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Click the title above for a link to open the 2022 Pharmaceutical Executive APEX Awards Program in an interactive PDF format.

2022 Pharmaceutical Executive APEX Awards Program 

Society’s expectations of what it means to be a sustainable business are evolving, and the pandemic has only accelerated demand for private-sector solutions. This is particularly important for the pharmaceutical industry because there exists an inextricable link between health outcomes and the environment; to have healthy people we need to have a healthy planet.

The Intergovernmental Panel on Climate Change report, published in August 2021, provided the starkest warning yet about the impact of climate change on lives and livelihoods. The message is clear: climate change is resulting in poorer health outcomes and increasing mortality, with the greatest impact being on people who are already living with chronic diseases.

And while many think about the pharmaceutical industry’s role as 

—treating with medicines—industry leaders have a responsibility to be proactive

finding ways to minimize environmental impact and 

 the associated health challenges. Progress has been made, but there is still much work to do.

The reality of our industry is that while many products provide life-saving solutions for patients, it also has an impact on the environment. Whether it is medical-waste plastic ending up in landfills, the water required for manufacturing, or the greenhouse gases emitted for transport, the entire ecosystem—from production to disposal—has opportunity for more purposeful, environmentally conscious planning.

Consider, for example, recycling programs for used plastic devices. At Novo Nordisk, we have found a solution through an innovative TakeBack program that allows patients to return insulin devices. We have also changed much of our transportation packaging to an eco-friendly, insulated container called Biocooler®, which will compost in almost all environments. This also helps reduce the need for refrigeration on long-haul transports.

But it’s not just about what the pharmaceutical companies ourselves do, we must also make purposeful decisions about our vendors and suppliers. Setting requirements for ourselves will certainly ensure progress, but choosing to partner with companies that prioritize sustainability will enhance and accelerate our impact.

There also exists an opportunity for tapping into research and development to create innovations where we integrate sustainability in all we do to solve for environmental challenges, while also providing a better patient experience. While most leaders have prioritized a culture of innovation with patient centricity, it is imperative that sustainability be a driving force in the company’s culture. We must think about innovating for patients—and the environment—in every step we take.

Let’s take another look at insulin. It is not just about identifying ways to reuse and recycle the plastic pens once used, but about reducing what patients need to use in the first place. At Novo Nordisk, our product pipeline includes a long-lasting basal insulin analogue intended for once-weekly dosing, potentially reducing the overall number of plastic pens required. Innovations can also help make the insulin itself more resistant to temperature changes so refrigeration during transportation is not required.

At Novo Nordisk, we take our responsibility to people and the planet seriously, and our goal is to reach net zero CO2 by 2045 through our Circular for Zero strategy. But we know this work is too important for us to do alone. No single program will be the answer. Together with partners at public agencies and private organizations, we will have a significant impact over time.

We need to share knowledge and work together to set up a system that allows for scale and the development of infrastructure for global initiatives. And our work should be documented and tracked to help us hold one another accountable and collaborate on new opportunities. Achieving these measures will not just help our environment; we will be working toward our shared, most important goal—saving lives.

, Corporate Vice President, Global Public Affairs and Sustainability, Novo Nordisk

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Reaching new heights in sustainability a win-win for industry.

Healthy Planet, Healthy People: How Pharma Can Lead the Way

One of the most significant transformational changes to hit the pharmaceutical industry in the last three years—and not just the result of the pandemic—has been the rapid acceleration and focus on sustainability initiatives. This is due to the wider environmental, social, and governance (ESG) agenda that has become an essential part in the strategic development of every corporation, including those in the pharma world.

The first big steps in the pharma supply chain sustainability journey were taken about seven years ago by pharmaceutical packaging companies, which have continued to lead the charge and have remained at the forefront of sustainability initiatives.

Since then, we have seen all parts of the contract development and manufacturing organization (CDMO) industry mirror trends in wider society with a huge shift in adoption toward new manufacturing processes and environmental technology. From green chemistries and metal catalysis to continuous processing, the industry has increasingly voiced its desire to improve the environmental impact of its manufacturing and processes, bringing about a paradigm shift in how innovators develop medicines quickly and sustainably.

For an industry that’s historically been driven by the twin imperatives of cost and speed of development, the impact of sustainability continues to create positive ripples across the industry, with profound implications for infrastructure planning as well as for how contract service providers market their services to innovators. The consensus among CPHI Annual Report experts is that investments need to be made now in modern manufacturing to prepare for these shifts.

The CPHI sustainability sentiment index points to an almost universal consensus among biopharma executives and leaders that environmental credentials are now integral to all supply chain decisions. In a global survey we will release in full ahead of CPHI Frankfurt (Nov. 2–4), 95% of industry executives—including representatives from pharma, biotech, and CDMOs—suggest it is either “important” or “extremely important” to have visibility on supply chain partners’ sustainability credentials and practices.

Underlying their concerns with sustainability, 83% of surveyed pharma industry executives believe that within the next five years, specific “sustainability metrics” (e.g., full waste recycling, green power percentage, low process mass intensity [PMI], and green chemistries) will be implemented within all CDMO contracts—suggesting the industry must accelerate its drive toward modern manufacturing and more efficient chemistries. In fact, nearly 60% believe CDMOs will be required to provide their partners with both sustainability metrics for projects and specific corporate ESG goals.

Given this momentum, it’s not a surprise that this year’s CPHI Frankfurt show will dedicate an entire theater to sustainability, gathering more than 20 industry experts across 15 targeted sessions, covering everything from ingredients and excipients, ESG risks and requirements, to the impact on quality, metrics, supply chains, and biologics. A particular highlight will be Boehringer Ingelheim and Novartis presenting on the new iGAL 2.0 metric (a new metric to measure sustainability in manufacturing against industry averages) and how this can be successfully integrated into pharma-CDMO partnerships.

Talking ahead of his session in November, Aurelio Arias from IQVIA forewarns that healthcare services are now looking to use their considerable buying power to impact change, “having identified medicines as one of the largest single contributors to their carbon footprint.”

Another significant driver of change is from the investor side, with much of the impetus toward sustainability coming from financial institutions. In fact, ESG funds now account for about one-quarter of US stock and bond mutual funds, and the percentage is growing.

This reach even extends to the M&A environment, with investors looking not only for tomorrow’s most potentially valuable biotechs and supply-side companies, but also for those with the most ambitious and developed ESG goals. If we take a medium-term picture of the pharma industry, this will have tremendous influence over decisions in the next five years.

The investment community is telling us loud and clear at CPHI events that they actively evaluate a company’s ESG track record as part of planning their future investments. At CPHI North America, a session with venture capital (VC) firms discussed the recent transition to an ESG-driven market. VCs emphasized the value ESG structures bring to biotechs in the early stages of development—with ESG-compliant companies likely to deliver better valuations on sale, and greater licensing options. Having this structure in place early, particularly in the supply chain, means the purchasing pharma company or investor knows it’s a good fit with their existing sustainability goals, an important consideration because retrofitting a sustainable business mode is potentially a risky and costly operation. So much so, it’s a future deal-breaker.

Consequentially, CDMOs are also feeling the pressure to improve their ESG reporting. In the past, CDMOs were a largely hidden aspect of the industry, often protected by confidentially agreements with sponsors. But they now face pressure not just from customers, but also from potential private equity partners, to bring their ESG activities and their reporting of them into line with industry best practice.

Compared to just a few years ago, awareness of something as seemingly technical as PMI—the measure of waste in any given pharmaceutical process—is now at an all-time high, as the industry constantly pushes for better working practices. In an annual survey, a remarkable 87% of respondents predict “innovators (pharma and biotech) will require CDMOs to implement sustainability goals as part of all new contracts within the next five years.”

Perhaps the starkest warning from experts is that companies which have not yet embedded ESG into how they do business are already behind, and rate of change is accelerating. The impact of failing to embrace ESG will only grow in the next few years—with particular impacts on their supply chain contracts and clients, with even regulatory forbearance now nearing reality as well. In the next two years, European regulations will cover both supply chain transparency and the environmental impacts of this supply chain—for active pharmaceutical ingredient (API) and finished-dosage companies.

 This will be for generic and innovator medicines alike. The good news, particularly for those at the front of the wave of ESG integration, is that these regulations will level the playing field with standardized reporting structures.

So what does this mean for pharma executives? It means they must have clear visibility now on the total life-cycle impact of their respective company’s manufacturing. That includes the need for its manufacturing and particularly the environmental impact to be documented thoroughly, and done so with an eye on a future where oversight and reporting expectations will only grow. Any pharma company not asking the right questions of suppliers risks facing challenges in the near future from regulators, consumers, investors, and governments.

It’s not enough to report a company’s own ESG performance and goals; the organization must be confident it can understand and illustrate the supply chain impact of its partners’ work, and look for those that share a commitment to open reporting.

, Executive Vice President, Pharma, at Informa – the event organizer behind CPHI Frankfurt

https://www.bloomberg.com/professional/blog/esg-assets-may-hit-53-trillion-by-2025-a-third-of-global-aum/

CPHI Annual Report 2022 (released in full at CPHI Frankfurt)

https://ec.europa.eu/commission/presscorner/detail/en/ip_22_1145

Features

Pharma supply chains are no longer hidden beyond the reach of ESG agendas, making it important for companies to accelerate adoption of new manufacturing processes and environmental technology.

At the Heart of Pharma: ESG has Arrived as a Central Strategy

M&A activity is seen as a vehicle to drive growth, fill pipelines, or put working capital to use. Weakened equity markets have led acquirers to be more circumspect about the deals they target, despite many of the biggest life sciences companies having the balance sheets and cash flows to complete deals.

Developmental stage companies and smaller pharmaceutical companies are facing higher interest rates and dampened valuations, driven by a market that has become increasingly risk averse.

The Nasdaq Biotech Index (NBI) reached a high of 5,449 in August of 2021 and hit a low of 3,509 in May, a 36% drop. An exchange-traded fund (SPDR S&P Pharmaceuticals ETF [XPH]) that represents the pharmaceutical segment of the S&P total Market Index traded as high as $55.56 in February 2021 and was as low as $37.94 in May 2022.

Amit Sinha, head of life sciences investing, asset management at Goldman Sachs, told the firm’s 

 podcast (https://bit.ly/3BVjePn) that the value of life sciences companies has been hurt. “On the fundamental side, we’ve seen a bunch of disappointing news over the past year,” he said. “These have been things like clinical trial failures to FDA setbacks, and they’ve served as an important reminder that life sciences innovation is risky.”

Jeffrey Stoll, KPMG’s US life sciences strategy and deal advisory leader, says market uncertainty has become a factor in decision-making about deals.

“I think the last thing you want to do is announce the deal and what you thought was a fair price end up looking ridiculous in the market,” he says. “I think there’s a little bit of a game of chicken. The valuations are down because the stock in most companies has been suppressed between 15% and 30%. A lot of [selling] companies are still going to want their 2021 price and make the argument that the 2022 market conditions are temporary. Certain companies are going to want to hold out if they can for the healthier market timeframe.”

Large pharma companies have resources to make deals, however. So what’s the likelihood of a mega-cap deal, such as a merger of global top 25 companies?

“It would have to be a very unique situation. I think the market uncertainty makes that a difficult thing. It’s not in vogue in terms of strategy right now,” says Stoll. “I would never say never, but I think it’s a low likelihood that we’ll see a mega merger this year.” Next year is a possibility if the market becomes “more consistent and predictable,” he adds.

Steven Lendaris, who leads the life sciences practice at the Baker Botts LLP law firm, says he doesn’t expect the same type of consolidation from 15 years ago. Some of the companies that have spun off of or will spin off consumer health businesses, or have sold generic drug divisions, might have a new mindset about consolidation.

This summer has seen a few billion-dollar-plus deals. Stoll and other industry deal advisors believe big drugmakers have the “dry powder to complete deals.” Some of the billion-dollar M&As have been in cash and the targets have been in very specific disease categories, where there are unmet medical needs.

In August, Amgen agreed to buy ChemoCentryx Inc. for $3.7 billion. ChemoCentryx is the maker of Tavneos, a treatment for anti-neutrophil cytoplasmic autoantibody-associated vasculitis that can harm the function of kidneys, the liver, and other organs. The company also has three early stage drug candidates that target chemoattractant receptors in other inflammatory diseases and an oral checkpoint inhibitor for cancer.

“Our decades of leadership in immunology and nephrology will enable us to add value to the Tavneos launch, reaching many more patients and much more quickly than would otherwise have been possible,” said Amgen Chairman, CEO and President Robert A. Bradway in a statement announcing the deal.

In July, GSK closed its acquisition of Sierra Oncology, the maker of momelotinib, a late-stage potential new medicine with a dual mechanism that may help with treating myelofibrosis patients with anemia. GSK says the deal aligns with its “strategy of building a strong portfolio of specialty medicines and vaccines.”

Both Pfizer and Novo Nordisk announced acquisitions of companies with a focus on sickle cell disease and rare blood disorders. Pfizer agreed to buy Global Blood Therapeutics (GBT), maker of Oxbryta and developer of GBT601, for $5.4 billion. Novo Nordisk agreed to acquire, for $1.1 billion, Forma Therapeutics Holdings Inc., whose etavopivat is in a Phase II/III clinical trial in patients with sickle cell disease and in a Phase II study in patients with transfusion-dependent sickle cell disease and another blood condition called thalassemia.

In May, Pfizer also announced the $11.6 billion acquisition of Biohaven Pharmaceutical Co. Ltd.’s migraine therapy portfolio.

Pfizer’s growth target factors acquisitions

Pfizer’s leadership has made it clear that deals are an important part of its efforts to reach growth targets through the remainder of the decade. The company has issued guidance to target business development opportunities that could add at least $25 billion in risk-adjusted revenues to top line in 2030.

“We wanted to just be very clear with everyone, what our expectations were on how we were going to deploy our capital and what we were going to achieve as a result of that,” Aamir Malik, Pfizer’s chief business innovation officer, told investors at the Morgan Stanley Healthcare Conference in September, noting “We also see ourselves as a growth company in the back half of the decade, ’25 till ’30, and that $25 billion is a very important part of that.”

Malik said the company’s balance sheet and strong cash flows give it flexibility to place capital on internal R&D and sourcing external science, which also compliments many of those internal programs. Acquisitions of ReViral, Biohaven, and GBT that were struck this year have the potential to add more than $10 billion in peak sales to Pfizer, according to Malik.

He also explained that the company has the following set of criteria about entering transactions:

Is the science compelling and can it potentially offer a breakthrough versus the standard of care?

Is there something that Pfizer can do scientifically and commercially to add value to that science?

Is the company confident that the deal is going to generate revenues between 2025–2030?

“The one thing that we have been clear on is that deals where cost synergies are the primary source of value creation are not a focus for us,” said Malik. “We are agnostic to size. So if we see a large-scale transaction that meets that criteria where we can advance breakthrough science and add value and create growth, we’re certainly very open to it.”

Smaller-cap, developmental companies, however, have their own struggles in this market because of the valuations.

KPMG’s Stoll says founders of these smaller-cap organizations are not looking for dilutive transactions, and any deals need to ensure that the strategy fits both companies.

“It becomes a confusing story to tell if it’s not a natural fit or a synergistic play around either the scientific platform or the commercialization efforts,” he says.

In cases where there is more cash at a smaller biotech than market value, Lendaris at Baker Botts says that can drive some consolidation if there is an opportunity to bring on products that can quickly add more market value.

Stoll notes that special purpose acquisition companies (SPACs) that were the rage two years ago are “still circling” and we may start to see some companies going public that route later in 2022 and the first quarter of 2023, especially if the IPO market is suppressed.

Sinha believes life science investors have become more finicky than a few years ago. In 2014, 90% or more of the companies going public were in clinical stages of testing, but that figure fell to 40% in the last surge for biotech funding.

“If you think about that simplistically, because most of the companies were going public earlier and the probability of success in earlier studies is much lower, you should see that a large number of the outcomes are negative,” said Sinha on the podcast. “And that’s what we’re seeing in the space today.”

Meanwhile, venture capital flooded into the sector. “When you see the total amount of capital going into a space rise that far, that fast, you inevitably see things that get funded that probably shouldn’t be funded,” said Sinha.

“We think in the near term there is going to be some challenges, particularly for companies who have recently gone public, just given the correction,” he added. Funds will continue to be raised and the markets will continue to reward the best companies, Sinha noted, asserting, “A little bit of the correction we’re seeing is, frankly, good and healthy for the space because it drives more rational allocation of capital.”

 is senior vice president at Tiberend Strategic Advisors, and a freelance journalist based in New Jersey. He does not have any business or financial interests in the companies or organizations mentioned in this article.

Big pharma’s finicky appetite for M&A comes as valuations of sellers soften. Though the pace of deals has picked up some, predicting just how long both sides will hold tight remains difficult.

Discerning Dealmaking: Caution Flag Still Raised in Biopharma M&A Race

Chris Boerner, as executive vice president and chief commercialization officer at Bristol Myers Squibb (BMS), leads commercial strategy and execution for the large pharma company across all geographies. Naturally, it’s a complex position in an even more complex and highly regulated industry—a role that holds a great deal of weight and responsibility, both internally (BMS is ranked No. 82 on 2022’s

 500 list) and externally. But Boerner likes to keep his focus simple, he tells 

. Admirably, and something he makes crystal clear when faced with questions regarding strategy, policy, and the evolving influences in healthcare, Boerner never loses sight of the most important stakeholder—the patient.

When asked, for example, about the changing face of healthcare and the shift to digital during COVID-19, or the rapid increase in physicians leaving private practice and joining the ranks of hospitals and health systems, he responds comprehensively and thoughtfully, always bringing it back to the same important goal. “There will always be cycles of change and a great deal of complexity in this industry, but what truly matters is how we effectively communicate our science and ensure that our products are getting in the hands of the patients with speed in order to transform their lives through our innovation,” says Boerner. “Where we run into trouble, not just as a company, but frankly, as an industry, is when we overcomplicate how we go about doing our business and make that complexity the problem of our customers.”

This people-first ethos is what ultimately has guided Boerner’s career. But how did he get to where he is today? “I often get asked this question, and I’d say that I’m kind of a case study for not over engineering your career path, being open to new opportunities, and not being afraid to stretch yourself and step out of your comfort zone,” he tells 

. “Most importantly, having a consistent thirst for learning because so many choices I made in my career were driven by an intense curiosity. When I look back on it, I probably wouldn’t have ever predicted I’d end up here, but seeing all the steps along the way, it makes sense.”

Boerner was a part of the first generation of his family to go to college—Washington University in St. Louis—where he majored in history and economics. At the time, he had absolutely no interest in science. After college, Boerner had hopes of becoming an academic, so he sought to get a PhD at the Haas School of Business in Berkeley, Calif. While there, he became fascinated by the study of innovation, and more specifically, innovation in healthcare. He wanted to understand why some pharma companies were better than others at developing new drugs. “It’s actually a really interesting irony—what led me down this path was an article I read about Bristol Myers Squibb and how good the company was at the time at developing oncology drugs,” says Boerner. “And I began wondering what factors make it good. Is it having the right people with experience in that space? Is it the drugs themselves?”

Reading that article and contemplating those fundamental questions in the late 1990s served as the jumping-off point for his career. The more Boerner learned, the more fascinated he became with the drivers of successful product development, which led him to McKinsey & Company as a consultant for biopharma companies, among other industries. It didn’t take long to figure out that he didn’t just want to study or consult about the industry, he wanted to be a part of it.

In 2002, Boerner joined Genentech as associate director, oncology market planning. At the time, the biotech giant was a more science-driven company, so he had to absorb a great deal of those aspects as quickly as possible. Boerner also discovered that it was important to dedicate time to understand pieces of the product value chain that were not necessarily part of his day-to-day, but grew his practical knowledge of the industry as a whole and how it operates. He spent eight years at Genentech advancing through various marketing roles focused on strategy, development, and commercialization for Avastin (bevacizumab), the blockbuster blood vessel growth inhibitor now used off-label to treat certain advanced-stage or metastatic breast cancers. From there, Boerner spent four years at Seattle Genetics serving as senior and then executive vice president of commercial, as well as vice president of marketing,before joining BMS in the beginning of 2015 as president and head of US commercial.

It was a full circle moment of sorts for Boerner. Many years after reading the BMS article, the one that seemed to chart his course, he was now part of the company—an attractive landing spot, he says, due to BMS’ commitment to invest in a range of unmet disease areas.

“If you look at the history, that’s what BMS has done in HIV/AIDS, cardiovascular disease, and, of course, in oncology, where we introduced the first immuno-oncology (IO) drug with Yervoy (ipilimumab)—and we’re still a leader in that space. In fact, we’re the only company with three IO mechanisms on the market,” he tells 

. “I wanted to work for a company that not only had that history, but also had that commitment on a forward-looking basis.”

BMS, whose portfolio also targets hematology, cardiovascular disease, and immunology, among other areas, is one of the biggest industry players in R&D, ranking fifth in 2021 R&D spend, investing $9.5 billion, as reported in 

 June “Pharma 50” feature. Breyanzi, a drug used to treat adults with certain types of large B-cell lymphoma, and Abecma, the first CAR-T cell therapy for relapsed or refractory multiple myeloma patients who have received at least four prior lines of therapy, are two success stories introduced in 2021. But the future is what Boerner is most excited about. He notes BMS is in the process of launching nine new therapies, five of which are first-in-class. “We’re at the beginning of bringing the next wave of innovative medicines to the market,” he says.

One of those is Camzyos (mavacamten), launched in April, for the treatment of adults with symptomatic obstructive hypertrophic cardiomyopathy (HCM). It is the first drug to specifically target the source of obstructive HCM, a disease that affects an estimated 600,000 to 1.5 million Americans, or 1 in 500 people. Deucravacitinib, one of the main pipeline assets discovered and developed by BMS’ own internal R&D team, was approved in the US last month. Branded as Sotyktu, the treatment targets moderate-to-severe plaque psoriasis and is being developed in several other indications, including psoriatic arthritis and lupus.

Boerner’s enthusiasm isn’t just limited to helping advance commercial pathways for new drugs. A peruse of his LinkedIn posts and photos reveals his passion for cycling, including heartfelt messages about BMS’ annual US Coast 2 Coast 4 Cancer (C2C4C) ride, held in September. The C2C4C tradition started in 2014 when a group of BMS oncology employees, largely in the sales organization, were compelled to do more to support cancer research, many closely affected by the disease. The riders volunteer their personal time to raise funds for cancer research and train for five months for their approximately 225-mile segment over a three-day period. (The total route is nearly 3,000 miles from Cannon Beach, Ore., to Long Branch, NJ). BMS initially partnered with Stand Up to Cancer around the event, and now works with The V Foundation. In its inaugural ride, BMS’ support included providing all the equipment and training, Boerner says, as well as a commitment to match up to $500,000 of the amount raised.

“I’ve done [the ride] since I joined the company in 2015, and it is one of the most impactful things personally and professionally that I get the pleasure to do every year,” he says. “You get to see employees—who aren’t professional riders—train for months on end, in their own personal time in honor of individuals who have had cancer… and some ride for themselves, having been previously diagnosed with cancer.”

C2C4C has grown into a global event, expanding to Europe in 2016, followed by Japan in 2021, and Latin America this year. Boerner is participating in the rides in Europe and Japan this year. Since the program’s inception, the rides have raised about $12.1 million for cancer research worldwide.

Boerner points to company and team culture as a major influence on his leadership style. He views his leadership role as something that’s very straightforward. His job is to hire and develop the most diverse talent that he can find in the industry and set the vision of BMS’ commercial and medical organizations, creating a climate and culture where that talent can be successful. “Oftentimes, companies fixate on tools or financial resources,” says Boerner. “I think equally and maybe more important is the culture—is your organization one that fosters innovation and eliminates unnecessary complexity? Does it encourage people to speak up and bring their best selves to work? Does it set the right tone around ethics?” Being accountable in addressing such questions, and living out those values, across company levels, is critical, he adds. “One of the things that I’ve learned is that cultures aren’t static. They’re constantly evolving, and hopefully they are improving,” says Boerner.

When it comes to tapping diverse talent sources externally, Boerner believes, “It’s not a ‘nice to have,’ it’s table stakes. The problems in healthcare are probably among the most complex and challenging that we face as a society; it is important for us to bring the best and most diverse minds to the table to try to solve those problems.” One example is BMS’ longtime relationship with the Healthcare Businesswomen’s Association (HBA), a connection Boerner has played a key role in during his tenure (he was named this year’s HBA Honorable Mentor and is an HBA Advisory Board member). For the last four years, he has served as the executive sponsor of the Bristol Myers Squibb Network of Women (B-NOW), an internal employee resource group charged with making sure the company empowers and develops women to help achieve business objectives, including evaluating policies that affect women, such as employee leave policies. On the more treatment-focused front, Boerner notes the company is injecting similar perspectives, such as thinking about how women make decisions on cancer treatment, and how to effectively engage female cancer patients and caregivers, for instance.

In accepting the HBA Honorable Mentor award in June, Boerner wanted to make a point about subtle moments in everyday interactions with employees juxtaposed with the big wins. Both are important to the culture of a company, he says, and how employees feel when they show up for work. “We as an industry have really made a lot of great progress on some of the big objectives that we have associated with diversity and inclusion and achieving gender parity,” Boerner remarked during his presentation “And while we can’t declare victory, we absolutely need to celebrate progress there. But at the same time, I don’t think we can let these macro-level accomplishments overshadow the impact of the more day-to-day, critically important moments that really do have a big impact on employees.” He cited examples such as scheduling calls or meetings in the evening when people should be focused on the “life” portion of their work-life balance, or letting men talk over women as those moments that stall progress.

Boerner credits several mentors that inspired him along his career journey, ones, he says, were willing to put their own reputations on the line by creating situations for him to learn and grow outside of his comfort zone—situations that held real weight. He recalls one mentor telling him, “Never forget that there’s real value in walking the halls and talking to more junior colleagues. It’s 10 minutes of your day, for them it’s dinner conversation.” In selecting Boerner as Honorable Mentor, HBA solicited information from past colleagues, and then shared the feedback with him. Boerner says it consisted largely of things he didn’t remember doing, the small, day-to day interactions that he wasn’t aware of but left positive impressions. One associate stressed the importance of always being an authentic leader: “If you’re hiring the right people, they’re going to know if you’re being upfront and candid with them and looking out for their best interests.” He says he keeps these insights and lessons tucked away, using them to help shape how he engages as a mentor—all toward doing his part to advance the mission of the organization in delivering new products across multiple therapeutic areas.

“I genuinely believe that there’s nothing we can’t accomplish when we come together as a team, focusing on our science and the opportunity it offers to meaningfully change the lives of patients,” he says. “I look forward to our next wave of innovation and delivering it to even more patients across the globe.”

is Pharm Exec's Senior Editor. He can be reached at

Executive Profile

Bristol Myers Squibb commercial head Chris Boerner believes a straightforward formula is the best formula in advancing innovation and developing talent in today’s complex healthcare climate—an approach he roots in authenticity and “not over engineering,” whether tackling business or culture.

Keeping it Simple

Rising interest rates are the enemy of long-dated assets as they put heavy downward pressure on valuations. As biotech is likely the longest dated of all asset classes, its valuations will run in an inverse direction to interest rates, which can explain part of the longest and steepest decline in the XBI since its inception.

So how bad is the interest rate environment?

Well, to put it in context for you, I have pulled some excerpts from a recent report from the best economist I know, Michael Darda, chief economist and market strategist at MKM Partners. Darda writes that as of the end of September, the 

 interest rate on the five-year TIPS security (a market-determined rate) has surged nearly 400 basis points (bps) from levels that prevailed late last year, the largest rise over a similar timeframe in the history of the TIPS market, dating back to the late 1990s. The surge has been precipitated by a dramatic repricing of terminal Fed policy rate expectations and the most rapid seven-month rise in policy rates in more than a generation.

The entire bear market this year can be explained by higher discount rates as the equity risk premium (the gap between earnings yields on stocks and bond yields) has actually moved lower—meaning the fall in equity valuations has been less dramatic than the fall in bond valuations. In order for equities to find their footing, bond rates will likely have to top and begin to pull back. Yet, this could also happen as a recession unfolds next year, which will create the risk of a secondary drop in the equity market as earnings estimates fall. So, the path to higher equity prices from here is likely via lower market interest rates.

According to SVB Securities, since the federal funds rate became the primary tool of monetary policy in 1982, there have been six periods with rate hikes of at least 2.00%. Never before has the Fed funds rate increased by 3.00% in just six months, as it has in this current period. In fact, when the hikes are finally over, this may be the fastest and steepest increase in rates ever (albeit from a low base).

The more than 17% surge in the S&P 500 from the June lows was also associated with a nearly 100 bps decline in the 10-year Treasury yield from mid-June until early August. In other words, to quote Darda, “this is still a rate-driven market.”

Interestingly, the biotech XBI index rose over 50% from the lows set in May to a recent high set in mid-August, but has since backed off by 17% as rates have continued to rise. Many of the fundamental factors that led to the collapse in the sector following its peak in February 2021 have improved, with data surprising to the upside, M&A picking up, and recent inflation metrics have come in lower than expected.

As I write this (late September), Biogen is trading up 36.5% (the equivalent of adding $10 billion in market cap), following the release of Phase III data for lecanemab, Eisai and Biogen’s follow-up Alzheimer’s drug to the botched Aduhelm launch. The drug candidate passed with flying colors on a test looking at memory, problem solving, and other dementia metrics.

Lecanemab, one of the most closely watched Alzheimer’s therapies in the clinic, met its primary goal on the CDR-SB (Clinical Dementia Rating-Sum of Boxes) in the study. Biogen is requesting approval in the US, EU, and Japan by next March 31. The experimental drug reduced clinical decline on the scale by 27% compared to placebo at 18 months. Umer Raffat, a senior managing director at Evercore ISI, called the trial results a “major surprise” in a note, and in its response to the news, the Alzheimer’s Association deemed the trial’s topline readout the “most encouraging results in clinical trials treating the underlying causes of Alzheimer’s to date.”

So, industry fundamentals remain strong; keep a watch on rates, as once the market prices in a plateauing in rates and perhaps a recession, investors may rotate quickly back into growth and biotech specifically.

is Founder, Barbara Ryan Advisors, and a member of Pharm Exec’s Editorial Advisory Board.

Finance

As fundamentals improve, potential rate plateau could ignite growth.

All About the Rates: The Fallout of Fed Hikes for Biotech

Last month, within two days of each other, FDA approved two very different products that promise to advance standard of care for conditions they target. The drugs were Zynteglo, for beta thalassemia, and Auvelity, for major depressive disorder (MDD).

For this discussion, what stands out is their similarity in representing an advance, plus their extreme scientific and pricing differences. The suggestion here is that this similarity-difference regime can be instructive for how the inner workings of medical policy govern coverage.

On the one hand, Auvelity has been described as “the first orally administered novel mechanism to enter the MDD market in more than 60 years.” But it consists of two decades-old agents—dextromethorphan plus bupropion—and while the price has not been set as of this writing, it’s not unreasonable to assume something in the range of branded atypical antipsychotics.

On the other hand, Zynteglo is a gene therapy developed to cure beta thalassemia. It consists of the patient’s genetically modified bone marrow stem cells, creating functional beta-globin. The price is a one-time $2.8 million, with a rebate of up to 80% back to payers if over two years transfusion independence is not maintained.

One question these profoundly different products raise is, are there different principles in medical policy that determine coverage for each, or are the principles the same regardless of the differences?

Based on my experience conducting payer market research, principles in medical policy governing coverage for an Auvelity or Zynteglo are almost certain to be the same. Each product must meet the requisites of efficacy, safety, and tolerability compared to existing treatment options.

But these fixed principles are inherently broad and, while there will be exceptions, few products fail to pass through the initial coverage gate. The critical factors governing coverage for Auvelity and Zynteglo—or any product—are the variable principles derived from where business and clinical considerations overlap. Two such principles are described here.

Variable principles and coverage decisions

In the case of MDD, there is no biomarker, so the decision on the appropriate patient will be determined by a history of antidepressant use.

In the case of beta thalassemia, the patient’s genetic defect is the biomarker, however, the specificity requirements go further. As one pharmacy director told me, someone with one transfusion every few months may not be a candidate, but three or four times a month would be. Here, the combination of a genetic defect and severity establishes the appropriate patient.

For brand planning, a key point about principle No. 1 is that the size of the market is not prevalence of the condition, but the percent of people who qualify for coverage.

 Independent of the appropriate patient, when payers make coverage decisions they focus on the treatment landscape. Are there other viable treatment options, particularly lower-cost options?

For Auvelity, payers can be expected to use prior authorization to require probably two generic antidepressants before coverage. While a barrier on its face, the upside is that previous antidepressant use can be determined electronically from the claims system, with coverage approval to follow. This short-term noise should not work against future pricing.

For Zynteglo there are no treatment options. The manufacturer can charge whatever it wants. Payers will narrow their criteria for defining the appropriate patient, but coverage restrictions are limited by the patient characteristics trial data supports.

Variable principles in medical policy drive the different ways products are absorbed in the payer market. Using the two products considered here as an example: payer focus on Auvelity will center on a brand replacing low-cost generics; payer focus on Zynteglo will zero in on an extraordinary new cost where there was none before.

In the first instance, coverage appearing to be restrictive, is ultimately not. In the second, coverage is heavily restrictive. Ironically, though, the super high-cost treatment should produce a substantial medical cost offset, while the much lower-cost treatment will not—potentially impacting any gray area around coverage policy.

president, Stellar Managed Care Consulting. He can be reached at

Managed Markets

Different paths to formulary decision-making.

Exploring Fixed and Variable Coverage Principles 

We give our energy to what matters. We only have so much of this precious resource that fuels our ability to connect with another person authentically. We can conserve energy by doing things the way we have always done them (being on automatic pilot), which may result in not growing a culture of inclusion.

When it comes to amplifying inclusion in the workplace, energy and a desire to expand our zone of familiarity are requirements. The following are a few ways leaders can build more trust and inclusion by dedicating energy to those who may not be outspoken, lack confidence, or the training necessary to understand the impact.

 Scan the room (or online platform) before the meeting begins. Who don’t you know? Consider adopting a philosophy of being the “host of the party” and get a quick introduction of those people if possible. Also, go out of your way to ask the opinion of the quiet person. They may be sitting on a gem of an insight, idea, or challenge.

 Resist the temptation to spend time with those you already know or are more comfortable with because of shared experiences or similar backgrounds. Please don’t wait for others to come to you. There is a good chance some people will not approach you because of positional power or anxiety around not knowing what to say. Make it easy for them to learn networking skills.

 Multitasking (doing more than one task simultaneously) is a myth. Research shows that what we think of as multitasking is actually the process of going back and forth between two tasks. When we meet with someone and continuously check our devices, we are not giving people our attention and energy. When we can’t control the impulse to check our phones, we make others feel less important and erode trust. In short, we are reducing our leadership impact. Unless it’s an emergency, it’s not worth being distracted and making an employee feel “less than.”

One of the greatest gifts of leadership is the ability to change a person’s life by helping them grow their self-confidence through experience and attention. Seeking out people who are different from us and giving them the gift of our energy can reap tremendous benefits for you, them, and the company. Similarly, when we are truly present with others, we can increase trust and connection, which produces a fantastic ROE (return on energy).

, senior healthcare executive; founder of The Mentoring Place, a free career mentoring program for women; and CEO of The Ignited Company, a change management and DE&I firm

DE&I

Three simple ways to build trust—by reaching outside your comfort zone.

Inclusion Check-In: Who are You Giving Your Energy To?

While the Asia-Pacific region’s importance has been increasingly recognized by most pharmaceutical companies, many also see it as a hard market to crack. They’re right.

First, Asia is not a homogeneous market. China’s policy, access, and reimbursement environments are distinctly different from those of India and Indonesia, and more affluent markets such as Japan, Korea, Taiwan, and Singapore each feature very different healthcare systems despite similar GDP per capita.

Second, Asian markets tend to be dynamic and fast evolving. China, for example, has seen ongoing healthcare reform in recent years. The reform has been driven by the central government, as well as local authorities such as Hainan and the Greater Bay Area, which offer early access options for innovative therapies. In addition, alternative reimbursement opportunities such as commercial health insurances (CHIs) are developing fast. City CHIs, for example, have mushroomed in a mere three years, expanding to 200 cities from just a handful, covering over 100 million people in China. This underscores the speed and momentum of change in Asia that’s rarely seen in the rest of the world.

Some Asian markets also are intertwined in many ways. Regulatory approvals in Hong Kong and Macau would help secure early access to China, while prices in Japan, Korea, and Taiwan are referenced for China’s national reimbursement drug listing.

Given the importance and complexity of Asian markets, global pharma companies would benefit from a strategic approach, focused on executing, in parallel, a two-pronged gameplan.

A good starting point is to group different markets into key archetypes, taking into account characteristics such as regulatory, pricing, and reimbursement potential, as well as clinical practices and competitive dynamics that may differ from one archetype to another.

Systematic prioritization is then needed to identify must-win markets. Take a rare disease drug, for example. It would be tempting to first launch it in the market with the fastest regulatory approval, but that may limit its commercialization in other markets, especially those with larger patient populations and higher pricing potential.

To derive better understanding of the must-wins, deep dives with healthcare practitioners, patients, and payers in those markets will help gain valuable insights into key value drivers. Embedding these considerations in development and launch plans will go a long way toward improving the value, pricing, and access potential of the asset in those markets, and toward a robust roadmap across Asia.

Asia has more roles to play beyond simply being a “growth market,” ranging from R&D to manufacturing and supply chain, as well as cross-border partnerships and business model innovation.

In terms of R&D and innovation, leading large pharmas have been increasingly inclusive of Asia in global development plans and multiregional clinical trials for key assets. In addition, Asia has become the source of innovation for certain diseases, given the differences in epidemiology and ethnicity, as well as the large population base and patient pool. The continent has also been at the forefront of business model innovation, partly due to the dynamic and competitive nature in the region. Large Pharma companies have been revamping the traditional go-to-market model. Besides upgrading engagements with physicians, once considered the foremost stakeholders, some are building partnerships with healthcare providers to improve diagnosis and treatment standards. They’re also seeking innovative ways to work with patients and advocacy groups to improve disease awareness, adherence, and outcomes.

To be effective in these engagements, especially in China, digital tools and mobile platforms have been deployed to improve user experiences, stickiness, and real-world outcomes. For example, a pharma firm has built digital platforms in partnership with JDHealth and AliHealth, which empowered patients by providing them with a one-stop solution from disease education to online consultation, prescription fulfillment, and adherence reminders. At the same time, it affords unprecedented customer insights, thanks to artificial intelligence and big data. It also helps pinpoint unmet needs and builds lifetime relationships with patients and patient families alike.

Shiying He and additional collaborators in Simon-Kucher’s life sciences division in Shanghai contributed to this article.

, partner at Simon-Kucher & Partners, leading its life sciences division in greater China

APAC

Global go-to-market strategies in region require a revamped gameplan.

Cracking the Code to Commercial Promise in Asia 

Switching to electronic labeling is one of the avowed aims of the European pharmaceutical industry, backed by claims that paper leaflets are a costly and inefficient hangover from the pre-digital age. But European consumer representatives have come out firmly against any wholesale shift, taking up cudgels on behalf of pharmacists as well as patients. At the same time, European doctors are digging in their heels against over-enthusiastic embracing of digital care in a sign of growing unease in Europe over headlong pursuit of what industry likes to refer to as health innovation. And there are other indications of a creeping hesitancy within the European healthcare community that could spell trouble for many of the bold initiatives and ambitions now in play to speed healthcare innovation

Sylvia Maurer of BEUC, the influential European consumers bureau, has gone on the record with a list of the downsides she sees in moving to digital-only leaflets that patients can look up online. The official position of industry lobby European Federation of Pharmaceutical Industries and Associations (EFPIA) is that the paper patient information leaflets should be phased out in favor of electronic versions, on the grounds that electronic product information (ePI) ensures that healthcare professionals, pharmacists, and patients and their carers always have access to the latest European product information for medicines. But Maurer says that the current printed leaflet enclosed in each package is there “for very good reasons,” because it tells patients about dosage, side effects, and interactions with other drugs. She rejects the industry demand for all information to be provided digitally, and does not buy the argument that patients who want it in written form can ask a pharmacist for a printout.

The consumer spokesperson insists that patients’ attention to important instructions is at risk if data is provided only in digital form, since that will make the information less likely to be consulted, or it will be read selectively and with less attention. Patients will be deprived of the physical experience that helps reinforce messages. Requiring them to go online rather than having it at their fingertips is going to lead to fewer patients accessing the data, she warns.

European pharmacists take a more nuanced view, but are still highly cautious: their lobby group, Pharmaceutical Group of the European Union (PGEU), supports the use of ePI only “to complement but not to replace” printed leaflets. Printed material linked to each box “addresses the paramount need for immediate and equal access to information crucial to minimise risks, regardless of the equipment and ease with technology,” it says.

As technology and science advance, and new rules are brought into being, the anxiety generated by shifts in established practice grows sharper among many stakeholders. The European Patients’ Forum is not opposed in principle to the proposed European data-sharing legislation, titled European Health Data Space (EHDS), but its response is so heavily loaded with reservations and conditions as to suggest the opposite. Any new arrangements, it says, must be shaped to ensure control of health data “with the highest possible level of data protection,” to ensure patient safety at all levels, and to respect the differences between different health systems that the proposal is in fact intended to overcome. The European hospitals organization, HOPE, also conditions its support for EHDS with a stress on the importance of “the highest viable levels of personal data protection and fundamental rights” and “strong ethical governance.”

Prescrire, the respected French drug monitoring service, warns that “with the increase of digital health services and products, including artificial intelligence, clarity is needed on the legislation applied to these products to guarantee their safety, effectiveness, as well as the patients’ and user’s privacy and rights.” Prof. Ray Walley, GP, vice president of the European doctors organization CPME, has been lamenting the COVID-19 pandemic’s reshaping of remote work and its pressure for online interactions, and argues that “patient safety is too important to be sacrificed for immediacy and convenience.” In comments submitted to the European Commission in its recent consultation on EHDS, 300 statements of rejection, principally from the Czech Republic and Slovakia, warned against the EU centralizing its power through knowledge of the health status of its citizens.

Industry leaders seeking to drive innovation in healthcare can no longer rely on classic justifications of business imperatives and efficiency. Like it or not, they will have to become as astute in politics as in management.

 is Pharmaceutical Executive’s correspondent in Brussels.

Europe Report

Patient safety and data protection concerns highlight hesitancy.

Push for Full Embrace of Digital Care Draws Opposition in Europe

Regulatory authorities and biopharma companies are engaged in a range of collaborations to harmonize research methods, approval standards, and quality production methods key to expanding global drug production. While some initiatives predated the COVID-19 pandemic, the ongoing health emergency has elevated the importance of collaborative efforts to speed biomedical research efforts and to ensure broad access to quality medicines and vaccines.

An important message from COVID is the critical need for global regulatory convergence, commented Peter Marks, director of the Center for Biologics Evaluation & Research (CBER), at the PDA-FDA Joint Regulatory Conference last month. He warned, though, that the move toward greater information sharing seen in recent years is “slipping away” as the pandemic recedes, speaking to the importance of joint efforts to provide pharmacovigilance information and review findings.

Such initiatives are not new for FDA, which has worked for decades to provide technical assistance to regulatory authorities in low-and-middle-income countries to advance regulatory convergence and improve drug production methods. The Promoting Quality of Medicines Plus (PQM+) program implemented by the US Pharmacopeia, with support from the US Agency for International Development (USAID), aims to build in-country regulatory capacity to ensure broad production of high-quality treatments for neglected tropical diseases, tuberculosis, and other infections. A recent FDA online seminar explained these issues for global regulators from lower-income regions, with agency experts describing the FDA’s submission and regulatory processes and collaborative efforts to advance drug quality testing.

Pharmaceutical manufacturers in Europe and other industrial nations similarly are working to ensure equitable access to vaccines and treatments in future pandemics, as seen in a framework devised by the International Federation of Pharmaceutical Manufacturers & Associations (IFPMA) to improve responses to future health emergencies. A declaration issued in July calls for the assessment and identification of successes in pathogen surveillance and vaccine development and distribution during the pandemic. The organization calls on biopharma companies to help regulators strengthen pandemic preparedness and response capabilities to help accelerate the delivery of vaccines, drugs, and diagnostics in their regions.

Similarly, the International Coalition of Medicines Regulatory Authorities (ICMRA) aims to harmonize standards for collecting real-world evidence, for assessing manufacturing information, and for conducting inspections to support quality assessments. One program encourages collaborative assessment of chemistry, manufacturing, and control (CMC) data.

FDA also supports global testing and review efforts, such as Project Orbis at its Oncology Center of Excellence (OCE), which was launched in 2019 to advance cancer drug development and regulation. Sponsors submit applications for high-impact oncology products simultaneously to participating regulators in Australia, Canada, Singapore, Switzerland, Brazil, the UK, and the US to work together on reviews for new cancer drugs and supplements for added indications. While OCE coordinates the program, each regulatory authority makes independent regulatory decisions.

One obstacle to global biomedical regulatory harmonization, however, arises from an EU effort to revise and strengthen its data privacy framework, despite the potential for blocking regulatory access to necessary clinical trial information and adverse event reports. The EU’s General Data Protection Regulations (GDPR), adopted in 2018, aims to limit the release of individual information related to a range of personal activities, including health care. Unfortunately, these policies have created difficulties for FDA bioresearch monitoring program (BIMO) inspections and for sponsors submitting information on patients in new drug applications and other documents.

A report from FDA’s Europe Office, posted in August, describes how the GDPR prevents FDA BIMO investigators from reviewing and copying clinical health data involving EU citizens participating in multinational clinical trails and in reviewing certain demographic and other information normally included in applications sent to the agency. While the EU data framework aims to protect private information on a range of activities, the resulting limits on FDA’s ability to assess EU health information pose difficulties in advancing a global clinical research framework and common regulatory policies.

Washington Report

FDA backs joint reviews and common research policies around world.

Seeking Harmonized Testing, Regulation, and Manufacturing

With short-term financial considerations hitting all industries worldwide, the pharmaceutical R&D ecosystems living within the US borders are still thriving based on well-known keys to success. It does not seem that long ago that 

 started to dig deeper into its biotech brethren that was fueling the innovation and inspiration for advanced science and therapeutic ingenuity.

 the keys to success for the top R&D hubs: Cambridge/Boston, San Francisco, San Diego, Philadelphia, New Jersey, and New York City. Keys included proximity to or number of research/hospitals/health systems; discovery/academia/universities (tech transfer); students/scientists; number of existing biotechs; transportation; state/local government investment; and the number of key FDA approvals that could indicate a positive pivot to commercialization.

The numbers haven’t changed all that much, according to the recent 

JLL 2022 Life Sciences Research Outlook and Cluster Rankings

, which designates its innovation cluster models based on access to talent; funding that leads to commercialization; and real estate infrastructure to support further growth, weighted at 35%, 30%, and 35%, respectively.

Based on their weighted rankings, JLL experts listed their top 15 life sciences clusters, consistent with our top five hubs above, adding Greater DC/Baltimore at No. 4; Raleigh-Durham, NC, at No. 6; Seattle at No. 9; and Salt Lake City at No. 10.

A shout-out to Philadelphia, however, for its recent No. 2 placement if you are looking at the cell and gene therapy (CGT) market. As noted in our 2018 article, state and local investment into building “Cellicon Valley” is hitting its stride. A recent 

 commissioned by the Chamber of Commerce for Greater Philadelphia and researched by economic consulting firm Econsult Solutions, Inc. points to the city as No. 2 overall for CGT hubs. This report ranks according to research infrastructure, human capital, innovation output, commercial activity, and value proposition. Boston placed first and New York third.

In this month’s issue, we do focus a bit on the current financial environment affecting biotech markets, as well as pharma M&As. Columnist Barbara Ryan 

Top hubs continue to perform despite financial uncertainty in other industries.

Pharmaceutical Executive-10-01-2022