Healthcare Newsletter – April 2017

Bleak Aftermath of Price Control Threatens Indian Patients’ Access to Innovative Devices and Drugs
Interests Spike Merely a month ago we applauded Meril Lifesciences’s flag bearing effort on the country’s first indigenously made bioresorbable vascular scaffold (BRS), MeRes100, and today the tables have turned in the Indian context. The recent NPPA notice to impose a price cap that essentially slashed stent prices in the country by over 80% has set panic waves in motion for MNCs and indigenous manufacturers alike, triggering companies to petition withdrawal of premium stents marketed in the country. While Abbott, Medtronic and Boston Scientific have petitioned to do so, others may follow suit. This highlights the burning concern of price control measures curtailing innovation access and introduction of next gen drugs and devices in the Indian market. As the pricing and healthcare access debate intensifies globally, the Indian policy draws attention with this move as well as stipulations in the National Health Policy 2017. After 15 years, the Government has approved a National Health Policy; and for the first time, has stipulated free drugs and diagnostics in all Government hospitals. The NHP also envisions expansion of insurance coverage and a focus on preventive healthcare. As India considers broader possibilities for expanding healthcare access, we would like to emphasize how critical it is for the country to stop overusing historically preferred method of price control, a mechanism that shrinks commercial markets and discourages innovation.
Further Regulatory Clarity Drives Momentum in US Biosimilars Market
AffordabilitySamsung Bioepis’ Renflexis, recently green-signaled by FDA, becomes the fifth biosimilar to be approved in the US, and more notably, the second biosimilar of J&J’s Remicade. Although FDA continues to be slow in warming up to the idea of biosimilars compared to other developed markets (Renflexis was approved in Korea in 2015 and in Europe in 2016), there is no denying that the US regulator has travelled leaps and bounds in the past year, catching up with the global momentum. Considering regulatory uncertainty is a crucial cog in the biosimilars engine, better regulatory clarity and acceptance is definitely encouraging in expanding market access and breaking affordability barriers to biologic drugs. However, other commercial concerns continue to plague the industry and continue to result in high near term uncertainty and risks. Interchangeability and substitutability are still top concerns that keep biosimilar CEOs up at night. Though the recent FDA draft guidance has introduced significant clarity on demonstrating interchangeability, including Renflexis, no biosimilars approved so far are deemed interchangeable and these issues still remain state subjects and there isn’t a national market access pathway laid out in the US yet. However, from the recent developments, it is clear that the clock is ticking away for biosimilar players eyeing regulated markets to act fast to strengthen pipelines, seek partnerships and sprint towards the market, before competition thickens further.
BD’s acquisition of CR Bard signifies Rapid Consolidation in Global Medical Devices Markets
Private Vaccines Market in India It is undeniably an era of consolidation for Med Tech. Be it mergers or acquisitions, there has been aggressive consolidation activity on domestic as well as global front. Becton, Dickinson & Company (BD) adds a major pin to the deal landscape this month. While the acquisition of CareFusion by BD in 2014 for $12.2 billion set the balls rolling for the company, its recent acquisition of C.R. Bard in April 2017 at an eye-raising proposed value of $24 billion enables the company to further build momentum towards expansion of markets and product portfolios. Likewise, the much publicized merger of Abbott Laboratories with Alere is also now close to finalization, albeit at a lower deal value, with Abbott bagging Alere’s industry-leading point-of-care technology. With such aggressive consolidation continuing in the global medical device industry, inorganic growth pursuits continue in both the developed and emerging markets.
Roche’s Ocrevus Poised to make a splash in Multiple Sclerosis Therapy
Home-Health Roche recently nabbed a FDA win for its much anticipated mAb drug Ocrevus (ocrelizumab) targeted for both types of the disease—Relapsing Remitting MS (RRMS) as well as primary progressive MS. Approved as the breakthrough therapy for the more severe and less common primary progressive MS affecting about 10-20% of MS patients, Roche’s Ocrevus has a distinct competitive edge over existing therapies as the industry-first drug for a more debilitating sub set. While this is a commendable feat in itself, the company has also made sure to secure a place in the larger and more competitive market of RRMS by ticking the right boxes of price and performance against competition. Ocrevus has outperformed Merck’s rival drug Rebif in clinical trials and is also prized at an approximate 20% discount to other current therapies, thus intensifying competition and heralding price wars in the near future. The fact that it is a once in six months infusion is the icing on the cake, throwing in a convenience benefit to patients, compared to thrice weekly subcutaneous injections of Rebif and once in 28 days infusion of Biogen’s rival drug Tysabri, essentially sealing the deal for the prospective blockbuster. We remain excited about expanding portfolios in areas of high clinical need and price rationalization benefits for patients.

Sathguru in the News


CPhI North America 2017 (Philadelphia, USA – May 2017)
Meet us at CPhI North America (May 16-18, 2017), the leading global show for pharma ingredients

BIO 2017 (San Diego, CA – June 2017)
Look forward to meeting you at the beach or in the convention center (booth 4700). Sathguru’s CEO Vijay is moderating a penel on biologics in crop improvement.

Stop by to say hello to us!

Mandates—ongoing assignments and partnering opportunities

  1. In-licensing/Acquiring – ANDAs and specialty generics for leading Indian Pharma Company
  2. Strategic investments – Leading Israeli CDMO with strong expertise in topical products
  3. Private equity fund raising – Indian diagnostic company
  4. Series A VC fund raising – Pioneering health tech venture

Contact us to know more…

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