Steve Turley, Managing Director of Lundbeck, has been re-elected Chair of the European Medicines Group (EMG), the UK voice of pharmaceutical companies based in continental Europe.

Robin Bhattacherjee, General Manager of Actelion, was re-elected vice-Chair of the EMG; and Mike Sumpter, CEO of Servier Laboratories, was elected Treasurer.

Issues highlighted at the EMG’s twelfth AGM included the impact of NHS reform on European-based companies and European perceptions of the UK as a pharmaceutical market and research base.

The EMG’s 15 member companies are Actelion, Almirall, Bayer, Boehringer Ingelheim, Ferring, Lundbeck, Menarini, Merck Serono, Norgine, Novartis, Novo Nordisk, Roche, Sanofi, Servier and UCB.

Steve Turley (pictured) commented: “We have members ranging from the UK’s biggest pharmaceutical companies, through biotechnology specialists to emerging organisations. Yet we all share common challenges and can benefit from being able to view these through a European-focused lens.”

“How the implementation of the NHS reforms affects European-based companies is a key issue this year,” noted Robin Bhattacherjee.

“Upwards of 60% of the medicines our members have introduced in the last decade have not been subject to a NICE health technology appraisal, so... local decision making in the CCGs about the use of these remains a major focus for EMG.”

Mike Sumpter noted: “Globally the UK is viewed as a tough market where innovative new medicines aren’t adopted as readily as similar economies.

“We want to work closely with our NHS stakeholder partners to demonstrate that the UK and the NHS is worth investing in.”

Lundbeck is based in Denmark, Actelion in Switzerland and Servier in France; all three companies have major UK operations.

Four UK pharmaceutical and biotechnology SMEs have won the opportunity to promote their innovations at BIO 2013 in Chicago (22–25 April).

The winners of the UK Trade and Investment (UKTI) Innovation Competition are Abcodia, Critical Pharmaceuticals, Nanomerics and PsiOxus Therapeutics.

The companies will receive £1,500 towards flights and accommodation, and a year’s free membership of the BioIndustry Association (BIA).

The UKTI Innovation Competition, open to life science SMEs in the UK, highlights excellence in groundbreaking technologies for a global audience.

As the world’s largest biotechnology event, attended by delegates from more than 65 countries, the BIO Convention represents a major opportunity for small UK companies to make contacts.

Abcodia (London) discovers and validates biomarkers for the early detection and screening of cancer. Critical Pharmaceuticals (Nottingham) is developing a pipeline of recombinant protein and peptide therapies, using patented drug delivery technologies. Nanomerics (London) is a speciality pharmaceutical company that uses patented nanotechnology to boost the performance of known drugs. PsiOxus Therapeutics (Oxfordshire) is developing novel therapies for cancer and other life-threatening diseases.

Gareth King, CEO of Critical Pharmaceuticals, said: “We have recently announced the results of a second clinical study on our intranasal growth hormone product demonstrating clinical proof of concept, and look forward to meeting with commercial partners at BIO 2013 to progress the product into phase 2/3 clinical development.”

“Nanomerics is delighted to be able to showcase to a global audience its Molecular Envelope Technology, which boosts the activity of drugs and gets them where they need to be,” explained Andreas Schatzlein, CEO of Nanomerics. “In a time of undiminished medical need and increasing economic pressure it is crucial that we make the most of the drug compounds that we already understand.”

The majority of physicians find visits from sales representatives useful and of value to their practice, new research has found.

Figures from Cegedim Strategic Data (CSD) revealed that 93.8% of physicians worldwide see value in appointments with only 6.2% of the opinion that appointments are “not at all useful or of value”.

Bruno Sarfati, CEO, CSD, says the results highlight the importance sales visits still hold, although there are still “gaps to be filled” to fully convince all physicians.

CSD analysed data from 11 key pharmaceutical countries, including both mature and emerging markets, based on more than 5.6 million product detailing mentions.

It found that at the end of last year, traditional detailing spending represented 61% of audited marketing channels worldwide.

Of the respondents who valued sales calls, a third (33.3%) described them as ‘very useful and of value’, with a further 60.5% saying they are ‘somewhat useful and of value’.

Almost all of US physicians (97.9%) found some value in calls from representatives. Physicians in Russia and Brazil were the most impressed with nearly half (47.7% and 46% respectively) finding visits very useful, although only 17.1% of Japanese physicians believed this to be the case.

The study also revealed there to be no distinct difference between established and emerging markets, despite an increase in the number of sales and marketing positions in developing regions.

As part of the study, CSD also investigated which of the top ranked international companies in total promotion spending provided the highest level of satisfaction. Eli Lilly came out of top, followed by Johnson & Johnson with Novartis in third. Pfizer, which spent the most money, came sixth.

Bruno Sarfati said the overall results were positive but new working methods may have to be introduced in the future. “The results of CSD’s study show that physicians still value visits from sales reps,” he said.

“A recent qualitative study showed that physicians are looking for rep interactions which are tailored to their daily practice. In the current industry environment it is inevitable that changes will be made to the way rep calls are conducted as we know it today.”

Inconsistent NHS leadership questioned

The NHS has suffered due to inconsistent leadership over a prolonged period, peers in the House of Lords have been told.

Baroness Cumberlege, a Conservative peer, told the House the number of different health secretaries in recent times has led to a lack of trust and confusion by the health service.

Speaking during the committee stage of the Health Bill, Baroness Cumberlege compared the Sir Alex Ferguson’s 25-year reign at Manchester United and asked “what difference it might make to the NHS” had it had a leader for a similar tenure.

Since 1997, there have been seven different health secretaries – six of which under the previous Labour government.

“One of the real problems that we have, and it exists even if it is the same party in power for a length of time, we lack a consistency of leadership, because the Secretaries of State are here one minute and gone the next,” said Baroness Cumberlege.

“I think that contributes to an NHS that gets confused, that gets fed up and is mistrustful of its masters.”

New research shows that SME growth provides the best prospect for economic recovery in the UK. But, as private equity firm ECI notes, finding the cash to reach out to global partners and markets can be a critical hurdle.

With continued pressure on governments across the Western world to reduce their expenditure, together with sustained macro-economic uncertainty and a tightening of bank funding, times are not necessarily easy for the average healthcare company – which often relies on the public purse for reimbursement and debt funding for growth. One might therefore expect the short-term outlook for growth to be somewhat muted, despite the backdrop of positive longer-term demographic drivers of demand.

Hence it is interesting that a recent survey of UK SME businesses by ECI Partners, a UK-based midmarket private equity firm, has found executives to be generally positive about growth prospects over the next 12 months, with 74% of respondents anticipating headcount growth and 60% expecting double-digit turnover growth.

The results met with a warm response from the Government, with Mark Prisk, Minister of State for Business and Enterprise, saying: “It’s good news that despite a tough few months, nearly three-quarters of the SMEs surveyed by ECI are looking to recruit over the next year and half expect to see substantial profit growth in that period. Up and down the country, it is Britain’s SMEs that are driving our economic recovery.”

Reaching out

This year, the survey conducted each summer by ECI Partners gained responses from a total of 246 chief executives from UK growth companies from a range of sectors with turnover between £10m and £200m. The results paint a positive picture against the gloomy economic backdrop of the Eurozone crisis and sluggish UK economy, and suggest that there remains growth potential amongst SME businesses – which account for around a third of UK private sector employment.

Steve Tudge, a Managing Director of ECI, commented: “Despite the barriers to growth, which are principally cited as a weaker macro-environment and funding constraints, we continue to be optimistic about the prospects for good mid-market companies.”

Executives see the key growth drivers to be increasing international sales – with Europe and the USA remaining the dominant international markets, though India and China are becoming more important – and organic growth through investment in sales and marketing and new product development. Over 40% of companies are also planning to increase their use of overseas suppliers to improve their margins.

Internal cash flows are viewed as the most likely source of funding for this growth, though around half of respondents say they are likely to seek bank debt within the next 12 months (despite continued complaints about its cost and due diligence requirements) and around 40% are also likely to look at private equity backing. Fewer than 10% of companies see the public markets as accessible, perhaps reflecting the recent volatility and liquidity issues associated with the AIM market.

Healthcare respondents are less bullish about high growth than their peers in other sectors, and are noticeably less positive about growth than they were last year. This no doubt reflects, in part, the political uncertainty surrounding the current UK healthcare reforms and the public sector spending constraints that are impacting on the health and social care sectors.

Despite this, companies remain more confident of raising growth financing – and of raising it from private equity firms, with over 50% saying that was a likely consideration over the next year.

Financing growth

What does all this mean for SME healthcare businesses in the UK? The sector certainly faces challenges in responding to Government spending cuts, which are tending to put pressure on margins if not always on volumes.

However, opportunities for growth remain amidst these challenges, particularly for companies who are able and willing to venture beyond the UK in order to seek new customers and cheaper suppliers.

Of course, this internationalisation can put a strain on smaller businesses, which may lack the scale to fully support an international infrastructure. Private equity groups with experience and expertise in this process can potentially offer support to management teams in this position – whether by making introductions, sharing best practice or simply financing the required infrastructure.

There are significant sums of capital available for investment from the UK private equity industry, and there remains an appetite to invest in market-leading healthcare businesses. Thus private equity should be considered seriously as an option by management teams in the healthcare industry who are looking to fund growth to help their companies succeed in the current economic environment.

ECI is a private equity group that has been investing in mid-market growth businesses for over 35 years. It invests across sectors, with a focus on UK and Irish companies. Healthcare companies in its current portfolio include a primary care provider (Harmoni), assisted living specialists (Premier Bathrooms, DLP) and medical software companies (Clinisys, Ascribe).

 

Pfizer’s Prevenar 13 (Pneumococcal Polysaccharide Conjugate Vaccine [13-valent, Adsorbed]) has been launched in the UK for active immunisation of invasive disease caused by Streptococcus pneumoniae in adults aged 50 and over.

It becomes the first and only pneumococcal conjugate vaccine to be licensed for adults aged 50 and over after gaining a new indication from the EMA.

Dr George Kassianos, GP and immunisation lead for the Royal College of GPs and the British Travel Health Association, says its introduction is an “important achievement and step forward” for adult patients.

The vaccine was first licensed for infants and young children in December 2009 in Europe and used during the UK’s Childhood Immunisation Schedule in April last year.

The new indication provides a new treatment option for the prevention of adult invasive pneumococcal disease (IPD), which includes the potentially fatal bacteraemic pneumonia, meningitis and septicaemia.

Chris Head, CEO of the Meningitis Research Foundation, welcomed the vaccine’s launch in the UK. “The new license for Prevenar 13 provides an opportunity to protect adults over 50, who are more at risk of serious pneumococcal disease than younger adults,” he said.

Until Prevenar 13’s new indication, adults over 65 and those in clinical risk groups were treated with the pneumococcal polysaccharide vaccine. But in clinical trials, patients given Prevenar 13 had significantly higher antibody responses with the vaccine expected to protect against seven out of the most ten most comment serotypes which causes IPD.

The Government needs to do more to support life sciences in the UK and create an environment where the industry can flourish, a new survey has found.

RSA’s The UK Life Sciences Leaders’ Survey 2011 revealed worries over the NHS reforms, medicine pricing and reimbursement, employment issues and the cost of research amongst its leaders.

Nick Stephens, CEO of RSA, says the Government “urgently needs to do more to ensure that education, regulation, access to medicines and the NHS research base align to support the industry’s continued contribution to the UK economy”.

The report is the second annual survey of industry bosses. Last year the general feeling was of optimism with leaders believing the recently elected coalition Government would improve the business environment.

But twelve months later the mood has changed with results finding leaders claim the UK is not competing effectively globally, creating opportunities for early phase/smaller companies or making the most of its unique selling points: the NHS and skills in innovation and discovery.

Leaders also raised concerns about the increasing cost of working in the UK, the implication of R&D as a result of the NHS reforms, the regulatory burden on operations and the process from development to market. They also advised that fiscal and tax incentives should be given to SMEs to help their growth and the UK compete globally.

Worries were also raised about the introduction of value-based pricing. However, in contrast, health technology assessments were broadly welcomed as a means of enhancing value and meeting therapeutic requirements, the report found.

During the tough economic environment, the survey found that leaders would focus on innovation, creating flexible organisations and processes, and refocusing research and development to weather the current storm.

In a perfect world, leaders revealed they would investing in R&D and make the healthcare sector, regulatory and commercial environment work closer together to achieve better outcomes for patients and the pharmaceutical industry.

Stephen Whitehead, CEO, ABPI, says the survey shows more support is needed for biopharmaceutical companies in the ever-changing NHS. “There is much that the Government has done to support the industry, particularly through the Growth Review and the Office for Life Sciences,” he said. “But we need to build on this as part of a continuing relationship with NHS and Government to explore how unnecessary bureaucracy can be eliminated from the healthcare system so that new treatments can reach patients as quickly as possible.”

A new technology for point of care diagnosis of carpal tunnel syndrome (CTS) is about to be become available to GPs through leading UK healthcare distributor Williams Medical Supplies.

Williams has an exclusive agreement with Finnish company Mediracer to make this groundbreaking diagnostic tool available to UK primary care.

CTS, often linked to typing or driving, is a pressure on the median nerve in the wrist that can lead to numbness, tingling, weakness or muscle damage in the hand.

The use of Mediracer’s NCS test is claimed to reduce the CTS screening cost per patient from £270 in secondary care to £67 in primary care.

The Mediracer NCS technology identifies nerve entrapments in the hand using disposable surface electrodes. The results can be used to diagnose CTS and grade its severity.

Steve Dunn, CEO of Williams Medical Supplies, said: “We have a strong presence in the primary care market, but we want to strengthen our position to help suppliers and manufacturers – like Mediracer – to win more business.

“By offering exclusivity on key products to Williams, these companies will benefit from our unparalleled market penetration and business support.”

“CTS is a high-incidence condition and our tool provides consultant interpretation within minutes, allowing GPs to do work which is normally confined to hospitals and which saves the NHS money,” commented Pasi Karsikas, Mediracer’s Sales Director.

“We chose to partner with Williams for a number of reasons – they are the UK’s leading GP supplier, with excellent customer support and unrivalled market penetration – so we are looking forward to a bright future in this marketplace.”

Based in Gwent, Williams Medical Supplies is the UK’s leading provider of medical supplies and services, used by around 9,000 of the 10,500 GP surgeries.

West Midlands home care specialist Salts Healthcare has acquired Healthlink, a Dispensing Appliance Contractor (DAC) covering Sussex, Hampshire, Kent and Surrey.

The acquisition will enable Salts to make its UK customer service network fully national, increasing its number of care centres to 17.

Sussex-based Healthlink has been run for 30 years by its founder and owner Liz Box, who is due to retire.

Family-owned Salts Healthcare, established over 300 years ago, specialises in stoma and continence care products.

The company’s home delivery service, Salts Medilink, provides specialist nurses and rapid prescription delivery via a network of customer care centres.

According to Peter Salt, Salts Healthcare’s Managing Director, the company “provides a vital service to ostomy and continence patients throughout the UK”. He added: “That passion to provide the very best service is found across the Healthlink team, and it’s that same quality of care and professional principles that attracted us.”

“This is a new chapter for both me and the company, and I’m delighted that my work will be continued with the same passion by Salts Healthcare,” said Liz Box. “As a family-owned firm, I know that Salts will look after my company, my staff and most importantly the patients.”

For Salts Healthcare, the last year has seen new product launches, significant export growth and the acquisition of UCI Healthcare.

Philip Salt, CEO, (pictured above with Liz Box and Peter Salt), commented: “Our early history shows we were originally metal workers who progressed to surgical instruments. This adaptation was borne out of our home-made but specialist skills and the desire to innovate. The same principles apply now, especially in a global economy with pressures for cheaper products coming from across the world.”

In the UK joint working is being encouraged to develop innovative services and propagate best practice. But in France, new legislation is placing significant barriers between pharma and its clients. Jérôme Guermonprez explains the implications for market access strategies in the country.

Across Europe pharmaceutical companies have been looking to underpin market access strategies with strong links to healthcare professionals. And while most pharmaceutical companies admit there are significant national differences that demand specific market access strategies, there has been a push, where possible, to leverage expertise, messaging and strategy to drive economies of scale.

Many organisations are now actively embarking upon innovative, cooperative working with regional decision-making bodies – such as the Clinical Commissioning Groups (CCG) in the UK; whilst doctors and pharmacists are increasingly involved in research projects, from clinical research to patient care, patient outcomes and procedures. Indeed, the UK’s amended Health and Social Care Bill strongly encourages pharmaceutical research, innovation and the use of scientific evidence in decision-making.

In France, the forthcoming radical overhaul of the drug regulatory system will significantly change relations between pharmaceutical companies, healthcare professionals, patient associations and physician associations. The “Reforme du Medicament” legislation aims to crack down on health practitioner conflicts of interest, restructure the country’s drug regulator and tighten the process for licensing drugs and for monitoring their effects once in use.

The proposed bill creates compliance requirements that far outstrip the UK anti-bribery laws and includes a number of significant changes which will directly affect the way pharmaceutical companies interact with opinion leaders across the French health service.

To minimise the risk of conflict of interest, the new legislation mirrors the US Sunshine Act by requiring pharmaceutical companies to disclose all financial relationships with healthcare professionals, patient associations and scientific experts.

With an emphasis on patient safety, the bill also requires far more detailed information and discussions about indications – from the provision of a helpline number on every drug packet to enable patients to report problems, to the creation of a government watch list of drugs under review.

It also demands pharmaceutical companies no longer undertake direct physician training but instead provide the funding for training to the government, which will then oversee independent training programmes.

 

Restricted access

Critically, from a market access perspective, the bill will prohibit individual medical representative visits to physicians within a hospital; visits must be collective to avoid any one-to-one relationships and ensure discussions are open and transparent.

The impact of this legislation – which is currently being discussed and should be passed by the French government by the end of 2011 – will be significant for pharmaceutical market access policies and demand companies gain new insight into key opinion leaders (KOL).

Under this new model, the industry will have to be incredibly careful about the type of relationships that are put in place with stakeholders; indeed, at least one pharmaceutical company has already announced it will no longer pay physicians directly in the future or invest directly in physician grants to avoid any regulatory compliance issues.

Furthermore, with many physicians likely to back away from any interaction with the pharmaceutical industry, at least in the short term, patient and physician associations will have a far greater role to play. Pharmaceutical companies will have to rapidly assess the way these associations and individual physicians respond to the new legislation and amend market access strategies accordingly.

 

Regional structure

This new challenge comes at a time when pharmaceutical companies are still adjusting to the major overhaul of the French healthcare system – which has seen the creation of 26 Regional Health Authorities (RHA).

While drug reimbursement is still set nationally as in the UK, since 2009, each region has found the responsibility to adapt national objectives to local or regional health and demographic problematic. Over the past year, each region has had to sign multiple year contracts between the  state and the region to deploy the health strategy.

As in the UK, over the past two years, pharmaceutical companies have realigned resources to create a regional approach based on a key account management (KAM) model. The regional structure has significantly broadened the number of stakeholders involved in decision-making, both financial and medical.

Furthermore, each RHA has a different demographic breakdown and health issues, creating very diverse goals for each region. This change has required a far greater insight into decision-makers and regional objectives; it has also demanded pharmaceutical companies use the KAM approach and strong CRM tools to drive synergies between teams at local, regional and national level.

Pharmaceutical companies in both France and the UK are now actively seeking in-depth insight into the KOLs within new regional structures. Information from the structure of the new organisations, including the multiple drug, technical and price commissions, to identifying specific members, roles and drivers is proving key to create the right regional messaging.

And with this regional, KAM-based model still in its infancy in France, pharmaceutical companies face a tough challenge to ensure the implications of the new medical reform legislation are incorporated.

Messaging, for example, must now be amended to include product safety, as well as quality and efficacy; while companies must ensure information is up to date to ensure changes in physician attitude to the pharmaceutical industry as a result of the new regulations are flagged to remove the chance of inappropriate or unwanted contact. CRM tools will also be essential to coordinate group visits to physicians to avoid any chance of the forbidden one-to-one interaction.

As in the US following the introduction of the Physician Payment Sunshine Act in 2009, pharmaceutical companies will also need help to meet their obligations to declare all activity with physicians.

 

What next?

It is tough to predict how the health service in France will respond to the new legislation over the next 12 months. For pharmaceutical companies there is no doubt that direct physician contact will decline and organisations will have to refocus efforts towards the increasingly influential patient associations and physician associations.

But for those organisations operating across Europe, the changes must demand very different approaches towards health service co-operation. As the UK market looks to drive service innovation and close ties with practitioners at every level, counterparts in France are being compelled to be transparent and improve patient safety. The concept of the global, or even pan–European, market access strategy looks ever less practical.

Jérôme Guermonprez is the Vice President and General Manager, France, Cegedim Relationship Management.