It seems that for Olivier Brandicourt the move from Pfizer to Bayer could not have come at a better time, which might seem surprising given the two companies’ structural and cultural differences.
“Innovation has kicked in early at Bayer. It reminds me of the good days of the 1990s and 2000,” he told EP Vantage last week, four months after starting as chief executive of the German group’s healthcare arm. He now has to prove that Bayer’s productivity will meet its aggressive targets, and to demonstrate that market enthusiasm has not put all new assets beyond its reach.
Last year Bayer set investors’ sights on five key marketed drugs with a combined sales potential of €5.5bn ($7.6bn); (Bayer shows big pharma that a conglomerate can do it too, October 10, 2013). At its annual results presentation in Leverkusen on Friday this internal peak revenue expectation was hiked to €7.5bn.
Key pipeline assets
The spotlight also fell on five key pipeline assets that underpin the German group’s plan to launch one NME a year to meet aggressive growth targets.
Mr Brandicourt says the task ahead is pretty onerous: “To become a (sustainable) €20bn company we will actually need more than one NME launch per year.” Last year Bayer sold €11.2bn of pharmaceuticals as part of a healthcare offering that brought in €18.9bn of revenue.
The growth plans will be music to the ears of deal bankers, who will see M&A as the way ahead, but Mr Brandicourt cautions that US biotech assets have become “extremely, extremely expensive”. That said, the need to grow by acquisitions will be unavoidable.
“Since Lipobay [Bayer’s statin, which was pulled from the market in 2001] we’ve been punching below our weight in the US,” the healthcare boss admits. “We never say no (to M&A)” (Bankers pitching biotech acquisitions to Bayer must fight hard, February 28, 2014).
Bayer’s internal discovery success offers one reason for optimism. Mr Brandicourt puts this down to the company’s “deep assessment” of projects after preclinical and phase I studies, in contrast to some of its peers, which might push a questionable asset into phase IIa.
One such internally discovered pipeline asset is the PI3K inhibitor copanlisib, in phase II for non-Hodgkin’s lymphoma. Curiously, chronic lymphocytic leukaemia is not being pursued for now, which Mr Brandicourt puts down to the molecule’s specificity for PI3K alpha and delta isoforms.
“Our strategy in oncology is still emerging,” he admits. “But we’ve been good at partnering.”
Partnering is vital in other therapy areas too, as evidenced by the co-development deal with Johnson & Johnson that resulted in the launch of the anti-clotting agent Xarelto, which Bayer sees as its biggest new driver.
The Xarelto peak sales forecast has been raised from €2bn to €3.5bn despite the fact that the US FDA has now rejected its additional use in acute coronary syndrome (ACS) not once but three times. The company stresses that that the €3.5bn forecast excludes any US sales for ACS.
EvaluatePharma consensus data estimate that Bayer’s share of Xarelto revenue will reach $2.7bn in 2018, with in-market sales coming in at $5.3bn that year. Last year, Bayer reported €949m of Xarelto revenue, and J&J's US in-market sales were over $800m, says Mr Brandicourt.
But he is evasive about the group’s plans to pursue the ACS indication, saying this is still under discussion with J&J. For now he is confident in Xarelto’s ability to remain the most popular novel blood-thinner.
And, as a former Pfizer executive, he should know. Pfizer’s Eliquis had been a hotly touted newcomer to this class, but brings up the rear behind Xarelto and Pradaxa, from Boehringer Ingelheim.
Pradaxa has come in for huge criticism, and Boehringer now faces lawsuits over the drug’s bleeding risk, along with claims that it withheld certain data on this from the FDA. Mr Brandicourt shrugs off the risk of Bayer being embroiled in a similar mess, and insists that patient data are in line with Xarelto’s phase III programme, and have been shared appropriately with the regulators.
The important thing is Xarelto’s potential in its approved stroke prevention indication, as well as uses such as coronary or peripheral heart disease, in which it is in phase III. “When you look at CAD/PAD, €3.5bn should be easily achievable,” he states, before pausing.
“Well, perhaps not easily,” he corrects himself. “But it should be achievable.”