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SAN FRANCISCO—Biotechnology company leaders expressed concern at the Biotechnology Industry Organization (BIO) annual meeting here about public support for biotech, pressure from investors for short-term results, and the possibility of increased competition with large pharmaceutical companies.
The industry needs to become more open and willing to educate people about biotech, according to top executives at four major firms who spoke Tuesday (June 8). "We're doing a terrible job of communication," said Howard Pien, chief executive of Chiron.
Pien identified several challenges to biotechnology innovation, including the possibility of generic biologics, parallel trade, and restrictions on stem cell research. "We have to recognize there are a variety of threats in the public environment," he said.
"We tend to be too scientific and clinical," said James C. Mullen, chief executive of Biogen Idec, who urged biotechnology executives to raise their presence in the public debate about biotech. "It's got to be a discussion that brings the science, but marries it to other issues, such as cultural values."
Dennis M. Fenton, executive vice president of Amgen, said his greatest concern for the industry is a push for lower prices by government and health insurers that might diminish patient choice. "We're moving to an environment where drugs must not only be safe and effective, but also cost effective."
Fenton acknowledged the industry's failure to sell many products in markets beyond the wealthy nations of Europe and the United States. "We have to figure out how to get these drugs to everyone, and we have to figure out how society will pay for that," said Fenton.
Arthur D. Levinson, chairman and chief executive of Genentech, said the increasing costs of developing drugs may bring biotech firms into direct competition with large pharmaceutical companies looking to biotechnology for new products. "Big Pharma is a threat to be reckoned with," said Levinson.
Levinson said biotech companies are still struggling to convince investors to look beyond the next quarter's financial results and stand by companies over the long run. He said Genentech struggled to win investor support to increase research funding that has since paid off in major product approvals.
Levinson also said he objects to new accounting rules that require companies to treat stock options as a business expense, which may hurt small companies trying to attract talented scientists.
Another challenge is the industry's perennial quest to reduce the time and expense of winning Food and Drug Administration (FDA) approval for its products. Fenton said executives met with FDA officials during the BIO meeting. While the two sides have their differences, he said he is more optimistic about change at the FDA than he has been in last few years.
"The dialogue is ongoing," Fenton said. "The good news is we have a common goal, which is to streamline the process and make it as efficient as possible."
Fenton predicted that in the next 5 to 10 years, new biotech drugs will evolve to the point where many cancers will be thought of as a chronic disease in which patients can continue to live for up to 10 years, rather than a terminal illness that will take their lives in 2 to 3 years.
Levinson dismissed concerns over the fact that the biotechnology industry overall continues to lose money. He said that while the total industry may not be profitable, investors who chose carefully have been able to make out with substantial payoffs. "The biggest key to success," he said, "is understanding the science."
References
| 1. | | [http://www.bio.org/events/2004/]
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| | | Biotechnology Industry Organization annual convention, San Francisco, Calif., June 6–9, 2004
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| 2. | | [http://www.chiron.com]
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| | | Chiron
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| 3. | | [http://www.the-scientist.com/news/20040408/03/]
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| | | E. Winnick, "EU turns down biotech generic," The Scientist, April 8, 2004.
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| 4. | | [http://www.the-scientist.com/news/20040520/04/]
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| | | A. Harding, "US stem cell rules loosening?" The Scientist, May 20, 2004.
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| 5. | | [http://www.biogen.com]
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| | | Biogen Idec
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| 6. | | [http://www.amgen.com]
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| | | Amgen
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| 7. | | [http://www.gene.com]
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| | | Genentech
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| 8. | | [http://www.the-scientist.com/news/20040318/03/]
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| | | P. Park, "FDA announces reform plan," The Scientist, March 18, 2004.
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