Pharmyard revolution

“We are in the business of continued medical education.”

Worldwide, Pfizer, the world’s largest research-based pharmaceutical company provides treatment for over 38 million patients a day. It employs 100,000 staff including more than 12,000 medical researchers, and in 2006 recorded revenues of US$48.4bn. Those aren’t bad figures for the education sector.

In the Middle East, the company operates in 14 countries, and covers a population of 270 million people from its Cairo headquarters. Around 1,200 staff are tasked with the challenge of cracking a market which has traditionally been slow to adopt new pharmaceutical products – and El Hakim, who is also director of External Affairs & Policy at Pfizer, is determined to increase the pace of change.

“Our proudest contribution is bringing these breakthrough medicines to the patients as soon as we can,” he asserts. “We are actually working with ministries of health across the region on the fast-track registration of new products, and the formula now in most countries is ‘FDA (US Food & Drug Administration) or EMEA (European Agency for the Evaluation of Medicinal Products) plus 90 days’.

“In some countries, including the UAE, this objective has been achieved, but in others we are still waiting,” he continues. “The longest period of regulatory approval at the moment is in Saudi, but we are working with the new Saudi FDA on achieving this important goal.”

El Hakim admits that the registration of new products in the Middle East is a slow process, but emphasises that the Gulf States in particular are making positive progress.

“We are moving forward, but to a great extent the delays have been as a result of government bureaucracy and the duplication of laboratory work – where a lot of time is spent in the labs of the ministry of health on things that have already been done in more advanced countries like the US or in Europe,” he explains. “Another reason is the constraints on the healthcare budgets – governments don’t want to use new products if they think there is no need for a new product on the market, because they think that there are already similar products or similarly-acting products.”

Nevertheless there is, he claims, a growing recognition from Middle East governments that patients need access to new medicines as quickly as possible.

“When you have an FDA investigating a product and approving it, there is definitely an un-met medical need there,” El Hakim declares. “Usually any new product comes with an added value to the currently available medicines, and when it comes from Pfizer or any of the multinational drug companies, then it’s definitely an addition.”

But being the world’s biggest pharmaceutical group is no protection against the rise and falls of the drug industry. In the last year, Pfizer has notched up a lawsuit from the Nigerian Government over Trovan trials held over a decade ago, seen the departure of both its finance chief, Alan Leving, and its chief scientist, John LaMattina, and watched its profit fall 17.5% in the first quarter. The announcment in January that the group planned to cull its global workforce by 10%, in a bid to secure up to $2 billion in cost savings, was seen as a quiet admission that life is tough at the top.

Pfizer is already involved in almost every major segment of the therapeutic market. It produces hypercholesterolaemia treatment Lipitor (atorvastatin) which, with annual sales of $12bn, is far and away the world’s bestselling drug, and perhaps the world’s most high-profile drug, erectile dysfunction medication Viagra (sildenafil). Other big names include the anticonvulsant Lyrica (pregabalin), which won FDA approval recently for the treatment of fibromyalgia, and Sutent (sunitinib), a treatment approved for advanced or metastatic renal cell carcinoma and gastrointestinal stromal tumour. Its anti-smoking product Champix (varenicline) is tipped to register sales worth over $1.2bn by 2010, and Pfizer reps are now busy flogging a new inhaled insulin treatment for diabetics.

“One of the major healthcare problems here in the Middle East is diabetes – it has reached 25% of the mature population in Saudi Arabia,” notes El Hakim. “Other markets are near this, and diabetes is related to all cardiovascular diseases, so you’re contributing to the treatment of the complications of that problem as well.”

However, the new product, Exubera (inhaled human insulin), has failed to make the anticipated splash since its launch last year. While hotly tipped as Pfizer’s new ‘blockbuster’ drug, the product has yet to find its footing in the market and Pfizer’s specialists have been forced back into the lab. The chief problem, as suggested by patients, is that the delivery inhaler is simply too bulky for everyday use.

“I think this is the price you pay as an innovator – the concept has not yet been established, and while we are now establishing the concept of using this convenient therapy, sales have not been up to the expectations of many people,” says El Hakim, matter-of-factly, quickly adding that Pfizer had anticipated the slow start.
“It’s a technical issue – I think the second generation of inhaled insulin will also come from Pfizer, and we will work on the improvement of this issue,” he continues. “In the Middle East there’s a lot of emphasis placed on convenience, so we’re working on improving it, although it’s very difficult to put any time frame on this.”

Clearly, not all Pfizer products are immediate hits – take a closer look at the company’s record and there are plenty of examples of drugs that have failed to even make the market for one reason or another. Moreover, for a firm so heavily invested in R&D, the consequences of an aborted blockbuster can be shattering. Last year alone, for example, the company plowed an astonishing $7.6bn into R&D; an approach which industry experts have criticized as being economically unsustainable. In a report released last month, accountancy firm PriceWaterhouseCooper noted that pharmaceutical firms are spending twice as much on R&D than ten years ago, but are producing half the number of drugs.

“When you talk about R&D, you talk more about failure than you do about success – only three products out of 10 regain their investment in R&D and actually make some profit,” El Hakim admits, offering an example of the company’s “risky business”.

“Pfizer has been working for years on a lipid-lowering agent that works on good cholesterol, improving it to work alongside Lipitor, which reduces bad cholesterol,” he explains. “But after we spent $1bn, and eight years of R&D, we had to discontinue because the safety profile was not up to expectations. This is a typical example for the pharmaceutical industry, and the risks involved.”

Although El Hakim is factual about the setback, the late-stage failure of torcetrapib – which was intended to compensate for falling Lipitor sales – dealt a major blow to the firm’s drug portfolio. Pfizer has since come under fire from industry analysts who doubt the company can generate enough sales from current and pipeline products to counter the billions that will be lost because of looming patent expirations on key drugs.

This game of risk, however, is one that Pfizer has played since its founding 158 years ago. The company has deliberately stayed high-end, leaving others to toe the generic line, and as El Hakim is continually emphasising, Pfizer puts a premium on innovation and being the first to market in any given sector. However, the landscape of the Middle East’s pharmaceuticals market is changing fast – and with Gulf states including the UAE insisting that residents take private medical insurance, surely the next few years could prove a boom time for generic drug manufacturers?

“We actually look at this from a positive point of view, as it will enhance access to medicines for patients who have not had access before,” responds El Hakim, after a moment’s pause.

“It will improve the solutions available for medical problems, and through this there will be a better chance for innovative medicines like Pfizer’s to be introduced to new segments of the population,” he continues. “We’re not against generics, and the pharmaceutical industry is reliant on both; the research-based industry products that are innovative and treat unmet medical needs, and also the products in the public domain.”

According to El Hakim, the entire pharmaceutical community is dependent on this sensitive balance – the idea is to protect an innovation’s exclusivity to cover the costs of R&D, after which generics come to the market and have their role to play at a much-reduced price. Unfortunately, he admits, the Middle East is at present an exception to the rule.

“In the Middle East at the moment it does not play this way, as generics are not at a substantial discount to original products,” he explains.

“When generics are introduced over here they are at about 70% of the original price, whereas the rest of the world is at about 40%,” El Hakim continues. “The pricing structure in the Middle East is different, as historically in countries like Egypt the instinct has been to protect local producers or give them privileges, and this has meant that the price of generics has not dropped.

“It will drop though – with increased competition, this will be the next revolution,” he insists. “Within the next five to 10 years, we will have stabilised and be paying the same as other parts of the world.”

In the meantime, El Hakim insists, Pfizer will continue to plow billions of dollars each year into the search for the next elusive superdrug.

“With our continuing level of innovation and R&D, we’re still pouring at least 18% of our revenues back into new R&D,” he says. “The continuous introduction of new innovative medicines will not stop, and that’s how Pfizer will focus.

“I don’t see Pfizer getting into generic business – this is not our core competence,” he continues. “We have been in this business for more than 150 years, doing the same business, and this gives you an indication of how this company has contributed to the wellbeing of the Middle East.”