Genzyme: The Price of Success - Pharmaceutical Executive


Genzyme: The Price of Success
Genzyme put patients first, and grew to become a multi-billion-dollar company. But empires don't survive on altruism.

Pharmaceutical Executive

There are even some potential benefits for Genzyme. Competition is likely to improve awareness of Gaucher, something that Genzyme has had to handle alone. A competitor would help share the service costs associated with the category. And a competitor would presumably help shoulder the burden of treating patients who can't afford to pay.

But there has been real advantage for Genzyme in being the sole company to carry the weight of building infrastructure and awareness for the diseases it treats. And it is not clear what happens to its strategy for converting unpaid to paid patients if it is not the sole supplier of treatment in a given area. What is clear is that Genzyme will increasingly be faced with competitors. There are several reasons for that:

Interest in orphans "Because Genzyme has been so profitable on the basis of revenues from one drug," says Meyers from National Organization for Rare Diseases, "it's gotten a lot of other companies to say, 'Oh, maybe orphan drugs aren't so unimportant.'"

Biogenerics In addition to branded competitors like Shire HGT, generic biologics pose a looming threat. In Europe, legal framework exists for "biosimilars," as they are called there, which has allowed EMEA to move forward with draft guidelines on the topic. Final guidelines are expected in Europe sometime this year. FDA lags notably behind on creating such pathways, but says it will do so once Congress creates the appropriate legislation.

Pipeline products Though the company remains committed to rare diseases, its pipeline has it moving into some more hotly contested areas, most notably, cancer, where a number of targeted therapies already exist. In December 2004, Genzyme laid down $1 billion to acquire Ilex Oncology, a deal that delivered two marketable cancer treatments: Campath (alemtuzumab for injection), for treatment of B-cell chronic lymphocytic leukemia, and ClolarTM (clofarabine), for treatment of children with refractory or relapsed acute lymphoblastic leukemia. The company is currently looking at both drugs for additional cancer indications, and has several other cancer treatments in its pipeline (see "New Ground" ).

A crowded space like oncology is uncharted waters for Genzyme, whose identity is centered on having first-to and only-in-market drugs. But the company says improving genetic knowledge of cancer (which is subdividing the category), combined with Genzyme's experience in working with small patient populations, makes oncology a sensible next step.

Possibly. But with competing companies—many with several years of oncology experience—honing niche skills, Genzyme may have to rethink how it builds markets.

Driving Ahead

With or without competition, Genzyme remains committed to serving Gaucher patients. Meeker points to a "long-standing program" on which Genzyme has spent over $200 million trying to develop a gene therapy for cystic fibrosis. The program, as it relates to cystic fibrosis, "was not successful," says Meeker, "but in the process, we learned a lot about different vectors and gene therapy." This information could eventually lead to ways of more definitively addressing Gaucher disease.

One specific attempt at that is GENZ-112638, an oral, small-molecule therapy in development for Gaucher, which Genzyme says also has potential for treating other LSDs. Enrollment for a Phase II study of GENZ-112638 is expected to begin in the first quarter of this year.

"This would completely change life for Gaucher patients again," says Meeker.

Indeed, National Gaucher Foundation's Buyers says, "Delivery is an issue." She says Gaucher patients would not be swayed by a new therapy, whether from Genzyme or a competitor, unless it was "at least as effective or more." But she points out that biweekly infusions over a person's lifetime are burdensome. "Obviously, if there was an easier way," says Buyers, it'd be attractive.

The lesson a company learns by serving small markets of people whose very lives depend on continuous access to a product is that sustainability matters. For Genzyme, that means not just preserving access to these products, but also preserving the culture that produced them.


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