Te­va ax­ing 14,000 work­ers, putting R&D and man­u­fac­tur­ing fa­cil­i­ties on the block in mas­sive re­struc­tur­ing

Im­age: Kåre Schultz, Te­va CEO. News Øre­sund

New­ly ap­point­ed Te­va CEO Kåre Schultz un­veiled a mas­sive re­or­ga­ni­za­tion of the com­pa­ny to­day, with plans to ax 14,000 work­ers, shut­ter R&D and man­u­fac­tur­ing fa­cil­i­ties in var­i­ous places and rad­i­cal­ly pare down $3 bil­lion in costs glob­al­ly to re­make the com­pa­ny in the wake of a pun­ish­ing down­turn in the gener­ic drug busi­ness.

Schultz and the team he’s putting to­geth­er for Te­va are mak­ing a rad­i­cal break from the past, shed­ding a long run­ning re­luc­tance to cut staffers in Is­rael. Al­to­geth­er, the com­pa­ny is cut­ting more than 25% of its work­force and slash­ing a large por­tion of its $16 bil­lion cost struc­ture.

That is a bit­ter pill for staffers at the com­pa­ny, but it is mu­sic to the ears of its in­vestors who have watched the num­bers de­te­ri­o­rate. Te­va’s stock spiked 16% af­ter the re­struc­tur­ing news hit.

The com­pa­ny’s state­ment says that they will close or sell off a “sig­nif­i­cant num­ber of R&D fa­cil­i­ties.” Man­u­fac­tur­ing fa­cil­i­ties will al­so be put on the block. And Schultz plans to launch a top-to-bot­tom R&D re­or­ga­ni­za­tion, start­ing with a com­plete re­view of its spe­cial­ty and gener­ic pipelines. When it’s done, he says, Te­va plans to have a sub­stan­tial pipeline in place able to pro­duce new and gener­ic ther­a­pies. But a com­pa­ny spokesper­son tells me there are no specifics yet on who’s get­ting cut in R&D and which fa­cil­i­ties will be shut­tered.

Te­va is meld­ing to­geth­er its gener­ics and spe­cial­ty drug busi­ness, in­te­grat­ing two re­search groups for brand­ed and gener­ic drugs and look­ing for “syn­er­gies” that al­low the com­pa­ny to cut deep in­to R&D. R&D chief Michael Hay­den is al­so head­ed out, as the com­pa­ny an­nounced ear­li­er.

“The on­ly thing we are re­al­ly pro­tect­ing is the prod­uct flow,” Schultz told an­a­lysts Thurs­day morn­ing. Every­thing else, with the ex­cep­tion of man­u­fac­tur­ing of prof­itable prod­ucts, faces the ax. The cuts are “all over the place,” both in the dif­fer­ent groups as well as the ge­o­gra­phies where Te­va works glob­al­ly.

Fo­cus­ing on man­u­fac­tur­ing, Schultz says that Te­va has 80 man­u­fac­tur­ing sites un­der re­view and there will be “dou­ble-dig­it plant clo­sures the next two years.” If the com­pa­ny was to wipe the slate clean and then start over, it would have a to­tal of on­ly 8 to 12 sites. It’s not re­al­is­tic to do that now, he adds, but over the next 10 years that’s the di­rec­tion the com­pa­ny plans to take fol­low­ing ini­tial cut­backs

Te­va will al­so set the stage for a planned launch of Auste­do and their CGRP mi­graine drug fre­manezum­ab. And the CEO cit­ed CNS dis­eases as Te­va’s best hope for de­liv­er­ing new med­i­cines as Te­va re­fo­cus­es R&D.

The CEO is al­so scrap­ping div­i­dends and bonus­es for 2017 as Te­va grap­ples with its fi­nan­cial cri­sis.

Says Schultz:

To­day we are launch­ing a com­pre­hen­sive re­struc­tur­ing plan, cru­cial to restor­ing our fi­nan­cial se­cu­ri­ty and sta­bi­liz­ing our busi­ness. We are tak­ing im­me­di­ate and de­ci­sive ac­tions to re­duce our cost base across our glob­al busi­ness and be­come a more ef­fi­cient and prof­itable com­pa­ny.

Rum­blings about these cuts have al­ready in­spired a string of protest plans on the part of Is­raeli unions, which hold a pow­er­ful po­si­tion at Te­va. Over the past year, though, Te­va has been in a fi­nan­cial tail­spin. Its deal to buy Al­ler­gan’s gener­ic busi­ness just ahead of the price ero­sion in the field has af­flict­ed all play­ers.

“I am aware that we will be part­ing with peo­ple who have ded­i­cat­ed years and con­tributed a great deal to this com­pa­ny,” Schultz says in a note to staffers, “and I deeply ap­pre­ci­ate their com­mit­ment. We are al­so aware that these changes im­pact not on­ly our work­force, but ven­dors, sup­pli­ers and com­mu­ni­ties where we have played a key role for years. How­ev­er, there is no al­ter­na­tive to these dras­tic steps in the cur­rent sit­u­a­tion.”

GSK's Hal Bar­ron her­alds their sec­ond pos­i­tive PhI­II for cru­cial an­ti-BC­MA ther­a­py, point­ing to a push for quick OKs in a crowd­ed field

Hal Barron has his second positive round of Phase III data in hand for his anti-BCMA antibody drug conjugate belantamab mafodotin (GSK2857916). And GSK’s research chief says the data paves the way for their drive in search of an FDA approval for treating multiple myeloma. 

It’s hard to overestimate the importance of this drug for GSK, a cornerstone of Barron’s campaign to make a dramatic impact on the oncology market and provide some long-lost excitement for the pharma giant’s pipeline. They’re putting this BCMA program at the front of that charge — looking to lead a host of rivals all aimed at the same target.

Martin Shkreli [via Getty]

Pris­on­er #87850-053 does not get to add drug de­vel­op­er to his list of cred­its

Just days after Retrophin shed its last ties to founder Martin Shkreli, the biotech is reporting that the lead drug he co-invented flopped in a pivotal trial. Fosmetpantotenate flunked both the primary and key secondary endpoints in a placebo-controlled trial for a rare disease called pantothenate kinase-associated neurodegeneration, or PKAN.

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UP­DAT­ED: An em­bold­ened As­traZeneca splurges $95M on a pri­or­i­ty re­view vouch­er. Where do they need the FDA to hus­tle up?

AstraZeneca is in a hurry.

We learned this morning that the pharma giant — not known as a big spender, until recently — forked over $95 million to get its hands on a priority review voucher from Sobi, otherwise known as Swedish Orphan Biovitrum.

That marks another step down on price for a PRV, which allows the holder to slash 4 months off of any FDA review time.

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We­bi­nar: Re­al World End­points — the brave new world com­ing in build­ing fran­chise ther­a­pies

Several biopharma companies have been working on expanding drug labels through the use of real world endpoints, combing through the data to find evidence of a drug’s efficacy for particular indications. But we’ve just begun. Real World Evidence is becoming an important part of every clinical development plan, in the soup-through-nuts approach used in building franchises.

I’ve recruited a panel of 3 top experts in the field — the first in a series of premium webinars — to look at the practical realities governing what can be done today, and where this is headed over the next few years, at the prodding of the FDA.

ZHEN SU — Merck Serono’s Senior Vice President and Global Head of Oncology
ELLIOTT LEVY — Amgen’s Senior Vice President of Global Development
CHRIS BOSHOFF — Pfizer Oncology’s Chief Development Officer

A premium subscription to Endpoints News is required to attend this webinar. Please upgrade to either an Insider or Enterprise plan for access. Already have Endpoints Premium? Please sign-in below. You can contact our Subscriptions team at help@endpointsnews.com with any issues.

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Brian Kaspar. AveXis via Twitter

AveX­is sci­en­tif­ic founder fires back at No­var­tis CEO Vas Narasimhan, 'cat­e­gor­i­cal­ly de­nies any wrong­do­ing'

Brian Kaspar’s head was among the first to roll at Novartis after company execs became aware of the fact that manipulated data had been included in its application for Zolgensma, now the world’s most expensive therapy.

But in his first public response, the scientific founder at AveXis — acquired by Novartis for $8.7 billion — is firing back. And he says that not only was he not involved in any wrongdoing, he’s ready to defend his name as needed.

I reached out to Brian Kaspar after Novartis put out word that he and his brother Allen had been axed in mid-May, two months after the company became aware of the allegations related to manipulated data. His response came back through his attorneys.

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Bob Smith, Pfizer

Pfiz­er is mak­ing a $500M state­ment to­day: Here’s how you be­come a lead play­er in the boom­ing gene ther­a­py sec­tor

Three years ago, Pfizer anted up $150 million in cash to buy Bamboo Therapeutics in Chapel Hill, NC as it cautiously stuck a toe in the small gene therapy pool of research and development.

Company execs followed up a year later with a $100 million expansion of the manufacturing operations they picked up in that deal for the UNC spinout, which came with $495 million in milestones.

And now they’re really going for it.

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Video: Putting the AI in R&D — with Badhri Srini­vasan, Tony Wood, Rosana Kapeller, Hugo Ceule­mans, Saurabh Sa­ha and Shoibal Dat­ta

During BIO this year, I had a chance to moderate a panel among some of the top tech experts in biopharma on their real-world use of artificial intelligence in R&D. There’s been a lot said about the potential of AI, but I wanted to explore more about what some of the larger players are actually doing with this technology today, and how they see it advancing in the future. It was a fascinating exchange, which you can see here. The transcript has been edited for brevity and clarity. — John Carroll

UP­DAT­ED: As­traZeneca’s Imfinzi/treme com­bo strikes out — again — in lung can­cer. Is it time for last rites?

AstraZeneca bet big on the future of their PD-L1 Imfinzi combined with the experimental CTLA-4 drug tremelimumab. But once again it’s gone down to defeat in a major Phase III study — while adding damage to the theory involving targeting cancer with a high tumor mutational burden.

Early Wednesday the pharma giant announced that their NEPTUNE study had failed, with the combination unable to beat standard chemo at overall survival in high TMB cases of advanced non-small cell lung cancer. We won’t get hard data until later in the year, but the drumbeat of failures will call into question what — if any — future this combination can have left.

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Am­gen, Al­ler­gan biosim­i­lar of Roche's block­buster Rit­ux­an clears an­oth­er US piv­otal study 

Novartis $NVS may have given up, but Amgen $AMGN and Allergan $AGN are plowing ahead with their knockoff of Roche’s blockbuster biologic Rituxan in the United States.

Their copycat, ABP 798, was found to have a clinically equivalent impact as Rituxan — meeting the main goal of the study involving CD20-positive B-cell non-Hodgkin’s lymphoma patients. This is the second trial supporting the profile of the biosimilar. In January, it came through with positive PK results in patients with rheumatoid arthritis.