#BIO2017 Day 3 roundup: Building value and what it costs
The theme of the BIO International Convention this year is the idea of "Breakthrough Innovation." This theme comes at a time when the industry association — which changed its name several years ago from Biotechnology International Organization to the Biotechnology Innovation Organization — has been trying to show that the incredible innovation being done by the industry is worth the high price being charged for drugs.
While talk at the conference eloquently showcased the innovation in the labs as well as in interesting pricing models, the BIO logo may have fallen a bit flat. Conference attendees could frequently be heard around the halls asking, “what’s with the slime?”
Here’s a look at some of the other things being said around the conference:
A value we can all agree on
The discussion got heated Wednesday morning at the FierceBiotech-hosted breakfast at the BIO International Convention as panelists argued about how to measure the value of drugs when thinking about pricing.
Sarah Emond, chief operating officer of the Institute for Clinical and Economic Review (ICER), lamented that things like caregiver burden and productivity are not measures often included in current value assessments (though she expressed hope that they could be considered more explicitly in the value assessment for ultra-orphan drugs). Meanwhile Amgen’s SVP of Global Value, Access and Policy Joshua Ofman argued those things need to be a major part of the discussion when looking at the value proposition for drugs.
"We have no idea what we should be paying for medicines. Maybe we should be paying more," said Ofman, who pointed to the innovation and value that medicines are bringing to the healthcare system.
The panel touched upon the idea of indication-based pricing, which is an alternative pricing model that would allow companies to price a drug differently for each of the therapeutic areas it treats based on the market for that indication. While alternative pricing structures are definitely being tested out (especially by companies like Amgen), those models are still in early stages and need quite a bit of tweaking before they really help with patient costs.
Emond pointed out that in our current system, pricing models like indication-based pricing hit major roadblocks when faced with policies like Medicaid Best Price practices. She noted a blended-pricing approach could be one work around.
While it was hard for the panelists to find a common solution to the drug pricing problem, they all agreed that the discussion has come a long way. "We weren’t having this discussion three years ago. If you had told me Sanofi was going to come out with a price limiting strategy, I wouldn’t have believed you. I would’ve been shocked," said Emond.
A little fanfare
Eli Lilly & Co. is trying to become a little more global than it has been during its 100-plus year history. The Indianapolis drugmaker hosted a ribbon cutting ceremony at its latest R&D facility in San Diego.
The $90 million dollar building expansion project has the capability to host nearly 400 employees (it only has about 200 at the moment — though Lilly says its hiring). The company added 180,000 square feet of working space to the research lab and will continue to do most of its immunology research out of the space.
Still-new CEO David Ricks told BioPharma Dive that the company has been expanding globally, but is trying to keep the hubs small enough to foster that innovative biotech feel and attract some new talent, as well as collaborations.
Having only been in the top slot for the big pharma for six months, Ricks admits that it has been a little of "running head down for awhile," and that he has been doing a lot more public facing events since taking the position. "I spend more time with non-Lilly people than Lilly people," he joked.
But Ricks gave himself a solid rating for his first few months on the job. "The company is in good shape. We’re launching products and that’s going well. Growing revenue, so that’s exciting. We have more promising science inside and outside our company than ever. And we’re talking about growing business development," the exec said in an interview.
Ricks explained the company is exploring more early-stage deals, particularly those in the preclinical space.
As for the hot topic of drug pricing, Ricks thinks government pricing controls will stifle and limit innovation. He said in public remarks on Wednesday that "the best route to less expensive medicines is increasing competition."
Heard around the hall
More than one attendee at the convention picked U.K. biotechs as the big losers of Brexit. As plans continue full speed ahead for the U.K to leave the EU despite Prime Minister Theresa May's election setback, the powers that be in Europe have been throwing their hats in the ring to host the headquarters of the European Medical Agency (which currently resides in London). While the European parliament is calling for a rapid relocation, member states have not yet agreed on the new locale — Amsterdam and Vienna have both been floated as possibilities.
Attendees at the conference said that they are increasingly hearing about biotechs ditching the UK for places like Germany to conduct clinical trials. Brexit might also come to mean biotech exit, as well British exit.
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