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It’s always fascinating to see just how entitled biotechnology investors feel about the outsized rewards the industry bestows whenever one of their long-shot companies finally strikes it rich — not to mention how thoroughly that sense of entitlement seems to muddle their thinking.

Case in point for the moment is Steve Burrill, CEO of the life-science VC firm that bears his name, and in most respects a sage and intelligent man. Yet here he is quoted in Fortune on the disaster that awaits biotechnology should Congress allow the FDA to approve generic forms of biotech drugs, here referred to as “biosimilars,” once the original patents expire:

G. Steven Burrill, CEO of Burrill & Company, a biotech venture capital firm, believes the government faces a huge dilemma in its quest to cut healthcare costs while also maintaining incentives for innovation. “It’s the new technologies of biotech that are moving us toward better preemptive and predictive medicines - the very medicines that will reduce healthcare costs. So far, the government’s approach has been schizophrenic.”

Burrill notes that biosimilars change the entire risk/reward equation for biotech investors. “This will have a bad effect on the capital markets that fund biotechs,” he says. “Anything that reduces the potential reward for those capital markets could be devastating for the industry.”

Leave aside the notion that biotechnology offers the hope of reducing healthcare costs — most evidence to date suggests biotech drugs and technologies do exactly the opposite. Instead, consider Burrill’s implicit — and breathtaking — assumption that no biotech investor anywhere has ever considered the possibility that expiring patents might one day lower the sky-high prices of most biotech drugs. No wonder the growing enthusiasm for biogenerics comes as such a rude shock to these folks.

Of course, limits on patent protection are written into the U.S. Constitution, so they really shouldn’t take anyone by surprise. (The relevant clause lies in Article I, Section 8, amidst other specified powers of Congress: “To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.” Emphasis added, of course.) If investors really thought biotech patents would grant their holders a perpetual monopoly, particularly in an era of rampant healthcare inflation and biotech drugs that can cost $200,000 a year, either they’ve been drinking the BIO Kool-Aid or they probably shouldn’t be allowed to dress themselves.

Recall also that pharmaceutical investors have lived with patent expirations and generic competition for better than two decades, and at least until the industry hit its recent bad stretch (see our coverage here), they’ve coped with it just fine. Had that industry continued to innovate the way it’s always claimed it does, it wouldn’t be in the pickle it’s in now.

Besides, biotech investors thrive on risk, or they wouldn’t be biotech investors. Plunking money into biotechs that are far more likely to collapse than return an Amgen-sized jackpot isn’t exactly rational, as I’ve noted myself on more than one occasion. With that kind of mentality, the possibility that biotech profits might be curtailed by biogeneric competition — eventually, that is, as in ten to 14 years down the road — surely pales when compared to the vastly more likely chance that a hot new drug simply won’t work.

At the end of the day, I doubt Burrill or any other opponent of biogenerics really believes they will “devastate” the biotech industry. These folks do, however, undoubtedly want to make the most of biotech’s legal monopolies while they can, and they don’t seem to mind ginning up alarmist scenarios in order to preserve the status quo. As I’ve argued before, if the biotech industry is so delicate that it requires perpetual protection from the cold, cruel winds of competition, it can’t possibly be anywhere near as innovative and revolutionary as it has always claimed.

See also: Biotech’s double standard on biogenerics

(UPDATED: See below.)

Yesterday, the WSJ Health Blog cited a WSJ story as evidence that “biogenerics” — that is, generic versions of biotech drugs, which currently don’t exist — need to be treated with caution. Unfortunately, that post missed a much more important point about biogenerics: The double standard that the biotech industry holds when it comes to determining whether different batches of biotech drugs are equivalent or not. The subject is still widely misunderstood, thanks in part to chaff kicked up by the biotechnology industry itself. (See our previous coverage here and here.)

The original WSJ story, written by David Armstrong and Geeta Anand, concerned production problems at a new Genzyme plant making Myozyme, the company’s new drug for a rare genetic condition called Pompe disease. Myozyme produced at the new plant, it turns out, differs measurably from that pumped out by the same genetically engineered cells at the company’s older manufacturing facility. In particular, the “new” Myozyme appears to contain less of a carbohydrate that helps muscle cells take in the drug. Because of this difference, the FDA has so far refused to approve the new manufacturing plant, which raises the prospect of Myozyme shortages and a financial hit for Genzyme.

The WSJ story itself didn’t delve into the issue of biogenerics. On the health blog, however, Armstrong wrote:

Making biologics is complicated work, and that’s one reason the biotech industry has voiced caution about legislation to allow generic versions of the medicines.

In the case of Myozyme, billions of cells from hamster ovaries growing in large stainless steel tanks produce the enzyme Pompe patients lack. The fact that Genzyme, which has loads of biotech experience, is having such difficulty ramping up production of its own drug heightens worries about the ability of generic manufacturers to accurately copy brand-name biotech drugs.

The first issue here is that there’s nothing new about biotechs finding that new production batches of a complicated protein differ in certain ways from older batches. I listed several examples in an online column I wrote for the WSJ more than three years ago, and there have undoubtedly been others since. Sometimes these differences are serious; more often, they’re not. When there is a major discrepancy, as there was for Genentech’s drug Raptiva (then called Xanelim) in 2001, the FDA requires the biotech to carry out clinical trials to ensure that the new production line is pumping out a drug that’s equivalent to the old stuff. So far, the FDA isn’t requiring Genzyme to conduct new clinical trials of Myozyme produced at the new facility, company spokesman Dan Quinn told me.

The second issue — and those of you who’ve followed these debates can probably see where I’m going — is that the biotech industry wants to have it both ways when it comes to the “complicated work” of making biologics. Where biogenerics are concerned, the industry insists that copycat versions of biotech drugs must undergo those expensive and lengthy clinical trials in the interests of “patient safety.” When it comes to their own drugs, however, biotech companies are perfectly willing to rely on a battery of simpler tests to ensure that a new production batch is equivalent to an old one, and only run clinical trials as a last resort (and when forced to by the FDA).

All of which suggests that it would probably suffice to subject any would-be copycat drug to the same set of tests that biotech manufacturers themselves must meet for a new production facility. If it passes, it’s approved. If not, then it’s time to consider clinical trials. In fact, this is pretty much the “case-by-case” strategy adopted by the House and Senate biogenerics bills — ones that I’m pretty sure the Biotechnology Industry Organization opposed. In any event, it doesn’t seem too much to ask that journalists covering these debates realize that the case against biogenerics is a lot weaker than the industry would like us to think.

UPDATE: This NPR story (via the LAT) makes some of the same mistakes. It’s not the complexity, folks — it’s whether there are reliable tests for ensuring that batches of these complex molecules are equivalent to one another short of clinical trials, which there most certainly are.

UPDATE REDUX: The In Vivo blog weighs in with a related story about the slow start to sales of Omnitrope, a generic human-growth hormone (which they refer to as a “biosimilar,” a word preferred by the biotech industry).

UPDATE, TAKE THREE: I revised the headline and first paragraph to better reflect the post’s main point. I also wanted to belatedly credit David Williams of the Health Business Blog for sparking this train of thought in the first place with this post. (I’d written about his thoughts on the subject earlier, but now that I’m thinking about it, there was no good reason not to mention it again.)

Palo Alto, Calif.-based Horizon Therapeutics, a biotech that aims to combine existing generic drugs to fight pain, raised $30 million in a third funding round. The company’s lead drug candidate, known only as HZT-501, is a “proprietary” combination of the generic drugs ibuprofen and famotidine, the latter of which is better known by its brand name Pepcid. It’s aimed at providing pain relief without gastrointestinal discomfort or injury, which is the same claim made by Cox-2 inhibitors such as Merck’s withdrawn pain drug Vioxx.

Horizon’s basic idea, which is both interesting and risky, is that packaging together existing drugs like these into a single pill may ameliorate side effects. Famotidine, for instance, suppresses the production of stomach acid, so by combining it with ibuprofen, Horizon hopes to reduce the likelihood of ibuprofen-related ulcers.

That’s the interesting part. The risky part is that patients and their doctors can usually just take the existing generic drugs together for the the same effect. Horizon hopes that its combination pill will prove more convenient for patients than the separate drugs. Would-be competitors to HZT-501, for instance, have different dosing schedules — two to three times a day for ibuprofen, but only once or twice a day for famotidine. (Hat tip to Lou Bock, a VC at Scale Venture Partners, who described Horizon’s strategy in the course of a longer conversation nearly two weeks ago.)

Will that be enough for Horizon to fend off generic competition? It’s hard to say, but Horizon’s backers clearly want to believe it will be. The latest round was led by Essex Woodlands Health Ventures, who was joined by existing investors Scale Venture Partners, Sutter Hill Ventures and Pequot Ventures.

Horizon has previously raised $21 million in equity funding. The company said the latest round will allow it to push HZT-501 through its current late-stage trials and potentially into an approval filing with the FDA, while also advancing a second drug candidate, HZT-602, into late-stage trials. HZT-602 combines another painkiller, naproxen, with famotidine. Naproxen is better known by its over-the-counter name Aleve.

House-Senate confrontation set over biogenerics – Late last month, a key group of senators reached agreement on legislative provisions that would authorize copycat versions of biotech drugs, which are typically complex proteins manufactured by genetically engineered cells (see details here and here). These provisions would finally put biotech drugs — which don’t face cut-rate competition once their key patents expire — on a par with traditional pharmaceuticals, and have been a long time in coming. They’re not perfect, but they’re about as good a compromise as we’re likely to see any time soon..

The catch is that biogenerics supporters want to attach this langauge to a reauthorization of the FDA’s user-fees act, the awkwardly named PDUFA, which has to pass by September to keep the FDA operating smoothly. The Senate’s version passed in May, whereas the House just approved its version yesterday — but didn’t include a biogenerics pathway. The senators want to add it to their version of the bill, which has to be reconciled with the House version in a conference committee. But key House members, including Energy and Commerce Chairman John Dingell, a Michigan Democrat, appear likely to object, since they haven’t had a chance to weigh in on the provision.

The upshot: Turf wars between the houses of Congress may cost us our best shot at biogenerics legislation in some time. Tying the measure to PDUFA would be one of the best ways to sidestep legislative roadblocks that opponents and their biotech/pharma backers are likely to throw up — but the window is closing rapidly. The WSJ has more here.

Digital medical records are good for your health — or are they? One of the strongest arguements for digitizing medical records is that they’ll help prevent medical errors and improve medical care. A recent review of other studies in the journal Health Services Research gave digitized records a strong vote of confidence when it found that hospitals that switched to electronic drug-ordering systems saw a 66 percent drop in medication errors. (Such mistakes apparently kill 500,000 U.S. hospital patients every year.) Similarly, a report from the Pharmaceutical Care Management Association predicts that electronic prescribing could save Medicare as much as $29 billion over the next two years while preventing two million medication errors.

As with any technology, however, electronic records are no panacea. Another study of walk-in doctor visits found no improvement in treatment quality among practices that used electronic medical records versus those that still relied on paper. The study’s conclusion: Implementing digitized records is just the first step — doctors and medical groups still need to do a lot of work to get the most out of them.

On a related note, a Senate committee recently passed legislation that would offer subsidies to convince doctors to install digital health-record systems.

RNAi is hot, hot, HOT — Once again, it’s boom times for a new drug technology, and this time the spotlight is on RNA interference — a fascinating but largely unproven method for turning off individual genes by using a short stretch of double-stranded RNA to activate ancient gene-silencing machinery inside cells.

The party really got started last year, when Merck paid $1.1 billion to acquire Sirna Therapeutics, a fledgling RNAi company that had barely managed to move a single drug into an early-stage trial. Now things have heated up even further. Last Friday, AstraZeneca struck a $400 million deal with Silence Therapeutics. Then on Tuesday, Roche stepped up to forge a $1 billion deal with Alnylam, an early pioneer in the area.

What’s worth remembering is that no matter how promising a technology like RNAi seems, putting it to practical use almost always takes far longer and costs more than people expect in the early stages. Just take a look at the roll call of other drug technologies that have undergone similar cycles of hype and disappointment — gene therapy, antisense, therapeutic vaccines. All remain promising — but none of them worked the first time out of the gate. Even monoclonal antibodies took close to two decades before anyone could make a reasonable drug with them. Maybe RNAi will be different — but I wouldn’t bet my wallet on it.

Have cancer vaccines gotten a raw deal? A paper in Clinical Cancer Research (described here) argues that regulators and companies may be too quick to dismiss clinical-trial results if they focus on tumor shrinkage rather than long-term outcomes like survival. That may well be true, as tumor shrinkage is a notoriously bad measure of whether drugs work or not, although it’s also worth noting that a reconsideration still wouldn’t have helped Dendreon’s Provenge vaccine, since its survival data was so statistically equivocal. (Separately, the SEC has now opened an informal inquiry into Dendreon’s public disclosures about Provenge this year.)

DNA transplant “transforms” microbial species – J. Craig Venter’s group at his eponymous institute takes the honors, described here in the WaPo. Next up: Transferring an entirely synthetic genome into a DNA-less microbe to create “artificial life,” something Venter says may happen within months. Similarly, here’s the NYT on the new science of “synthetic biology.” Brace yourselves.

Does “pay for performance” improve medical care? A few weeks ago, the WSJ said no, citing a Medicare experiment. Today, the NYT says yes, citing… a Medicare experiment! I’ll have more to say once my head stops hurting.

Pre-implantation genetic diagnosis may harm fertility – Or so say the authors of a Dutch study described by the WSJ here. Several researchers seem to think the results need to be verified elsewhere before abandoning the procedure, in which a single cell is extracted from an IVF embryo for genetic analysis.

Stem cells tailor their own environments — At least according to Canadian researchers, who explored the specifics of how embryonic stem cells communicate with the cells around them. The Globe and Mail has the story.

Simple enzyme short-circuits bacterial drug resistance – Basically, it prevents bacteria from swapping the genes that confer resistance to antibiotics.

High-throughput output –

• Vermont sets up a Web site comparing pharmacy drug prices (Kaiser)
• Researchers discover molecule that may promote food allergies (BBC)
• Breast-cancer risk genes may not influence survival (WSJ)
• Congressional Democrats want to know who muzzled the former surgeon general (Bloomberg)
• Scientists identify gene linked to autism (BBC)
• Robotics help stroke patients regain function (NYT)

(NOTE: This item originally incorrectly stated that J. Craig Venter’s company, Synthetic Genomics, was involved in the research that transplanted one microbe’s genome into another. In fact, it was Venter’s own research institute, the J. Craig Venter Institute.)

Is the bell tolling for EPO? – The news keeps going from bad to worse for the wonder drugs of biotech — the anemia treatments known as ESAs or EPO, shorthand for “erythropoiesis stimulating agents” and “erythropoietin,” respectively. Earlier today, an FDA advisory panel recommended new warnings for the drugs, which stimulate the production of oxygen-carrying red blood cells, as well as fresh clinical studies on their safety. Recent studies in kidney-dialysis patients linked higher doses of ESAs to heart problems and strokes, while studies in cancer patients treated for chemotherapy-related anemia have suggested that the treatments don’t improve patient survival, and may even cut lives short — possibly by encouraging tumor growth.

New restrictions, which the panel didn’t spell out, could put a serious crimp in ESA sales, which currently amount to billions of dollars for Amgen and Johnson & Johnson. The two companies have also been taking a public-relations battering in terms of how they promote the drugs. Yesterday, the NYT ran a front-page piece that detailed how rebates offered by Amgen and J&J encourage doctors to overuse the drugs, and today the WSJ followed with a look at whistleblower allegations that J&J boosted EPO sales by pushing higher-than-approved doses.

It’s worth remembering that while the storm is currently walloping industry giants like Amgen and J&J, plenty of smaller biotechs that have staked their hopes on getting into the anemia-treatment game could eventually be affected as well. These companies include Affymax, FibroGen and Neose. Only Affymax is public; another potential ESA competitor, GlycoFi, was acquired by Merck last year.

First embryonic stem-cell trial edges forward – By early next year, Geron plans to be injecting recent spinal-injury patients with nerve cells grown from embryonic stem cells, in hopes of regenerating damaged nerve pathways. This trial was supposed to be underway already, but last year the FDA requested more animal data for safety purposes. Geron CEO Thomas Okarma says the treatment will have been tested in 2,000 animals before it ever reaches humans. The FT’s Clive Cookson has the story.

Aggressive treatment leads to worse “quality of death” in cancer patients – File this one under things you already knew but didn’t want to think about. A study of 243 advanced cancer patients revealed that a greater number of aggressive treatments — including the use of ventilators and non-palliative chemotherapy — in the last week of life was associated with greater physical and psychological distress and a lower chance of dying in a preferred location (often home). Money quotes:

[Said study lead author Gabriel Silverman:] “These results suggest that when patients are actively dying, the use of aggressive treatments should be considered with caution and only pursued with the full understanding of patients or their surrogate decision makers.

[...]

“As a doctor, if I had a patient or family who wanted aggressive, life-sustaining care toward the end of their life, I would view it as a red flag warning of patient or caregiver distress,” Dr. [Robert] Arnold [of the University of Pittsburgh] concluded. “Often patients and their families are suffering, sad, or distressed at the end of life, and when dying occurs in medical settings they may hope that aggressive treatment will help the suffering, but often it doesn’t.”

Tau gets a little respect – For the past decade or so, Alzheimer’s researchers have concentrated their attention on beta amyloid, the protein that clumps around neurons in “tangles” visible in the autopsied brains of many — though not all — Alzheimer’s patients. Now comes evidence that a dark-horse protein called tau may also bear some responsibility for the disease. Researchers reported last week in Science that they reversed memory loss in mice by tinkering with their genes to produce lower levels of the tau protein. It’s heartening to see competing theories getting some attention in the Alzheimer’s community, which has had an unfortunate tendency to shun researchers who strayed from the majority opinion, but don’t expect beta-amyloid supporters to give much ground until they have to. That might be soon, as a new batch of drugs designed to block formation of beta-amyloid tangles should begin reporting data from human trials later this year.

New genetic heart-disease link – Another whole-genome association study has identified a new genetic variation that appears to increase heart-attack risk by 60 percent in European populations. The catch is that the variation doesn’t appear to be associated with any known gene, and instead exists in the long stretches of non-coding, or “junk,” DNA, meaning that no one has any idea why it should have any effect on heart-attack rates. The NYT has more.

Stem-cell researchers make like Willie Sutton – Near the end of this otherwise unremarkable account of a talk by James Thomson, the Wisconsin researcher who first isolated and grew human embryonic stem cells, comes this interesting nugget: Thomson will open a “satellite laboratory” on the UC Santa Barbara campus for stem-cell collaborations with UCSB researchers. Coincidentally enough, having a presence in the state might also qualify Thomson for funding by California’s $3 billion stem-cell program. Willie Sutton, you’ll recall, is the outlaw who once proclaimed that he robbed banks “because that’s where the money is.” Some sentiments, it seems, are universal.

Hypocrisy in the generic-biologics fight? – The prospect of legislation that clears a path for “generic” versions of expensive biotech drugs appears to have dimmed significantly. But biotech consultant and blogger David Williams — no fan himself of the push for “biogenerics” — notes that biotech companies and their lobbyists may be shooting themselves in the foot when they argue that biogenerics could never be “identical” to branded products now on the market. It’s worth reading his entire post — it’s not long — but the gist is that changing the manufacturing process for name-brand biotech drugs, which happens all the time, opens up the same “equivalence” issues that BIO and its allies find insurmountable where biogenerics are concerned. The main difference is that name-brand manufacturers can handle the issue with short, inexpensive “bioequivalence” trials — but they insist that biogenerics must undergo expensive, full-blown clinical testing to assure their efficacy and safety. If the biogenerics issue heats up again, don’t be surprised to see this argument make a comeback.

Surgical robots in space, stem cells in rodent eyes – These are just two interesting stories from the San Jose Mercury News I haven’t yet had a chance to mention. Last Sunday, the Merc ran this piece on efforts to automate surgery, with the ultimate goal of building robots that could operate on astronauts in space or soldiers on the battlefield. Far off and far out stuff. Similarly, this piece outlined the possibility of growing new blood vessels using an early and highly regenerative stem cell called a hemangioblast. Ultimately, these fast-growing cells could one day regrow blood vessels in the heart, eyes or limbs that were damaged by injury or disease.

No nukes in lymphoma treatment – Two innovative biotech drugs that target tumor cells for destruction by tiny radioactive particles are struggling in the marketplace, in part because cancer doctors are simply too specialized to make proper use of them. The drugs — Zevalin (pictured at left), from Biogen Idec, and Bexxar, now produced by GlaxoSmithKline — consist of bioengineered antibodies that carry fragments of radioactive material directly to lymphoma tumors in the bloodstream, where the localized radiation can kill cancer cells with fewer side effects than traditional radiation or chemotherapy.

Although both drugs seem to work well, fewer than 10 percent of eligible lymphoma patients receive either one, the AP reports. One main reason: Oncologists don’t usually work with radioactive materials, and so must send patients to nuclear-medicine specialists instead, something many are loathe to do. Demand for the drugs is so anemic that Biogen Idec announced in December that it will try to sell off Zevalin to another company. It’s an interesting tale of how some innovations can fall completely flat when they don’t neatly fit modern medicine’s specializations.

Vaccinating infants — or cows — for E. coli – Those are two possible steps that might protect people from food poisoning by the bacterium Escherichia coli, which was responsible for two major outbreaks last fall, one involving bagged spinach and the other contaminated lettuce served in chain tacos. At the moment, doctors have few options for treating E. coli-related illness, but have begun considering ways to vaccinate children against the bug and to test possible therapies. Canada last year approved an agricultural vaccine for cows that can limit, but not eliminate, E. coli in the animal’s manure. (Cows and their waste are the primary source of the microbe.) The NYT has the story.

New eggs from old ovaries – In a fascinating fertility-medicine development, women can now have small strips of their ovaries frozen, then thawed and re-implanted years later to produce youthful-seeming eggs — even if they have already reached menopause. The technique is most commonly used when medical treatments such as chemotherapy threaten a woman’s fertility, although some women simply hope to improve their odds of bearing children in later years. Check out the WSJ story here.

Ballooning costs of biotech drugs – In five years, biotechnology treatments could account for a full quarter of all prescription-drug spending, according to a study by pharmacy-benefits manager Express Scripts. Spending on biotech drugs is rising far more quickly than for traditional pharmaceuticals, largely because many biotech drugs tend to be vastly more expensive, imposing costs that can range into the tens of thousands — or even hundreds of thousands — of dollars per year. Overall spending on biotech drugs rose 21 percent in 2006, compared to a 5.9 percent increase for traditional pills. By 2010, the company predicts, biotech drug spending will rise to $99 billion and will account for 26 percent of all drug costs, almost double the $54 billion spent in 2006. New drugs for cancer, arthritis and other inflammatory conditions are expected to account for the bulk of that growth. (Hat tip: Reuters, via the San Diego Union-Tribune.)

Additional signs of life among early-stage biotechs – Solace Pharmaceuticals today said it raised $15 million in an early venture round, providing further evidence that investors’ interest in younger biotechs may be perking up. The Boston-based company is developing new pain treatments; its investors include Polaris Venture Partners and InterWest Partners.

Doctors and sales reps, entangled again – A federal court struck down a New Hampshire law that barred the sale of physicians’ prescribing patterns to drug companies, information that drug reps use to tailor their approach to particular doctors. According to the NYT account, the decision may impact several other states that have considered similar laws. Separately, the NYT reports that some doctors are starting to just say no to free drug samples.

Prospects for “biogeneric” legislation may be dimming – Several reports suggest that momentum behind the push to allow cheap generic-style competitors to expensive biotech drugs is slowing, largely because the Senate failed to include the bill in a package of proposed laws that include various FDA reforms and renewal of the program under which drug-industry fees help pay for drug approvals. The biogenerics bill may still move separately, but the conventional wisdom seems to be that its odds were much better as part of the FDA package. The NYT has more on that FDA-reform package here.

Amgen’s anemia rollercoaster — Biotechnology titan Amgen may have dodged a bullet when a study released Thursday showed that its anemia drug Aranesp didn’t shorten the lives of patients, after several other studies had suggested the opposite. But its anemia franchise isn’t out of the woods yet. A Wednesday report in the Journal of the American Medical Association revealed that for-profit dialysis clinics prescribe far higher doses of anemia drugs to their patients than do their non-profit counterparts, suggesting a profit motive behind the overuse of drugs that have been linked to cardiovascular problems at high doses.

Now it appears that Congress may weigh in: The WSJ quotes Rep. Fortney “Pete” Stark, a California Democrat, calling for changes in Medicare reimbursement to eliminate any incentive to overuse the drugs, which stimulate production of the red blood cells that carry oxygen.

More on “generic” biologics — Here are two takes on the move to allow copycat versions of biotech drugs that I neglected to mention in yesterday’s post on the subject. Writing at Forbes.com, Scott Gottlieb — former FDA deputy commissioner for medical and scientific affairs, now a pundit at the neoconservative American Enterprise Institute — makes the counterintuitive argument that copycat biotech drugs will speed the development of new drugs, even if they’re just simply improved versions of older ones.

Meanwhile, pharma/biotech consultant David E. Williams dismisses the biogenerics push as “a bad bill that deserves to die” on his Health Business Blog, but suggests that Congress could adopt a more straightforward solution: Simply mandate price cuts on biotech drugs once their patents expire. It’s such a wacky but weirdly intriguing idea that I can’t even tell if it makes sense, but I certainly doubt that Congress could muster the political will for such a naked exercise of government power — it simply violates too many current assumptions about the usefulness and necessity of markets.

Stem cell divisions — The president of California’s $3 billion stem-cell research program resigned abruptly on Tuesday, citing both health concerns (a recent diagnosis of prostate cancer) and tensions between patient advocates and biomedical academics over plans to spend up to $300 million on new research facilities. Zach Hall’s departure will now come earlier than expected — he’ll depart at the end of April instead of the end of June — but plans to name a successor are already underway. Despite his title, Hall wasn’t the head honcho of the California institute; that honor is reserved for Robert Klein II, chairman of the inaptly named Independent Citizens Oversight Committee, who is also rumored to have clashed with Hall more than once. David Jensen of the estimable California Stem Cell Report has all the details.

Dollars for doctors (and everyone else) — Why does U.S. healthcare cost so much? The economics blog Marginal Revolution hosted a fascinating debate on the subject earlier this week, prompted by Tyler Cowen’s capsule review of a new book by Maggie Mahar titled Money Driven Medicine. The argument is too complex to do it much justice here; the best summary I can make without writing an essay myself is that the entrepreneurial instincts of doctors and medical-technology suppliers (including drug companies), combined with weak resistance from desperate patients, leads to market failure, including drastic overuse — and misuse — of medical services. Don’t miss Mahar’s contribution to the Marginal Revolution debate in comments. Two other takes on the book are here and here.

In a similar vein, this post from the group blog Health Care Renewal aims to explain why so many academic researchers seek out funding from pharmaceutical and biotech companies these days. Turns out it’s not just the greed of companies eager to co-opt paragons of the ivory tower; instead, blogger Roy Poses suggests that university incentives similar to the ones that motivate car salesmen are at fault. Definitely worth a read if the question has ever crossed your mind.

Research odds and ends from the week that was:
• Scientists discovered a gene that appears to be key to “self-renewal” in both embryonic and adult stem cells.

• Surgeons are exploring ways of conducting minimally invasive procedures using “natural openings” in the body such as the mouth, the rectum or the vagina.

• Take that, white supremacists: Physical anthropologists now believe that European skin only lightened up 6,000 to 12,000 years ago, suggesting that “our European ancestors were brown-skinned for tens of thousands of years” prior to that. The link is subscription-only, so here’s a brief snippet of the Science news article:

Researchers have disagreed for decades about an issue that is only skin-deep: How quickly did the first modern humans who swept into Europe acquire pale skin? Now a new report on the evolution of a gene for skin color suggests that Europeans lightened up quite recently, perhaps only 6000 to 12,000 years ago. This contradicts a long-standing hypothesis that modern humans in Europe grew paler about 40,000 years ago, as soon as they migrated into northern latitudes. Under darker skies, pale skin absorbs more sunlight than dark skin, allowing ultraviolet rays to produce more vitamin D for bone growth and calcium absorption. “The [evolution of] light skin occurred long after the arrival of modern humans in Europe,” molecular anthropologist Heather Norton of the University of Arizona, Tucson, said in her talk.

(Note: This item has been copied over to the Life Sciences page from its original location on the VentureBeat main page. To view it in its original context, with comments, click here.)

Amgen’s anemia rollercoaster — Biotechnology titan Amgen may have dodged a bullet when a study released Thursday showed that its anemia drug Aranesp didn’t shorten the lives of patients, after several other studies had suggested the opposite. But its anemia franchise isn’t out of the woods yet. A Wednesday report in the Journal of the American Medical Association revealed that for-profit dialysis clinics prescribe far higher doses of anemia drugs to their patients than do their non-profit counterparts, suggesting a profit motive behind the overuse of drugs that have been linked to cardiovascular problems at high doses.

Now it appears that Congress may weigh in: The WSJ quotes Rep. Fortney “Pete” Stark, a California Democrat, calling for changes in Medicare reimbursement to eliminate any incentive to overuse the drugs, which stimulate production of the red blood cells that carry oxygen.

More on “generic” biologics — Here are two takes on the move to allow copycat versions of biotech drugs that I neglected to mention in yesterday’s post on the subject. Writing at Forbes.com, Scott Gottlieb — former FDA deputy commissioner for medical and scientific affairs, now a pundit at the neoconservative American Enterprise Institute — makes the counterintuitive argument that copycat biotech drugs will speed the development of new drugs, even if they’re just simply improved versions of older ones.

Meanwhile, pharma/biotech consultant David E. Williams dismisses the biogenerics push as “a bad bill that deserves to die” on his Health Business Blog, but suggests that Congress could adopt a more straightforward solution: Simply mandate price cuts on biotech drugs once their patents expire. It’s such a wacky but weirdly intriguing idea that I can’t even tell if it makes sense, but I certainly doubt that Congress could muster the political will for such a naked exercise of government power — it simply violates too many current assumptions about the usefulness and necessity of markets.

Stem cell divisions — The president of California’s $3 billion stem-cell research program resigned abruptly on Tuesday, citing both health concerns (a recent diagnosis of prostate cancer) and tensions between patient advocates and biomedical academics over plans to spend up to $300 million on new research facilities. Zach Hall’s departure will now come earlier than expected — he’ll depart at the end of April instead of the end of June — but plans to name a successor are already underway. Despite his title, Hall wasn’t the head honcho of the California institute; that honor is reserved for Robert Klein II, chairman of the inaptly named Independent Citizens Oversight Committee, who is also rumored to have clashed with Hall more than once. David Jensen of the estimable California Stem Cell Report has all the details.

Dollars for doctors (and everyone else) — Why does U.S. healthcare cost so much? The economics blog Marginal Revolution hosted a fascinating debate on the subject earlier this week, prompted by Tyler Cowen’s capsule review of a new book by Maggie Mahar titled Money Driven Medicine. The argument is too complex to do it much justice here; the best summary I can make without writing an essay myself is that the entrepreneurial instincts of doctors and medical-technology suppliers (including drug companies), combined with weak resistance from desperate patients, leads to market failure, including drastic overuse — and misuse — of medical services. Don’t miss Mahar’s contribution to the Marginal Revolution debate in comments. Two other takes on the book are here and here.

In a similar vein, this post from the group blog Health Care Renewal aims to explain why so many academic researchers seek out funding from pharmaceutical and biotech companies these days. Turns out it’s not just the greed of companies eager to co-opt paragons of the ivory tower; instead, blogger Roy Poses suggests that university incentives similar to the ones that motivate car salesmen are at fault. Definitely worth a read if the question has ever crossed your mind.

Research odds and ends from the week that was:
• Scientists discovered a gene that appears to be key to “self-renewal” in both embryonic and adult stem cells.

• Surgeons are exploring ways of conducting minimally invasive procedures using “natural openings” in the body such as the mouth, the rectum or the vagina.

• Take that, white supremacists: Physical anthropologists now believe that European skin only lightened up 6,000 to 12,000 years ago, suggesting that “our European ancestors were brown-skinned for tens of thousands of years” prior to that. The link is subscription-only, so here’s a brief snippet of the Science news article:

Researchers have disagreed for decades about an issue that is only skin-deep: How quickly did the first modern humans who swept into Europe acquire pale skin? Now a new report on the evolution of a gene for skin color suggests that Europeans lightened up quite recently, perhaps only 6000 to 12,000 years ago. This contradicts a long-standing hypothesis that modern humans in Europe grew paler about 40,000 years ago, as soon as they migrated into northern latitudes. Under darker skies, pale skin absorbs more sunlight than dark skin, allowing ultraviolet rays to produce more vitamin D for bone growth and calcium absorption. “The [evolution of] light skin occurred long after the arrival of modern humans in Europe,” molecular anthropologist Heather Norton of the University of Arizona, Tucson, said in her talk.

(Note: This item has been copied over to the Life Sciences page from its original location on the VentureBeat main page. To view it in its original context, with comments, click here.)

A second legislative fight for the biotech industry is shaping up in Washington over whether to give the Food and Drug Administration authority to approve “generic” versions of biotechnology drugs whose patents have expired.

Measures that would grant FDA that authority, introduced separately in the House and Senate, are billed as a natural cost-saving measure by supporters. They note the high cost of many biotech drugs and the fact that several best-sellers are expected to go off-patent over the next few years. To biotech’s biggest companies and their lobbyists, however, the effort could jeopardize public safety and the incentives that lead companies to spend vast sums in search of new drugs in the first place — at least unless the copycat products are required to go through the same arduous and expensive clinical trials as their brand-name counterparts.

Here, the industry relies on an argument that is one part science and one part misdirection. Biotech drugs generally consist of large, complex proteins that are much more difficult to understand than the relatively straightforward active chemical ingredients in traditional pills. The industry argues that it’s impossible to analyze copycat biotech drugs thoroughly enough to know whether or not they’re identical — or at least close enough — to a name-brand version. Which, of course, leads to the demand that copycat biologics run the same human-trial gauntlet as name-brand drugs, a requirement that might run up development costs so high that a “generic” biotech drug wouldn’t necessarily be any cheaper than its rival.

The problem here is that some biotech-drug proteins aren’t so complex as to defy analysis. The FDA, for instance, already approved a copycat version of human growth hormone called Omnitrope a year ago, after a variety of laboratory and limited human tests allowed FDA scientists to determine that it was “highly similar” to its name-brand cousin. That sort of testing isn’t possible for all biologic proteins, but as analytical laboratory technology gets better, so will the FDA’s ability to correctly assess the similarity of even complex protein drugs. Last month, in fact, FDA Deputy Commissioner Janet Woodcock testified before Congress that the agency already has the skills to make those assessments in some cases. Since the bills in question simply give the FDA the authority to authorize copycat versions of biotech drugs when the evidence warrants it, it’s hard to see what all the shouting is about.

Except, of course, that this fight — like most such Beltway brawls — is at heart about money. Unlike Big Pharma, which has to brace itself for generic competition every time a billion-dollar drug approaches the end of its patent lifetime, biotech companies face little threat of pricing pressure even when patent protection lapses on their cash cows (such as Amgen’s Epogen, a version of the erythropoietin molecule pictured above). Given that annual costs for many best-selling biotech drugs run into the tens of thousands of dollars — even hundreds of thousands in some cases — the green at stake is truly astonishing.

As for the innovation argument, it helps to remember that patents are limited, artificial monopolies created for public-policy reasons that are written into the Constitution itself. If innovation in the biotech industry really depends upon perpetual monopolies over incredibly expensive drugs — well, let’s just say that this is not an argument you’re likely to hear explicitly from a biotech representative any time soon.

A second legislative fight for the biotech industry is shaping up in Washington over whether to give the Food and Drug Administration authority to approve “generic” versions of biotechnology drugs whose patents have expired.

Measures that would grant FDA that authority, introduced separately in the House and Senate, are billed as a natural cost-saving measure by supporters. They note the high cost of many biotech drugs and the fact that several best-sellers are expected to go off-patent over the next few years. To biotech’s biggest companies and their lobbyists, however, the effort could jeopardize public safety and the incentives that lead companies to spend vast sums in search of new drugs in the first place — at least unless the copycat products are required to go through the same arduous and expensive clinical trials as their brand-name counterparts.

Here, the industry relies on an argument that is one part science and one part misdirection. Biotech drugs generally consist of large, complex proteins that are much more difficult to understand than the relatively straightforward active chemical ingredients in traditional pills. The industry argues that it’s impossible to analyze copycat biotech drugs thoroughly enough to know whether or not they’re identical — or at least close enough — to a name-brand version. Which, of course, leads to the demand that copycat biologics run the same human-trial gauntlet as name-brand drugs, a requirement that might run up development costs so high that a “generic” biotech drug wouldn’t necessarily be any cheaper than its rival.

The problem here is that some biotech-drug proteins aren’t so complex as to defy analysis. The FDA, for instance, already approved a copycat version of human growth hormone called Omnitrope a year ago, after a variety of laboratory and limited human tests allowed FDA scientists to determine that it was “highly similar” to its name-brand cousin. That sort of testing isn’t possible for all biologic proteins, but as analytical laboratory technology gets better, so will the FDA’s ability to correctly assess the similarity of even complex protein drugs. Last month, in fact, FDA Deputy Commissioner Janet Woodcock testified before Congress that the agency already has the skills to make those assessments in some cases. Since the bills in question simply give the FDA the authority to authorize copycat versions of biotech drugs when the evidence warrants it, it’s hard to see what all the shouting is about.

Except, of course, that this fight — like most such Beltway brawls — is at heart about money. Unlike Big Pharma, which has to brace itself for generic competition every time a billion-dollar drug approaches the end of its patent lifetime, biotech companies face little threat of pricing pressure even when patent protection lapses on their cash cows (such as Amgen’s Epogen, a version of the erythropoietin molecule pictured above). Given that annual costs for many best-selling biotech drugs run into the tens of thousands of dollars — even hundreds of thousands in some cases — the green at stake is truly astonishing.

As for the innovation argument, it helps to remember that patents are limited, artificial monopolies created for public-policy reasons that are written into the Constitution itself. If innovation in the biotech industry really depends upon perpetual monopolies over incredibly expensive drugs — well, let’s just say that this is not an argument you’re likely to hear explicitly from a biotech representative any time soon.