The good, the bad and the ug­ly for the top 15 spenders in the glob­al drug R&D busi­ness: 2018

As a general rule, the top 15 R&D groups in biopharma are known for keeping a very steady hand on spending. I’ve been following this group for more than a decade now, and it hasn’t been unusual seeing little year-to-year variations in the total spend.

But that’s no longer the case.

Four giant companies — J&J, Bristol-Myers Squibb, GlaxoSmithKline and Celgene — all increased R&D spending last year by more than a billion dollars each, according to their recent year-end tallies. That represents some big bets on late-stage efforts during an intense and growing rivalry to score bigger markets in oncology and other key disease focuses. And several will continue to wager fresh billions in the year to come, as analysts now keenly wait to see which of these big players — such as Amgen or Pfizer — pull off some new acquisitions in 2018.

The very biggest players, such as Basel-based Roche and Novartis, will likely keep hunting those bolt-ons they like best.

As we’ve been tracking in our ongoing survey of biotech execs, this is all playing out at a time that experimental drug valuations are at an all-time high, showing few signs of stagnating now. Bristol-Myers just helped prove that with its record pact to partner with Nektar.

Over the past year we’ve seen a continued pullback from brick-and-mortar ops in China, as GlaxoSmithKline helped illustrate with its retreat from Shanghai. But J&J is helping blaze a path toward new alliances with Chinese upstarts, just as Celgene did when it partnered with BeiGene on PD-1. China is becoming a huge new influence on drug development, and they have the scientific capability to make some stunning advances with the help of a reenergized CFDA making it easier to gain an approval there.

Along the way, Chinese biotechs are becoming so prolific that some categories could become commoditized by a slew of me-toos.

Reorganization never stops in Big Biopharma, either. That can mean increased spending at a company like GSK, which tore up its US ops several years ago to knit something new in the Philadelphia area. Lilly has made some deep cuts, presumably ahead of new dealmaking. Amgen keeps trimming staff. And Pfizer demonstrated its zeal for the ax when it cut off neurosciences in a brutal stab. Takeda has undergone a complete remake over the past two years, and like the rest of the pack, it’s building more externalization into the research structure.

The race for PD-1/L1 domination is far from over, even though a tsunami of experimental meds would seem to be setting up some cheaper alternatives. As a result, the leaders are distinguishing themselves with new combos that can top any single therapy. And we’ve moved from pioneering approvals in CAR-T to a race for CAR-T 2.0, with aggressive players like Gilead and Celgene stepping in to fight it out with a powerhouse team at Novartis.

In this field, scoring two or three significant new drug approvals in one year is good, maybe even great. But with old franchises fading fast, it’s the companies that can stay ahead with dominant late-stage pipelines that promise a steady stream of blockbuster OKs that earn the most respect. That requires round-the-clock vigilance, a keen ability to design and execute the right trials and one eye to look over your shoulder to see who’s catching up. All while the industry’s ROI for the giants continues to shrink.

Whew.

And without more ado, here are the top 15 companies by R&D budgets.


This is Endpoints News’ third annual look at the top 15 spenders in the global R&D business. Read the 2016 edition and 2017 follow-up here.

Get instant access to this report with a paid Endpoints News subscription. Includes a detailed analysis of each top spender and the players involved.

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UP­DAT­ED: Roche bags 'break­through' an­ti-fi­bro­sis drug in $1.4B biotech buy­out deal

Roche is snapping up a “breakthrough” anti-fibrotic drug in a $1.4 billion buyout.

The pharma giant announced Friday that it is acquiring Promedior, primarily to get its hands on PRM-151, a recombinant form of human pentraxin-2 (PTX-2) protein that has nailed down mid-stage clinical data on idiopathic pulmonary fibrosis and demonstrating its potential for a range of fibrotic conditions.

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Amarin emerges from an ex­pert pan­el re­view with a clear en­dorse­ment for Vas­cepa and high odds of suc­cess when the FDA weighs in for­mal­ly

Several FDA experts who gathered Thursday to consider the landmark approval of Vascepa to reduce cardio events in an at-risk population voiced their unease about various aspects of the efficacy and safety data, or ultimately the population it should be used to treat. But the overwhelming belief that the data pointed to the drug’s benefit and clearly outweighed risks carried the day for Amarin.

The panel voted unanimously (16 to 0) to support the company’s positive data presentation — backing an OK for expanding the label to include reducing cardio risk. The vote points Amarin $AMRN down a short path to a formal decision by the FDA, with the odds heavily in its favor. Chances are the rest of the questions about the future of this drug will be hashed out in the label’s small print.

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Federal Trade Commission commissioner Rohit Chopra testifies on Capitol Hill (AP Photo/Susan Walsh)

FTC clears Bris­tol-My­ers’ $74B deal to buy Cel­gene — but Dems sig­nal a po­ten­tial hard shift against Big Phar­ma M&A

Bristol-Myers Squibb’s record $74 billion takeover of Celgene is a done deal. And it will all be over — except for the lingering complaints from die-hard Celgene investors — on Wednesday.

Like much else that’s going on in Washington these days, the vote among the 5 FTC commissioners split along party lines, with the 3 Republicans voting to clear the way and the 2 Democrats steamed over what they see as a major M&A move that will lessen competition and innovation. And that split has big implications for the M&A side of the business if the Dems take the White House in 2020.

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No­var­tis scores its lat­est FDA OK — this time for a new sick­le cell dis­ease drug picked up in a $665M deal

Novartis’ decision to buy Oklahoma-based biotech Selexys 3 years ago for up to $665 million has paid off with an FDA approval today.

Blessed with the FDA’s breakthrough drug designation for a speedy review, the pharma giant has pinned down an approval for crizanlizumab, a new therapy designed to reduce the frequency of painful incidents of vaso-occlusive crises among sickle cell disease patients 16 or older.

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No­var­tis spin­out’s first an­ti-ag­ing PhI­II is a flop, so now they’ll turn to Parkin­son’s chal­lenge as shares wilt

Novartis spinout resTORbio is grappling with the collapse of its lead clinical program this morning — an anti-aging R&D failure that will badly damage their rep in the field.

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BeiGene CEO John Oyler at an Endpoints event in Shanghai, October 2018 (Credit: Endpoints News/PharmCube)

UP­DAT­ED: In a first, FDA green-lights use of a Chi­nese built can­cer ther­a­py — and more are com­ing

Weeks after Amgen took a $2.7 billion stake in BeiGene, the Beijing-based biotech has secured its first-ever FDA approval for zanubrutinib, a BTK inhibitor, months ahead of schedule.

BeiGene’s drug, branded as Brukinsa, has secured accelerated approval for adult patients with mantle cell lymphoma (MCL) — a typically aggressive, rare, form of blood cancer — who have received at least one prior therapy.

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What does $62B buy you these days? A lot, says Take­da ex­ecs as the phar­ma play­er promis­es a block­buster R&D fu­ture

First comes the $62 billion buyout. Then comes the asset auction and reorganization to pay down debt. Now comes the detailed pledge of a bigger, brighter future in drug development.

That’s where Takeda finds itself on R&D day today, about 11 months after closing on their Shire acquisition. R&D chief Andy Plump is joining CEO Christophe Weber and other top members of the team to outline a new set of priorities in the greatly expanded pipeline at Takeda, which has jumped into the top ranks of the world’s pharma giants in the wake of the Shire deal.

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GSK's asth­ma bi­o­log­ic Nu­cala scores in rare blood dis­or­der study

GlaxoSmithKline’s asthma drug Nucala, which received a resounding FDA rejection for use in chronic obstructive pulmonary disease (COPD) last year, has shown promise in a rare blood disorder.

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Mer­ck buys a fledg­ling neu­rode­gen­er­a­tive biotech spawned by an old GSK dis­cov­ery al­liance. What’s up with that?

Avalon Ventures chief Jay Lichter has a well-known yen for drug development programs picked up in academia. And what he found in Haoxing Xu’s lab at the University of Michigan pricked his interest enough to launch one of his umbrella biotechs in San Diego.

Xu’s work laid the foundation for Avalon to launch Calporta, which has been working on finding small molecule agonists of TRPML1 (transient receptor potential cation channel, mucolipin subfamily, member 1) for lysosomal storage disorders. And that pathway, they believe, points to new approaches on major market neurodegenerative diseases like Parkinson’s, ALS and Alzheimer’s.

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