the lack of standard study methodologies. while in the area of pricing. are in the range of US$ 15.g. Ontario. or shorter length of therapy). genetically engineered blood clotting factor for hemophiliacs can cost as much as US$150.000 per year. The subject was supposed to be highlighted during the 1999 review of TRIPs but was deferred to the upcoming WTO negotiations. BC.g.
Alzheimer’s. nerve. Drug Discovery Drug discovery is based on four core technologies: genomics (source of novel drug targets). the Basque region of Spain. Because many clinical investigators have a financial interest in the companies sponsoring their research. !Increasing corporate funding of academic research could undermine research integrity. concerns are usually linked to animal testing. high throughput screening (methods to assay one against the other using cultured cells to mimic some aspect of a disease of interest). 3. While existing drugs are active Biopharmaceuticals Overview & Prospects Page 30 . !In January 2001. !The mining of DNA samples from closely-knit populations derived from a small founder group such as Iceland. but research on in vitro embryos originally created for reproduction but found to be in excess of a couple’s needs would be allowed. has launched a web site that lists university and government scientists and their corporate sponsors. a fatal brain disease. or payments by the sponsor to the investigator for on-going research. and is examining tests for familial adenomatous polyposis. On August 9. human cloning and the intentional creation of an in vitro embryo solely for research purposes would be prohibited. the UK became the first to authorize “therapeutic” cloning.5 Technologies Current technologies and technical challenges are summarized below. or retainers for consultations. 2001 US President Bush authorized federally funded research only on existing 60 stem cell lines already derived from human embryos. undermining of research by corporate links with academia. hereditary motor and sensory neuropathy. In Canada. The US and the Netherlands have enacted legislation that restricts genetic discrimination while the UK’s Genetics and Insurance Committee has endorsed the use of a genetic test for Huntington’s chorea. !The use of genetic test results has sparked a great deal of controversy because of possible genetic discrimination and the uncertainty about the interpretation of test results. the creation of human embryos for use in stem cell research (reproductive cloning is prohibited). etc. Gene therapy research has been restricted to somatic cells (muscles. enabling the artificial gene to be passed on to future generations. the database already includes several Canadian universities. tissues and organs combined with functional genomics for improved in vitro toxicity assays and screening procedures could reduce the number of animals used. Instead. myotonic dystrophy. combinatorial chemistry (molecules generated from small chemical building blocks to interact against those targets). ! technologies to modify the gene content of future generations are regarded with apprehension because it foreshadows the genetic improvement of the human race.reaction faced by the agri-food sector because the medical field is market driven. Center for Science in the Public Interest. !Companies and patients are also struggling to devise an appropriate method for rationing scarce drugs. Genentech. germ line therapy (involving the cells that make the sperm. Computer simulation models of mammalian cells. but no funds will be provided for research on new embryos. The Life Sciences Branch has launched a biopharmaceutical Technology Roadmap initiative to identify emerging technologies critical to a globally competitive sector. the FDA in 1998 required drug sponsors to disclose any financial arrangements such as compensation and shares paid to the clinical investigator. or Israel’s Ashkenazi Jewish population so as to more easily pinpoint genetic mutations and associated illnesses has raised fears about patient confidentiality and the sharing of benefits between the local population and multinationals. for example. equipment. egg or their precursors) is currently prohibited in all countries because of the impact on offspring. 2001. multiple endocrine neoplasia. bone. and similar difficulties were encountered by hemophiliacs for Bayer’s recombinant blood clotting factor. with welldefined needs that cannot be satisfied with existing products. under the proposed Assisted Human Reproduction Act which was tabled on May 3r d . and bioinformatics (computerized techniques for managing and analysing biological information stored in databases such as DNA sequences. Several biotech firms have formed Ethics Advisory Boards to address these issues. and protein structure and function). Similar objections have been raised about injecting genetic material directly into tissues of a developing fetus to alleviate a rare disorder because of the risk that some of this material will find its way into those fetal cells that give rise to sperm or eggs.). was forced to institute a lottery for distribution of its breast cancer treatment Herceptin because of supply problems. interest in any patent held by the investigator in the product being tested. and hereditary breast and ovarian cancers. A US group. No restrictions are placed on the private sector but the firms depend on academic researchers whose institutions risk the loss of federal money if the regulations are violated. and advances in genetics and reproductive technologies (Box 2). Box 2 Ethics and Medicine ! Animal testing is probably the most controversial part of drug development.
yeast. Despite the heavy investment in genomics. Because most diseases are due to protein imbalances or aberrations in protein-protein interactions. moving from traditional screening/chemistry capabilities to the front end of drug discovery research. 9 Proteomics (identification of the protein profile of each cell type along with the protein’s structure and function using 2-dimensional gel electrophoresis. genomics is expected to lead to 10. All are protein drugs. fruit fly. Pharmaceutical firms have taken the most advantage of this opportunity. Several companies offer internet-based subscriptions to their proprietary genomics databases which are integrated to public domain information. Since the pattern of gene expression directs a cell’s biological character. and in understanding the mechanisms underway. There is a need for better target validation technologies and cell-based assays that more closely mimic a specific disease state. The multiplicity of targets has become a major bottleneck and many targets used in screening programs have not been properly validated (defining the role of the receptor. only a handful of genomics-based drugs (defined as those based on the identification of an unknown gene sequence followed by elucidation of its function and therapeutic potential) have reached the clinical stage. gene sequence data by itself provides little information about a gene’s relationship to a particular disease.000 or more new targets for drug development. protein structures or metabolic pathways. those proteins involved in critical interactions can be developed as targets for therapeutic intervention. as compounds are ultimately found to interact with irrelevant targets. and roundworm because genes are often grouped in the same way on chromosomes. in direct competition with biotechnology companies. enzyme or target protein and confirming it is relevant to the disease process). The initial focus of genomics was on sequencing the human genome (Human Genome Project) and genomes of species such as mouse. Whether these will be amenable to small molecule intervention or result in the discovery of new proteins with biological effects that can be useful as therapies in themselves remains to be seen. function. studies of the levels and timing of gene expression are useful in identifying the genes involved in cell differentiation. However.against some 500 targets. each of which may have a different role. paying millions of dollars in annual subscription fees. and for standardized 9 Biochips consist of glass slides on which are deposited thousands of bits of DNA designed to bind to any complementary DNA sequence in a test sample. Big pharma is bringing these technologies in-house. Protein analysis has been slower to automate because proteins are much more complex than nucleic acids and because a gene may make several proteins. Also. scouring proprietary and public genetic databases for DNA sequences. Biopharmaceuticals Overview & Prospects Page 31 . Molecular biologists have been using the internet for a number of years. leaving researchers in academia and small and mid-size biotechnology firms struggling to keep up with the latest analysis software and ever-expanding public databases. development. no drugs have been discovered by the exclusive application of combinatorial chemistry/high throughput screening. and genes and biochemical pathways tend to be conserved during evolution. mass spectrometry and X-ray crystallography) complements functional genomics. Efforts have now shifted to the determination of the biological function of each gene (functional genomics) using DNA microarrays (also called gene chips or biochips) to detect mutations in specific genes as markers of the onset for a particular disease and to measure differences in gene expression (protein production) in healthy and diseased cells. nor is there is any evidence that the success rate has materially improved in the clinic.
making orphan drug legislation important.slight differences in DNA sequences among individuals leading to variations in protein expression) will enable companies to segment people according to how they react to a particular drug (high responders. and advanced algorithms and pattern recognition software. resulting in a major reduction in clinical trial costs. resulting in side effects and poor patient compliance. pharmacogenomics will provide biotech firms with an opportunity to target niche markets that would be unattractive to big pharma (e. sustained release injectables which can cut the number of injections needed from daily to monthly using biodegradable polymers to microencapsulate the protein of interest (Genentech’s encapsulated human growth hormone approved in December 1999 is the first sustained release protein to be marketed). the number of patients required to produce statistically significant results can be reduced. usually in a hospital or clinic.bioinformatics software platforms so that biologists can share and compare data from multiple computer operating systems. On the other hand. ushering an era of personalized medicine tailored to one’s genetic makeup. microfluidic chip based screening systems. Pharmacogenomics can also change the way clinical trials are undertaken. or intramuscular injection.10 The technologies employed (DNA microarrays and sequencing) overlap with those in genomics but presently are too expensive for routine use and few doctors know how to interpret the results. increasing costs. The detection of single nucleotide polymorphisms (SNPs . Tests for drug responses are particularly relevant when the drug therapy is either expensive or risky. By screening candidates based on their genotypes to eliminate poor responders from the study population early in the process. proteins are large molecules which degrade rapidly in the digestive tract and must be administered by subcutaneous. A variety of delivery technologies are in development: needle-free injection devices (commercialized for liquid doses of insulin. pulmonary drug delivery via liquid 10 For example. many injected drugs are rapidly cleared from the blood so that relatively high doses and/or frequent injections are often needed. Pharmacogenomics and Personalized Medicine Inherited variations such as the genes that specify enzymes responsible for drug metabolism or in the receptors that bind to drugs contribute to variability in drug responses among the population. low/non responders. human growth hormone and vaccines. or a high probability of non-response exits (e. Drug Delivery Unlike orally delivered small molecule drugs. intravenous. automation and robotic chemistry devices.g. under $200 million in sales). the monoclonal antibody Herceptin for breast cancer which is only effective in those 30% of women that overexpress a particular growth factor).g. protein microarrays. novel signal detection and imaging systems. customized drugs will narrow big pharma’s market. resulting in high health care costs. and resulting either in lower returns or large price increases to counteract the lower market if the customized therapy proves more effective. Also. The technology comes with a number of challenges and opportunities for both industry and government: diagnostics will have to be developed for each drug. in development for proteins and vaccines which can be reformulated into dry powders). and people with a certain genetic profile run the risk of being denied insurance coverage. and those who will suffer a severe side effect). The whole drug discovery field is being driven by the need for higher throughput resulting in advances in miniaturization. Drug delivery systems designed for small molecules such as transdermal patches and slow release capsules are not applicable to biopharmaceuticals. people who carry variants of the enzyme P450 CYP2D6 do not benefit from codeine as they are unable to convert into morphine Biopharmaceuticals Overview & Prospects Page 32 .
Because of their high costs and large dose requirements. advances in manufacturing capability are needed to meet market demand. The next generation now in clinical development are fully human antibodies produced via methods such as transgenic mice containing human antibody genes.based aerosols or dry powders (insulin and Pulmozyme for cystic fibrosis are at an advanced stage of clinical development. early stage for a number of vaccines). as well as genetic disorders such as Gaucher’s and Fabry’s diseases) and their enormous structural diversity (more than 10 million polysaccharides can be formed from nine common monosaccharides compared to 16. and anti-infection responses. and oral transmucosal routes (advanced stage for insulin. or antigenic fragments (subunit vaccines). live. but not all large molecules can easily be reformulated to be absorbed through the lungs). and Montreal based Neurochem’s mimetics of glycosaminoglycans (GAGs . • Fully Human Monoclonal Antibodies First generation mouse-based antibodies provoked a strong immune reaction in humans limiting their clinical utility. Emerging Biopharmaceuticals • Mimetics and peptidomimetics (small molecule compounds that mimic proteins and peptides) have advantages over proteins in terms of ease of delivery and cost. pegylation (conjugating the protein to polyethylene glycol to increase its half life . • Vaccines Conventional vaccines based on inactivated (killed) viruses. phage display. • Glycotherapeutics (complex sugars/carbohydrates) have significant potential both as drugs and drug targets because of their diverse biological roles (cell surface carbohydrates act as binding sites for other molecules. a major cause of side effects. the market will require more than one technology to address all applications. their application as biopharmaceuticals has lagged far behind protein drugs because they are difficult molecules to analyse and synthesize.commercialized for interferon. attenuated (weakened) viruses. in Phase III for insulin and GCSF).complex carbohydrates that promote amyloid fibril formation characteristic of Alzheimer’s) which compete with naturally occurring GAGs to inhibit deposition of amyloids (early stage). microbial toxoids. Examples include mimetics of insulin and granulocyte colony stimulating factor (in early stage development). playing structural roles in cancer transformation. or collection of human B cells from infected individuals which are then fused with human tumor cells to create antibody producing hybridomas. peptide based mimetics of erythropoietin (late stage). fusing the protein to blood serum albumin (interferon alpha in early stage development). tissue repair. Because each product has some unique features. However. Strategies to generate more human compatible antibodies include mouse-human chimeras (60%-70% human protein) first introduced in 1995. followed by humanized antibodies (90%-95% human protein) in 1998 in which certain mouse antibody amino acid fragments are grafted onto a human antibody.000 peptides from 20 amino acids). have a number Biopharmaceuticals Overview & Prospects Page 33 . immune system regulation. but there are considerable technical challenges in mimicking the large and intricate protein-protein interacting surfaces and overcoming the weak binding forces of small molecules.
leading to the development of novel and more effective antigens. Live virus vaccines (e.g. Sabin polio.recombinant vector vaccines using weakened viruses such as poliovirus. influenza. hepatitis A. and the virus is unable to enter host cells which renders the vaccine useless if the mechanism of infection is intracellular. transgenic bananas in order to offer an improved mode of delivery. HIV. • Gene therapy Whereas recombinant proteins and antibodies are produced outside the body and administered to the patient. involving attempts to activate immune responses against antigens in the tumour to which the immune system has already been exposed. insulin and human growth hormone in E. mumps. and 11 Inactivated vaccines (e. in development). The first genomics derived vaccine (Group B meningitis) developed by Chiron is expected to enter clinical trials in 2001. tPA. genes or new proteins. Transgenic plants. and a number of anticancer applications are the closest to commercialization). malaria. Salk polio) usually require multiple boosters to generate continued antigen exposure. those critical genes that encode the proteins that cause disease can be identified.g. Biopharmaceuticals Overview & Prospects Page 34 . Molecular Farming Biopharmaceuticals are typically produced by microbial fermentation (e.g. Vaccines are also being developed as anti-cancer agents. antibodies.g. Subunit vaccines (e.g. ease of scale-up.RNA vaccines (particularly applicable to yellow fever and polio caused by RNA viruses) Genomics has the potential to improve the effectiveness of existing vaccines and design vaccines for diseases for which no protection currently exists: by sequencing invading bacterial and viral organisms. and possible immune reaction caused by the vectors.recombinant antigen vaccines where the antigen is produced in bacteria or yeast rather than extracting it from chronic human or animal carriers (e. measles. herpes simplex. and .g.g. Production is not the primary cost driver except for those proteins that must be administered in large amounts e. vaccinia virus or salmonella bacterium as carriers of the disease causing organism to overcome the inability of inactivated whole antigens or recombinant antigen vaccines to enter cells and express the desired gene product (hepatitis B. because sustained gene expression is not necessary once the targeted tumor cells die or new blood vessels grow to bypass blocked arteries. control over where the transferred gene is expressed. 11 New vaccine strategies include: . Research is also being undertaken on edible vaccines e. e. A number of major challenges have to be solved: design of a safe and effective gene delivery system. pertussis. people with compromised immune systems are usually not given live vaccines. . cancer and coronary artery disease. . the short duration of gene expression.g.g. Many efforts now concentrate on conditions that require only transient gene expression. or over a period of many years. Complete DNA sequences of most human pathogenic viruses and more than 20 bacterial pathogens have already been determined. influenza type b) use only parts of the pathogen to minimize risks but the antigenic properties may not be effective against future exposures. and eggs from transgenic chickens may offer more attractive alternatives because of their low cost (factor of 10 to 100 over mammalian cell culture).of disadvantages. in Chinese hamster ovary cell lines). rubella) provide continual antigenic stimulation but at the risk that the microorganism will revert to its pathogenic form. the mammary gland of transgenic animals. produced from a core gene of a virus. recombinant hepatitis B vaccine in yeast) or mammalian cell culture (e. tuberculosis.DNA vaccines. coli. cholera. are effective against those pathogens that change their exterior protein coat by attacking the interior proteins of a virus (HIV. hepatitis B). gene therapy has the potential for the body to produce the desired protein on its own if a synthetic gene with the correct DNA sequence for that protein can be inserted into targeted defective cells. Factor VIII.
Cancer. Other age-related illnesses such as osteoporosis. The most advanced is antithrombin for managing coagulation during open heart surgery expressed in transgenic goats (Phase III completed). Infectious diseases. cancer. and Parkinson’s are major factors affecting quality of life. Only one new class of antibiotics has been approved over the last 30 years. Figure 1 Biopharmaceuticals Overview & Prospects Page 35 . The main causes of death are cardiovascular disease. 4. liver and kidney diseases has hardly changed. offering significant areas for research breakthroughs. and the market size is often larger than the approved indication because of a high off-label use (for other cancers). arthritis. monoclonal antibodies in corn. and interleukin-10 in tobacco leaves (all in Phase I).1 Demand Outlook An increasing elderly population in industrial nations over the next 25 years will be the most important factor in the growing demand for therapies. and the anti-coagulant hirudin in canola.ability to express complex. and respiratory disorders. Mortality from cancer. diabetes. highlight the pressing need for new vaccines and antibiotics with novel mechanisms of action to avoid growing drug resistance. No products derived via molecular farming have yet been approved. poorly served by traditional chemotherapies. correctly folded proteins (not possible with microbial fermentation). GROWTH PROSPECTS 4. is a major opportunity for biotech firms because the investment needed to develop a cancer drug is lower than other diseases: the field has high priority with regulatory authorities who are willing to give it fast track status on the basis of smaller (and therefore cheaper) clinical trials (a few extra months of survival could be enough to win FDA approval). Alzheimer’s. the third most common cause of death in the US. alpha glucosidase against Pompe’s disease expressed in transgenic rabbits (Phase II). large. the clinical community is highly concentrated. Others in clinical development include alpha-1-antitrypsin for cystic fibrosis expressed in sheep (Phase II). all of which are strongly age-related.
Global biopharmaceutica l sales are expected to increase by 5% p. and hepatitis B vaccine) will expire within the next five years. over the next five years approaching US$20 billion by 2004.a. potentially opening the market for biogenerics. infections. or human growth hormone. obstructed arteries. Protein Biogenerics A number of US biopharmaceutical patents (e. and as an adjunct in cancer chemotherapy) are all protein drugs. Genome sequencing efforts are making it possible to identify new protein candidates. The first drug candidates derived from genomics (an anti-obesity drug from Amgen and four drugs from Human Genome Sciences for wound healing. However. human growth hormone. Proteins on the other hand are much more complex molecules whose mode of action is not completely understood and whose properties are influenced by many factors during the Biopharmaceuticals Overview & Prospects Page 36 . recombinant proteins will continue to dominate the biopharmaceutical market. interferon alpha. human insulin. and proteins such as growth factors will allow firms to enter the market for regenerative medicine organ and tissue repair. extensive clinical trials are not required for marketing authorization as long as bioequivalence studies confirm that the rate and extent of drug adsorption and hence safety and efficacy are similar. Growth will largely be driven by therapeutic monoclonal antibodies.g. Many of the new biopharmaceuticals in development are aimed at niche markets and may never reach the blockbuster status of EPO. competition may not be as intense as that currently experienced in the generics industry. new delivery vehicles may make oral or inhalation delivery possible. With traditional chemical generics. human insulin. Recombinant proteins Most diseases are complex and are unlikely to be treated with a single protein drug but. protein product life cycles are longer than synthetic molecules because they are harder to duplicate and manufacturing methods are unique. new approved indications for drugs already on the market. for the near term. and second generation versions of existing blockbusters such as EPO and interferon alpha and beta.
and cystic fibrosis. To prove that impurities and inactive compounds. and designing broad antigenic variants of rapidly mutating RNA viruses such as HIV and influenza. followed in 1998 by a vaccine against Lyme disease. Only in cancer has gene therapy progressed into Phase III with only two products (against head and neck cancer and melanoma)12. Monoclonal Antibodies (Mab). The costs required for these trials. rheumatoid arthritis. and Crohn’s disease. but over 80% of clinical activity is currently focused on cancer. areas considered to be more commercially promising. such as host cells and culture conditions. Worldwide. Still to be established is whether the entire solid tumor can be killed or only those cancerous cells around the site of the injection. In the US. The dearth of approvals is due to numerous technical challenges: devising the correct recombinant antigens (the antigen must be the same as is present in the “real” virus and must be non-pathogenic). Mabs are more versatile than other drugs as they can be constructed to treat a wide range of diseases such as cancer. it took a decade for the next product to reach the market (to treat blood-clot-related complications in patients undergoing angioplasty). or used as a vaccine in which an antibody is designed to mimic a tumor antigen in order to stimulate the immune system to identify and eliminate cancer cells with that particular antigen on its surface. Regulatory standards for biogenerics are still being developed. and are now achieving notable successes e. The first anti-cancer antibody (against non-Hodgkin’s lymphoma) was launched in 1997 and the first antibody linked to a chemotherapy agent was approved in 2000 against relapsed myeloid leukemia. and 12 The first Phase III trial of any kind for gene therapy was against glioblastoma in 1996 but it did not extend patient survival. sickle cell anemia. they do not have the same manufacturing consistency as drugs based on synthetic chemistry. and formulation processes. In addition. antibodies can be used alone to disable cancer antigens. are one the fastest ways of translating genomics-derived targets into therapeutics by targeting novel cell surface receptors. patent holders are developing second generation products which are longer lasting and do not have to be injected as often. which might differ from the original process. increasing the immune response (the engineered protein has a limited lifetime in the body which reduces its antigenicity compared to inactivated/innocuous viruses). AIDS and cardiovascular disease. Because biological products are produced in living organisms.production. Recombinant vaccines The first FDA-approved recombinant vaccine (against hepatitis B) was in 1986. and entail relatively fewer subjects for clinical trials as they are designed to target specific cells. approximately 4000 patients participated in nearly 400 trials since 1990 for a variety of diseases but no convincing evidence of a long term beneficial effect has been established. respiratory syncytial virus. As anti-cancer agents.g. as well as the fact that the manufacture of biopharmaceuticals is more difficult and expensive. 25 products were in clinical development at the end of 1999 with over two thirds in Phase I. purification. Gene Therapy Gene therapy was originally proposed as a treatment for genetic disorders such as hemophilia. new clinical trials may be required to validate the manufacturing process. Since the first approval of a therapeutic Mab in 1986. could be a significant barrier to entry. conjugated to cytotoxic drugs or radioisotopes to kill tumor cells. (Chiron also developed a recombinant vaccine against pertussis (whooping cough) but this is only marketed in Italy). Biopharmaceuticals Overview & Prospects Page 37 . do not affect the safety and efficacy of the generic.
glycotherapeutics. notably cancer vaccines and blood substitutes. there are few Canadian-owned pharmaceutical companies with the necessary financial and international marketing capability to serve as strategic partners. peptide-based imaging agents. a virus that causes blindness in AIDS patients) has been approved. The importance of shortages in scientific. Another broad challenge is to ensure that an appropriate policy framework is in place to support the industry's development.2 Current Industry Strengths Canada is noted for its academic excellence in medical research which includes facilities such as the University of Toronto and its affiliated teaching hospitals. The size of the domestic marketplace is insufficient to support the growth of Canadian biotech firms. It is still an experimental technology with considerable challenges such as finding the right gene to target. delivery mechanisms and costs. and the application of mass spectrometry to proteomics. technical and managerial skills must also be addressed. These institutions have considerable expertise in fields such as gene therapy. A number of issues have been flagged by the industry. and carbohydrates. Only one product (Isis’ Formivirsen for the treatment of CMV retinitis. However. First. the country ranks among the leaders in the creation of biotechnology companies with a steady flow of spin-off companies from university research. particularly in Quebec. 4. On the industrial side. Most antisense drugs are a long way from market and suffer from the same delivery problems as gene therapy. International marketing and distribution channels are controlled by big pharma while universities often assign their intellectual property rights to foreign companies which adds little value to the domestic economy. financing rounds are much smaller than in the US forcing management to spend a disproportionate amount of time raising capital. DNA plasmids. The long product development time period requires access to sustained and patient risk capital. However. drugs to treat antibiotic-resistant microorganisms. humanized monoclonal antibodies. 4. Venture capital and public equity markets have established significant expertise in biotechnology compared to a decade ago. and cardiovascular disease.whether there will be any effect on malignant cells that may have migrated elsewhere in the body. the level Biopharmaceuticals Overview & Prospects Page 38 . Canada has a growing pipeline of products in clinical development with nine products in advanced stages.3 Current and Anticipated Competitiveness Challenges A major challenge for the sector is to capture increased value by moving towards the commercialization of research findings. Canada is also strong in certain product areas. vaccines. one of the largest medical faculties in North America. Canada also has a number of GMP certified facilities for the production of recombinant proteins. Finally. cancer. Antisense Antisense involves the use of nucleic acids (oligonucleotides) to prevent the production of proteins expressed by specific genes through RNA targeting. Canada also has a strong public health system and a relatively low cost research infrastructure that can attract international investment.
! fostering technology transfer through training of such officers in universities. ! establishing pricing and reimbursement levels that contain health care expenditures without damaging the viability of the industry. however. but these firms face significant financial. With the notable exception of BioChem Pharma (3TC). providing valuable employment opportunities for Canadian researchers and creating outputs that have great potential to contribute to Canadian well-being. Attention has also been drawn to fact that Canada currently lacks legislation similar to the US Orphan Drug Act which has stimulated the growth of the US biotech industry. is inherently a high risk activity. genomics and bioinformatics research and encouraging multi-disciplinary research. ! encouraging the formation of academic spin-off companies through incubator facilities. The major challenges for governments and industry include: ! strengthening long term investment in biomedical. Canadian firms are smaller and invest much less in R&D than their US competitors. ! increasing linkages between institutions and companies to better exploit Canadian research. there is concern about broad patents which could restrict industrial development in Canada. ! strengthening technology intelligence and forecasting initiatives in firms. Canada has many promising companies with good potential in selected niches. concern has been raised about the length of regulatory process for drug approval in Canada and a lack of commitment to improve agency performance. human resource and other impediments to their long-term growth. there is a need for a strategy that can better define Canadian industry from its competitors in specific niches so as to attract attention from foreign investors. teaching hospitals and government laboratories and by improving access to technologies available for licensing. ! increasing financial support for laboratory infrastructure.of government support for basic research falls extremely short of other industrialized nations. Second. Canadian success stories are not well known. ! optimizing commercial benefits for Canada from government and industry investment in R&D. Biopharmaceutical development. Although foreign firms are aware of Canada’s attractiveness as a site for competitively priced clinical trials. Thirdly. patents on genes are being concentrated in a handful of multinationals. Biopharmaceuticals Overview & Prospects Page 39 . 4.4 The Bottom Line The biopharmaceutical industry is a key part of the knowledge-based economy. In the area of genomics. with respect to patents.
! improving regulatory efficiency. and ! addressing human resource requirements through expanded immigration and better co-ordinated education and training programs. Biopharmaceuticals Overview & Prospects Page 40 .! ensuring Canada’s patent regime is competitive with other jurisdictions.
ANNEX A GLOSSARY OF TECHNICAL TERMS Amino Acid Building blocks of proteins. mR NA then mo ves from the nucleus to the cell’s cytoplasm where it is translated by the cell into protein Expression system is a recomb inant cell or virus used to produce a selected protein Ge l electro phoresis Movem ent of suspended particles through an agar or agarose gel under the action of an applied electromotive force which separates particles based on molecular weight. By sequencing a gene of interest (determining the order of the four bases). drugs. There are 20 comm on amino acids that can be combined in various combinations (sequence) to form proteins. and properly trained staff m ust maintain a sterile environm ent. test tube or other laboratory apparatus. DNA marker or probe (gene probe) A m olecule usually a nucleic acid that has been labelled with a radioactive isotope. guanine (G). The hum an gen om e conta ins roughly 3 billion bases pa irs organized into distinct units called chromo som es. researchers are able to correlate specific gene mutations with a disease. equipm ent qualified. processes validated. and thymine (T) . Used to identify proteins. and medical devices are produced. Antisense Peptide s which interfe res w ith the production of a specific protein by binding to its m RN A. Standard operating procedures must be followed. Many diseases are caused by alterations of the DNA sequence in a gene resulting in the overexpression or underexpression of the protein for which the gene codes. cGMP S (current good m anufacturing prac tices). dye or enzyme used to locate a particular nucleotide sequence or gene on a DNA m olecule cDNA (complementary DNA) mR NA artificially translated back into DN A bu t withou t the non coding sequence gaps found in the original gen om ic DNA Express Ability of a cell to produce a given protein. Mon oclonal antibody is a highly specific purified antibody derived from only one clone of cells and which recognize s only one antigen. cytosine (C). and gene mapping. DNA (Deoxyribonucleic acid) Long double stranded helix molecule coiled inside cells held together by bonds between pairs of nucleotides or bases -adenine (A). Antibodies Proteins (also called im mu noglobulins) produced by spe cialized blood pla sma cells (B and T cells) in response to the introduction of foreign molecules called antigens. isolate DNA fragments. Hum an genes vary in length from fewer than one thousand bases to several million. Chromosome Threadlike structures found in the nucleus of a cell composed of a DN A com plex that contains the genetic m aterial (genes). The antibody combines with the antigen and neutralizes it. Regulations that dictate the manner in which biopharm aceuticals. Biopharmaceuticals Overview & Prospects Page 41 . Each cell contains 46 chrom osomes except for the sex ce lls (sperm and ovum ) which contain 23. Ch imeric antibodies are those that consist of both m ouse and hum an regions. Glycopr otein Proteins having carbohydrates attached to specific amino a cids In vitro In glass. In vivo In the living organism. Genetic information is specified by the sequence (order) in which these bases occur. Gene A segm ent of D NA that directs a cell to add am ino acids to make specific proteins.with A always binding to T and G to C. Genom e Complete DNA sequence in a full set of chromosomes for a given organism. Protein production begins in the nucleus of the cell when the gene is copied (transcribed) into a pre cursor ribonuc leic acid (pre-m RN A) w hich is processed in the nucleus to mR NA . A gene occupies a specific position on a chromosom e.
and a nitrogen containing aromatic base (A. Peptide A m acromolecule composed of 50 am ino acids or less. Biopharmaceuticals Overview & Prospects Page 42 . U or C in RN A). A. Phage D isplay Method for producing very large diverse collection of peptides and fully human antibodies using bacteriophages (viruses) that infect bac teria. T. a phosphate group. A retrovirus is a type of virus that has the ability to live dormant within the cell’s genetic code. Nuc leic acids Macromolecules composed of sequences of nucleotides. Transcription First step in a two step process w hereby a cell converts the informa tion encoded in its genes into proteins. Receptor A binding site located on the mem brane of a cell that responds to a specific molecule RNA Ribonucleic acid. but unlike the large double-stranded DN A. Longer peptide chains are called polypeptides or proteins Plasmid A sm all circular piece of DNA found in certain bacteria that can exist and replicate independently of the cell’s chrom osomes. ribose in RNA). similar to DNA. Exam ples are horm ones. Protein A large molecule com posed of 50 or more chains of amino acids in a specific order which is specified via the genetic code an d when folded into its natural shape will have a unique biological activity. enzym es. Genes in DNA are copied into an RNA molecule through a process called transcription and the RNA is then decoded (translated) into amino acids that ma ke a protein. Sequencing Process of determining the order of the four bases in a DNA m olecule. G. During transc ription. and antibodies. Translation Second step in the process whereby mR NA directs the manufacture of a protein Vector Vehicle such as virus which transfers foreign DN A from one cell to another Virus Subm icroscopic age nts without a cell wall that are only able to reproduce by inserting itself into a host cell using parts of that cell’s reproductive system. Each nucleotide is made up of a sugar molecule (deoxyribose in DNA. or C in D NA .Mapping Locating all genes and other landmarks as well as their relative positions on the chromosome. a m olecule of m esseng er RN A is m anufactured. The antibody fragm ent is then expressed on the surface of the phage . Plasmids are the principal means of inserting genes into m icroorganism s. G . RN A m olecules have only one strand and a different base (uracil) substitutes for thymine. The cod ing sequence for a peptide or antibody fragm ent is inserted into the gene that encodes the viral coat protein. one of the bases in DNA .
Immunex various Diagnostic antibodies/others Total 457 15440 Source: Decision Resources. December. Centocor/Eli Lilly. 1999 Biopharmaceuticals Overview & Prospects Page 43 . Sankyo Eli Lilly. genital warts multiple sclerosis hepatitis B hemophilia A blood clot dissolver 1145 Interfero n-beta Hepatitis B vaccine rFactor VIII tPA 972 960 740 500 rGluco cerebro idase rDornase alpha GM CSF Gauc her’s disease cystic fibro sis chem o induced white blood cell deficiency hemophilia B renal cell carcinoma transplant rejection. Sankyo Human growth hormo ne 1540 Genentec h. Merck Bayer Gene ntech/Roche H oldings. Novo Amgen. Hoffmann -La Roche J&J. Centocor Genzyme Genentech Immunex.ANNEX B 1998 GLOBAL BIOPHARMACEUTICAL SALES ($US millions) Product Erythropo ietin Human insulin GCSF Indication anem ia in dialysis diabetes chem o induced white blood cell deficiency growth deficiency Sales 3780 1875 1655 M arketer Amgen. Novo. Chiron/Schering SmithKline Beecham. Eli Lilly Schering/Biogen. Schering Interferon-alpha hepatitis B &C. cancer various 411 150 138 rFactor IX Interleukin-2 Therapeutic antibodies 111 106 900 Genetics Institute Chiron. J& J. cancer. angiop lasty. Hoffmann-La Roche Biogen. Pharma cia. Glaxo.
RP128/technetium 99 labelled peptides for imaging infection.MBI 853NL peptide antibiotic/S.Synsorb Pk/ E. US) . US).NovoVAC-M1/antibody based anticancer vaccine/melanoma Status -Phase II (Canada.NOVOMAB-G2 IgM/humanized monoclonal antibodies/melanoma . recombinant fibronectin/thrombosis imaging agent .ALX.Phase II (Belgium) . breast.Phase I (US) initiated 1Q00 .MBI 226/venous catheter related bloodstream infections .MBI 594AN/peptide antibiotic/acne . US) .Phase I (US) commenced Dec/99 .Phase I (Canada) . Aureus .Phase II (US) complete.IND submitted to FDA to commence Phase I .Fibrimage.26015/dementia .NOVOMAB-G2 scFv/humantibodies/non-Hodgkin’s lymphoma .Phase I/II (Canada) .Phase I (US) complete .IND filed Canada 4Q99 . arthritis.Phase II (US) completed 4Q99 .Synsorb Cd/recurring antibiotic associated diarrhea .HspE7 .Phase II (US) initiated 3Q99 .Phase I/II (US) Cangene Draxis Inex Lorus MethylGene Micrologix NPS Allelix Resolution StressGen Synsorb Viventia Biopharmaceuticals Overview & Prospects Page 44 .Phase III (US) . US) . Phase III 1Q00 .Phase II (Canada. DECEM BER 2000 Company AltaRex Biochem Pharma Biomira Product/Indication -OvaRex monoclonal antibody/ovarian cancer . lung cancers .BLP25 MUC1 vaccine/non small cell lung cancer .Phase I (UK) complete .liposomal idiotypic vaccine/B-cell lymphoma .recombinant meningococcal vaccine .Phase I (Canada) complete .INX-3280/antisense/solid tumors .for genital warts .coli based kidney damage in children .Phase II (US) .ALX -0600/short bowel syndrome .Phase I (UK) .Phase I (Canada.Theratope vaccine/metastatic breast cancer (a) GMCSF (Leucotropin) autologous bone marrow transplants (b) GMCSF (Leucotropin) mobilization of peripheral blood stem cells .INX-3001/antisense/leukemia -GTI 2040/antisense/cancer . infected prosthesis .ANNEX C CANA DIAN BIOP HAR M ACEU TICALS IN CLINICAL D EVELO PM ENT.Phase III (US) initiated 4Q98 (a) Phase III (Canada) 1997 (b) Phase III (US) terminated 4Q99 due to slow patient recruitment .ALX 1-11/postmenopausal osteoporosis . inflammation /Crohn’s disease.Phase II (US) .Phase III (Canada.Phase III (Canada) . US) 2Q99 .ALX -0646/migraine .immunotherapeutic stress protein against precancerous cervical dysplasia .Phase II complete .RP527/peptide receptor/prostare.Phase III (Canada.MG98/antisense/cancer . Terminated Dec/00 .HspE7 .