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Quaterly compendium of biosciences industry perspectives, Q4 2018 , January 2019

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Are most research findings false ?

« In a recent presentation, Prof. Victor Gay shows why most research findings might actually be false. Indeed, with a Bayesian approach to knowledge, the mechanics underlying statistical inference implies that as soon as several teams of researchers work on the same problem, the rate of false positives soars relative to the rate of true positives. As a result, the post-study probability—or the probability that a research finding is true—vanishes (see figure). Not all is lost however, as replication might just be the remedy to the crisis of confidence of scientific research.

(presentation available : Improving science findings robustness).

Weak signals regarding innovation for mobile apps in healthcare.

A recent presentation within the Belvedere network shows that regulation is adapting to new trends concerning apps in healthcare. FDA is adopting technology in the field of treatment compliance and diagnostic. The talk shows that an app led to 7 months of progression free survival improvement in oncology (see figure). This monitoring tool seems to preclude adverse reactions and enables relevant dosing for classical treatment. The presentation shows as well the miniaturization of diagnostic tools.

(presentation available :  New trends regarding health apps and AI ).

Le Belvédère, January 3^rd 2019

All the best for 2019 !

Hoping that your projects succeed with health and support from your friends and family !

We wish you a rich professional life and positive scientific journey !

To begin this new year, 2 topics are shared in the our last Pilot Chart, we hope that it will give you useful insights.

PILOT CHART Q4 2018

Le Belvédère, January 3^rd 2019

Quaterly compendium of biosciences industry perspectives, Q3 September 2018

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CRISPR Patent fight

In 2012, a research team led by Jennifer Doudna of University of California Berkeley and Emmanuelle Charpentier, a french microbiologist of the Max Planck Institute in Germany, published  the first article (Science, August 2012) that described how CRISPR-Cas9 can make precise alterations in the DNA in eukaryotic cells. This article is considered as a dramatic contribution with tremendous industrial potential. Since then, it has paved the way of a huge research effort enabling a new way to treat diseases, as reported in a recent landscape analysis (Clarivate Analytics, May 2018).

Thema concept map of major concepts and subject matters from 4,450 DWPI analyzed Patent Families related to CRISPR. Clarivate landscape report

Another team led by Feng Zhang from the Broad Institute reported the use of CRISPR to cut DNA in human cells (Science, February 2012). In April 2014, Broad received the first patent of a series for the mammalian cell use of CRISPR, after a fast-tracked review by USPTO. UC which filed a patent before Broad, were granted two patents in June 2014, and sued in 2016 the Broad before the USPTO for patent infringement. In February 2017, the Patent Trial and Appeal Board (PTAB) ruled in favor of Broad (Science, April 2018), against patent interference from January 2016 (Science, February 2017) argued by UC. Although UC was able to show that some of the techniques used to transfer systems into eukaryotes were known to the person ordinary skilled in the art, PTAB considered the one skilled in the art would not have reasonably expected a CRISPR-Cas9 system to be successful in a eukaryotic environment, because UC had only published results in prokaryotic cells and in vitro.

The CRISPR market Pie. G. Grullón/Science.

In September 3018, the U.S Court of Appeals for the Federal Circuits (CAFC, September 2018) ruled that the Broad and UC were patenting sufficiently distinct material and both patent will stand, meaning that Broad will continue to hold intellectual property for the use of the CRISPR gene editing in eukaryotes, separately from UC’s invention of the use of CRISPR-Cas9 in all environments including plant and animal cells. Hence, CRISPR-Cas9 patent claims owned by UC and Broad respectively remain unsolved (Pswire, September 2018). In 2018, EPO revoked Broad’s EP2771468 patent, and found all claims of the patent to be invalid, due to a procedural defect and was challenged on its competency to rule on priority (Article 87 of the European Patent Convention) as compared to US laws for inventorship (Sciencemag, January 2018).

Petition to the Supreme Court concerning PCSK9 patents

The economic battle is between Alirocumab and Evolocumab for the treatment of cardiovascular risk. After prosecution started in March 2016 at the district court of Delaware, Sanofi received a permanent injunction to withdraw Alirocumab from the market (dossier in appeal January 13, 2017). This decision has been reversed by the Court of Appeals (Federal circuit result for appeal October 5, 2017) due to improper instruction of the jury concerning written description and improper issue of the permanent injunction. In fact the district court of Delaware stated that antigen description was sufficient to enable an antibody. This is not always the case. The court of appeal stated regarding the Noelle’s case[1] and the PTO Guidelines (Guidelines, Page 60), the conclusion that instead of “analogizing the antibody-antigen relationship to a key in a lock,” it was more apt to analogize it to a lock and “a ring with a million keys on it.” Antigen enablement for a claim of an antibody raises also the question of the patentability of ‘nature’, as antigen is a mechanism of ‘nature’ not ‘manufacture’ as stated in the Myriad case[2]. The district court also improperly issued the permanent injunction because it was in contradiction with the public interest. Therefore Sanofi recovered its right to propose Alirocumab for patient treatment.  However, this summer, Amgen came back and reloaded the litigation to advocate for enablement of an antibody given the antigen. The company filed a petition to the Supreme Court (petition to the Supreme Court July 23, 2018).

Le Belvédère, September 24^th 2018

[1] Noelle v. Lederman, 355 F.3d 1343 (Fed. Cir. 2004)

[2] Association for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107(2013)

A talk by Dr Jault with advices to unlock your potential on innovative projects.

Le Belvédère, April 9^th 2018

Quaterly compendium of biosciences industry perspectives, Q2 April 2018

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Venture capitals in Biotechs

Last Healthcare Investments and Exits report (SVB annual report, 2018) analyzed activity of biosciences companies with venture capital investment. U.S. healthcare venture fundraising reached $9.1 billion  in 2017, it is the biggest capacity of investment in the life sciences sector in the world. IPOs and M&A activities in Oncology  represent 36% of all exits in 2017. VCs represent 60% of most active investors.

Ranking of American VCs specialized in Biotechs (Biotechbourse, HedgeMind, January 31^st 2018)

 A portrait of innovative start-ups across countries: Success factors, OECD Science 2018

A recent report (OECD iLibrary, February 2018) presents new cross-country descriptive evidence on innovative start-ups and related VC investments. This report relies on the analysis of a micro-level Crunchbase database encompassing many countries & sectors.

Firms founded by a team of individuals are more likely to receive VC funding (higher  number  of funding  rounds and a  greater  amount  of VC funding). Previous  experience  in  entrepreneurship  and  in  academia increases the probability of getting VC funding and to be acquired.

Start-ups’ patent applications are positively associated with the probability of getting VC, and negatively associated with the number of funding rounds and with the probability of IPO, and to a lesser extent with probability of acquisition. Companies where at least one founder is a patent inventor are more likely  to  experience  a  successful  exit  or  file  a  patent  application. Also, in general, VC funding is positively associated with successful exit.

LASSO regressions, across all sectors & countries, of amount of funding on set of firms and founders characteristics:

Extraterritorial US laws which impact global trade

Nowadays, industry has to be aware of the very broad scope of US laws in international trades. Export Administration Regulation (EAR) controls export equipments and technologies including software and technology that are licensed to other countries. The same scheme exists for military technologies but it includes also non military technologies alike commercial information satellite, bioproduction equipment (USLM Cateogry XIV) or trubine engine (USLM Category XIX) (March 15, 2018, CRS report : Export Control System). Liability for the disclosure of controlled technical data includes 20 years imprisonment and penalties up to $1,000,000 per violation (IEEPA sanctions 50 U.S.C. 1705(b)).

This sword of Damocles is applicable likewise for misconduct in business practices with criminal penalties of several million and imprisonment of maximum 20 years. For example VimpelCom paid $795 million global settlement for FCPA violations to win business in Uzbekistan. Or BNY Mellon paid $14.8 million because it had provided student internships to middle East family members of government officials (March 15, 2016, CRS report : FCPA). Total sanctions in 2016 raised to $2,4 Billion (Standford FCPA observatory) and denouncement is rewarded with whistleblower award of $83 million to note in March 2018 (March 19, 2018, FCPA blog). In 2017, 3 non US countries are main information providers for FCPA violations : UK (84 #tips) , Canada (73) and Australia (48) (SEC Annual Report 2017, page 33).

Regarding investment, any buy of 10% in shares in a strategic US company needs approbation of the Committee on Foreign Investment in the United States (CFIUS). The CFIUS investigates the operation using all appropriate intelligence agencies and can block and postpone transaction. The most controversial feature of this arrangement  (called the Byrd amendment) allows CFIUS to reopen a review of the deal and to overturn its approval at any time if CFIUS believed the companies “materially fail to comply « with the terms of the arrangement (March 13, 2018, CRS report : CFIUS).

In conclusion now, non-US companies try more and more to rely on technologies that do not include US patents. And now companies  need to build tactics to prevent FCPA damages alike TEVA which paid $519 Million in December 2016 (SEC Release, December 22, 2016) and now which is collapsing and announcing a 14 000 layoff plan (The New York Times, December 27, 2017).

Le Belvédère, April 23^rd2018

Monthly compendium of biosciences industry perspectives, February 2018

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When a cluster needs a keystone player

With the hectic hype of clusters’ creation to foster innovation, it is sometimes good to come back to reality. We looked at a patent report regarding Australian medical devices (Australian Patent analytics report 2014) and it is indisputable to note that keystone players, which means implanted players in the innovation field, are the true catalysts of inventions. This report shows that long term collaboration between local research and industry is the only way to success. Cluster as an open field with intermittent partners is bound to be a branding masquerade. Without keystone players who reciprocate it is like pouring money and intelligence into the abyss. Current legislative landscape tends to comfort this wrong impetus, where unfair techno-vultures cherry-pick long term research nuggets. It is worrying that EU is less than capable to stem the tide of this economic drain. The union has no safety net concerning industry M&A (Kuka acquisition, DW June 1^st 2017), tax evasion (Panama unblacklisted, Reuters January 23^rd 2018) and market caveats (CE mark weakness, Icom uk 2010). Vulpine companies are gaming the system despoiling tax incentives, public investment & free work from universities. That trend leads to an unsustainable innovation culture where good fortune is captured instead of being reinvested into the ecosystem.

The platinum pill

With Luxturna marketed with a price of $425,000 per eye ($850,000 for both eyes) it raises concerns about acceptability of innovation price model (Reuters, January 12^th 2018). Regarding specific technology and very low prevalence, innovation leads to high prices. This trend is major with numerous drugs exceeding $500,000 cost per patient (Motley Fool, April 18^th 2017):

• Glybera one unique curative injection $1 million
• Ravicti annual cost per patient of nearly $794,000
• Spinraza costs for the first year of treatment $750,000
• Lumizyme costs annually more than $626,000
• Carbaglu is priced per year per patient at more than $585,000
• Actimmune is priced per year per patient at more than $572,000
• Soliris has an annual price tag per patient of nearly $543,000

But high prices also happen for current marketed drug (Daraprim increase from $13.50 to $750, New York Times, September 20^th 2015) or for simple drug or device with dramatic impact on healthcare system (valve replacement rebills savings on standard surgery,  MDCJV 2012 ).

Currently US government has the project to make a law to counter this trend of high priced drugs after controversy to things like the $1,000 Sovaldi pills, or the price of life-saving EpiPens being raised to nearly $500 from $60 (Los Angeles Times, Feb 1^st 2018). A lobbying strategy to undermine the government project has been set-up by main business players in the field (Medcity news, Feb 5^th 2018).

European  Commission proposal on joint Health Technology Assessment

The European Commission has proposed joint health technology assessments (HTA) of new drugs and medical devices, to determine if they offer value for money and should be prescribed for patients. Health Technology Assessment (HTA) is a multidisciplinary process that summarizes information about the medical, social, economic and ethical issues related to the use of a health technology in a systematic, transparent, unbiased and robust manner and provides recommendations whether health products should be financed or reimbursed by the healthcare system in a given country or region.

A joint assessment is a structured information for rapid or full/comprehensive HTAs which is the output of joint production in which 2 or more countries and/or organizations work together to prepare shared products or agreed outcomes. Several joint assessments have already been released by the European Network of Health Technology assessment since 2010. European Medicine Agency and Medtech Europe are key stakeholders for such joint effort.

A draft bill published last month would address the current issues for HTA, such as scattering of resources, redundancy of national approaches to HTA, and limited transparency for patients, which limitate market access for innovation. Today, pharma companies and device manufacturers are required to submit evidence to different agencies in different countries to get their products reimbursed. The joint clinical assessments for HTA purposes will only be completed after the products have obtained a marketing authorization.

The proposal includes provisions for the use of common HTA tools, methodologies and procedures across the EU.

The Commission has proposed 10 to 15 assessments in the first year of operation, rising to around 65 joint clinical assessments towards the end of a transitional period. Governments would have three years to put the regulation into national law after approval by the European Parliament and European Council.

Biotech patents: Focus on Relative Specialisation Index

We have studied the top world countries from which an originated inventor filed a biotech patent as main technology class, under PCT (Patent co-operation treaty), at international phase in 2013. Source data: OECD

The Relative Specialisation Index (RSI) is a measure to account for how specialised a country is in a particular technology area. The RSI compares a country’s fraction of the total number of biotech patents filed across all countries, with its fraction of the number of patents across all technologies. The formula is given below:

where: n_i is the number of biotech patents from country i

n_total  is the number of total biotech patents over the time period

N_i is the total number of patents across all technologies from country i

N_total is the total number of patents across all technologies over the time period

The RSI accounts for the fact that some countries, like US, Japan and China, file more patent applications than others. The RSI enables to put the light on countries that have a greater level of patenting in a given area than expected from their overall level of patenting, and which would otherwise remain under the radars. RSI is equal to zero when the country’s share in a given technology field is equal to all patents filed in all fields (no specialisation), and positive when a specialisation is observed.

Although USA, Japan and Germany were the top three countries from which inventors filed a PCT patent in 2013 for biotech, only USA remains among specialised countries. Japan and Germany have both a negative RSI.

Among the top 18 countries having filed patents as inventors, we recover Belgium, Canada, Israel, Australia, Switzerland, UK, France and Netherlands as having a positive RSI. On the contrary, Japan, China and Korea do have negative RSIs.

Le Belvédère, February 19^th 2018

Monthly compendium of biosciences industry perspectives, January 2018

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US secures national investments after Pfizer mega merger attempt to evade taxation

After the risk in 2016 of US tax base erosion with a loss of 2 billion per year only for this merger, US government has strengthened law in order to keep at home corporate who are massively benefiting from public investment. It was the case of the pharma giant which benefits from universities, healthcare system and US research effort. Other High-profile firms in the medical sector such as Medtronic, Salix, AbbVie, Mylan and Hospira were on the track to relocate headquarter outside US (CRS Report, August 17, 2017). Without tax/work borders headquarters seem to end up in Bermuda and jobs & factories in Asia which hampers public services’ funding such as hospitals, justice, and security. The current Tax reform is bound to boost in the long-run GDP by 1.7 percent and increase the domestic capital stock by 4.8 percent (Tax Foundation model December 2017). As a matter of fact, Apple is about to bring home 38 billion in the federal budget from foreign cash taxes (Reuters January17th 2018).

A patent published on January 4th 2017 to graft a brain in a cloned body in order to extend life expectancy.

This patent “Method for realizing human rebirth by adopting human cloning and brain transplantation” (CN 106264624 A patent), paves the way of a new era where human cloning is possible and where designed body could be the shell of the conscience of a human being materialized by the brain. It reminds of the cryogenization dream, where people hope to come back to life after being frozen. It raises major ethic question concerning the status of the body. In latin law use for money or patent of human body consists in a major offense to human dignity, in EU law human cloning process is not patentable (EU 98/44/CE 6 July 1998 Article 6). This invention echoes to the movie The Island (Michael Bay, 2005). This patent filing shows also that research in China is at the forefront of this bioethical controversy.

OECD Biotech patents in 2013, clear correlation between expenditure in R&D and patent filing

We have studied the top world countries from which an originated inventor filed a biotech patent as main technology class, under PCT (Patent co-operation treaty, OECD current data), at international phase in 2013. There is a log linear relation between the number of filed patents and the gross domestic expenditure on R&D. (Pearson correlation test cor = 0.8961566 95, percent confidence interval: 0.7826889 0.9519739, t = 10.098, df = 25, p-value = 2.634e-10). Hence, rather than GDP, GDE on R&D predicts better the outcomes in term of number of filed patents in biotechnology. We do see China as a serious challenger, having a massive GDE on R&D and an amount of filed patent similar to Germany (Third world rank). France performed well in 2013 for Biotech patents filing (6th world rank and 2nd rank in Europe).

Project of EU regulation on drug pricing is on the way

In 2017, a study published in the British Medical Journal reported that most cancer drugs recently entering the European market do so without clear evidence of extending or improving quality of life. Since then, policy makers are reflecting upon current EMA’s practices.  By the end of January 2018, European Commission’s health department,will submit a proposal to coordinate how countries measure the value of new medicines (value based pricing) according to general Health Technology assessment framework (HTA).   EMA may collaborate also at a european level with national HTA bodies, to help decide whether to pay for a treatment. This policy change will raise questions with respect to harmonization of drug pricing, local versus european regulation, and potential more stringent depedency on HTA regulation for pharma companies (Politico January 17th 2018).

Biosciences’ Mergers and Acquisitions boost planned for 2018

According to an Healthcare sector report from BakerMcKenzie, we may anticipate a boost in M&A activity to rise to USD 418 billion (250.2 billion, 104.8 billion and 55.1 billion in US, Europe and Asia respcetively), hence up 50% from USD 277 billion in 2017. Former year was put under the potential riks of Brexit and US tax reform. In 2018, upcoming deals may confirm strategic moves toward outsourced innovative drug candidates, blockbusters hopefully. Current US tax reform which proposes a relocation of overseas earning at a 15.5 % tax rate, may also provide incentive for big pharmas to invest their foreign/offshore cash in M&A and IPO transactions. EY predicts also the development of shareholders’ activism in Europe and Asia, as a key strategy driver.

Le Belvédère, January 23^rd 2018

All the best for 2018 !

Let biosciences play a positive role in our society.

Le Belvédère for the begining of the year is offering you this short video !

An historical review of innovation in medicine in France.

« French pioneers who contributed to innovative medicine »

Good luck for all innovators in biotech in 2018!

Be ready to follow the path of pioneers in this field. ^^

KR

Le Belvédère, January 9th 2018