Big pharma: big rewards come from big risks
pharmafile | December 5, 2011 | Feature | Business Services, Manufacturing and Production, Medical Communications, Research and Development, Sales and Marketing | Pfizer, R&D productivity
John LaMattina joined Pfizer in 1977 after having completed his PhD in organic chemistry, and moved up through the ranks in the firm’s research and development over the next 30 years.
LaMattina was heading up the company’s global discovery operations by the late 90s, then taking on the drug development unit before finally being made senior vice president of global R&D at the company in 2003.
By then, Pfizer was the world’s biggest pharma company, buoyed by its mega-blockbuster Lipitor and other brands, and had the biggest R&D budget in the sector.
LaMattina left the company in 2007 after overseeing the drug discovery and development efforts of over 12,000 people in the US, Europe and Asia.
Vowing not to ‘just play golf’ on retirement, LaMattina continues to be involved in the industry, chiefly as a senior partner in venture capital firm PureTech – which is not your standard venture capital company he adds.
“It’s basically a company that incubates start-ups and recognises the areas of major medical need. We bring in experts to determine where the next major breakthrough might be and start a company around that idea. And if the company takes off after investing some funds in it and gets to proof of concept, then we look to spin that company out to somebody who is ready to take the potential of the new medicine all the way.”
LaMattina is also an active blogger and an author. He started blogging in order to address the many negative opinions being aired about the pharma industry – many of which he says are misinformed. His book Drug Truths: Dispelling the Myths About Pharmaceutical R&D was published in 2009.
Drug discovery hurdles higher now
LaMattina’s experience allows him to reflect on drug discovery and its processes over time. Understanding of the causes of diseases and the underlying biology has grown immensely in the last decade or so, but this hasn’t made the development process easier.
On the contrary, it is now much more difficult. “You have to demonstrate that your compounds not only are effective, but have prolonged demonstration of safety. Now you not only have to show the immediate consequences of taking a drug, but also the long-term potential risk/benefit of your medicine.”
Despite these more formidable hurdles, he says there is still a tremendous satisfaction when you see a programme you began in the lab 15 years earlier, finally reaching and helping millions of patients.
LaMattina left Pfizer as head of its global R&D operations. Since then, Pfizer has acquired Wyeth, cut back its R&D budget and abandoned the least promising disease areas.
When you were head of R&D at Pfizer, you had the biggest budget in pharma at your disposal. What did you do to maximise the R&D productivity in that period? What problems did you come up against?
“The first thing done was to set concrete productivity goals for the R&D organisation. For example, in discovery we set stretch goals for producing candidates that were based on years when the productivity had set records. The rationale was that if we were able to do this once, we should be able to hit that type of productivity annually.”
LaMattina says the next step was to study the reasons for early attrition of candidates, and then set stringent guidelines that compounds had to meet before advancing them into pre-clinical development. “The purpose of these changes was to try to get to an aspirational situation where most if not all candidates would get to Phase II proof-of-concept studies.”
He says both these changes to the process were met with resistance.
“Scientists would often tell me that ‘good science leads to candidates, and cannot be legislated by productivity goals’. Candidate quality guidelines were also resisted, as people could always find an example of a compound that broke a rule but that became a drug.
“Nevertheless, we enforced both principle and productivity and survival rates of candidates rose significantly.”
Torceptrapib’s failure
In December 2006, the company experienced a huge setback when its Phase III cholesterol treatment torcetrapib had to be abandoned because of safety problems. The drug had been identified as the successor to Lipitor, but its failure meant Pfizer stood no chance of finding a drug to match Lipitor’s stature.
Abandoning torcetrapib was clearly a decisive moment, being a major blow for Pfizer’s future earnings. What lessons do you take away from that experience in terms of R&D and the wider business?
‘‘Torcetrapib teaches a few things. First, the need for long-term outcomes studies for drugs to treat cardiovascular disease, diabetes, obesity, osteoporosis, etc., has raised the hurdles of drug discovery and development higher than ever before. Second, while a drug can show all the desired effects in a Phase II study, Phase III results are still the ultimate proof of the new drug’s value.”
Lastly, LaMattina says: ‘‘R&D sometimes doesn’t answer questions – instead it often poses new ones. In the case of torcetrapib, is the CETP hypothesis flawed? Is the hypothesis valid but is torcetrapib the wrong compound?”
He points out that a number of other companies, including Merck, Roche and Lilly are now spending over a billion dollars to answer those questions, and may prove fortunate where Pfizer was unfortunate.
What drugs that you worked on at Pfizer would you point to as being significant?
‘‘This is sort of like being asked which of your children you like best! Part of the problem in answering this question is that the R&D process for an individual compound can take 20 years. For example, we started the JAK-3 programme in 1994. This effort produced tofacitinib, a very exciting, first-in-class small molecule to treat rheumatoid arthritis, psoriasis and may prove to be valuable in preventing organ transplant rejection. I believe Pfizer plans to submit the NDA for this shortly.”
LaMattina says one of the things he is most proud of is the creation of Pfizer’s strong pipeline of oncology compounds.
‘‘Unfortunately, the first, Tarceva, had to be divested to OSI/Roche as part of the acquisition of Warner-Lambert. However, axitinib, crizotinib, dacomitinib, and other compounds have emerged from efforts begun in the late 1990s and make up one of the best oncology pipeline in the industry. Other significant drugs include Chantix/Champix for smoking cessation, Selzentry the first CCR-5 antagonist approved for AIDS, and the antifungal, Vfend.”
Creating the next blockbuster
An ongoing concern in the industry is how to produce the next blockbuster product. “Well, you don’t sit down and say to yourself let’s create a new Lipitor,” which he adds was a wonderful drug but benefitted from a variety of things happening at one time. One of which being the recognition that low-density lipoprotein (LDL) is better for prevention of heart attacks and strokes, and was helped not only by demonstrating to be a safe medicine, but one which was also superior to all the other statins at the time in terms of lowering LDL.
“A drug that has peak sales of $13 billion a year is not replaceable, you can’t possibly in this day and age plan something like that.”
LaMattina says that it is premature to talk about the end of the blockbuster – if any company can discover a breakthrough treatment for obesity, diabetes or Alzheimer’s, for instance, will have a massive commercial opportunity.
At the same time he says it is clear that many major products of the future will be based on ‘personalised medicine,’ treating a smaller groups of patients. Having a diagnostic tool to determine whether or not the disease is susceptible to a certain type of drug, with the drug taken only by patients who will benefit is an advance in medicine.
‘‘The doctor knows it will benefit the patient, the patient knowing the drug is targeted for their condition, and the payers know they’re not paying for something that’s not going to work,” he says.
LaMattina adds that in-licensing promising drugs is now essential for big pharma. ‘‘No matter how big your organisation or budget is – or even how smart it is – you’re not going to cover or to be successful in every area, and so there’s a lot of great research that goes on outside your own walls. What they tried at Pfizer was to cast the net beyond their own R&D labs to try to bring in new approaches, or some new early-stage compounds that they might not have had otherwise in their pipeline.”
Big pharma and reputation
Without profit there is no new R&D, but LaMattina says it’s that profit drive that the public often perceive as being the sole focus for big pharma. He says pharma needs to rectify this problem – but adds massive fines for marketing violations in the US continue to damage its public profile.
“The industry hasn’t done itself any favours when you read every month about a new settlement or lawsuit that has occurred because a company has illegally detailed their medicines, and when it becomes overly aggressive. I think a lot of people don’t enjoy direct-to-consumer marketing, which I think puts the industry into a negative perspective. For example it’s clear that advertisements for erectile dysfunction compounds resonate very poorly here [in the US] and yet they keep being shown.”
He thinks pharma can change how it is perceived, and says educating the public is imperative. LaMattina points out that many people think the real work goes on in academia or in places like the US National Institutes of Health.
“While great work goes on in both places, the brunt of R&D and the work involved in R&D discovery occurs in the pharma and biopharmaceutical industry.” He points out that the industry still invests more in top-line R&D than any other industry, and that people also have to realise that medicines always carry some level of risk.
“No single drug can be universally safe and if you think about it, it’s not smart to assume that. The same medicine is being taken by young and old, male and female, people of different ethnic backgrounds.” But LaMattina admits: “The industry has to do a better job of telling its story and obeying the rules better that are laid out by the regulatory boards.”
The industry and government
LaMattina says he is a supporter of regulatory agencies, and says they tend to be criticised because they are often politicised, at least in the US where it’s not unusual for a senator or a congressmen to try and make some headlines by attacking the FDA.
But LaMattina is worried about US moves towards government involvement in the pricing of drugs. He believes that will make things a lot more difficult for pharma in the US. This raises an obvious comparison with the UK’s cost effectiveness body NICE and how this model would sit with US healthcare.
“People would be appalled in this country if they knew that a medicine existed to benefit them and that the government wasn’t allowing it because it was too costly. I think America wouldn’t tolerate that at all. It’s going to be a long debate, and these issues will get re-hashed again as more drugs are covered by Medicare or Medicaid and government becomes a major purchaser of drugs.”
Future contained in the pipelines
Looking ahead to pharma’s future, LaMattina says just looking at the current pipelines can give us a pretty good picture of pharma ten years from now.
He adds there are at least 800-1,000 compounds around the world in company pipelines to treat cancer.
“Now, all these won’t make it obviously due to the attrition rate but 200 will, maybe 250, so 250 new compounds to treat cancer is a pretty wonderful thing if you think about it.”
Pointing out the FDA’s recent declaration that 2011 had been a productive year for it and the industry, with many new medicines advancing treatment, LaMattina remains positive about the industry’s collective pipeline.
So while some fear that pharma’s ‘golden era’ is behind it, is it in fact yet to come?
“Well that’s a great question – on one hand you’ve got tremendous opportunities for investing in R&D but on the other hand, you have companies whose top-line revenues are dropping.
“When a compound like Lipitor goes off patent, your revenues are hit. As a result people are cutting back across the board including in R&D. I’m not sure that’s the right thing to do, R&D is your engine, and you need an engine to drive your company, and without it you will just remain in a downward spiral.
“Now people can say well, R&D hasn’t yielded in the last ten years and my response to that is – you don’t know what it’s yielded in the last ten years. Drugs that are coming out now are from programmes that started in 1990-5; the stuff that was done in 2004-5 is just starting to emerge into Phase II and III, so you don’t really know what the investments in the last decade have brought you.
“But it’s a high risk/high reward business if you don’t invest; you lower your chances of a reward.”
John LaMattina is the author of Drug Truths – Dispelling the Myths About Pharma R&D.
Follow his Drug Truths blog.
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