Partnering with Pfizer
6th Annual Rice Alliance
Life Science Technology Venture Forum
Dr B J Bormann, Vice President
Strat...
Jury Duty, last person in the pool of 200, interviewed at 5 pm
Selected as an alternate for jury, ‘medical condition’ civi...
“Pfizer has had a long history of
great innovations, but it
recognizes that no single
company has a monopoly on
good ideas...
Pfizer HistoryPfizer History
! " # $%
& ' ! ( )
! " # $%
& ' ! ( )
Charles PfizerCharles Pfizer
CharlesCharles ErhartErhart
Pfizer ProductsPfizer Products
2007 Key Products by Therapeutic Area
Aricept
Cabaser
Dilantin
Geodon/Zeldox
Lyrica
Mirapex...
Phase 2
Preclinical &Phase 1
Phase 3
In Registration
6363
2727
1212
44
102102
3333
88
1111
R&D Results – Pipeline Growth
J...
Candidates in Advanced DevelopmentCandidates in Advanced Development
Exubera Diabetes- APPROVED
ParecoxibParecoxib Acute P...
Efficacy Studies Complete
Long Term Pulmonary Safety
Studies Continuing
Efficacy Studies Complete
Long Term Pulmonary Safe...
Varenicline – Alpha 4-Beta 2 Partial Agonist
Smoking Cessation
Varenicline – Alpha 4-Beta 2 Partial Agonist
Smoking Cessat...
UK-427,857
HIV Entry Inhibitor
UK-427,857
HIV Entry Inhibitor
HIV Cell Entry
Inhibition
HIV Cell Entry
Inhibition
First-in...
SU-11,248
Cancer
Multi-Targeted VEGFR
Kinase Inhibitor
Remarkable Efficacy
Seen in Gastrointestinal
Stromal Tumor and
Rena...
CTLA-4: Ticilimumab
Oncology
CTLA-4: Ticilimumab
Oncology
Cyctotoxic T Lymphocyte-
associated Antigen-4
Antibody
CTLA-4 Bl...
*+, " +-, **+, " +-, *
La Jolla,
CA, U.S.A.
Rinat Labs
La Jolla,
CA, U.S.A.
Rinat Labs
New London and
Groton, CT, U.S.A.
N...
R&D Therapeutic AreasR&D Therapeutic Areas
!
" "
# $
% %
* Pfizer has exited ‘research’ in Dermatology and GI* Pfizer has ...
Pharmaceutical Industry
Challenges
Pharmaceutical Industry
Challenges
High Attrition Rate in Drug DevelopmentHigh Attrition Rate in Drug Development
. // , & "((. // , & "((
000
High Risk Proc...
Generic SubstitutionGeneric Substitution
August 2, 2001 - Barr Laboratories cleared to ship
generic version of Lilly’s Pro...
Shrinking Market ExclusivityShrinking Market Exclusivity
InderalInderal -- 19651965
TagametTagamet -- 19771977
CapotenCapo...
Productivity ChallengeProductivity Challenge
% +-, ) & # 12 3% +-, ) & # 12 3
$0$0
$5$5
$10$10
$15$15
$20$20
$25$25
197019...
Adding Value:
Pfizer Strategic Alliances
Adding Value:
Pfizer Strategic Alliances
SA supports a fully Integrated R & D ProcessSA supports a fully Integrated R & D Process
Target Identification
Toxicology
...
Our alliance investments are:
Integrated and aligned with our global strategies, initiatives
and internal investments
Addr...
Change in
growth
rate
mAbs
Recombinant
proteins
Cell therapy
Gene
Prophylactic
vaccines
Size indicates relative
potential ...
0
5
10
15
20
25
30
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
From a single program in 1996 to over 25
programs tod...
MCSF mAbMCSF mAb
MAdCAM mAbMAdCAM mAb
IGF1R mAbIGF1R mAb
PEGPEG--hGHhGH
ETCETC--642642
TLR CPG 7909TLR CPG 7909
T2T2--TrpR...
Expanding Oncology Portfolio: CP-675,206Expanding Oncology Portfolio: CP-675,206
$ %8" # "
Many “Firsts” for
Pfizer Oncolo...
Biotherapeutics and Macromolecules
Development
Candidates
Manufacturing
ODN TLR9
angonist
Candidate
Biologics
manufacturin...
Diagnostics Will Be Enablers of Rx Sales
Example Situations
Diagnostics Will Be Enablers of Rx Sales
Example Situations
Ex...
External Diagnostics Landscape – EvolvingExternal Diagnostics Landscape – Evolving
The diagnostics market has total revenu...
Business Dynamics for DiagnosticsBusiness Dynamics for Diagnostics
• Revenues smaller (~$55B(1) relative to pharmaceutical...
Key Trends: Limited Short-Term Change
Pricing under
pressure
• Prices historically very low, continued downward pressure b...
Expansion in Evidence-
based treatment
• Market increasingly demands evidence-based
treatment selection that can be provid...
Aureon Labs
Avid Radiopharmaceuticals
Genizon
Genomic Health
ICardiac
Monogram
M2S
Perlegen
Virtual Scopics
Aureon Labs
Av...
New ParadigmsNew Paradigms
Recent DealsRecent Deals
Scripps
An infusion of new ideas, fresh science
The Pfizer Incubator
Nurturing ‘solutions’ to Pfi...
The Collaborative Research
Program Between The Scripps
Research Institute and Pfizer
The Collaborative Research
Program Be...
General Provisions of CollaborationGeneral Provisions of Collaboration
5 year term
Governed by Steering Committee (SC) wit...
The Pfizer Incubator Business ModelThe Pfizer Incubator Business Model
Value to Pfizer
• Early access to enabling technolo...
TPI LLC
Entrepreneurs-In-
Residence (EIRs)
Open innovation
manager
TPI Head
TPI Organization, facilities and service model...
Thanks for Listening!!Thanks for Listening!!
Pfizer is a superb partner
If an opportunity fits within our strategy, we are...
Upcoming SlideShare
Loading in …5
×

Partnering with Pfizer 6

1,774 views

Published on

0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
1,774
On SlideShare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
37
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Partnering with Pfizer 6

  1. 1. Partnering with Pfizer 6th Annual Rice Alliance Life Science Technology Venture Forum Dr B J Bormann, Vice President Strategic Alliances June 6th, 2007 Partnering with Pfizer 6th Annual Rice Alliance Life Science Technology Venture Forum Dr B J Bormann, Vice President Strategic Alliances June 6th, 2007
  2. 2. Jury Duty, last person in the pool of 200, interviewed at 5 pm Selected as an alternate for jury, ‘medical condition’ civil trial Closing arguments, juror was ill Chosen as replacement Deliberations – I was alone in my opinion, needed to convince fellow jurors – Do you remember “Twelve Angry Men?” All took > 2 weeks Cancelled my presence but not my presentation last year You saw my slides presented by Dr. Ajay Gautam, a Rice alum. I have mostly new slides for you this year Jury Duty, last person in the pool of 200, interviewed at 5 pm Selected as an alternate for jury, ‘medical condition’ civil trial Closing arguments, juror was ill Chosen as replacement Deliberations – I was alone in my opinion, needed to convince fellow jurors – Do you remember “Twelve Angry Men?” All took > 2 weeks Cancelled my presence but not my presentation last year You saw my slides presented by Dr. Ajay Gautam, a Rice alum. I have mostly new slides for you this year Last YearLast Year
  3. 3. “Pfizer has had a long history of great innovations, but it recognizes that no single company has a monopoly on good ideas. To build on and complement its strengths, Pfizer actively seeks out alliances.” William Steere, Former CEO of Pfizer 1999 Agenda Today: A wee bit of Pfizer Propaganda A Flash review of challenges to the pharmaceutical business The evolution of Pfizer by Alliances Biologics Diagnostics New Paradigms Scripps The Pfizer Incubator Agenda Today: A wee bit of Pfizer Propaganda A Flash review of challenges to the pharmaceutical business The evolution of Pfizer by Alliances Biologics Diagnostics New Paradigms Scripps The Pfizer Incubator
  4. 4. Pfizer HistoryPfizer History ! " # $% & ' ! ( ) ! " # $% & ' ! ( ) Charles PfizerCharles Pfizer CharlesCharles ErhartErhart
  5. 5. Pfizer ProductsPfizer Products 2007 Key Products by Therapeutic Area Aricept Cabaser Dilantin Geodon/Zeldox Lyrica Mirapex Neurontin Rebif Relpax Xanax XR Zoloft/Zustrel Aricept Cabaser Dilantin Geodon/Zeldox Lyrica Mirapex Neurontin Rebif Relpax Xanax XR Zoloft/Zustrel Diflucan Sulperazon Unasyn Vfend Viracept Zithromax Zyvox Diflucan Sulperazon Unasyn Vfend Viracept Zithromax Zyvox Genotropin Somavert Genotropin Somavert Camptosar Ellence/ Pharmorubicin Aromasin Sutent Camptosar Ellence/ Pharmorubicin Aromasin Sutent Spiriva/Daxas Zyrtec/Zyrtec D Spiriva/Daxas Zyrtec/Zyrtec D Xalatan Macugen Xalatan Macugen Accupril/Accuretic Glucotrol/Glucotrol XL Inspra Lipitor Norvasc/Istin Procardia/Procardia XL Tikosyn Exubera Accupril/Accuretic Glucotrol/Glucotrol XL Inspra Lipitor Norvasc/Istin Procardia/Procardia XL Tikosyn Exubera Depo-ProveraDepo-Provera Cardura/Cardura XL Detrol Viagra Cardura/Cardura XL Detrol Viagra Celebrex/Celebra Bextra Dynastat Celebrex/Celebra Bextra DynastatSource: Pfizer 2006 Year-End Corporate Earnings Release Central Nervous System Endocrine Oncology Infectious Disease Allergy/Respiratory Pain/Inflammation Women’s Health Urology Cardiovascular/ Metabolic Ophthalmology
  6. 6. Phase 2 Preclinical &Phase 1 Phase 3 In Registration 6363 2727 1212 44 102102 3333 88 1111 R&D Results – Pipeline Growth July 2003: 106 NMEs July 2003: 106 NMEs 154 New Molecular Entities154 New Molecular Entities 6
  7. 7. Candidates in Advanced DevelopmentCandidates in Advanced Development Exubera Diabetes- APPROVED ParecoxibParecoxib Acute PainAcute Pain Sildenafil PAH Pulmonary Arterial Hypertension Torcetrapib/Atorvastatin Atherosclerosis- FAILED Varenicline Smoking Cessation-APPROVED Asenapine Schizophrenia SU-11248 GIST, Renal Cancer-APPROVED Edotecarin Colorectal Cancer Zithromax/Chloroquine Malaria UK-427,857 HIV Metabolic Diseases Inflammation & Immunology Allergy & Respiratory Cardiovascular Neurosciences Oncology Infectious Diseases
  8. 8. Efficacy Studies Complete Long Term Pulmonary Safety Studies Continuing Efficacy Studies Complete Long Term Pulmonary Safety Studies Continuing Exubera Diabetes Exubera Diabetes
  9. 9. Varenicline – Alpha 4-Beta 2 Partial Agonist Smoking Cessation Varenicline – Alpha 4-Beta 2 Partial Agonist Smoking Cessation Orally Effective Nicotinic Partial Agonist Reduces Nicotine Cravings 1.3 Billion Smokers Worldwide Average 50% Continuous Quit Rate After 12 Week Treatment Compared to 12% With Placebo Orally Effective NicotinicOrally Effective Nicotinic Partial AgonistPartial Agonist Reduces Nicotine CravingsReduces Nicotine Cravings 1.3 Billion Smokers1.3 Billion Smokers WorldwideWorldwide Average 50% ContinuousAverage 50% Continuous Quit Rate After 12 WeekQuit Rate After 12 Week Treatment Compared toTreatment Compared to 12% With Placebo12% With Placebo
  10. 10. UK-427,857 HIV Entry Inhibitor UK-427,857 HIV Entry Inhibitor HIV Cell Entry Inhibition HIV Cell Entry Inhibition First-in-Class Selective, Reversible Binding to the CCR-5 Receptor Excellent Pharmacokinetics and Selectivity Potent In Vitro Activity Against Resistant Strains No Drug-Drug Interactions FirstFirst--inin--ClassClass Selective, Reversible Binding toSelective, Reversible Binding to the CCRthe CCR--5 Receptor5 Receptor Excellent Pharmacokinetics andExcellent Pharmacokinetics and SelectivitySelectivity Potent In Vitro Activity AgainstPotent In Vitro Activity Against Resistant StrainsResistant Strains No DrugNo Drug--Drug InteractionsDrug Interactions
  11. 11. SU-11,248 Cancer Multi-Targeted VEGFR Kinase Inhibitor Remarkable Efficacy Seen in Gastrointestinal Stromal Tumor and Renal Cell Carcinoma Cancers MultiMulti--Targeted VEGFRTargeted VEGFR Kinase InhibitorKinase Inhibitor Remarkable EfficacyRemarkable Efficacy Seen in GastrointestinalSeen in Gastrointestinal Stromal Tumor andStromal Tumor and Renal Cell CarcinomaRenal Cell Carcinoma CancersCancers Inhibits Tumor VascularizationInhibits Tumor VascularizationInhibits Tumor Vascularization Disrupts Tumor SurvivalDisrupts Tumor SurvivalDisrupts Tumor Survival
  12. 12. CTLA-4: Ticilimumab Oncology CTLA-4: Ticilimumab Oncology Cyctotoxic T Lymphocyte- associated Antigen-4 Antibody CTLA-4 Blockade with CP- 675,206 May Break Peripheral Immunological Tolerance and Induce Anti-tumor Activity Currently Conducting Phase III Study Using Multiple Doses Cyctotoxic T LymphocyteCyctotoxic T Lymphocyte-- associated Antigenassociated Antigen--44 AntibodyAntibody CTLACTLA--4 Blockade with CP4 Blockade with CP-- 675,206 May Break Peripheral675,206 May Break Peripheral Immunological Tolerance andImmunological Tolerance and Induce AntiInduce Anti--tumor Activitytumor Activity Currently Conducting PhaseCurrently Conducting Phase III Study Using Multiple DosesIII Study Using Multiple Doses
  13. 13. *+, " +-, **+, " +-, * La Jolla, CA, U.S.A. Rinat Labs La Jolla, CA, U.S.A. Rinat Labs New London and Groton, CT, U.S.A. New London and Groton, CT, U.S.A. St. Louis, MO, U.S.A. St. Louis, MO, U.S.A. SingaporeSingapore Cambridge, MA, U.S.A. Cambridge, MA, U.S.A. Sandwich, ENGLAND Sandwich, ENGLAND Toronto, CanadaToronto, Canada Sydney, Australia Sydney, Australia Seoul, KoreaSeoul, Korea Shanghai, ChinaShanghai, China
  14. 14. R&D Therapeutic AreasR&D Therapeutic Areas ! " " # $ % % * Pfizer has exited ‘research’ in Dermatology and GI* Pfizer has exited ‘research’ in Dermatology and GI
  15. 15. Pharmaceutical Industry Challenges Pharmaceutical Industry Challenges
  16. 16. High Attrition Rate in Drug DevelopmentHigh Attrition Rate in Drug Development . // , & "((. // , & "(( 000 High Risk Process 12-15 years, ~$900MM/candidate High Risk Process 12-15 years, ~$900MM/candidate DiscoveryDiscovery Exploratory DevelopmentExploratory Development IdeaIdea DrugDrug1111 -- 15 Years15 Years Full DevelopmentFull Development Phase I Phase II Phase III 00 151555 1010 Preclinical Pharmacology Preclinical Safety Thousands of Compounds Screened Clinical Pharmacology & Safety ~250~250 ~5~5
  17. 17. Generic SubstitutionGeneric Substitution August 2, 2001 - Barr Laboratories cleared to ship generic version of Lilly’s Prozac By September 2001, 80% of Lilly’s Prozac sales were taken by Barr Laboratories substitute product August 2, 2001 - Barr Laboratories cleared to ship generic version of Lilly’s Prozac By September 2001, 80% of Lilly’s Prozac sales were taken by Barr Laboratories substitute product Key products representing >$50 billion are set to lose exclusivity in 2007 - Decision Resources, May 2003
  18. 18. Shrinking Market ExclusivityShrinking Market Exclusivity InderalInderal -- 19651965 TagametTagamet -- 19771977 CapotenCapoten -- 19801980 SeldaneSeldane -- 19851985 AZT - 1987 MevacorMevacor -- 19871987 ProzacProzac -- 19881988 DiflucanDiflucan -- 19901990 RecombinateRecombinate -- 19921992 CelebrexCelebrex -- 19991999 0 1 2 3 4 50 1 2 3 4 5 6 7 8 9 106 7 8 9 10 Years of Exclusivity for Innovative DrugYears of Exclusivity for Innovative Drug LopressorLopressor -- 19781978 ZantacZantac -- 19831983 VasotecVasotec -- 19851985 HismanalHismanal –– 19891989 VidexVidex –– 19911991 PravacholPravachol –– 19911991 ZoloftZoloft –– 19921992 SporonoxSporonox –– 19921992 KogenateKogenate –– 19921992 VioxxVioxx–– 19991999 Innovative Drug /Innovative Drug / Year IntroducedYear Introduced 22ndnd GenerationGeneration Drug/YearDrug/Year
  19. 19. Productivity ChallengeProductivity Challenge % +-, ) & # 12 3% +-, ) & # 12 3 $0$0 $5$5 $10$10 $15$15 $20$20 $25$25 19701970 19751975 19801980 19851985 19901990 19951995 20002000 # NCEs# NCEs 6060 4040 2020 00 Source: 2004 PhRMA Annual Survey, 2003/2004 PAREXEL’S Pharmaceutical Industry SourcebookSource: 2004 PhRMA Annual Survey, 2003/2004 PAREXEL’S Pharmaceutical Industry Sourcebook $30$30 $35$35 20032003
  20. 20. Adding Value: Pfizer Strategic Alliances Adding Value: Pfizer Strategic Alliances
  21. 21. SA supports a fully Integrated R & D ProcessSA supports a fully Integrated R & D Process Target Identification Toxicology In Silico Modeling Compound Screening Lead Optimization Human Trials Target Validation Computational Chemistry Animal Studies Strategic Alliances Strategic Alliances
  22. 22. Our alliance investments are: Integrated and aligned with our global strategies, initiatives and internal investments Address opportunities and gaps to create competitive advantage Enable the low-cost evaluation of novel opportunities Provide access to novel technologies with the potential to change the current R&D paradigm Managed with respect to the science, business, legal and IP issues Assessed and monitored with appropriate metrics Our alliance investments are: Integrated and aligned with our global strategies, initiatives and internal investments Address opportunities and gaps to create competitive advantage Enable the low-cost evaluation of novel opportunities Provide access to novel technologies with the potential to change the current R&D paradigm Managed with respect to the science, business, legal and IP issues Assessed and monitored with appropriate metrics Adding value: the SA visionAdding value: the SA vision “Cradle to grave Alliance Management”“Cradle to grave Alliance Management”
  23. 23. Change in growth rate mAbs Recombinant proteins Cell therapy Gene Prophylactic vaccines Size indicates relative potential market size* Size indicates relative potential market size*Therapeutic vaccines Change in growth rate mAbs Recombinant proteins Antisense Cell therapy Gene therapy Prophylactic vaccines Relative level of platform validation (time) Size indicates relative potential market size* Size indicates relative potential market size*Therapeutic vaccines Therapeutic Biologics Relative Maturity of Biologics Market Segments Therapeutic Biologics Relative Maturity of Biologics Market Segments Insulin &erythropoietinsare market leaders Insulin & erythropoietin market leaders $32.6B Over 100 products currently in development Over 100 products currently in development $7.3B
  24. 24. 0 5 10 15 20 25 30 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 From a single program in 1996 to over 25 programs today, Pfizer continues to increase its Biologics Portfolio. Growth of Pfizer’s Biologics PortfolioGrowth of Pfizer’s Biologics Portfolio
  25. 25. MCSF mAbMCSF mAb MAdCAM mAbMAdCAM mAb IGF1R mAbIGF1R mAb PEGPEG--hGHhGH ETCETC--642642 TLR CPG 7909TLR CPG 7909 T2T2--TrpRSTrpRS CD40 mAbCD40 mAb CTLA4 mAbCTLA4 mAb ETCETC--588588 ETCETC--216216 (interferon beta-1a) (dalteparin sodium injection) (pegvisomant for injection) human insulin powder Expanding the Scope of R&D Future Biologics Powerhouse Expanding the Scope of R&D Future Biologics Powerhouse 4 254 25 0//6 ' ! 1 7( 30//6 ' ! 1 7( 3 NY 7/31/2006
  26. 26. Expanding Oncology Portfolio: CP-675,206Expanding Oncology Portfolio: CP-675,206 $ %8" # " Many “Firsts” for Pfizer Oncology Melanoma Monoclonal Antibody Immuno- therapeutics First Immunotherapeutic Novel MOA that enhances immune system (“removes the brake”) Broad applicability for all tumor types Option to lead in Tumor Immunology First Fully-Human mAb Focus on cutting edge science Sales of biologics estimated at 31% of cancer market in 2009 vs 18% in 2003*
  27. 27. Biotherapeutics and Macromolecules Development Candidates Manufacturing ODN TLR9 angonist Candidate Biologics manufacturing ODN manufacturing Process Development Discovery / Lead Generation Transgenic Mouse fully human mAb platform Transgenic Mouse fully human mAb platform Spiegelmer (Modified Aptamer) Obesity Candidate and platform antisense platform Phage display fully human mAb platform Cell line engineering using ZFP nucleases Pegylation & Inhalation Technologies High efficiency mammalian expression system Rapid generation of high expression cell lines RNAi for wet AMD
  28. 28. Diagnostics Will Be Enablers of Rx Sales Example Situations Diagnostics Will Be Enablers of Rx Sales Example Situations Example driver Overall Pfizer Impact All TAs have identified areas of diagnostics needAll TAs have identified areas of diagnostics need Situation where Dx adds value Example Impact Uptake and Compliance Diagnostic that identifies presymptomatic individuals eligible for preventive/ disease-modifying treatment Alzheimer’s Disease, test + disease-modifying drug Potential to grow market by 10M+ individuals; multiple billion dollar value Market Share Diagnostic that indicates best therapy for individuals HIV, resistance profile, Maraviroc Rapid ramp-up and share increase; multiple hundred million dollar value Market Size Diagnostics that identifies subpopulation eligible for treatment Breast cancer, HercepTest, Herceptin Fragments market, but increases price and share within fragment
  29. 29. External Diagnostics Landscape – EvolvingExternal Diagnostics Landscape – Evolving The diagnostics market has total revenues of $70-75B(1) is growing at ~7% pa and has margins varying by technology segment from 5% to 30% Electronics companies are merging the traditional technology segments (in vivo and in vitro), pursuing higher margin services and IT revenues from clinical institutional customers Most large pharma companies (Merck, GSK, Bristol-Myers Squibb) have elected for selective diagnostics licensing deals focusing on support for specific portfolio assets Diagnostics will grow in importance in healthcare decision- making over the long term, driven by expansion in evidence- based treatment, shifts to early testing and screening and demand for personalized medicine The diagnostics market has total revenues of $70-75B(1) is growing at ~7% pa and has margins varying by technology segment from 5% to 30% Electronics companies are merging the traditional technology segments (in vivo and in vitro), pursuing higher margin services and IT revenues from clinical institutional customers Most large pharma companies (Merck, GSK, Bristol-Myers Squibb) have elected for selective diagnostics licensing deals focusing on support for specific portfolio assets Diagnostics will grow in importance in healthcare decision- making over the long term, driven by expansion in evidence- based treatment, shifts to early testing and screening and demand for personalized medicine (1) Including in vitro, in vivo direct and in vivo IT and Services
  30. 30. Business Dynamics for DiagnosticsBusiness Dynamics for Diagnostics • Revenues smaller (~$55B(1) relative to pharmaceutical ~$600B), margins lower (10-20%), and growth equivalent (~7%). Short-term diagnostics business Acquisition challenges in in vivo Acquisition challenges in in vitro Key short-term trends Landscape of activity Long-term diagnostics business Long-term Impact Of Dx On Rx • Attractive segments fragmented; in select transactions studied, market paid $5-7B, for base revenues of ~$0.8B and revenue growth of ~$0.2B per annum • Three key players; theoretically pay $15-25B (Philips Medical Systems) to $55-75B (GE Healthcare), for base revenues of $9B (PMS) to $15B (GEHC) and revenue growth of $0.4B (PMS) to $2.7B (GEHC) per annum • No indication of a large improvement in diagnostics business • Integrated Rx-Dx businesses have struggled to synergize • Companies entering or expanding are doing so for different reasons • Critical longer-term enablers of pharmaceutical revenues • More attractive as diagnostics expected to grow considerably in importance as drivers of healthcare decisions
  31. 31. Key Trends: Limited Short-Term Change Pricing under pressure • Prices historically very low, continued downward pressure by payors • Reimbursement challenge: labs often have to absorb test costs • But, several trend-breakers may be emerging, such as in molecular diagnostics (e.g., Genomic Health’s Oncotype Dx) Increasing regulatory hurdles Capabilities being commoditized • Many segments already highly commoditized (e.g., clinical chemistry) • Higher margin segments seeing downward pressure with new entries Long-term growing importance in healthcare decision-making • Human Genome Project, SNP Consortium and Hap Map are synergistic with diagnostic development • Diagnostics likely to be much more important in driving healthcare decisions • Variable regulatory path (PMA, 510(k), class I ASR, home-brew)( at FDA discretion • Recent examples indicate intent of FDA to increase hurdles - Refusal to allow Roche AmpliChip as ASR in 2003 - Draft proposal to regulate Multivariate Index Assays, February 2007 Limited IP protection • Few areas of real exclusivity • Many ways to resolve a particular Dx problem allows circumvention of IP
  32. 32. Expansion in Evidence- based treatment • Market increasingly demands evidence-based treatment selection that can be provided by diagnostics • Theranostics now standard for HIV, increasing for HBV and HCV • Potential to grow Rx market for many indications • E.g., Biomarker and diagnostic development to identify pre-symptomatic Alzheimer’s Disease Shift to early testing and screening Demand for Personalized Medicine • Diagnostics to identify molecular basis of disease important during both R&D and commercial • Huge potential impact across many diseases currently defined by clusters of symptoms and tests Longer-Term, Diagnostics Growing in ImportanceLonger-Term, Diagnostics Growing in Importance
  33. 33. Aureon Labs Avid Radiopharmaceuticals Genizon Genomic Health ICardiac Monogram M2S Perlegen Virtual Scopics Aureon Labs Avid Radiopharmaceuticals Genizon Genomic Health ICardiac Monogram M2S Perlegen Virtual Scopics Cogstate Epidauros General Electric Oxford biosensors Source Mdx Current and Past “Investments” in Diagnostics Equity Non-Equity
  34. 34. New ParadigmsNew Paradigms
  35. 35. Recent DealsRecent Deals Scripps An infusion of new ideas, fresh science The Pfizer Incubator Nurturing ‘solutions’ to Pfizer ‘technology gaps or problem statements Scripps An infusion of new ideas, fresh science The Pfizer Incubator Nurturing ‘solutions’ to Pfizer ‘technology gaps or problem statements
  36. 36. The Collaborative Research Program Between The Scripps Research Institute and Pfizer The Collaborative Research Program Between The Scripps Research Institute and Pfizer
  37. 37. General Provisions of CollaborationGeneral Provisions of Collaboration 5 year term Governed by Steering Committee (SC) with equal representation from Scripps and Pfizer Areas of Defined Collaboration 2 Target Biology Projects/Year 10 Screen Configurations/Year (Drug Pfinder) Biological Libraries – creation/screening First option to license up to 47% of inventions First option to fund any corporate-sponsored research Collaboration in other fields as approved by SC Sabbatical Opportunities 5 year term Governed by Steering Committee (SC) with equal representation from Scripps and Pfizer Areas of Defined Collaboration 2 Target Biology Projects/Year 10 Screen Configurations/Year (Drug Pfinder) Biological Libraries – creation/screening First option to license up to 47% of inventions First option to fund any corporate-sponsored research Collaboration in other fields as approved by SC Sabbatical Opportunities
  38. 38. The Pfizer Incubator Business ModelThe Pfizer Incubator Business Model Value to Pfizer • Early access to enabling technologies • Flow of products at various stages at lower cost • Agility in exploring new technologies & processes Value to Entrepreneurs • Easy hassle-free start-up, focus on science • Strategic advice from the ultimate customer • Opportunity for faster payoff TPI Board needs • to ensure nimble decision making • to have flexibility to pursue different legal structures • to reconcile compliance with certain Pfizer policies and procedures in the context of TPI and incubated entities Founder(s) IP, know-how NewCo Executes Research Plan TPI $$*, facilities, operational support TPI acquires exclusive rights • Value negotiated or by third party • TPI cannot acquire only a portion of company - cherry pick (in most situations) • Milestones, royalties can provide long-term reward for founders Spin out • TPI may acquire non-exclusive license • NewCo can raise funding from external investors or be acquired • NewCo moves out of incubator • TPI may remain a stakeholder (no Board seat) • Agreed upon objectives, research plan • 2 year funding, 6 month milestones • Plan and milestones can be changed if approved by TPI Board • Equity share negotiated at start • TPI has a Board seat • TPI reserves an option to buy out founders based on negotiated or 3rd party valuation Project initiation / Entity Creation Incubation Exit Scenarios
  39. 39. TPI LLC Entrepreneurs-In- Residence (EIRs) Open innovation manager TPI Head TPI Organization, facilities and service modelTPI Organization, facilities and service model TPI LLC is an umbrella organization under which multiple incubators at various locations can be run: scalable structure TPI Board Expert advisors Investment budget for LJ incubator: $10M/y Operating budget for 2007: $2.5M LJ Incubator Company 1 Company 2 Company 3 Incubator Head Employees/contractors Concierge Service model Incubator Entity Concierge Services IT EHS Facilities Services Supplies/ Logistics Security Pod1 1st Floor 26,600 sq. ft. 5 dedicated labs (divisible into 8) Office space to support 70+ people Glass wash & central services Shipping / receiving location Least invasive renovation Shell space provides future flexibility CB7
  40. 40. Thanks for Listening!!Thanks for Listening!! Pfizer is a superb partner If an opportunity fits within our strategy, we are nimble We negotiate deals appropriate for the opportunity We focus on the science We manage the Alliances with purpose and for success Any Questions? Pfizer is a superb partner If an opportunity fits within our strategy, we are nimble We negotiate deals appropriate for the opportunity We focus on the science We manage the Alliances with purpose and for success Any Questions?

×