Engen joined JapanBridge from Purdue Pharma (known as Mundipharma outside the United States), where he established the company's Tokyo and Osaka offices and served as president. JapanBridge is fueled by MPM Capital, the world's largest healthcare venture-capital firm; Japanese-based Itochu Corporation; and their latest investor, Kyowa Hakko, a Japanese company focused on therapeutic antibodies. These investors hope JapanBridge can gain Japanese rights to promising drugs in US companies' pipeline and become a specialty pharma company in its own right.
JapanBridge is still searching for its first asset, but it represents the type of company that can take off, given the changing regulatory environment in Japan. Here, Engen sits down with Pharm Exec to discuss the business opportunity in Japan, and its government's new take on using data from around the world.Which pharmaceutical companies are having success in Japan?
The big companies—Glaxo, Pfizer, Novartis, Schering-Plough—are there and doing very well. In fact, they are growing far faster in Japan than Japanese companies. There's also Mundipharma, Lundbeck, Amgen, and Biogen. But there aren't a lot of new startups.
Why is that?
The venture-capital money just isn't there. In 2006, the total amount of VC spent in healthcare was about $160 million. That scale of capital is not going to give you what it takes to build a company. It's a very young market, and the VCs have invested only minimally.
That's a stark difference from the United States.
Sure. In the States, almost daily you see specialty pharma companies being formed and doing very well, like King or Endo. This just doesn't happen in Japan. Those companies are focused on the United States, and they see Japan as an afterthought. It's only once they've reached a certain scale that they will think about Europe and then maybe Japan. Take Celgene. Celgene is doing very well with Revlimid in the States. They're building a business now in Europe, and now they have the scale to start building a business in Japan.
Why has Japan been such an afterthought?
Traditionally, the Japanese MHLW [Ministry of Health, Labor, and Welfare] has required all Phase I through Phase III studies be replicated in Japan. That's resulted in five to 10 years of a drug lag, with a lot of pharmaceutical products that are available in the United States but not available in Japan.
But more people, particularly younger people, are starting to speak up. Now you have grassroots advocacy—especially with cancer patient groups—saying, "We're suffering. We're trying to get these drugs from overseas. Why does it take so long to get these drugs when Europe and the United States have them?"
You also had the [Japanese legislator] Takashi Yamamoto, who has cancer himself, who got up in front of the Parliament and said Japan's patients were cancer refugees. Things like this are really making the Japanese government realize the problem.