Johns Hopkins Masters Project: Strategy Project

1. MAKE THE COMMOM MAN HEALTHY
PRESENTED BY
SHUBHDA ROY
COM^3

2. AGENDA
 Mission
 Who we are
 Where we want to be – Vision 2020
 SWOT Analysis
 Emerging Opportunities
 Our Strategy

3. COM^3
 MISSION
 Providing a healthy life for the coMMom Man
 We do this by providing drugs at an affordable
price to the common man.
 Vision
 Provide drugs that a common man can buy.
 PURPOSE:
 To make the common man healthy.

4. WHO WE ARE
 Private Generic Pharmaceutical
 Presence only in the USA
 Last 15 years
 200 Million in annual Sales
 From 2 Diabetic Generic drugs
 Drugs are the cheapest in the Market

5. WHERE WE WANT TO BE – VISION 2020
 Expand our market overseas
 Get into Prescription Drug Market
 Go Public

6. Strengths
•Good repution in the generic market
•Two great generic product
•200 Million in annual Sales
•Customer happy
Opportunities
•Strategic alliances possible with Dimensia
Partners
•Getting two new Patented drug coming off
their patents
•Product expansion
•Entering the foreign Maket
•Become Public
Threats
•Strong competiton from other generics
with better efficacy
•Could lose our good reputation
•Could lose market presence
•May need to increase drug prices
Weaknesses
•15 years old
•Nothing innvotive
•Nothing new to offer
S W
TO
SWOT ANALYSIS for COM^3

7. HOW WILL WE GET THERE – EMERGING
OPPORTUNITIES
 TWO ANTI – OBESITY DRUGS COMING OFF
PATENT (OPTION 1 – OBESITY MARKET)
 PROJECTED ANNUAL SALES 100% to 400 million
dollars
 SMALLER EUROPEAN COMPANY
(OPTION 2 – DIMENSIA MARKET)
 PRODUCT IN EARLY PHASE II
 ANTI-DEMENTIA DRUG
 PROJECTED ANNUAL SALES $750 million

8. PRO/CONS – OBESITY MARKET
 PRO
 VIABLE CANDIDATE TO ENTER – ANTI OBESITY
MARKET
 EXPAND EXISTING PIPELINES
 NO UPFRONT INVESTMENT
 NO RISK
 SAFE AND A GOOD OPTION
 PROJECTED SALES INCREASE PROFITABILITY BY
ALMOST DOUBLE
 EXISTING 200 MILLION TO 400 MILLION
 CONS
 DOES NOT COMPLETELY ALIGN WITH Vision 2020

9. ADDITIONAL RESEARCH - OBESITY MARKET
 “More than one-third of U.S. adults (34.9%) are
obese”
 “Obesity-related conditions include heart
disease, stroke, type 2 diabetes and certain
types of cancer, some of the leading causes of
preventable death”
 Obesity is slowly on the downfall because
 Awareness
 Exercise
 Obesity may not be a problem in the far future
http://www.cdc.gov/obesity/data/adult.html

10. ADDITIONAL RESEARCH - OBESITY MARKET
 Only ONE PATENT ANTI – OBESITY DRUG
IN THE MARKET
 TWO ADDITIONAL PATENTS DRUGS
LOSING PATENTS SOON
 TWO GENERIC OPTIONS WILL BECOME
AVAILABLE SOON
http://www.cdc.gov/obesity/data/adult.html

11. REGULATIONS – OBSEITY DRUG
 Need to file ANDA Abbreviated New Drug Application in an electronic
format
 File using eCTD, and can ask for Expedited Review
 This will help us achieve an approval for the generic drugs quickly
 Could receive an ANDA approval within ~ 30 Months
 Per Section 745A(a) of the FD&C Act, applications will have to be
submitted electronically.
 http://www.fda.gov/Drugs/DevelopmentApprovalProcess/FormsS
ubmissionRequirements/ElectronicSubmissions/ucm153574.htm
http://www.fda.gov/ForIndustry/UserFees/GenericDrugUserFees/ucm319568.htm
http://www.fda.gov/downloads/Drugs/DevelopmentApprovalProcess/SmallBusinessAssista
http://www.interphex.com/RNA/RNA_Interphex_V2/documents/2013/speaker-presentations/Regulatory_-
_GDUFA_Panel.pdf?v=635029417975748363nce/UCM397812.pdf
http://www.interphex.com/RNA/RNA_Interphex_V2/documents/2013/speaker-presentations/Regulatory_-
_GDUFA_Panel.pdf?v=635029417975748363

12. REGULATIONS – OBSEITY DRUG
“The Generic Drug User Fee Amendments of 2012
(GDUFA) is designed to speed access to safe and
effective generic drugs to the public and reduce costs
to industry. The law requires industry to pay user fees
to supplement the costs of reviewing generic drug
applications and inspecting fees.”
 Original ANDA Fee - fee is $$51,520
 ANDA Backlog Fee $17,434
http://www.fda.gov/ForIndustry/UserFees/GenericDrugUserFees/ucm319568.htm
http://www.fda.gov/downloads/Drugs/DevelopmentApprovalProcess/SmallBusinessAssista
http://www.interphex.com/RNA/RNA_Interphex_V2/documents/2013/speaker-presentations/Regulatory_-
_GDUFA_Panel.pdf?v=635029417975748363nce/UCM397812.pdf
http://www.interphex.com/RNA/RNA_Interphex_V2/documents/2013/speaker-presentations/Regulatory_-
_GDUFA_Panel.pdf?v=635029417975748363

13. REASON TO INVEST IN OBESITY MARKET
 LOW HANGING FRUIT
 LOW INVESTMENT
 QUICKET RETURN ON INVESTMENT (ROI)
AFTER GETTING APPROVAL ON THE ANDA
 WITHIN 2 years generic drug can be marketed with
a positive ROI

14. PRO/CONS – DIMENTIA MARKET
 PRO
 BLOCK BUSTER CANDIDATE TO ENTER – ANTI DEMENTIA MARKET
 EXPAND EXISTING PIPELINES
 PROJECTED SALES INCREASE PROFITABILITY BY MORE THAN THREE
TIMES
 EXISTING 200 MILLION TO 750 MILLION
 EXACTLY ALIGNED WITH VISION 2020 TO EXPAND AND GO OVERSEAS
 EXCLUSIVE LICENSING AND DISTRIBUTION AGREEMENT
 CONS
 HIGH RISK
 UPFRONT INVESTMENT WITH CLINICAL TRIALS WHICH IS ESTIMATED TO
BE AROUND 80 MILLION
 At least 5 more year before any return on investment when Drug is marketed
 30 Months for Phase III
 Average Filing of the NDA which is average of 2 years.
 This time may increase because of foreign clinical data

15. ADDITIONAL RESEARCH - DIMENTIA MARKET
 CURRENTLY FOUR DEMENTIA DRUGS AVAILABLE IN THE
MARKET – SPECIFICALLY Alzheimer's disease
 ALL THESE DRUGS ARE LICENCED IN UK BUT NOT
AVAILABLE IN THE US
 ALL FOUR ARE PATENTED WHICH DOES NOT EXPIRE FOR
ANOTHER DECADE
 NONE OF THEM CURE DIMENTIA
 ALL EXISTING DRUGS SLOW DOWN PROGRESSION OR
IMPROVE SYMPTOMS

16. ADDITIONAL RESEARCH- DIMENTIA MARKET
 NO GENERIC OPTIONS AVAILABLE
GLOBALLY
 MORE RESEARCH FUNDING NEEDING

17. REGULATION – DEMENTIA DRUG
 DIMENTIA DRUG CLINICAL TRIALS NOT IN USA
 WILL NEED TO FILE IND/NDA APPLICATION
 For the IND/NDA application :-
 Will need to show compliance to
 21 CFR 312.120 - FDA Acceptance of Foreign Clinical
Studies Not Conducted Under an IND
 “such studies be conducted in accordance with good clinical
practice (GCP), including review and approval by an
independent ethics committee (IEC) and informed consent
from subjects”.(1)
(1)http://www.fda.gov/downloads/RegulatoryInformation/Guidances/UCM294729.p
df

18. REGULATION – DEMENTIA DRUG
 Can ask FDA to waive any applicable requirements
under 21 CFR 312.120(a)(1) and (b) by submitting a
waiver request
 FDA will decide whether to grant or deny waivers on
a case-by-case basis, taking into account all
appropriate circumstances.43
 Marketing approval of a new drug based solely on
foreign clinical data is governed by 21 CFR 314.106.
(1)http://www.fda.gov/downloads/RegulatoryInformation/Guidances/UCM294729.p
df

19. IMPORTANCE OF CLINICAL TRIALS – PHASE III
 “The importance of Phase III trials stems from the statutory
language in the Federal Food, Drug, and Cosmetic (FD&C) Act.
Under Section 505(d) of the act, sponsors of new drug
applications must demonstrate “substantial evidence” of the
drug’s clinical benefit, with “substantial evidence” being defined
as “adequate “
http://www.manhattan-institute.org/html/fda_05.htm

20. ESTIMATING UPFRONT INVESTEMENT FOR
CLINICAL TRIALS – PHASE III
 COM^3 needs upfront investment for PHASE III clinical trial for DIMENTIA
 Below is some research data to help us estimate this cost:-
 “Phase III clinical trials have become far larger and more complex than they were in the
past. “
 “From 1999 to 2005, as the Tufts group has shown, the average length of a clinical trial
increased by 70 percent;”
 “The average number of routine procedures per trial increased by 65 percent; and the
average clinical trial staff work burden increased by 67 percent.”
 “On top of that, increasingly stringent enrollment criteria and trial protocols resulted in 21
percent fewer volunteers being admitted into trials and 30 percent more enrollees dropping
out before completion of the tests.”
 “Clinical Trial Phase III cost 40 percent of pharmaceutical companies’ R&D expenditures”
http://www.manhattan-institute.org/html/fda_05.htm

21. ESTIMATING UPFRONT INVESTEMENT FOR
CLINICAL TRIALS – PHASE III
 Based on the figure below in 2009 the projected dollar value was around 16 M for Phase III Clinical Trial
with 60% chances of FDA approval
 In our case the PHASE II TRIALS SHOWS 90% Chances of FDA Approval
 Based on that if our PHAST III TRIAL has a 60% chances of FDA Approval AND the PHASE III Costs up
about 45% of our total expenditure: On top that, if we still inflate the cost of investment for phase III to
be about $80 M, our overall ROI will still be very high
http://www.manhattan-institute.org/html/fda_05.htm
http://www.nature.com/nrd/journal/v9/n3/extref/nrd3078-s2.pdf
http://www.raps.org/focus-online/news/news-article-view/article/1359/report-phase-iii-clinical-trials-behind-increase-in-the-cost-
of-pharmaceuticals.aspx

22. FEES FOR DEMENTIA DRUGS
 IND FILING– $500
 NDA with Clinical Data – NME FILING - ~ 3200
 FDUFA fees
 Differential for foreign facilities - $15,000
 Application Fee with fee with clinical data for 2014 ~ 2.2
Million (3)
 Establishments ~ 554,600 (3)
 Products ~ 104,060 (3)
 Estimated out of pocket capital for Phase III Clinical
Trial ~ $80M
 Out of pocket capital – ~ 85 M
http://www.fda.gov/ForIndustry/UserFees/PrescriptionDrugUserFee/ucm093484.
http://www.gpo.gov/fdsys/pkg/FR-2013-08-02/pdf/2013-18624.pdf
(3) http://www.alzheimersanddementia.com/article/S1552-5260(12)00049-0/fulltext

23. REASON TO INVEST – DEMENTIA MARKET
 No good drug out there For Dementia
 In the USA - 15% of people have Dementia aged 71 or more
(3.8 Million)
 By 2040 this will increase to 9.1 Million
 Baby boomers will inundate the coming years with system
with the surge of cost and cases of Dementia
“There are no treatments to prevent or slow Alzheimer’s, the
most common dementia. And it’s unlikely that any one drug will
be the silver bullet, so we need to pursue many pathways”
http://www.nytimes.com/2013/04/09/opinion/key-to-fighting-alzheimers-costs-new-drugs.html?_r=0

24. REASON TO INVEST – DEMENTIA MARKET
 DIMENTIA CLINICAL TRIALS IN PHASE 2
HAS SHOWN 90% EFFICACY
 Even with ~ 85M upfront investment, and 5
years of downtime, this blockbuster drug is a
great investment for now and the future and
will help us make our company go public

25. PROJECTED SALES
OBESITY, 400
DEMENTIA,
750
0
100
200
300
400
500
600
700
800
PROJECTED SALES
OBESITY
DEMENTIA

26. OUR STRATEGY
 Initially invest in getting the two patent drugs
into our pipeline
 ROI will increase from 200M to 400M in 2 or
three years
 This is a safe and good option
 Product Line will diversify, money will come in
for further research and investing
 Will keep these two drugs generic, and cheap
 This is in alignment with our Company Vision
 Also keeps us ahead of the competition

27. OUR STRATEGY
 Simultaneously invest in the DIMENTIA
MARKET
 This will enable to increase our ROI within the
next 5 years to $750M
 This will help us go Public and aligns our 2020
strategy
 This is a high risk but visionary option.
 Will make this drug cheaper and affordable for
the common man
 This will put us in the forefront of the DIMENTIA
MARKET in the US