By Wayne Koberstein, Executive Editor, Life Science Leader magazine
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It has now been a day and a half since I arrived in New York to attend DCAT Week, and it will be more than week thereafter before I finish the account I’m writing, so this diary technically isn't one, but may the following narrative suffice. You may also find live tweets from the event by me and our Chief Editor Rob Wright at the hashtag group, #DCATWEEK. DCAT, as everyone calls the conference, starts relatively slowly, with Monday morning given to registration and informal interaction, but by the time the first session begins in the afternoon, the hubbub of off-site business meetings is already well underway.
Like the annual JP Morgan Healthcare Conference, DCAT is a gathering where most of the action is invisible to conference attendees. But DCAT also resembles a big market or bazaar, bringing people together to do business the best way it can be done — face to face — which no amount of social media, telecommunications, or remote sensing can replace. It is a uniquely ecumenical industry group; the DCAT association avoids advocacy and lobbying, so it can serve as a big tent where the producers of branded and generic drugs mingle freely, recognizing their common interests.
And don't take the outside action as a reason to dismiss the conference sessions. This is not one of those must-go-but-empty-content conferences surviving only as an industrywide habit. DCAT delivers practical, useful information for both sides of the Pharma supply chain — the buyers and sellers of all necessary ingredients for making and distributing every conceivable small-molecule or biological drug, from early development to commercial scales.
At the same time, DCAT offers some of the most substantive conference content of any comparable event in the industry. In addition to doing business, people come here to explore and study the frontier of drug manufacturing and supply, from their APIs to their QbDs. Each session is several hours long, with real experts sharing information that you will not easily find anywhere else, including the Internet.
MONDAY: THE BIG OUTLOOK
The first day had only one afternoon session, an industry forecast billed as the “2014 PharmaChem Outlook: Pipelines, Products, Restructuring Data, Market Trends and the Impact Upon Pharma Innovation.” Here, we heard from IMS, Roger Green and Associates, and the Boston Consulting Group. Unfortunately, the session’s most memorable moment did not show industry in the most favorable light. Roger Green quoted Bayer's CEO Marijn Dekkers, and the words are still ringing in my ears: "We developed Nexavar for western people who can afford it, not for Indians." The combination of brutal honesty and myopic callousness in that statement is astounding, and I plan on returning to the topic it suggests in the near future.
Another, and perhaps related idea came from Graham Lewis of IMS. Lewis observed that drug pricing is not the key to entering emerging markets people tend to think it is. Companies that have lowered prices in such markets have scratched their collective heads as sales remained flat. The reason? Poverty is not just about spending money but about the living conditions impoverished societies impose. Such "markets," even when technically undergoing an economic boom, lack sufficient infrastructure to deliver medicines to patients effectively, no matter how cheap they are. The stubborn vestige of what we used to call third-world economies with large, often rural populations in poverty acts like a heavy lid on sales volume.
Lowering the cost of healthcare is not enough, Lewis said. Companies must also find ways to help expand access to care. He noted public/private partnerships to increase access to larger populations in Malaysia and Vietnam.
Meanwhile, Lewis also predicted a low-growth future for Pharma in all of the developed markets, where payers will persist in constraining sales and prices. His forecast was echoed by Green, who said payers are actually afraid of new high-priced drugs for big diseases like HCV. Their response is to place an iron fist of control on drug reimbursement, not collaborate with industry in ways that lower overall healthcare costs. Sound familiar? Paradoxically, said Green, payers will reimburse high-priced drugs and collaborate with Pharma only when the drugs at issue represent a low percent of total care cost.
BCG’s Priya Chandran added some interesting insights to those of Lewis and Green. First, she observed that, much like manufacturing suppliers, CROs have been largely unable to establish sufficient trust and collaboration with their pharma clients, forcing contractors to compete only on the costs of their services, not on offering better ways to reduce the total cost of clinical research. Yet the cost of failure in clinical trials has become the largest portion of the industry’s lost R&D productivity.
My own thought while listening to all this grim news: there is no slack left for mediocre drugs in development; it is time for a quantum leap in the general standard of drug safety and efficacy.
TUESDAY: BUYERS, SELLERS, & REGULATORS
The pace of the conference picked up on the second day, with parallel three-hour sessions all day covering the nuts and bolts of how to create value with excipients, new procurement models, and new regulatory trends such as quality initiatives and serialization — topics all close to home for this drug-manufacturing crowd. The big-picture issues still frequently surfaced, however, because they tend to divide the attendees into two camps with widely divergent points of view, the views of buyer and seller.
The sellers of goods and services in the drug supply chain, contractors to Big Pharma and often to each other, practically pleaded for constructive partnerships with the buyers. From their tone, I gather the pleas have fallen mainly on deaf ears, because sellers say they still face relentless “commoditization” of their wares, the cruel mantra of buyers to do more, a lot more, for a lot less. A few large pharma companies have made some bold moves to collaborate with their suppliers in some cases, but the exceptions only seem to brighten the spotlight on the dominant price-pinching play. Please, though, correct me if I'm wrong.
The most notable other session on Tuesday was lead by Ilisa Bernstein, deputy director, Office of Compliance, FDA. Manufacturing quality and tracing were the main thrusts of the presentations by Bernstein, Brian Hasselbalch, a leader in the transition to the FDA’s proposed new Office of Pharmaceutical Quality (OPQ), and one regulatory advisor, Vincent Ventimiglia, Principal, Faegre BD Consulting. The session content was full enough of good information, and I will give it the full attention and editorial space it deserves in future writings.
For now, a couple of highlights: FDA is building a “Pharmaceutical Quality Platform,” based on its ongoing outreach to all the stakeholders, from companies to patients. The project is now at the early stages of a multi-year process. The plan is for an integrated OPQ team to review all generics by dosage form and API, assess the need for plant inspections, and use metrics to identify at-risk operations. To improve drug manufacturing standards and fix related problems such as vital-drug shortages, the agency asks for nothing less than a total industry commitment to quality.
My question: Is such a commitment likely, given the previous discussion on buyers and suppliers? Another question: Will FDA successfully reorganize its way to greater efficiency and overcome a lack of resources to implement OPQ and other initiatives required by new laws — for example, the Drug Quality & Security Act (DQSA), passed by Congress in 2013 with extraordinary bipartisanship? “It has to” is the only answer anyone can conceivably give.
WEDNESDAY: MANUFACTURING INNOVATION
For me, the third and last day of the conference was only a half-day; I had entry to a single session, a detailed and well-supported set of presentations on quality by design (QbD). Pierre Boulas, director of analytical development at Biogen Idec, maintained that QbD implementation has more to do with more people than science, because it is a form of innovation requiring special expertise, and major changes in the “cultural DNA” of manufacturing suppliers and clients.
Filipe Gaspar, senior director of particle engineering services at Hovione, documented 100-percent “right-first-time” batches with a ObD spray-drying system compared to the mid-9Os with a conventional process, saying the lower manufacturing costs with QbD compensated for its higher development costs. Nick Thomson, director, chemical R&D, Pfizer WRD, concurred, “QbD has brought measurable improvements in process performance in the Pfizer portfolio.”
Perhaps more widespread sharing of QbD gains will unlock the glacier of industry adoption. A half-decade ago, in 2008, 50 percent of all drug manufacturers were only envisioning or planning some form of QbD in their operations, said Anil Kane, Patheon’s global head of formulation sciences. Now the portion of companies still lingering in the vision/planning stages of QbD has shrunk to a third, I believe indicating slow, albeit significant, progress.
All three QbD presenters loaded a wealth of technical data and case information into their slides, and this diary cannot begin to capture the least part of it. As with all sessions, to obtain the slides from speakers who chose to share them, you had to be there, then complete an email survey following the event. Believe me, I will be pouring over all the DCAT Week slides I can obtain, and mining them editorially for months to come.
The other two sessions on Wednesday covered promising but unpredictable markets: China and biosimilars. I am only sorry I was not there to report on at least one of them. The China session addresses regulatory and business trends that affect drug manufacturing, product registrations, and logistics. The “2014 BioPharmaceutical Forum” examined development, regulatory, and marketing experiences with biosimilars and, I presume, lessons thereof.
Dear Diary, my final entry: You do have to make some choices at DCAT: sessions run in parallel and each event, including most official networking breakfasts and receptions, carries a separate charge. But if you truly absorb all of the information even in a single session, you’re likely to go away feeling like your head will explode.
Every morning has its networking coffees, and every evening its receptions. Thursday has no sessions, but it offers the Women’s Networking Breakfast in the morning and the DCAT Annual Dinner in the evening, this year keynoted by Hillary Clinton, for those lucky enough to obtain tickets. And all through the week, the furious congregation of meetings continues, off-site and on. I came away not only with a wealth of fodder for future editorial, but also with a microcosmic education that elevated my knowledge of the life science supply chain.