The Burrill Report


GlaxoSmithKline said it has reached settlements in principle with the Attorneys General of eight states to pay $229 million to resolve lawsuits relating to the development and marketing of its diabetes drug Avandia, as well as a separate action brought by the state of Louisiana relating to other products. The company announced the settlements within its second quarter earnings report. It said the amount of the settlements is within existing provisions for its outstanding legal disputes. The settlement follows a $3 billion settlement announced a little more than a year ago where GSK agreed to plead guilty to criminal charges relating to illegally marketing Avandia and failing to report safety data. At the time, the U.S. Department of Justice called it the largest healthcare fraud settlement ever.

The U.S. Food and Drug Administration placed a partial clinical hold on Vertex Pharmaceuticals’ mid-stage trial of an experimental hepatitis C drug, taken in combination with ribavirin. The hold applies to the largest dose, 200 milligrams, in a U.S. trial and comes after patients in a European trial taking 400 milligrams of the drug showed signs of potential liver toxicity. Study arms of the U.S. trial incorporating smaller doses will continue. The drug in the trial, VX-135, is an oral formulation of a compound that inhibits replication of the hepatitis C virus by inhibiting its nucleotide polymerase inhibitor.

Teva Pharmaceutical and Lonza will discontinue their collaboration for the development, manufacturing, and marketing of biosimilars in favor of pursuing their own individual strategies. While Teva did not provide a specific reason for wanting to dissolve the joint venture, begun in 2009, Lonza said it could not afford to spend the capital or time on clinical development of biosimilars or end product commercialization, and will focus on contract manufacturing and cell line development. Lonza’s net profit fell by half and sales were down 11 percent in the first half of 2013. Chief Executive Richard Ridinger is reviewing the company’s future structure and strategy.

Abbott Vascular will lay off 200 workers, or approximately 10 percent of the workforce, from its Temecula, California manufacturing site for bioresorbable vascular scaffolds. While there are no plans to close the facility, an Abbott spokesman told the Temecula Press-Enterprise that the company was adjusting the workforce “to meet the evolving needs of our business.” In 2004, Temecula’s redevelopment agency approved an agreement with Abbott allowing for expansion of the campus on the condition that Abbott create and maintain a minimum of 300 additional full-time jobs with full benefits that paid between $45,000 and $80,000. In exchange, the redevelopment agency gave Abbott 50 percent of the incremental property tax increase related to the expansion, which totaled $162,700 last year. The agreement is valid through 2023, and during any time that Abbott doesn’t comply it will lose 50 percent of the tax benefit.

The United Kingdom Joint Committee on Vaccination and Immunization rejected Novartis’s vaccine against meningitis B for inclusion in the National Immunization Program. The decision is an interim one. Novartis will have an opportunity to provide additional pricing information prior to the committee’s final decision. The rejection was based on the conclusion that the vaccine, marketed as Bexsero, is unlikely to prove cost-effective based on current evaluation methods in the U.K. Novartis stated that the current method of evaluating cost-effectiveness failed to fully capture the lifetime benefits of disease prevention and undervalued technologies that prevent diseases. “It is disappointing to see that the decision was mostly driven by financial considerations,” said Andrin Oswald, division head, Novartis Vaccines and Diagnostics. “The evaluation model does not do justice to the vaccine's ability to prevent babies and young children from dying.”



July 26, 2013
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