Life sciences summit pegs latest trends


    The life sciences business takes a lot of money, a lot of time and a lot of patience for government regulation, local industry leaders said last week at a conference at Grand Valley State University.

    Featured speakers at “SUMmIT 09: Drugs, Diagnostics, Devices” included Tom Cotter, director of U.S. consumer health care business development for Perrigo Co., headquartered in Allegan;  Daniel H. Farkas, laboratory director of the Sequenom Center for Molecular Medicine; and Mike DeVries, managing director of venture capital firm EDF Ventures. The conference was sponsored by the West Michigan Science & Technology Initiative.

    At $291 billion in 2008, the pharmaceutical market is bigger than the auto industry, Cotter pointed out. Of the 12,750 drugs in the market, 80 percent are generic, he said, which is one of Perrigo’s product lines.

    With big pharma relying on a pipeline of patented medicines, spending on research and development is at about $60 billion for the industry. But much of that investment comes to little fruition. To get to the 2,900 drugs now in clinical trials, 3 million compounds must be tested, he said.

    It can take $1.3 billion and 15 years to get from development to market, he said. Built into that cost is the “cost of failure,” as well as the time-value of money over the long cycle.

    Yet once a drug comes to the market, profits can range into the billions annually, and that promise keeps the investment flowing, Cotter said.

    Perrigo, with annual sales at $2 billion, is based on prescription generic drugs whose patents have run out, and on over-the-counter drugs, including those that used to be patented prescriptions, Cotter said. The public company has brought 61 previously prescription drugs to market over 30 years, he said.

    For retailers, the profit margin on lower-cost OTC drugs is higher than on their brand-name cousins, he said. “We save money for the consumers and we make a lot more money for the retailer, so the retailers love us.”

    Farkas identified several trends, including personalized medicine and companion diagnostics.

    Genetic testing can be used to predict how well a patient will respond to a certain drug. In any group of patients, there will be a subset who don’t respond to a drug and another subset for whom the drug is toxic.

    “Wouldn’t it be great if you could identify those individuals (ahead of time)?” Farkas said, instead of wasting time and money on ineffective drugs and possibly causing side effects for those patients. Such tests also could help pinpoint participants in clinical trials, he said.

    “This phenomenon has not escaped the attention of the insurance industry,” Farkas added.

    “About 20 years ago, 25 years ago, molecular diagnostics represented about 0 percent of that $15 billion to $18 billion industry. Last year — actually, the number that we’re using right now is that it’s about 10 percent of a worldwide $35 billion to $40 billion in vitro diagnostics,” he said. “So from zero to $4 billion in 20 years is pretty good.”

    DeVries said the medical device industry is currently in flux as federal regulators sort out questions about which types of devices require clinical trials and which may not require Food and Drug Administration oversight at all.

    “Minimally invasive surgery is exactly where the medical device world is going to continue to move,” DeVries added. “This is a robot where the surgeon sits several thousands of miles away and operates on a patient, say in California, while he’s in Cleveland. … We will begin to see more and more telesurgery where the surgeon doesn’t have to be present with the patient.”

    In fact, more and more, surgery and other procedures will move out of hospitals, he said. 

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