Transcript Building a Major Pharmaceutical R&D Pipeline Via Alliances

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Merck Overview
Merck Research Laboratories
Partnerships and Licensing
Policy and other
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Merck’s Philosophy
Our philosophy is to bring medical excellence to the
patient by being First in Class or Best in Class and
Demonstrating the Value to Patient, Payor and Provider
Mission of Merck Research
Laboratories
Discover & Develop Breakthrough Medicines in Major
Areas of Unmet Medical Need
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Merck-Medco
Merck Research
Managed Care
Laboratories (MRL)
Independently Operated
and Managed
Manufacturing
Division
J&J•Merck Consumer Pharmaceuticals
Merial Limited
Merck and Schering-Plough JVs
Human Health
Division
• The Americas
• Europe/Middle East/Africa
• Asia Pacific
Vaccine
Aventis Pasteur MSD
Division
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Sales by Therapeutic Class
2001 Human Health Sales $21.3 Billion
Ophthal HIV
2%
Vaccine/ Antibiotics 3%
Biologicals
3%
5%
Asthma
6%
Elevated
Cholesterol
26%
Other Merck
8%
Osteoporosis
8%
Arthritis
11%
2 of the top 5 products were
discovered in the Montreal Lab of MRL
VIOXX* and SINGULAIR*
Hypertension/
Heart Failure
17%
Anti Ulcerants
11%
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Merck Research Laboratories
and
Product Development
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Merck Research Laboratories
R&D $2.9bil 2002 (+16% ; CAGR 12% ‘85-’01)
• 11,900 research employees (over 2000
doctorals) - 300 with advanced degrees at MRL
Montreal
• Several thousand publications per year
(including joint)
• 250-300 patent applications per year
• Global R&D efforts in a range of therapeutic
classes
• Over 100 NDAs approved since 1963
(Regulatory)
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Merck Research Laboratories Locations
Includes multi-billion dollar capital building campaign in West Point, Pa and New Jersey
Montreal, Canada
Rahway, N.J.
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Metabolic disorders
Atherosclerosis
Infectious Diseases
Inflammation
Endocrine/Metabolic
Animal Sciences
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Respiratory, Asthma,
Allergy, Inflammation,
Osteoporosis
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Virology
Oncology
Neurosciences - Sibia
Rosetta Inpharmatics, WA*
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Genomics
Terlings Park, UK
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Neurosciences
Chibret Lab, France
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Madrid, Spain CIBE
Coming in 2004
San Diego, CA*
West Point , PA
Cardiovascular
Ophthalmics
Bone Biology
Vaccines & Antivirals
Oncology
Neurosciences
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Boston, MA*
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IRBM, Italy
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Screening
Banyu Res. Labs, Japan
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Cardiovascular
Infectious Diseases
Endocrine/Metabolic
Plus Clinical Research
Worldwide
and Regulatory
Safety Assessment
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Research Project Selection
• Development Costly
successful new drug costs up to $800 MM
• Most Projects turn out to be flawed
• pathophysiology of many human diseases is complex in etiology &
poorly understood
• Picking the right project is the key to success
• and the hardest if you want to be an innovator!
• easy if you are a follower!
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Research Project Selection
• Is there a medical need?
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what is the size of the population involved?
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how serious is the problem?
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what are the available therapies?
• Is there a rational scientific approach?
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is there a genetic or biochemical insight?
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is there a specific target or pathway?
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is there “proof of concept” available?
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can it be an early goal of MRL Research?
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Research Project Selection
• Is it chemically feasible?
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Some targets are difficult to approach with small molecules
• What is the long-term perspective?
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takes > 10 years to discover and develop a drug.
• What is the competitive environment?
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can we be first to develop an innovative product
• Do we have in-house expertise?
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If not, how can we develop it; can we collaborate?
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Guiding Compounds Through Development
• Project teams (Merck and joint with partners) - implement
drug development; project teams are little companies within a large
company
• Commercialization-type teams - are charged with assuring
that all company areas are aligned to make the product candidate a
success (clinical research/ manufacturing/regulatory/ marketing)
• Other Committees – cross-divisional Senior Management
oversight and approvals
• Large Clinical Outcomes Studies - Demonstrate the Value of
Merck Products
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Licensing at Merck
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Licenses played an important to critical role in 7 of the 17
new product approvals since 1995
About one-third of Human Health Sales are attributed to licensed products,
patents or formulations
Including:
COZAAR / HYZAAR
FOSAMAX
PEPCID
PRILOSEC
RECOMBIVAX HB
VARIVAX
MAXALT RPD Formulation
Licensed
Products,
Patents and
Formulations
~ 32%
2001 Merck Human Health Sales
$21.3 Billion
Others
1017695
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Merck’s Licensing Arrangements
Important Therapeutic Areas
1999 – 2001
Complementing Current Areas
• Cholesterol
• Schering Plough
• Respiratory
• Schering Plough
• HIV
• CAT
• Crucell
• CytRx
• Antibacterials
• Elitra
• Osteoporosis
• Axys
• Ophthalmics
• Cole Eye Institute
Expanding Into New, Large Areas
• Diabetes
• ISIS
• Kyorin
• Neuroscience
• NeuroTargets
• SIBIA
• Influenza
• Biodiem
• HCV
• ISIS
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Merck’s Licensing Arrangements Target
Cutting Edge Science
1999 – 2001
• Pharmacogenomics
• Rosetta Inpharmatics
• Genomics/Proteomics
• DoubleTwist, LifeSpan,
Amersham Pharmacia,
Proteome
• Gene Tools/Targeting
• Lexicon, Sangamo,
Affymetrix
• Drug Delivery
• Elan/Nanosystems
• Flamel
• Symyx
• Lead Identification
• NeoGenesis
• Assay Development
• Chromagen
• Chemical Libraries
• Array Biopharma,
Chembridge, Discovery
Partners
• Knock Out Mice
• Deltagen
• Biologics
• ProBioGen
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Our Network of Relationships*
AstraZeneca
INVANZ®
Yamanouchi / J&J
PEPCID®/PEPCID AC®/
PEPCID COMPLETE®
BMS (formerly Dupont
Pharma)
COZAAR®/HYZAAR®
Gentili
FOSAMAX®
Preclinical/Clinical
Development
Schering-Plough
Vical
Isis Kyorin
CSL Biodiem
Basic
CHOP/Wistar Institute
Research
Celltech
Collaborations
Formulation
and Delivery
Technologies
CAT ProBioGen Elitra
Elan/Nanosystems
Celera KaroBio Isis
RP Scherer
Enabling/Platform
Cole
Eye
Institute
Kyorin
Flamel
Technologies
NeuroTargets
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NOROXIN
CytRx
NeoGenesis Array Exelixis Aurora
Symyx
Osaka Univ. / Biken
CMMT
Cellomics Incyte Proteome
DoubleTwist Lexicon Crucell
VARIVAX®
Chembridge LifeSpan Harvard
Biogen/Chiron/Genentech
Albany Molecular Sangamo
Chromagen Amersham
U. Cal/U. Wash/Inst. Pasteur
Genzyme Evotec Deltagen
Hep B vaccine/COMVAX®
Discovery Partners
Affymetrix
*Disclosed agreements
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Merck is a Flexible, Experienced,
and Committed Partner
Merck is Constantly and Proactively Seeking New
External Opportunities
• Each external relationship receives high priority at all
levels of Merck,
• Compounds resulting from external arrangements are
fully integrated into the Merck drug development
process with the same level of rigor and resources as
internally discovered product candidates
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Review and Licensing Committees
17 Review and Licensing Committees targeting Therapeutic Areas
& Technologies
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Anti-Infectives
Antiviral
Biologics and Antibodies
Cancer
Cardiovascular
Diabetes, Obesity and
Atherosclerosis
• Drug Delivery
• Gastrointestinal
• Immunology and
Rheumatology
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Molecular Profiling
Neuroscience
New Vaccine Technology
Ophthalmic
Research Technology
Respiratory
Urology/Dermatology
Women's/Men's
Endocrinology
Worldwide Licensing & External Research
Expertise to bring the best in science to Merck
Mr. Richard Kender
Dr. Bennett M. Shapiro
Vice Pres.
Corporate & Business Development
Executive Vice Pres.
Worldwide Licensing & External Research
Dr. Greg Wiederrecht
Ms. Barbara Yanni
Transaction Leaders
• Project Lead/Negotiator
Executive Director
External Scientific Affairs
Information Group
Chief Licensing Officer
NCEs and New Biologicals
[email protected]
Research Technologies
Relationship Management
• Relationship Development and
Management
Transaction Services
• Project/Company/Analysts
Platform Research
Technologies
• Chemistry, Screening,
Pharmacogenetics
Dr. Lewis R. Mandel
Emeritus
Academic Programs
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Some other comments
• Premier scientific research organization
• Excellence in translating cutting-edge science into
break-through medicines
• Conferences, scientific meetings- two way
• Journals, abstracts
• Graduate school and post doc contacts important
• Regulatory and access environment
• Research a companies interests
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External Relationships Will Continue
To Be Essential To Merck’s Success
• Alliances at all stages of the discovery and
development process will complement a robust
and therapeutically diverse pipeline that will be a
key driver to Merck’s success
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“We try never to forget that medicine is
for the people. It is not for the profit.
The profit follows, and if we have
remembered that, they have never
failed to appear”
George E. Merck
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For more about Merck & Co.
and Merck Frosst Canada Ltd
merckfrosstlab.ca
merckfrosst.ca
merck.com
Patrick Lauzon
Manager of Corporate Affairs
Merck Frosst Canada Ltd
11131 Hammersmith Gate
Richmond BC V7A 5E6
(604) 536-4228
[email protected]
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Back up
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Policy Goal
Stimulate Economic Development
FEDERAL FACTORS
Intellectual
Property
Protection
Regulatory
Approval
Reasonable
Pricing
PROVINCIAL FACTORS
Quality of R&D
and R&D
Infrastructure
Market Access
• Talent
• Listing
• Public $ Support • Recognize
• Tax Incentives
Innovation
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Policy Goal
Stimulate Economic Development
RDP - BC Investment Performance
PMPRB Reported Investments ($ millions)
$80
Total Investment PMPRB per capita - 2000
$60
20.0
$40
14.4
15.0
$20
1
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8.2
10.0
$0
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18.2
9
1
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0
1
9
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1
1
9
9
2
BC
1
9
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1
9
AB
9
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SK
1
9
9
6
1
MB
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1
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BCXP
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0
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7.3
5.0
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MB
AB
MB
SK
AB
SK
BC
BC
PMPRB 2001
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Merck Research Laboratories
• 2002 R&D Spending - Approx. US$2.9
Billion
• 1985-2001 R&D Spending @ 12% CAGR
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8 (9) Basic Research Facilities Worldwide
>7000 Employees (>1600 doctoral)
Basic Research - >750 PhD-level Scientists
Global R&D Efforts Covering the Full Spectrum of
Human Disease
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Financial Highlights
($ in billions except EPS)
2001 2000 1999 1998 1997 1996
Sales
$47.7 $40.4 $32.7 $26.9 $23.6 $19.8
Merck
21.3 20.2 17.3 15.3 14.2 12.7
Merck-Medco 26.4 20.2 15.4 11.6
9.4
7.1
R&D
Net Income
EPS
$2.5 $2.3 $2.1 $1.8 $1.7 $1.5
$7.3 $6.8 $5.9 $5.2 $4.6 $3.9
$3.14 $2.90 $2.45 $2.15 $1.87 $1.56
Employees (000's)
Total
78.1
Research
11.9
69.3
10.4
63.2
8.9
57.3
8.5
53.8
7.5
96/01
CAGR
19%
11%
30%
11%
13%
15%
49.1
7.0
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Merck Frosst
Centre for Therapeutic Research
• Research interests
• Asthma & Allergies
• Biology of leukotrienes
• PDE4 inhibitors
• Inflammation
• Biology of prostaglandins
• Biology of apoptosis
• Osteoporosis
• CatK inhibitors
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Is Drug Discovery hard?
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Introduction
Registration
Product Surveillance Phase
IV
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2
Years
Development
2-5
Phase
III
Clinical Tests
(Human)
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Basic
Research
0
Phase
II
Phase I
5,000
Substances
Preclinical Tests
(Animal)
?????
Substances
Synthesis
Examination &
Screening
Source: PhRMA
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Shrinking period of market exclusivity between introduction of a
breakthrough medicine and competing innovators
Innovative Drug/Year of Introduction
Follower Drug
Inderal - 1965
101978
Tagamet - 1977
1983 - Zantac
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Capoten - 1980
- Lopressor
1985 - Vasotec
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Seldane - 1985
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1989 - Hismanal
AZT - 1987
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1991 - Videx (ddl)
Mevacor - 1987
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1991 - Pravachol
Prozac - 1988
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1992 - Zoloft
Diflucan - 1990
1992 - Sporanox
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Recombinate - 1992
1992 - Kogenate
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Invirase - 1995
1996 - Norvir
0.25
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4
6
8
10
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The Mission of
Merck Research Laboratories
Discover & Develop
Breakthrough Medicines
in
Major Areas of
Unmet Medical Need
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Alliances – A Critical Role
Compound
Field
Mechanism
NDA Submitted
Zetia™
Cholesterol
Cholesterol Absorption Inhibitor
Phase III
Arcoxia™
MK-869
MK-869
Arthritis
Emesis
Depression
Second Entry Cox-2 Inhibitor
Substance P Antagonist
Substance P Antagonist
Phase II or Later
KRP-297
Anxiolytic
Anti-Inflammatory
Diabetes
Anxiety
COPD, Asthma
Dual-acting Glitazone
GABA-A α2/α3 Agonist
PDE-IV
Vaccines
Herpes Zoster
HIV/AIDS
HPV
Rotavirus
Shingles
AIDS
Cervical Cancer
Infant diarrhea
Resulting from alliance/licenses
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