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Business and Science for BD & others #55, January 2011
Linda Pullanwww.PullanConsulting.com805-558-0361
_______________________________________________________________________________ Happy 2011!_______________________________________________________________________________
My picks for the big trends of 2010
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A shortage of “old” drugs
There is an increasing shortage of old chemotherapy drugs, many of which form the backbone of standard of care treatment regimens, resulting in rationing and substitutions of other drugs. Although some shortages result from manufacturing problems, more frequently manufacturers have stopped using their production lines for these low profit drugs in favor of newer more profitable drugs. For example, 8 companies used to make leucovorin but now only 2 are making it. To fill the need, companies will need FDA approval of their manufacturing facilities. In the meantime, the NCI is advising groups on how to manage shortages in their clinical trial protocols. http://www.cancer.gov/ncicancerbulletin/011111/page2
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Puerto Rico - budget fixes versus incentives for jobs
The US Commonwealth of Puerto Rico is the site of manufacturing for 8 of the top 20 biologics sold in the US, and 13 of the top 20 prescription drugs. Puerto Rico has long had a tax structure that favors pharmaceutical manufacturing, with no U.S. federal income tax and a local corporate rate that was not higher than 7%, lower than Ireland’s 12.5% corporate rate. Lilly opened the first plant in the 1960’s and most of the major pharmaceutical companies have plants there. To attract earlier stage companies (and their jobs), Puerto Rico offered 0 to 2% tax rate for up to 15 years, with credits for infrastructure and for 50% of the clinical trial costs.
But Puerto Rico recently passed a new law adding a 4% tax in 2011 (declining over 6 years) on offshore companies benefitting from island manufacturing. The Governor had inherited a 40% budget shortfall and a credit rating worse than California’s. The new tax would be used to help finance the budget and to allow cuts in corporate and individual tax rates to spur economic development. (Life Science Leader, December 2010).
_______________________________________________________________________________ China In-licensing deals from West still rare China is a hot topic, with this month’s JP Morgan’s Healthcare Conference featuring a special track on China. And venture capital investment in China life science in 2010 will reach new highs,” said Greg Scott, CEO and Founder of ChinaBio® LLC, “reaching almost $700 million. Big pharma is eager to market in China. But still the number of product licensing deals where the Chinese companies are bringing in product candidates from the West is small.
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See you at the next meeting?
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Linda Pullan 4400 Paseo Santa Rosa, Newbury Park, CA 91320 1-(805)-558-0361 lpullan@msn.com
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