Industry might want to take its eyes off the patent cliff for a moment and look at its patent submissions. IFI Patent Intelligence revealed to 

 this week that the number of new patents being filed is also trending downward.

In 2008, the pharmaceutical industry received the thumbs up for 2,987 patents, down from 3,219 the previous year. Meanwhile, the biologics community didn’t fare much better, having been approved for 2,676 patents, down from 2,926 in 2007.

The good news for drug companies is that the number of patents being submitted jumped from 8,653 to 9,430 in the past year. The number of submissions from biotech companies, however, has trended downward since 2003, when the molecular biology area submitted 10,189. By last year that number had stumbled to 5,412 filings.

Darlene Slaughter, general manager at IFI, explained that the number of filings in 2008 does not relate directly to the number of patents approved. It takes up to two years for a patent submission to make it through the approval process, meaning that the spike in submissions this year might not affect patent approvals until 2011-right around the time some of the biggest drugs begin to go off patent.

Patents aren’t the only indicator of a company’s success, Slaughter said, “but the more patents you have ready to go through the FDA approval process, the more likely you’ll be to have a couple of new blockbuster sin your pipeline.”


  So what company received those most patent approvals in 2008? Bristol-Myers Squib took the top spot once again with 88 approvals, up from last year’s tally of 82. 

Recently united firms Wyeth and Pfizer dropped from second and third place to fourth (64 patents) and sixth (47 patents), respectively. AstraZeneca (76 patents) and Roche (73 patents) surpassed Wyeth, while Merck bumped Pfizer out of the fifth place slot with 60 approved patents. 

Slaughter said that pharma companies submit and are approved for far fewer patents than other industries due largely to the minimal number of components in a new chemical entity. Tech corporations rank the highest because of the thousands of small technologies involved in making a new computer or television, for example. 

Unlike pharma, tech companies don’t rely as much on current patents for future earnings. “The lifecycle of the patents differ because although tech patents are effective for 20 years, they may not be any good after a year when the technology has moved on,” Slaughter said. “A pharma company’s aim is to get a patent that will keep them going for a good 20 years.”

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News Analysis

Big name patent expirations may be looming, but that's not stopping pharma companies from filing - and getting approved for - dozens of new patents. Pharm Exec looks at which companies are getting the most approvals, and how 2008 compared to previous years.

BMS Tops List of Patent Approvals

CV Therapeutics (CVT) said Wednesday that it will once again review Astellas’ $1 billion dollar bid, having rejecting a similar proposal in November. Observers, however, are skeptical about whether the deal will go through. 

Astellas Pharma Inc. is offering to buy all outstanding CVT shares for $16 per share in cash-a 69 percent premium on CVT’s 60-day average closing price. 

CVT responded in a press release that it would consider the proposition.  “Because Astellas, by its recent announcement, has sought to revive its previously rejected proposal, the CV Therapeutics board of directors will again review developments in the context of the company’s strategic plans and the long term interests of its stockholders.” 

Masafumi Nogimori, president and CEO of Astellas, said in a press release published Tuesday that Astellas was disappointed CVT’s board of directors had rejected their previous proposal; Nogimori believes the two companies are a good fit. “CV Therapeutics’ product portfolio would complement Astellas’ US based hospital and cardiology business,” Nogimori said. “Our established infrastructure and proven track record in drug development and commercialization provide an ideal platform to increase the value inherent in CV Therapeutics.” 

Astellas and CVT partnered earlier in 2008 to market Lexiscan (regadenoson) injection, an A2A adenosine receptor agonist for use as a pharmacologic stress agent in radionuclide myocardial perfusion imaging (MPI). But CVT’s recently relabeled angina treatment, Ranexa (ranolazine), for which it has exclusive rights, would be a desirable addition to Astellas’ product lineup should the deal pan out. In addition to the angina indication, Ranexa’s label now states that Ranexa reduces arrhythmias in patients with coronary artery disease and hemoglobin A1c (HbA1c) in patients with diabetes, and can be used alone or in combination with traditional therapies. 

Although Astellas is aggressively pursuing the deal by going public, analysts are skeptical that CVT will bite. “I think the board and definitely upper management believe Ranexa’s new label in the US makes it a more valuable company,” said Craig Gordon, a biotechnology research analyst with Cowen and Company. “They believe that sales are going to accelerate dramatically, and because [of that] they feel that $16 a share is likely too low.” 

Gordon also predicts that if Astellas is turned away again, it’s unlikely another company will swoop in to make a deal. “One discouraging issue for a big global is that Ranexa is a very pricey drug. Our estimates are that it costs about $2,200 per year, per patient,” he said. “So Ranexa will face headwinds. The cost is a major hindrance, and it’s going to take a lot of marketing and a lot of time to penetrate the primary care setting.” 

Astellas bumped its bid for CV Therapeutics to $1 billion, but analysts doubt the offer is high enough to get the biotech's board of directors to sign on the dotted line.

Astellas Takes Another Stab at CV

Pfizer CEO Jeffrey Kindler revealed on Monday that the biggest pharma company in the world just signed a deal to purchase Wyeth for $68 billion. In one fell swoop, Pfizer offered one answer to the question on analysts’ minds: How can the company survive after so many recent failures and the looming loss if its superstar cholesterol drug Lipitor?

According to reports, Lipitor accounts for approximately 25 percent of the firm’s annual sales. The loss of patent exclusivity for Lipitor in 2011 would have bumped Pfizer from the top of the Big Pharma food chain down to number five. But with Wyeth now in tow, Pfizer might be able to weather the storm.

“In our view, Pfizer’s acquisition of Wyeth is a sound strategic and financial move, which will enhance rev[enue]s and earnings per share in the cliff period, and diversify its portfolio into biologics and vaccines,” stated Deutsche Bank Analyst Barbara Ryan in a letter to investors.

Others aren’t so sure that the purchase of Wyeth alone will cover the potential profit loss. 

“The merger won’t immediately solve Pfizer’s revenue issue,” said Simon King, senior analyst at DataMonitor. “We think that the combined company will still see a decline in prescription pharma revenues through 2013 because Lipitor is such a big earner. Once Lipitor goes off patent, no one product will account for more than 10 percent of total sales.”


  However, the sheer scale of the deal should allow Pfizer to maintain its position as top dog in pharma. “Prior to the acquisition of Wyeth, we expected Roche (with Genentech included) to overtake Pfizer by 2012,” King said. “We also expected Novartis, Sanofi, and GSK to all overtake the company by 2013. Based on this deal-and if the other companies do not partake in M&A activities-we expect Pfizer to stay in the top spot in 2013.”

This purchase allows Pfizer to branch out beyond its small-molecule niche, and immediately push into vaccines. In addition, Wyeth has at least 10 drugs in development for CNS/Alzheimer’s-a particular passion of former CEO Robert Essner, and an area that could pay off big if one or more of those drugs prove effective. 

Wyeth currently markets two of the biggest selling biological drugs-the multivalent vaccine Prevnar and rheumatoid arthritis treatment Enbrel. The Wyeth acquisition also gives Pfizer a sizable veterinary drug division and a consumer division. (Pfizer sold its consumer unit to Johnson & Johnson two years ago.) 

“This is a good move for the industry, because now the biggest player in pharmaceuticals will have the technology for biologics and vaccines,” said Mike Luby, TargetRx. “Pfizer won’t be dabbling in this field-they are now a major player.”


  A cause for concern \ is the number of positions that will be eliminated as part of the acquisition. Pfizer stated on Monday that it expects to reduce its workforce by approximately 10 percent. 

 reported that the company also plans to cut another 15 percent as part of the merger, estimating a total loss of nearly 19,500 jobs. For a sense of scale, that would be the equivalent of laying off roughly 40 percent of Wyeth’s employees. Pfizer told the 

Michael Steiner, a group leader at executive counseling firm RegentAtlantic, told 

 that he has received calls from some in upper-middle management at Wyeth who are weighing their options. 

“What makes a merger like this so attractive is the ability to maintain revenue levels and cut costs by eliminating redundancies,” Steiner said. “You don’t need a headquarters on 42nd Street and another in Madison, NJ-25 miles away.”

Pfizer hit hard with the surprise purchase of Wyeth. But will the pharma giant strike out in the long run? Analysts ponder the long and short-term ramifications of this monster acquisition.

Pharmaceutical Executive-01-29-2009

BMS Tops List of Patent Approvals

Astellas Takes Another Stab at CV

Two Become One: Pfizer Acquires Wyeth