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This is a guest post from Susan K Finston, President of Finston Consulting. Do you have a response to Susan’s post? Respond in the comments section below.
Susan Kling Finston
Perhaps like me you are working and not on vacation this early August.  If so, I hope that you will join me in a mental vacation to the Emerald Isle.  So close your eyes and think of biotech in Ireland.

One data point that may come to mind is the country’s famously low corporate tax rate, particularly following recent reports of M&A activity driven in part by the opportunity to “buy into” Ireland’s 12.5% corporate tax bracket.

The buyer, Perrigo, may be the largest pharma company you never heard of:  a Michigan-based company with strengths in over-the-counter (OTC), generic prescription, and active pharmaceutical ingredients (APIs), nutritional products (formula, supplements), and related consumer products.

In a deal announced July 29th, Perrigo is buying Irish biotech Elan for $8.6 billion and moving to Ireland, reportedly to save $150 million annually in corporate taxes. This latest news involving a major U.S. company pulling up stakes and moving to Ireland to save on taxes likely may relaunch debate by American states over the plusses and minuses of “Ireland’s model for growth using state money and incentives to lure private biotechnology companies.”

So just how likely is it that tax rates are a key driver for M&A decisions and broader biotech growth?  Not very.

It may be unsettling to hear about a major U.S company jumping ship and giving up its nationality for reported tax gains, given our complicated feelings about homeland and nationality.  Corporations, however, are not people – sorry, Mr. Romney – and when they get to be as big as Perrigo, may not retain a clear national identity.

Perrigo’s strengths in generics and OTC products are driven, for example, through international acquisitions over the last decade, including Agis Industries (Israel), Galpharm Healthcare (UK), Laboratorios Diba (Mexico), and Orion Laboratories (Australia, New Zealand), among others.   Given ongoing operations of affiliated business units in Australia/New Zealand, Europe, Latin America, and the Middle East, how American is Perrigo – even before the Elan takeover?

More broadly,  as noted back in Biotechnology in Countries Starting with “I”  (Part 3  –  back in March 2013), Italy, and not Ireland, places third in the EU for biotech after the UK and Germany, as measured by the number of pure biotech companies. Italy’s corporate tax rate is nearly triple that of Ireland.

How does Ireland stack up in the EU looking –  beyond straight numbers of pure biotech companies?  According to the EU’s Innovation Scoreboard (2013), Ireland is the tenth (10th) most innovative market for biotechnology in Europe, falling short of the most successful biotech markets in the EU.

Using its own composite index including human resources, firm investment, strength of research systems, entrepreneurship intellectual assets and related economic impact, the EU’s top-4 picks are Denmark, Finland, Germany and Sweden.  Corporate tax rates play a limited role at best, in the biotechnology ecosystem.

Will we likely see similar transactions this year, where companies outside of Ireland acquire Irish assets and relocate to the Emerald Isle?  Possibly, given that M&A is again on the upswing and at least two Irish healthcare companies are rumored as attractive take-over targets.  There has to be more on the table than a more favorable tax rate to justify a term sheet, as one analyst has noted:

“A deal that is solely driven by tax purposes could be a slippery slope.” 


Susan K. Finston is President of Finston Consulting LLC, and, together with biotechnology pioneer Ananda Chakrabarty, is co-founder of Amrita Therapeutics Ltd., an emerging biopharmaceutical company based in India with cancer peptide drugs entering in vivoresearch. She is currently preparing to launch her first Crowd Funding campaign for Amrita Therapeutics first-ever therapeutic oncology medical device. For more information see AmritaTherapeutics.com or FinstonConsulting.com.


Drug Patent Expirations for July 2013

TradenameApplicantGeneric NamePatent NumberPatent Expiration
AZILECTTevarasagiline mesylate5,532,415Jul 2, 2013
CIPROBayer Hlthcareciprofloxacin6,136,347*PEDJul 6, 2013
EVOXACDaiichi Sankyo Cocevimeline hydrochloride5,340,821Jul 7, 2013
ELOXATINSanofi Aventis Usoxaliplatin5,290,961*PEDJul 12, 2013
METROGEL-VAGINALMedicismetronidazole5,536,743Jul 16, 2013
CADUETPfizeramlodipine besylate; atorvastatin calcium6,126,971*PEDJul 19, 2013
LIPITORPfizeratorvastatin calcium6,126,971*PEDJul 19, 2013
INOMAXInonitric oxide5,485,827*PEDJul 23, 2013
EMENDMerck And Co Incfosaprepitant dimeglumine5,538,982Jul 23, 2013
EMENDMerckaprepitant5,538,982Jul 23, 2013
INOMAXInonitric oxide5,873,359*PEDJul 23, 2013
RELENZAGlaxosmithklinezanamivir5,360,817Jul 26, 2013
DELZICOLWarner Chilcott Llcmesalamine5,541,171Jul 30, 2013
ASACOLWarner Chilcott Llcmesalamine5,541,170Jul 30, 2013
ASACOL HDWarner Chilcott Llcmesalamine5,541,170Jul 30, 2013
IMAGENTImcor Pharms Codimyristoyl lecithin; perflexane6,287,539Jul 30, 2013
DELZICOLWarner Chilcott Llcmesalamine5,541,170Jul 30, 2013
ASACOLWarner Chilcott Llcmesalamine5,541,171Jul 30, 2013
IMAGENTImcor Pharms Codimyristoyl lecithin; perflexane6,280,704Jul 30, 2013
ASACOL HDWarner Chilcott Llcmesalamine5,541,171Jul 30, 2013
IMAGENTImcor Pharms Codimyristoyl lecithin; perflexane6,280,705Jul 30, 2013
*Drugs may be covered by multiple patents or regulatory protections. See the DrugPatentWatch database for complete details.

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This guest post is from the BiotechBlog Intern,  Fintan Burke. Fintan is a student at the School of Biotechnology at Dublin City University. Do you have a response to Fintan’s post? Respond in the comments section below.

One of the more enduring financing trends in recent years has been to turn to public interest to help fund for research. As Susan Finston has noted on this blog before, the successes seen in other areas has more recently been translated into the biotech world, with such sites as Petridish.org and scifundchallenge.org forging ahead in public financing in the sciences.

For emerging technologies a new website promises to add an extra aspect to the crowdfunding framework; innovation in the technology itself. Marblar.com was recently established in order to facilitate crowd-orientated uses for new technologies developed by the patent holder.

Marblar cofounder Gabriel Mecklenburg explains new technologies have limited potential under the old system. “You typically have a physics technology and a professor comes down from tech transfer office, talks to their physics guy and those two people – [who] may be opposed to being thrown into the mix – will then have to come up with the best way of applying this technology. We figured ‘well that’s maybe not the best way of doing it.’ Science has become such a vast field now these days that maybe actually the physicist isn’t the best person to find that killer application for this piece of physics technology.”

“So we figured to really open up the sectoral process to a much much wider crowd and break down the technologies in a way that a non-expert could understand them and open it up to anyone around the world, be they neurologist, chemists, engineers, business people- get all these different perspectives together and create this kind of crowdsourcing platform where [what] we do is put each technology out as a competition and say ‘Okay, come up with the best new market application, the best new way of using this technology.’”

Marblar works by having the patent holder post their technology up on the website and having the community suggest potential applications. Those viewed as particularly innovative get voted on and discussed before entering a final shortlist. The community then continues to vote for what is deemed the best use of the new technology, which is finally selected by the technology holder and is rewarded with a cash prize and points towards their Marblar profile. “Ultimately it’s not a life changing amount of money. More importantly than that there is this community that we’ve built all working towards the same goal that I mentioned earlier; realising the promise of science and actually being in this community of really really bright, motivated people and working with them and collaborating in coming up with these ideas is actually hugely rewarding for a lot of these people, much more so than the money. It’s what drives actually self creativity, pretty senior people in some cases, very very qualified people spend a lot of time on the site and developing these ideas.”

In order to open up the doors for innovation as wide as possible, Gabriel and his team have put considerable effort to elucidate the technology. “We actually spend quite a lot of time digesting down the key features of the technology and presenting them in a way that makes them easily understandable to someone who’s coming cold to the technology. And one key feature of the platform itself is its open nature; that the inventors can interact in real time with the crowd. So the inventor can actually mould each idea with their feedback pack and that way – even if the original application wasn’t quite technically feasible – through this real time tech feedback between the crowd and the inventor the ideas are actually shaped into much more feasible incarnations. You do want the outsider’s perspective.”

As crowdfunding in science grows, the benefit of the outsider’s perspective is increasingly being recognised. As Jeanne Garbarino notes in her post at Nature.com, the growth in science-based crowdfunding has helped lead the way in a new era in connecting science to the general public. By opening their project funding (or even part thereof) to the public, there is an extra imperative to scientists to explain and engage with the public about their research, their methods and eventually their end goal. This potential for outreach-through-crowdfunding is being recognised by websites such as scifundchallenge.org which aim to not only raise funds for research, but also help researchers with outreach activities and help the public connect with the work being carried out. In one of the first papers to fully explore the psychology of crowdfunding from the individual’s perspective, Crowdfunding: Why People Are Motivated to Post and Fund Projects on Crowdfunding Platforms, Elizabeth Gerber et al found that as crowdfunding grows and becomes more common, people will tend to be more discerning about who they choose to fund, increasing the imperative for researchers who choose to crowdfund their research to illustrate its benefits. In the same paper, however, they noted that people who chose to undergo the crowdfunding route found added validation to their work, establish long-lasting professional connections and expand the awareness of their work to both the public and other like-minded professional bodies, thereby helping to increase their chances of getting funding through crowdsourcing in the future.

For Gabriel and the rest of the team at Marblar, having a simplified, accessible explanation for emerging technologies has already shown itself to be beneficial in reaching a wider-than-predicted range of people looking to be a part of the next big thing. “Where our last count it’s people from a hundred and thirteen countries and that’s really running the gamut all the way from a gang of high school students that are sneaking past the age limit all the way to emeritus professors kind of spicing up their retirement by having a go at some of the new science coming through some cutting edge discoveries.”

In a 2001 paper Belinda Clarke suggested that the best way to tackle the worsening lack of interaction between researchers and the public would be to create a forum where the two could interact in non-technical dialogue, away from issues of the media and interest groups acting as middle men and obscuring the message. With the financial appeal that crowdfunding offers and the relative ease in collaborating and explaining to the public about emerging technologies, researchers may yet realise the benefits to putting their mouth where the money is.

About the author:

Fintan Burke is a student at the School of Biotechnology at Dublin City University. His main fields of interest include biomedical therapies and recombinant organisms.  Fintan may be contacted at fintan.burke2@mail.dcu.ie .

In the last weeks, India has seen serious setbacks to its life sciences industry. The NIH recently announced that they were cancelling 40 clinical trials in India due to an ‘unstable regulatory environment’. Earlier, the UK Medicines and Healthcare products Regulatory Agency (MHRA) recalled 16 Indian drugs, citing deficiencies in manufacturing procedures.

These recent occurrences compound prior concerns over the patentability of medicines (here and here), and low drug innovation rates. Furthermore, in the recent issue of Scientific American Worldview I showed how the sum of India’s API production revenues were exceeded by the the top-selling patented drug. So, even having a focus on generic drugs is not generating substantial revenues for India.

These developments lead one to question — does India present a postive environment for biotechnology?

worldview-5-yearsFive years ago I built a biotechnology innovation index and I have been using it since tracking global biotechnology innovation in Scientific American’s Worldview. It has been a very rewarding project, and I have enjoyed the opportunity to present my research data at international conferences, business schools, and even National Defense University.

Now, Worldview’s editor Mike May has compared my innovation scores with the Venture Capital and Private Equity Country Attractiveness (VCPECA) index. I was quite pleased to see a relatively strong correlation between my innovation index and the VCPECA index.

I am always looking for feedback on the index and opportunities to expand it. I invite you to visit the scorecard at http://www.saworldview.com/wv/scorecard/ and send me your suggestions and feedback.

Image courtesy of Biswarup Ganguly, via Wikimedia Commons

The 1980 Supreme Court decision in Diamond v. Chakrabarty established the patentability of human modifications to bacteria, and arguably laid the foundation for the biotechnology industry.

Professor Chakrabarty remains an active researcher, and is currently pursing a promising anti-cancer therapy. Given his unique perspective on patenting in biotechnology, I asked him to provide a personal perspective on the recent Myriad ruling. His commentary on patenting human genes and mutations appears as an open access paper in the latest issue of the Journal of Commercial Biotechnology.

I invite you to read Professor Chakrabarty’s commentary and sound off in the comments below.

bioentrepreneurship-bootcampThe Journal of Commercial Biotechnology announces the publication of the July 2013 issue, featuring new papers on biotechnology management and commercialization.

Journal of Commercial Biotechnology Vol 19, Issue 3 (2013)

Patenting human genes and mutations: A personal perspective
Ananda Mohan Chakrabarty
Full details at the Journal of Commercial Biotechnology

The polyvalent scientist: the added value of management training
Maria Theodosiou, Arsia Amir-Aslani
The PhD is becoming more and more prevalent as a degree. However, PhD students are not adequately prepared for careers outside academia and most of them have trouble translating their skills to the job market. The biotech sector is a science-driven industry that is now mature and flourishing and requires business leaders that are technically trained…
Full details at the Journal of Commercial Biotechnology

A Role for Virtual Biotechnology Companies in Drug Discovery and Development?
Dianne Nicol, Johnathon Liddicoat, Christine Critchley
The orthodox business model of many drug discovery and development companies centres on adding value to early-stage discoveries prior to engaging with large pharmaceutical companies to bring products to market. Anecdotal observations suggest some companies are moving to a ‘virtual’ business model – instead of employing in-house scientists, a skeletal management team runs the company and out-sources all research and development…
Full details at the Journal of Commercial Biotechnology

The role of specialization in mutual fund investment strategies: An exploratory study of the life sciences industry.
Osne Frans Kirzner, Lorraine Marie Uhlaner
This paper explores possible differences in investment strategies between specialty and non-specialty funds in the life sciences industry…
Full details at the Journal of Commercial Biotechnology

Culture and the Principles of Biomedical Ethics
Kola Abimbola
This paper examines the roles of culture in the principles of biomedical ethics.  Drawing on examples from African, Navajo and Western cultures, the paper maintains that various elements of culture are indispensable to the application of the principles of biomedical ethics. Full details at the

The relevance and importance of business development and licensing in the biopharmaceutical industry.
Roger Davies
The importance of the business development and licensing (BD&L) function in the global biopharmaceutical industry has grown significantly over the past 20 years as pharmaceutical companies have sought to supplement their internal R&D with innovative products and technologies sourced from biotechnology and drug delivery companies…
Full details at the Journal of Commercial Biotechnology

Patent Licensing Considerations for Biologics under the BPCIA
Sheila Swaroop, Carol Pitzel Cruz
Full details at the Journal of Commercial Biotechnology

Evergreening patents: The Indian Supreme Court rejects patenting of incremental improvements
Joanna Brougher
On April 1, 2013, the Supreme Court in India handed down its decision to dismiss Swiss drug maker Novartis AG’s attempt to win patent protection for its cancer drug Glivec…
Full details at the Journal of Commercial Biotechnology

The life sciences industry and the changing IP landscape
Gareth Williams
This article looks at the findings of Marks & Clerk’s 2013 Life Sciences Report, launched in April 2013. Of interest to both R&D/IP experts and professionals in strategic positions within biotechnology companies, it explores many of the issues facing the biotechnology industry and is informed by an industry survey of over 330 international life sciences professionals…
Full details at the Journal of Commercial Biotechnology

EU Legal & Regulatory Update
Ewan Grist
Full details at the Journal of Commercial Biotechnology

Book Review: The crowdfunding revolution: How to raise venture capital using social media
Steven S. Ma
Full details at the Journal of Commercial Biotechnology

DrugChatter - How do people like their drugs?A common challenge faced pharmaceutical industry analysts, pharmacists, and other healthcare professionals is obtaining objective information on recently approved drugs. Often the only source of information in the first months after a drug’s launch is from sales representatives who may not have access to raw clinical data.

DrugChatter fills this gap by tapping into the DrugPatentWatch database and mining social media to bring you public opinions on recently-approved drugs . DrugChatter also provides details on the most discussed drugs, and can supplement focus groups with its profiles of pharmaceutical drug ads.

I invite you to take a look at this new site in development, and let me know what you think.

This guest post is from the BiotechBlog Intern,  Fintan Burke. Fintan is a student at the School of Biotechnology at Dublin City University. Do you have a response to Fintan’s post? Respond in the comments section below.

Earlier this year the International Service for the Acquisition of Agri-biotech Applications (ISAAA) reported that for the first time the developing world has taken over responsibility for producing over half (52%) the commercially available Genetically Modified (GM) crops worldwide. While the majority of these seeds can be traced to Western companies, the current state of native GM research in both the African and Asia-Pacific regions are both growing and have noticeable similarities; in both areas only a handful of countries serve as the growth poles for a region with scattered levels of GM policies and research institutions.

In Sub Saharan Africa, both South Africa and Burkina Faso have been recognised in a UNDP paper as instigating modern commercial biotechnology in the region. Similarly India, China and The Philippines are credited with the quick adoption of GM crops in their regions with cotton, maize and canola being the leading crops. While social debates over GM crops echo many of the issues in the developed world, a unique complaint in the African region is the involvement of the dominant seed companies in native biotech agriculture development projects by controlling the supply of seeds, these companies can be seen to be taking over the traditionally held role of the farmer in creating the best possible crop variety. In effect, what sovereign genetic engineering there was (via breeding) in the region is being removed. In Asia problems seem to stem from the sheer variety of GM legislation levels for each country. A 2008 list compiled by APCoAB illustrates the varying extent of legislation established by governments; from India’s extensive policies covering trade and biosafety to Mongolia only offering a 2005 framework for development.

The African Panel on Biotechnology has recommended a “co-evolutionary” approach to developing biotech legislation. As Dr Adrian Ely – head of Impact and Engagement at Social Technological & Environmental Pathways to Sustainability (STEPS) Centre – explains the agricultural research group CIMMYT were “working within a regulatory vacuum” when it came to their recent efforts in Kenya. “They obviously have been working with the authorities and everything they’ve been doing is in the full knowledge of the authorities and where they’ve required licences they’ve had them. That’s an example where even in the absence of an actual law … legally sanctioned biosafety research was able to continue.”

For Africa a major factor hindering research development is the highly volatile nature of investment. In 2011 the Agricultural, Science and Technology Indicators held a conference in an attempt to pin down reasons for the low investment in Africa’s agricultural R&D. The financial culture of one-off donations and deals with development banks tend to leave research institutions nearing bankruptcy once the donor-funded project is finished was pointed out as one major factor. It was also illustrated using the “Volatility Coefficient” (the standard deviation of growth in R&D spending over a course of time) that Sub-Saharan Africa’s scattered R&D investment amongst countries created a far more volatile environment compared to the Asia-Pacific region. Two main sources of funding – government grants and the region’s remarkably higher level of donor contribution – were also found to be incredibly volatile, with the lack of transparency and income security in government and in particular the short term, ad hoc attitude to donor funding being the main factors in volatility.

In the Asia-Pacific region, both government policies and public opinion tend to provide the main difficulties in fostering a competitive R&D capacity. When discussing the challenges with BiotechBlog Dr Tom Burns, director of the Asia and Pacific Seed Association, notes that while India has had a history of success with GM cotton crops, the vocal anti-GM lobby is being successful in preventing edible GM crop research from being developed further. These protests may then prevent funding at a government level in response to the negativity. This approach manifested itself most clearly in 2004, when Bayer announced it was giving up on its efforts on commercialising crops in India, following several protests which included Greenpeace activists chaining themselves to their Indian headquarters.

Another, more pressing issue involves the restrictions on commercialising research due to the prohibitive cost of intellectual property licensing. Licensing out previous traits to include in a new GM crop strain under westernised intellectual property (IP) policies often mean that those crops developed in the African and Asian-Pacific region can be too expensive to compete in the market.

Such problems are less prevalent in India and China, the two emerging R&D centres of the region. China is less stringent on its IP policies and has benefited from constantly revising their seed policy to ensure that even small seed companies are able to flourish, curtailing the practice of a black market for seeds that bypass lengthy legislation and are grown without approval (the so-called “Stealth Seeds” that have been found in India and Argentina, among others). Active support from the Chinese government and self-tailored polices have meant that the country is now the 6th largest producer of GM crops in the world. India’s success with GM crops (in particular GM cotton) has lead to a more commercial achievement. As stated in an ISAAA report last year, India was transformed from a net importer to net exporter of cotton since its commercial approval in 2002, and quotes a Barnes and Barfoot estimate of GM cotton adding $9.4bn to agricultural income in the 2002-2010 period alone. This seems to have encouraged regional governments in India to pursue field trials with other crops, though this has been met with the aforementioned controversy. Nonetheless India’s recent confidence in its GM crop potential has lead to a quickened pace in research centres, increased acceptance among the farming community and just this month the introduction of a bill in government aiming to quell disinformation from anti-GM groups.

Though only in its infancy, GM crop research in these countries has nontheless already produced world-class success stories. Calestous Juma, Professor of International development at Harvard University, recently illustrated the success Nigeria’s Institute for Agricultural Research in addressing a regional challenge to the black-eyed pea crop by developing their own transgenic variety. Larger-scope institutions such as the International Treaty on Plant Genetic Resources are helping to harmonise the intellectual property and biopiracy concerns to help encourage commercialisation, while the Strengthening Capacity for Safe Biotechnology Management (SABIMA) project offers support for those countries who decide to develop their biotechnology capacity. Though it may still be too early to tell in many of these cases it appears that for the countries experiencing the greatest growth in the regions, a certain degree of autonomy and relaxed intellectual property laws have helped GM research create localised solutions to crop challenges and economic strength.

About the author:

Fintan Burke is a student at the School of Biotechnology at Dublin City University. His main fields of interest include biomedical therapies and recombinant organisms.  Fintan may be contacted at fintan.burke2@mail.dcu.ie .