[Ip-health] Biotech Marathon: Vaccines And Open Innovation, But Less IP?

[Sophie Bloemen]

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16 February 2010


Biotech Marathon: Vaccines And Open Innovation, But Less IP?


By Catherine Saez <http://www.ip-watch.org/weblog/author/catherine/>  @ 8:5=
1 am

In a mad-dash 34-hour marathon, biotechnology and pharmaceutical industry p=
rofessionals met on 1-2 February in Geneva in what was intended to be a hea=
rth of partnering opportunities. About 600 participants debated future tren=
ds and current challenges along with open innovation, global health and vac=
cines.

Contracts were discussed at all hours in cosy salons or individual confessi=
onal-like booths, and some participants were finding the compressed agenda =
overwhelming with an early start in the morning, networking dinners late in=
to the night and the VIP lounge open till dawn.

Although the biotechnology and pharmaceutical sectors are being challenged =
by the economic crisis and the inherent difficulties of innovation, partici=
pants said that some sectors were promising, such as vaccines, and biotech =
innovations, in particular in healthcare. However, the current systems for =
research and development and intellectual property protection might be obst=
acles for which solutions have to be designed, they said.

According to speakers, greater convergence between different sectors is imp=
ortant, as is the development of partnerships between the public and the pr=
ivate sectors, in particular a closer collaboration with governments in the=
 public health sector.

The event is called BioSquare, a yearly occurrence which alternates between=
 France and Switzerland and organised by BioEvents, a commercial subsidiary=
 of the Fondation Scientifique de Lyon. According to the organisers, 25 pha=
rmaceutical, 241 biotech, and 58 start-up companies attended the 2010 event=
, and 3,266 one-to-one meetings were arranged.

On a panel on open innovation, Ludo Lauwers, senior vice president for John=
son & Johnson pharmaceuticals, said that the current innovation model is no=
t sustainable for the pharmaceutical sector, and companies should seek open=
 innovation solutions. Open innovation is a network of partnership, beyond =
classical networks, he said, and implies a change of mentality.

IP Backlash on Innovation?

Intellectual property seems to be at a crossroads where industry still stro=
ngly favours it but some speakers voiced concerns about the possible counte=
r-effects of too much IP protection on innovation.

Some departments inside companies are afraid of the risk of weak IP protect=
ion, and IP conditions should be worked out up front when an agreement is b=
eing negotiated, said Lauwers. "What we are doing today is not sustainable,=
" he said, arguing that beyond the intense IP discussions in courts, the pa=
tient should be central and if solutions can be brought to the market, ever=
ybody wins. Other ways must be used to protect inventions, he said, such as=
 market exclusivity, which can delay the introduction of competing versions=
.

Bernard Munos, advisor on corporate strategy for Eli Lilly and Company, sai=
d industry has a strong proprietary culture and a non-disclosure policy, bu=
t a change of mentality is critical and although it is happening, progress =
is slow. Eli Lilly, he said, is publishing the audited results of their cli=
nical trials. "A lot of the things that we protect do not really need to be=
 protected. They could be out there on the internet for the world to analys=
e," and this would help a lot of people, he said.

"Maybe we created our own problem," Munos said, adding that today any innov=
ation has so much prior art that "to secure the access to this prior art so=
 that you can practice your innovation it is almost an endless process," ta=
king years and raising costs so high that sometimes it is not worth pursuin=
g the project, he said.

This is a paradoxical situation where a patent system that was designed to =
foster innovation is now actually hindering it, Munos said. The patent syst=
em was created in a pre-internet days, he said, and internet changed the dy=
namics of innovation. There are no longer giant advances but rather a risin=
g number of smaller scientific contributions that need to be aggregated, he=
 said.

Vaccines: Best Still to Come

Industry has derived significant economic benefits from the global pandemic=
 influenza crisis and industry representatives at BioSquare were confident =
vaccines are a promising sector, despite rising scrutiny of the decision to=
 declare the flu a pandemic (IPW, Public Health, 25 January 2010 <http://ww=
w.ip-watch.org/weblog/2010/01/25/who-lashes-out-as-council-of-europe-preps-=
hearing-on-flu-pandemic/> ).

In the past, vaccines were an area of little interest for the pharmaceutica=
l industry because of their low profit margins, said Hedwig Kresse, a senio=
r analyst on infectious diseases for Data Monitor. However, in the last 10 =
to 15 years, the situation has changed considerably and vaccines are now a =
key revenue driver for the sector, she said.

This change has been brought about by the better understanding of the human=
 immune system and development of new products that could be sold at premiu=
m prices, such as the Merck vaccine against the human papillomavirus, launc=
hed in 2006 and yielding important benefits, she said.

However, the market is not growing as rapidly as it used to be, and sales f=
igures are showing stagnation, if the pandemic flu stockpiling sales are su=
btracted.

According to Jacques-Fran=E7ois Martin, CEO of Mymetics, three major phenom=
ena are creating a favourable economic environment for vaccines. The first =
phenomenon is evidence, as health ministers' planning is based on evidence =
and "vaccine will come first" because prevention is the best way to spend m=
oney, the second is economical because "prevention always happens to have a=
 better result" even for expensive vaccines, and the third is that the top =
five pharmaceutical companies no longer are producing 80% of the world's ne=
ed and new vaccine manufacturers are appearing, and they will provide cheap=
 solutions to cover the need of developing countries. All of this will cont=
ribute to a solid growth for the sector, he said.

The key to the success in the vaccine sector has been innovation, said Jacq=
ues Cholat, vice president of commercial operations for Sanofi Pasteur. Som=
e 20 years ago, the basic immunisation of a child would have "cost a few do=
llars, even in developed countries," he said, compared to US$130 today with=
 the arrival of new vaccines such as that for hepatitis B.

The Global Alliance for Vaccines and Immunisation (GAVI) process has "made =
credible the opening of the developing world to becoming a potential custom=
er," Cholat said. Even at low prices "like our industry is willing to do," =
when multiplying that price by the number of children in developing countri=
es, "you reach a very significant amount of money."

"Today, with institutions like the Gates Foundation supporting GAVI," real =
market for vaccines in developing countries has become credible, Cholat sai=
d.

If technological and scientific developments are promising, existing tools =
still have a lot to yield, said Cholat, taking the example of whooping coug=
h, in which nowadays, in most cases in the developed world, adults are cont=
aminating children. "We are at the very early stage of an immunisation stra=
tegy that will go far beyond children," and which will address the immunisa=
tion status of adults all through life, bringing a very substantial develop=
ment of the market, he said.

Catherine Saez may be reached at csaez@ip-watch.ch.