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» Scott Weintraub Honored Scott Weintraub, founding ­principle of Healthcare ­Regional Marketing, has been selected for the 2010 ­Outstanding Leadership ­Recognition Award by the U.S. ­Leaders and Entrepreneur’s ­Association (USLEA). The USLEA Awards Program recognizes highly regarded individuals and companies that have demonstrated leadership and ­admirable drive in 2010. GlaxoSmithKline achieved more than 325,000 cubic meters (85.8 million gallons) of water savings, enough for the annual water needs of almost 3,400 people. Computers Help Doctors Deliver better care A survey by GfK Roper for Practice ­Fusion reveals a majority of ­Americans ­believe doctors using a computer system provide them with better care. An ­estimated $27 billion has been allocated to help the medical sector transition to EHR systems as part of the 2009 American ­Recovery and Reinvestment Act (ARRA). • 78% of patients whose doctors used an EHR believe the computer system helps their doctor deliver better care. • 49% of patients report their physician used an EHR during their last office visit. • 38% of patients whose doctors use paper charts would like their doctor to “go digital.” Biotech M&A Activity on the Rise In 2010, $57.5 billion was committed to biotechnology M&A, a 21% increase from last year despite there being 78 fewer reported deals compared with 2009, according to Deal Search Online. This is the second highest amount of money committed to the biotechnology sector over the past decade; in 2008, nearly $94 billion was committed. The biotechnology industry posted a total of 115 M&A deals in 2010, a 40% decrease from 2009’s decade high 193 deals. But the average price per deal has risen indicating that ­buyers are more confident in committing more capital to deal making. GSK Honored for Conservation efforts GlaxoSmithKline received the 2010 ­Environmental Stewardship Award from Nalco in ­recognition of its ­ongoing ­efforts to reduce its climate change impact and energy and water use. The Environmental Stewardship Award recognizes exceptional performance in achieving sustainability objectives and financial goals. According to Emilio Tenuta, Nalco’s director of sustainability, the award ­recognizes companies that go beyond measuring ­performance and embrace a mindset of continuous improvement to help achieve or surpass targets by leveraging the partnerships of experts in the industry. In 2006, GSK set targets to reduce its water ­consumption by 2% per year by 2010. By 2009, water consumption had decreased 15%, significantly ­exceeding its goal. In 2007 GSK launched a climate change program for its operations, setting targets to ­reduce energy use by 45% per unit of sales by 2015. Quote of the month “Late-phase programs are ­bigger and ­lasting longer, which feeds into increased competition for good study sites and patients. ” Dr. Peter Aurup / Merck Podcasts Oncology Trials: A Novel Approach to Patient Recruitment Thought Leader: Ed Watson, Acurian Streamlining Clinical Trials with an ­Approved Phrase Library for Labeling Thought Leader: Kevin Shea, Clintrak Clinical Labeling Services LLC, a division of Fisher BioPharma Services White papers Conquering the Challenges of Cancer Trial Accrual Sponsored by: Acurian Clinical Labeling: The Benefits of an Approved Phrase Library Sponsored by: Fisher KOL Identification and Mapping Sponsored by: Snowfish HBA Names Star Volunteer The HBA has named Daria Blackwell, healthcare ­marketing consultant and ­former managing partner of advertising agency Sudler & Hennessey, as the 2011 Star Volunteer. She will be formally recognized at the 21st annual Woman of the Year (WOTY) Luncheon on Thursday, May 5, 2011. Daria Blackwell M&A Trends In 2010, total M&A transaction value ­increased by 81% over 2009, reaching $11.62 billion in 2010. Total transaction ­volume also increased, with a 13% gain over 2009, from 199 in 2009 to 224 in 2010, ­according to Berkery Noyes. Pharma’s Market Truths Pharma’s innovation rates are not high enough to drive growth, and prolonged reform and budget pressures in healthcare systems globally are producing accessibility and ­affordability challenges that also stifle revenue growth, say Booz & Company consultants. Seven trends that will impact the industry include: 1. More than 70% of product launches in ­recent years missed their initial analyst sales ­forecasts; 2. Tenders and contracts represent more than a quarter of the global pharmaceutical market, and their share is growing; 3. Between 2010 and 2013, half of the growth in healthcare will come from the E7 countries (Brazil, China, India, Indonesia, Mexico, Russia, and Turkey); 4. The rate of new drug discovery in the period from 2000 to 2010 was so low that the head of a major ­pharmaceutical company dubbed it the “lost decade;” 5. The cost of development from protocol design to patient enrollment continues to skyrocket. In industry-sponsored clinical trials in the U.S., for example, on average only 14 patients are enrolled for every 100 patients screened; 6. Potential economies of scale in the supply chain remain unexploited; 7. Although income growth has been buoyed by multiple cost reduction initiatives, the sector’s return on invested capital continues to decline. Supplemental Drug Indications ­Rising New or modified indication approvals for ­existing prescription drugs have steadily ­increased in the United States since the late 1990s, according to an analysis by the Tufts ­Center for the Study of Drug Development. The number of new or modified indication approvals-consent by the Food and Drug ­Administration (FDA) to market drugs for other than the original indication increased 17% from 1998 to 2003 to 2004 to 2009, Tufts CSDD found. A record 460 medicines for rare diseases are in late stages of the pipeline, either in clinical trials or awaiting FDA review, ­according to a report by PhRMA. R&D Costs—what’s the real number? A recent article published in the Feb. 7, 2011, issue of the journal BioSocieties for The London School of Economics and Political Science disputes the industry’s estimates for R&D costs. The authors — Donald W. Light of Stanford University and University of Medicine and Dentistry of New Jersey and Rebecca Warburton of University of Victoria in Canada — suggest the estimates made in 2003 by the Tufts Center for the Study of Drug Development are artificially high. Tufts surveyed 10 pharmaceutical firms for the research and development costs of 68 randomly chosen new drugs and calculated an average cost of $802 million in 2000 dollars. That comes to $1 billion in 2011 dollars based on the general inflation rate since 2000 (28%). The authors of this study say the Tufts’ assessment made no adjustment for taxpayer subsidies or tax deductions/credits specifically tied to R&D expenditures, which would reduce net R&D costs for a company. The authors also question the inclusion of cost of capital, or the costs of returns from funds that would have been invested in the stock market, were the R&D project not undertaken. Tufts used a rate of return of 11% compounded annually, which is higher than the 3% called for by U.S. government guidelines. The authors calculate a net mean cost of $80.3 million per approved drug and net median cost of $59.4 million per approved drug, which includes the lower guidelines for cost of capital. Question of the Month… PharmaVOICE wants to know: do you agree with the authors that R&D cost ­estimates are artificially high, as the ­authors suggest, to ­support higher prices of ­prescription drugs? { Send you responses to ­feedback@pharmavoice.com.

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