Has the life sciences
sector discovered
a formula for growth
Quarter 2 FY10
October–December 2009
What would you like to change?
Published:
March 2010
BioForum
Edition 31
Sector puts the
GFC behind it
The Life Science Index ex majors continued its stellar
performance in the second quarter, growing 16 per cent to
31 December 2009. Although this growth rate was half that
of the previous quarter, the index ex majors continued to
outperform the ASX All Ordinaries (up three per cent) and the
NASDAQ Biotech Index (up 0.5 per cent).
Two of the majors – Resmed (up 14.3 per cent) and Cochlear
(up 3.5 per cent) – posted respectable gains but CSL’s
lacklustre performance over the quarter held back the
broader Life Science Index. This index grew just 1.6 per cent.
The medical device index ex majors continued on its positive
path with a gain of 29.2 per cent even though 44 per cent
of the stocks experienced share price losses. The pharma/
biotech index ex majors grew 11 per cent.
Over the past four quarters, the ex majors has gained 118 per
cent and outperformed the All Ords by 85 percentage points.
Its returns are now close to those achieved before the global
financial crisis hit in late 2007.
IPOs and secondary financing
There was no Australian IPO activity in the December quarter.
However, there were further signs that confidence is returning
to the secondary finance market. A total of $201 million was
raised, $121 million in the biotech/pharma sector and $80
million in the medical device sector. This continued the recent
trend of raisings increasing each quarter.
In contrast to the lack of activity in Australia, there were two
US IPOs worth $294 million during the December quarter.
The US market was again propelled by optimism with $4.13
billion raised through secondary financing. Total issues have
doubled in recent quarters, resulting in a return to
2007 levels.
VC interest promising
As 2010 continues, signs point towards continued market
support for biotechs. US venture capitalists have been
investing more heavily in life science companies in recent
quarters and there have been substantial secondary raisings
both in the US and locally. Some of this growing US capital
may well find its way into the local sector through M&A
activity: there has been significant interest from overseas
in recent quarters and many Australian companies still
represent good value to US investors.
Still, confidence is not uniform across the entire sector.
Caution should be exercised as half the companies in the
broader Life Science Index experienced share price losses
during the quarter (mainly the smaller cap companies).
Several companies exited the sector and IPOs have been
delayed. The market is now, more than ever, ruthless in taking
companies to task that don’t deliver on their promises.
Feature articles
This edition features four thought leadership articles. We hear
from a patent attorney about the importance of patents in
attracting capital and being competitive, as well as what to
look for when selecting a patent attorney.
A PwC publication discusses venture capitalists’ renewed
interest in the pharmaceutical and life science sector in the
United States. There is also an article from the PwC Pharma
2020 publication regarding the likelihood that pharmaceutical
and life science companies will face a growing tax bill over
the next decade. The last article featured illustrates how
medical device companies can build business value through
an effective compliance program.
Craig Lawn
PricewaterhouseCoopers
Manoj Santiago
PricewaterhouseCoopers
Tony Gellert
PricewaterhouseCoopers
PricewaterhouseCoopers Australia
Life Sciences and Innovation Practice contacts
Australian Industry Leaders – Life Sciences
Craig Lawn
Phone: +617 3257 5672
Email: craig.s.lawn@au.pwc.com
Manoj Santiago
Phone: +612 8266 4494
Email: manoj.santiago@au.pwc.com
Sydney
Private Clients – Assurance
Manoj Santiago
Phone: +612 8266 4494
Email: manoj.santiago@au.pwc.com
Private Clients – Transactions
Kate Julius
Phone: +612 8266 5835
Email: kate.julius@au.pwc.com
Private Clients – Advisory
Tony Gellert
Phone: +612 8266 5776
Email: tony.gellert@au.pwc.com
Corporate Finance
Adrian Bunter
Phone: +612 8266 5099
Email: adrian.bunter@au.pwc.com
Private Clients – Tax & Accounting
Craig McIlveen
Phone: +612 8266 2261
Email: craig.mcilveen@au.pwc.com
Private Clients – Tax
Stephanie Fabian
Phone: +612 4925 1278
Email: stephanie.fabian@au.pwc.com
Pharmaceutical Industry Leader
John Cannings
Phone: +612 8266 6410
Email: john.cannings@pwclegal.com.au
Financial Assurance
Michelle Chiang
Phone: +612 8266 7575
Email: michelle.chiang@au.pwc.com
R&D Tax
Sandra Mason
Phone: +612 8266 0470
Email: sandra.mason@au.pwc.com
Financial Assurance
Ian Benham
Phone: +612 8266 2409
Email: ian.benham@au.pwc.com
Licensing and Forensic Accounting
Cassandra Michie
Phone: +612 8266 2774
Email: cassandra.michie@au.pwc.com
Legal – Commercialisation & IP
Megan Dyball
Phone: +612 8266 6333
Email: megan.dyball@pwclegal.com.au
Brisbane
Melbourne
Craig Lawn
Phone: +617 3257 5672
Email: craig.s.lawn@au.pwc.com
Nadia Carlin
Phone: +613 8603 6616
Email: nadia.carlin@au.pwc.com
Troy Morgan
Phone: +617 3257 8934
Email: troy.morgan@au.pwc.com
Sam Lobley
Phone: +613 8603 3689
Email: sam.lobley@au.pwc.com
Contents
Contents
Quarterly key findings
1
Feature articles
3
Market performance
21
Performance overview
22
Quarterly financing
24
Yearly financing
25
Top 10 performers
26
Bottom 10 performers
27
Announcements – Australia
29
Partnerships
30
Mergers, acquisitions and divestments
32
Clinical trials
33
Regulatory
35
Other news
37
Announcements – US
41
Partnerships
42
Mergers, acquisitions and divestments
43
Clinical trials
45
Regulatory
47
Appendix
Companies in the PwC Life Sciences Index
53
54
Methodology
56
Acknowledgements
57
Quarterly key findings
Quarterly key findings
Market performance
Total market cap of the life sciences industry at end of quarter
Quarterly change in the life sciences industry
Total market cap of the pharma/biotech sector at end of quarter
Quarterly change in the pharma/biotech sector
Total market cap of the medical device sector at end of quarter
Quarterly change in the medical device sector
Page number
A$34,094m
22
1.6%
22
A$23,895
23
-2.2%
23
10,198
23
11.9%
23
Prima BioMed Limited
26
2,900%
26
Individual company performance
Top individual performer
Change in market cap over the last four quarters
Bottom individual performer
Change in market cap over the last four quarters
Rockeby Biomed Limited
27
-80%
27
0
24
0
24
Financing
Number of Australian life sciences companies that IPO’ed
Total market cap injected into the Australian life sciences index through IPOs
Number of US life sciences companies that IPO’ed
Total capital raised in US life sciences IPOs
Number of Australian life sciences companies that had secondary raisings
Total capital raised in Australian life sciences in secondary raisings
Number of US life sciences companies that had secondary raisings
Total capital raised in US life sciences in secondary raisings
2
24
A$294m
24
51
24
A$201m
24
45
24
A$4,131m
24
30
Announcements
Australian
Total number of partnerships formed this quarter
39
Total number of mergers and acquisitions
16
32
Total announcements for clinical trials
30
33
Pre-clinical
4
33
Phase I
10
33
Phase II
8
33
Phase III
8
33
39
35
Total number of regulatory announcements
US
Total number of partnerships formed this quarter
10
42
Total number of mergers and acquisitions
42
43
Total announcements for clinical trials
30
45
Pre-clinical
2
45
Phase I
3
45
Phase II
6
45
Phase III
19
45
94
47
Total number of regulatory announcements
BioForum: October – December 2009 | | PricewaterhouseCoopers
Feature
Feature articles
articles
Feature articles
BioForum: October – December 2009 | Let’s be clear
about patents
Any technology-based business that
wants to be competitive must protect its
investment in innovation, writes patent and
trademark attorney David Shoolman.
To patent or not to patent?
Most inventions, especially those in the life sciences arena,
are the product of significant investment in time, money and
ingenuity. It makes no commercial sense to allow others to
have a free ride on such investment.
Relying on trade secrets can sometimes provide sufficient
protection for inventors. However, the technological basis
of most inventions that are in the public domain can be
discovered by reverse engineering or research using the
disclosed invention as a springboard. Competitors are free to
copy inventions that are not protected by patents.
One thing a patent is not is a magic bullet. But it can be a
very valuable asset to a business if used correctly.
The very existence of some businesses is based on their
patent protection. Some companies in competitive industries
have extensive patent portfolios that provide a blanket of
protection to tie up a large part of the technological space.
This can give competing companies significant leverage to
cross-license each other. Without patent protection, they
might be bit players, or might not be able to compete at all.
Others may have patent protection for a few strategic
products or processes forming part of their operation, and
this can give them an edge against their competitors.
Yet others might have a single patent for a small but valuable
aspect of a business that enables them to corner a niche
market. Alternatively, a company might have a patent relating
to a non-core part of its business that it might license to other
companies for which that area is a core activity.
A patenting strategy should ideally be considered as part of
a company’s overall business plan, especially where a larger
patent portfolio is involved.
| PricewaterhouseCoopers
A launching pad for start-ups
“A patent or patent family can be the launching pad for
a start-up firm,” the European Patent Office notes on its
website www.epo.org in an article entitled “The economic
importance of patents”. “Using their patents, small firms
may be able to attract venture capital and assert their rights
in front of larger companies.”
The article continues: “Today, the number of high-quality
patents – from the point of view of substance – held by a
company increasingly defines its overall value. The stronger
a company’s patent portfolio, the more it is worth on the
stock market, and the higher the price a competitor must pay
in the case of a takeover.”
Start-ups in sectors such as biotechnology often have their
roots in public research institutions, and licensing of an
institution’s patent rights “funds the universities’ research
and opens up new possibilities for innovation”.
Indeed, as the life sciences are highly research-based,
and in light of the potentially high values of the technologies
worldwide, the patent system can be a useful ally to
these industries.
A patent gives an invention’s owner a monopoly (exclusive
commercial rights to the invention) for a set time. In
exchange, the inventor makes details of the invention public
as part of the patent process. The life of a patent typically
ends 20 years from the date the application is filed, and after
that, the invention is part of the public domain, or free for all.
This encourages innovation for the benefit of society as a whole.
Using their patents, small firms
may be able to attract venture
capital and assert their rights in
front of larger companies.
For some businesses, especially those developing new
products or processes, identifying and protecting innovation
is a constant focus. However, for many businesses,
innovation is incidental to their core operations.
For example, a manufacturer might find an innovative solution
to a problem that arises in the manufacturing process.
However, such companies usually get caught up in day-today operations and overlook the fact that such solutions are
potentially valuable.
Companies should be aware of the possibility of protecting
such innovations, as their competitors may be experiencing
similar problems. On the other hand, even if a solution is
innovative, careful thought should be given as to whether its
innate value makes it worth protecting and warrants the cost
of the patenting process.
What to look for in a patent attorney
The most important factor in selecting a patent attorney is
whether they have the experience and technical capabilities
to do the job. While qualifications may be an indication,
clients should feel free to ask about an attorney’s experience.
Drafting patent specifications is often considered something
of an art form, as it requires properly identifying the crux of
the invention, distinguishing this from what is already in the
public domain, and putting it into the concise language used
in patent specifications. This may involve a high degree of
legalese but is often necessary due to legal requirements in
most countries.
Cost is an important consideration. The simple fact is that
patent applications can be extremely costly. However, costs
can be minimised and managed, and risks reduced.
Some firms will offer fixed or capped costs for many aspects
of the work and this can prevent unpleasant surprises. The
key thing is transparency. One should not be afraid to ask
for a clear breakdown of expected costs, including hourly
charge-out rates for time-based matters. This applies to work
to be done in the immediate future and also to work further
down the road.
The application process
Patent applications can be complicated, with numerous
options available. For example, there is the question of
whether and when to conduct a search and which type of
search may be appropriate. There are various options relating
to the type of application to be filed and applications for
patents in other countries.
A patent attorney should outline and explain the available
options, including the approximate costs, to allow the client
to make an informed decision. Remember, the purpose of a
patent is to add value to the business, and this value can be
large. It is important to work closely with your patent attorney
to make the most of your innovation.
David Shoolman is the managing principal of Ascot Martin
Patent & Trade Mark Attorneys.
Attorneys should be proactive, and understand their client’s
requirements and where the invention fits into their business.
Most clients without experience of patents do not know what
information their attorney needs to properly draft a patent
specification. It is the attorney’s job to ask questions to elicit
the required information. Many patents are not worth the
paper they are written on as the attorney has not asked the
right questions to properly understand the true nature of
the invention.
The purpose of a patent specification is not simply to
describe the features of the invention, but to define in words
the protection and monopoly being claimed. If your attorney
is not able to explain in straightforward language that the
claims are of the appropriate scope, this should give you
cause for concern.
BioForum: October – December 2009 | Feature articles
Identifying inventions
| PricewaterhouseCoopers
Also driving investment in the sector, stepped-up
acquisitions of smaller biotech, pharmaceutical, and
medical device companies by more established ones
and a promising opening in the IPO window have
created new exit opportunities, Lefteroff observed.
“Those opportunities, not as abundant in other sectors,
appear to be encouraging venture capitalists to put
more money to work in life sciences,” he said.
Though still in decline, life sciences sector investment
has outpaced overall venture capital funding since the
third quarter of 2008 (Figure 1). For the full year 2009,
life sciences sector funding totaled $6 billion in 715
deals. That figure came in lower than the $7.8 billion
invested in 884 deals in 2008 and $9 billion in 899
deals in 2007.
1
0%
-20%
Life sciences funding
2009 Q4
2009 Q3
2009 Q2
2009 Q1
2008 Q4
-60%
2008 Q3
-40%
2008 Q2
“Venture capitalists see real opportunity for growth
within the sector. As the worldwide population ages
and more people enter their years of greatest healthcare
need, demand for new pharmaceuticals, diagnostics,
and medical devices has the potential to go higher than
we’ve ever seen,” Lefteroff continued.
20%
2008 Q1
“The life sciences sector continued to attract the lion’s
share of funding, accounting for one-fourth of all deals
in the fourth quarter of 2009,” said Tracy T. Lefteroff,
global managing partner of the Venture Capital practice
at PricewaterhouseCoopers LLP.
Figure 1: Life sciences funding compared with total
venture funding
% change (Y/Y)
Reflecting the relative strength of the sector during the
economic downturn, life sciences captured the largest
share of overall venture capital during 2009. The sector
accounted for 34 percent of all venture dollars invested
last year, compared with 28 percent in 2008.
Total venture capital
For all sectors, venture capitalists invested $17.7 billion
in 2,795 deals in 2009, marking the lowest level of dollar
investment since 1997. Venture investments in 2009
represented a 37 percent decrease in dollars and a
30 percent decrease in deal volume from 2008 and
marked the second consecutive year of deal and dollar
declines. Overall investments in the fourth quarter of
2009 totaled $5 billion in 794 deals, a 2 percent decline
in dollars but a 15 percent increase in deals from the third
quarter of 2009, when $5.1 billion went into 689 deals.
Life sciences funding by year
Compared with 2008, life sciences funding plunged
22 percent in 2009. Funding had already declined
14 percent in 2008 compared with 2007, the year
that marked its historical high point (Figure 2).
Sector deal activity also continued to decline in 2009,
marking its lowest point in the past six years. Along with
a lower number of deals, average deal size declined to
$8.5 million in 2009, down from $8.8 million in 2008 and
$10 million in 2007.
The MoneyTree life sciences sector includes the biotechnology and medical device and equipment industries. Biotechnology is defined as “developers
of technology promoting drug development, disease treatment, and a deeper understanding of living organisms; includes human, animal, and industrial
biotechnology products and services. Also included are biosensors, biotechnology equipment, and pharmaceuticals.”
Medical devices and equipment industries are defined as those that “manufacture and/or sell medical instruments and devices including medical diagnostic
equipment (X-ray, CAT scan, MRI), medical therapeutic devices (drug delivery, surgical instruments, pacemakers, artificial organs), and other health-related
products such as medical monitoring equipment, handicap aids, reading glasses, and contact lenses.”
The MoneyTree life sciences sector covers the US market and all dollar figures included in the report are in US dollars.
1
PricewaterhouseCoopers LLP
BioForum: October – December 2009 | Feature articles
Venture capital funding for the life sciences1 sector, which includes the biotechnology and medical device industries,
eked out a somewhat jagged recovery from the steep decline of 45 percent in the first quarter of 2009, according
to findings from the MoneyTree™ Report by PricewaterhouseCoopers and the National Venture Capital Association
(NVCA), based on data from Thomson Reuters.
Figure 4: Life sciences deal volume 2007–2009
1,000
250
8
800
200
6
4
Number of deals
10
Number of deals
Deal value ($ in billions)
Figure 2: Life sciences funding and deal activity 2007–2009
600
400
2
200
0
0
150
100
50
0
2007
2008
2009
2007
2008
2009
Q1
2007
Q2
2008
Q3
Q4
2009
Life sciences funding by quarter
Life sciences average deal size by quarter
During the fourth quarter of 2009, venture capital
investment in the life sciences sector regained upward
movement after dropping almost $65 million in the third
quarter. Sector funding grew from $1.1 billion in the first
quarter of 2009 to approximately $1.7 billion in the fourth
quarter, bringing it back to the same level as in the fourth
quarter of 2008 (Figure 3).
Average deal size increased in the last quarter of 2009,
compared with the last quarter of 2008 as well as the third
quarter of 2009. With the exception of the first quarter
of 2007’s high point of $12 million, average deal size
remained roughly consistent over the past three years
(Figure 5).
Figure 5: Life sciences average deal size 2007–2009
Figure 3: Life sciences funding trends 2007–2009
16
3.0
12
$ in millions
$ in billions
2.5
2.0
1.5
4
1.0
0.5
0.0
8
0
Q1
2007
Q2
2008
Q3
Q4
2009
Life sciences deal volume by quarter
Deal volume in the fourth quarter of 2009 (195 deals)
remained lower compared with the same quarter of 2008
(202 deals). Volume improved sequentially, however,
for the last three quarters of 2009. Life sciences deals
accounted for one-fourth of all deals in the fourth quarter.
Under recovery
| PricewaterhouseCoopers
Q1
2007
Q2
2008
Q3
Q4
2009
Funding for biotechnology and medical devices
The life sciences sector’s investment split for 2009
remained consistent with the two previous years.
Biotechnology captured 59 percent of sector investments
during 2009, while medical devices claimed 41 percent
(Figure 6). Similarly, biotechnology represented 56 percent
of the split in 2008 and 58 percent in 2007.
2
Historically, the biotech human subsegment has received
a majority of the biotechnology industry funding every
quarter. For the last quarter of 2009, with $714 million in
funding, the biotech human subsegment received almost
as much funding as the whole medical device industry.
Out of 108 biotechnology deals for the fourth quarter of
2009, 64 of those belonged to biotech human. Looking
at 2009 as a whole, 244 of the 406 biotechnology deals
belonged to biotech human.
Figure 7: Biotechnology and medical devices funding trends
3.0
$ in billions
2.5
2.0
1.5
1.0
Biotechnology
3
Medical devices and equipment
2009 Q4
2009 Q3
2009 Q2
2009 Q1
2008 Q4
2008 Q3
2008 Q2
2008 Q1
2007 Q4
2007 Q3
2007 Q2
0.0
2007 Q1
0.5
Figure 8: Life sciences funding by subsegment 2007–2009
2.0
1.5
1.0
2009 Q4
2009 Q3
2009 Q2
2009 Q1
2008 Q4
0.0
2008 Q3
0.5
2008 Q2
On an annual basis, biotechnology funding declined
from $5.3 billion in 2007 to $3.5 billion in 2009, while
funding for medical devices plunged from $3.8 billion
in 2007 to $2.5 billion in 2009. On a brighter note,
biotechnology was the single largest investment sector
for the year. For all of 2009, biotechnology completed
406 deals; and medical devices, 309.
Investment in the biotech equipment subsegment
demonstrated strong growth for the year, increasing by
67 percent to $206.5 million.
2008 Q1
For the fourth quarter of 2009, biotechnology ranked
as the No. 1 industry sector for dollars invested and the
only one receiving more than $1 billion. Software came
in second at $959 million.
Funding for the biotech human segment came in flat in
the last quarter of 2009, compared with the same quarter
of 2008 (Figure 8). An increase in deal size offset a small
decline in deal activity.
2007 Q4
In the last quarter of 2009, biotechnology investments
totaled $1 billion in 108 deals; whereas, $719 million
went into 87 medical device and equipment deals.
Biotechnology funding declined by 7 percent year
over year, primarily because of a drop in deal activity.
However, funding for medical devices increased by
14 percent compared with the same quarter in 2008.
This increase reflected gains in both deal activity and
deal size (Figure 7).
2007 Q3
Medical devices
2007 Q2
Biotech
2007 Q1
59%
$ in billions
41%
Biosensors
Biotech Equip
Biotech Research
Biotech Animal
Biotech Human
Biotech Industrial
Pharmaceutical
Medical device funding by subsegment
In the medical device industry, the medical therapeutics
subsegment historically attracts the most funding
every quarter. Medical therapeutics funding started
to decrease, however, after the second quarter in 2009,
falling from $455 million in that quarter to $439 million
in the last quarter.
Within the medical therapeutics subsegment, one
category saw strong growth during 2009. Funding for
surgical lasers jumped by 58 percent to $77.6 million.
Surgical instrumentation and equipment also gained a
small percentage, capturing $864.9 million for the year.
PricewaterhouseCoopers LLP
BioForum: October – December 2009 | Feature articles
Biotechnology funding by subsegment
Figure 6: Life sciences investment split 2009
Medical diagnostics recovered from $65 million in the
second quarter of 2009 to $164 million in the last quarter.
Medical and health products also recovered from the
third quarter’s $34 million in funding to $116 million in the
fourth quarter (Figure 9).
Figure 10: Life sciences funding by stage 2007–2009
3.0
2.5
2.0
1.5
1.0
2009 Q4
2009 Q3
2009 Q2
2009 Q1
2008 Q4
2008 Q3
2008 Q2
2008 Q1
2007 Q4
2007 Q3
Medical therapeutics
Medical diagnostics
Med/health products
Life sciences funding by stage
Life sciences funding trends show late-stage investment
remaining under pressure and early-stage improving.
“These trends illustrate that investors are upbeat on the
sector’s possibilities for liquidity,” Lefteroff said.
“Later-stage companies are finding other ways to
generate cash, such as partnerships and licensing
agreements with larger companies looking to expand their
product pipelines,” he continued. “This takes the laterstage funding burden off venture capitalists.
2009 Q4
2009 Q3
2009 Q2
2009 Q1
2008 Q4
2008 Q3
2008 Q2
2008 Q1
2007 Q4
2007 Q3
2007 Q2
0.0
2007 Q1
0.5
Early stage
2007 Q2
1.2
1.0
0.8
0.6
0.4
0.2
0.0
2007 Q1
$ in billions
Figure 9: Medical devices and equipment funding by
subsegment 2007–2009
Although each of the last quarters of 2008 and 2009
gained $1.7 billion in life sciences funding, early-stage
dollars rose 56 percent in the last quarter of 2009 over the
same quarter of 2008, while late-stage funding dropped
33 percent (Figure 10).
$ in billions
Although medical therapeutics decreased 4 percent
compared with the fourth quarter of 2008, the other
subsegments (medical and health products and medical
diagnostics) grew by 118 percent and 35 percent,
respectively—resulting in a growth of 14 percent for
medical devices as a whole over the last quarter of 2008.
Late stage
Early-stage funding grew to $1 billion in the fourth quarter
of 2009 from $649 million in the fourth quarter of 2008.
Increases in both deal activity and deal size resulted in
this rise in early-stage investment.
Late-stage funding declined to $717 million in the fourth
quarter of 2009, compared with $1 billion in the same
quarter in 2008. Late-stage deal activity and deal size
both declined in this period.
Biotechnology funding by stage
Biotechnology funding by stage shows a similar historical
pattern as life sciences. For the last quarter of 2009,
the largest share of biotech funding went to early-stage
projects. During the fourth quarter of 2009, start-up/seed
funding grew by 43 percent and early stage by 17 percent
over the last quarter of 2008. In contrast, expansion stage
declined by 49 percent; and later stage, by 17 percent.
“The need for venture capital is greater for early-stage
companies that don’t yet have an exit strategy. They need
to funnel assets into the clinic to develop products that
will make them attractive acquisitions or IPOs down the
line,” Lefteroff explained.
Under recovery
10 | PricewaterhouseCoopers
4
2009 Q4
2009 Q3
2009 Q2
2009 Q1
2008 Q4
2008 Q3
100%
Medical device funding by stage
80%
Showing the same overall trends as life sciences
and biotechnology, medical device investments
experienced greater growth in early-stage funding.
During the last quarter of 2009, start-up/seed funding
climbed 194 percent; and early-stage, 143 percent over
the same quarter of 2008. In contrast, both expansion
and later-stage investments experienced a drop of
approximately 35 percent over the same period
(Figure 12).
60%
Figure 12: Medical device funding by stage 2007–2009
$ in billions
1.0
0.8
0.6
0.4
2009 Q4
2009 Q3
2009 Q2
2009 Q1
2008 Q4
2008 Q3
2008 Q2
2008 Q1
2007 Q4
2007 Q3
2007 Q2
2007 Q1
0.2
Early stage
Late stage
First-time funding compared with follow-on
Recovering from a decrease suffered in the first three
quarters of 2009, first-time funding improved in the
last quarter to $275 million, representing 40 deals.
First-time funding in the last quarter of 2009 showed a
growth rate of 14 percent in comparison to the same
period the year before.
5
Follow-on investment
2009 Q4
2009 Q3
2009 Q2
2009 Q1
2008 Q4
2008 Q3
2008 Q2
2008 Q1
2007 Q4
0%
2007 Q3
20%
Initial investment
Regional funding trends
The top five metropolitan regions receiving life sciences
venture capital funding during 2009 were San Jose,
Boston, San Diego Metro, San Francisco/Berkeley, and
New York Metro. Over the past three years, San Jose
ranked highest, with $4.9 billion. Boston came in second
with $3.3 billion, San Diego third with $2.3 billion, and
San Francisco and New York last with $1.7 billion and
$1.4 billion, respectively.
1.2
0.0
40%
2007 Q2
2008 Q2
Late stage
Figure 13: Life sciences follow-on compared with initial
investments 2007–2009
2007 Q1
Early stage
2008 Q1
2007 Q4
2007 Q3
2007 Q2
On an annual basis, first-time funding dropped from
$1.7 billion for 2007 to $916 million for 2009. Follow-on
investment followed a similar decline, slipping from
$7.4 billion for 2007 to $5.1 billion for 2009.
2007 Q1
$ in billions
1.6
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0.0
Figure 14: Top five metropolitan regions 2007–2009
San Jose
Boston
San Diego Metro
SF/Berkeley
New York Metro
0
1
2007
2
3
Deal value ($ in billions)
2008
4
5
2009
PricewaterhouseCoopers LLP
BioForum: October – December 2009 | 11
Feature articles
In contrast, follow-on funding declined in the last
quarter of 2009, compared with the same quarter in 2008.
From year-end 2008, follow-on life sciences investment
dropped $28 million.
Figure 11: Biotechnology funding by stage 2007–2009
Funding in the San Jose area declined more steeply
than the national level in 2009, while funding in the
Boston metro area outperformed the national average.
Both biotechnology and medical devices demonstrated
stronger performance in the Boston area (Figure 15).
Figure 15: Funding trends in top five regions 2007–2009
For the full year 2009, 120 US venture capital firms raised
$15.2 billion. This total represented a 47 percent annual
decline in dollars committed. The year ended as the
slowest for fundraising activity since 1993.4
100%
80%
60%
40%
Boston
S/F Berkeley
New York Metro
2009 Q4
2009 Q3
2009 Q2
2009 Q1
2008 Q4
2008 Q3
2008 Q2
2008 Q1
2007 Q4
2007 Q3
2007 Q2
2007 Q1
20%
0%
The seed and early-stage pipeline needs
replenishing across all industries, and the
health of the start-up community in the next
decade will be dependent upon more robust
first-time financings. 2010 should be the year
to begin that process in earnest.
San Diego Metro
San Jose
Venture capital outlook
The beginning of 2010 brought signs of improvement with
the announcement of several venture capital financings in
the life sciences sector. Several US biotech and medical
device companies closed deals in the $25 million to $30
million range during the first month of 2010.2 A few larger
deals ranging up to $55 million apiece raised capital for
medical device, biotech, and biopharma companies.3
Looking back over the past year and ahead to the next,
Mark Heesen, president of the NVCA, said:
The venture capital industry had no choice but
to slow the investment pace in 2009. The weak
exit environment resulting from an unstable
public market combined with a challenged,
limited partner base sent a strong message to
the venture community to pull back the reins—
and the VCs listened.
Now that the economy has begun to show
signs of improvement, we expect to see dollars
flow more freely back into those sectors that
offered the most promise before the recession
began: clean technology, life sciences, and IT.
Despite this downturn, the venture capital industry’s
outlook for 2010 remained “cautiously optimistic.”
Responding to an NVCA survey conducted late last
year, venture capitalists predicted gradual increases in
investment levels and exit transactions in 2010 but a
shrinking industry over the next five years. Respondents
were almost equally divided as to whether investment in
biotechnology will increase, decrease, or stay the same.5
PricewaterhouseCoopers’ Lefteroff weighs in on the
optimistic side. “A recovering economy combined
with growing demand for innovative products have the
potential to continue to drive investment upward for the
sector,” he said. Lefteroff cited advances in personalized
medicine, enabling specialized pharmaceuticals,
diagnostics, and devices targeted to specific patient
populations as further fuel for investor optimism.
Lefteroff noted that a product does not necessarily need
to promise blockbuster returns to attract venture capital.
“Venture capitalists have demonstrated that they are
willing to place their bets on compounds with a market
potential of several hundred million dollars. We have
seen that this level of potential ROI has provided enough
impetus to take a company public or make it attractive
enough to be acquired.
“History has taught us that as long as investors see a
shorter horizon for an exit strategy, they will be drawn to
the life sciences sector,” he concluded.
2
Marie Daghlian, “Biotech is top sector for venture investment in 2009,” The Burrill Report, Jan. 25, 2010, http://www.burrillreport.com/article-2088.html,
accessed Jan. 26, 2010.
3
OnBioVC, http://www.obviovc.com, accessed Jan. 26, 2010.
4
“Despite Fourth Quarter Increase Venture Capital Industry Experiences Slowest Annual Period for Dollars Committed Since 2003,” Thomson Reuters and
NVCA news release, Jan. 11, 2010.
5
“Venture Capitalists Are Optimistic for 2010 Despite Predictions for Industry Contraction,” NVCA news release, Dec. 16, 2009.
Under recovery
12 | PricewaterhouseCoopers
6
Feature articles
About PricewaterhouseCoopers’ Pharmaceutical
and Life Sciences Industry Group
PricewaterhouseCoopers’ Pharmaceutical and Life
Sciences Industry Group (www.pwc.com/medtech) is
dedicated to delivering effective solutions to the complex
strategic, operational, and financial challenges facing
pharmaceutical and life sciences companies. We provide
industry-focused assurance, tax, and advisory services
to build public trust and enhance value for our clients
and their stakeholders. More than 163,000 people in
151 countries across our network share their thinking,
experience, and solutions to develop fresh perspectives
and practical advice.
Contacts
Tracy Lefteroff, Partner
+1 (408) 817-4176
tracy.t.lefteroff@us.pwc.com
Attila Karacsony, Director
+1 (973) 236-5640
attila.karacsony@us.pwc.com
www.pwc.com/pharma
This document is for general information purposes only and should not be used as a substitute for consultation with professional advisers.
© 2010 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP (a Delaware limited
liability partnership) or, as the context requires, the PricewaterhouseCoopers global network or other member firms of the network, each of which
is a separate and independent legal entity. *connectedthinking is a trademark of PricewaterhouseCoopers LLP (US). NY-10-0613
BioForum: October – December 2009 | 13
Tax threat to the
blockbuster model
Pharmaceutical and life science companies face a growing tax bill over the next decade, a
new PricewaterhouseCoopers report warns.
The report finds that taxes are expected to increase as
a result of the global financial crisis, government pressure,
changing market dynamics and rapidly evolving
healthcare reforms.
The corporate tax burden will rise significantly over the next
decade as governments of industrialised countries struggle
to repair public finances deeply damaged by the debts they
have accrued in managing the global recession.
Entitled Pharma 2020: Taxing times ahead – Which
path will you take?, it was launched in late 2009 by
PricewaterhouseCoopers’ Global Pharmaceutical & Life
Sciences Industry Group and is the fifth paper in the
Pharma 2020 thought leadership series.
Many governments will clamp down on the practice of
minimising corporate tax by shifting profits from countries
with higher tax rates to countries with lower tax rates. By
2020, all multinationals will be subject to much more stringent
tax regulations, and the major powers could impose trading
restrictions on any tax havens that refuse to cooperate.
The report explores both the challenges and opportunities
the industry faces over the coming decade.
In the past, big pharma companies have traditionally
done everything from research and development through
to commercialisation, however this blockbuster model is
continuing to come under threat.
Market trends and lack of innovation are driving
pharmaceutical companies to form more partnerships and
alliances, engage in mergers and acquisitions, and provide
diverse services beyond their traditional product offerings.
PwC believes that to remain competitive, big pharma
companies will need to:
• improve their research and development productivity
• reduce their costs
• expand their presence in emerging markets
• switch from selling medicines to managing utcomes
• embrace changes in the broader healthcare arena.
Big pharma companies must either become fully diversified
conglomerates capable of providing more healthcare
services, or provide such services in collaboration with
research and other organisations.
These include academic institutions, hospitals, technology
vendors and firms offering compliance programs, health
screening, physiotherapy and exercise facilities.
As new business models develop and large pharmaceutical
companies start offering healthcare packages that comprise
medicines and supporting services, we expect their effective
tax rates to rise – unless they pursue strategies to mitigate
the impact.
We also anticipate that a number of political and economic
trends – including a crackdown on tax minimisation – will
contribute to increased complexity in tax planning for the
pharmaceutical and life sciences industry.
14 | PricewaterhouseCoopers
The tax authorities will also work more closely with their
counterparts in other territories to limit the use of hybrid
instruments and entities in cross-border transactions.
Despite the need to replenish depleted public coffers, the
competition to attract companies engaging in R&D will
intensify. Some countries will offer generous tax incentives
and credits – and there will be new competitors keen to build
knowledge-based economies.
To manage effective tax rates in this new commercial
environment, pharmaceutical and life science companies
will need to develop tax planning consistent with their new
business models and carefully balance risk with opportunity.
The industry will need tax professionals who are not only
versed in international law and transfer pricing, but who also
understand the broader business issues – people who can
help top management structure its operations to support new
ways of doing business.
For further information and to download the report, go to
www.pwc.com/pharma2020.
Craig Lawn
Partner
Tax & Legal – Private Clients
Ph: +617 3257 5672
Email: craig.lawn@au.pwc.com
John Cannings
Partner
PricewaterhouseCoopers Legal
Ph: +612 8266 6410
Email: john.cannings@au.pwc.com
Feature articles
BioForum: October – December 2009 | 15
16 | PricewaterhouseCoopers
Background
Through the recent overhaul of the
AdvaMed Code of Ethics1, medical device
companies gained the opportunity to
use the renewed emphasis on ethics to
revamp their approach to compliance.
Most companies quickly integrated
the updated Code provisions into their
compliance policies and trained their
employees to follow explicit guidelines
about appropriate and inappropriate
interactions and arrangements with
healthcare professionals. Now they stand
ready to take the next steps to building
global compliance programs that create
business advantage, foster innovation,
and contribute to long-term viability.
•
Effective training and communication
•
Robust auditing and monitoring
•
Consistent enforcement
•
Prompt response to violations
In addition to assimilating the new
AdvaMed guidelines, medical device
companies are striving to get ahead of
stepped-up enforcement actions from the
Department of Justice (DOJ), Securities
and Exchange Commission (SEC), Federal
Trade Commission (FTC), Department
of Health and Human Services Office
of Inspector General (OIG), Centers for
Medicare and Medicaid Services (CMS),
and Food and Drug Administration (FDA).
Investigations and prosecutions from
this alphabet soup of regulators drain an
enormous amount of financial and human
capital from individual companies; but the
consequences of not devoting adequate
resources to address compliance issues
can cost even more. Financial penalties,
imprisonment of company officers, and
reputational damage can have a lasting
negative impact on business value.
A recent PricewaterhouseCoopers survey
revealed that almost 60 percent of medical
device companies polled do not use risk
assessments to determine whether their
monitoring programs effectively match
limited resources to the most relevant
risks. Failing to set such priorities limits
compliance effectiveness from the outset.
Medical device companies should
understand the minimum requirements
of a compliance program that builds
business value:
•
Clearly established written policies
•
Executive oversight
•
Careful delegation of responsibility
Leading medical device companies move
beyond these basics to weld compliance
into the framework of their corporate
culture. To achieve this integration, they
assess risks, audit their compliance
efforts, and reinforce compliance through
ongoing monitoring of key performance
indicators (KPIs).
Assess risk
Leading companies manage — rather
than eliminate — risk, knowing that they
need to analyze and balance an array of
sometimes competing elements before
formulating an appropriate response. To
effectively assess risk, companies must
establish a compliance baseline and
then identify the risks associated with
that target. Before deciding on a tactic,
prudent companies examine their risk
tolerance, cost-benefit ratio, and the
effects of various potential actions on
business performance.
After identifying risk tolerance, companies
should examine business processes to
see where risk lies and determine how
they want to manage it. Good candidates
for assessment include marketing and
promotional campaigns, charitable
contributions, research grants, consulting
arrangements with health professionals,
and educational conference sponsorships.
Yet many processes go unchecked.
For example, the PwC survey revealed
that most of the participating medical
device companies (90.6 percent) do not
require their compliance departments
to review sales compensation plans
for incentives that could conflict with
compliance laws and regulations.
Compensation processes are often
vulnerable to risk and lend themselves
to enhanced controls, such as required
completion of annual compliance training
or tying bonuses to ethical behavior.
For each process, the compliance
assessment should identify risks and
ask if an infrastructure of people, process,
and technology exists to manage them.
Are controls in place? Is available data
sufficient to monitor compliance?
Assessment tools might include personal
interviews or written questionnaires for
staff who carry out the process, flow
charts showing the activities involved
and who is responsible for them,
benchmarking of practices against
industry standards, and site visits to
see how the process works in practice.
Once the assessment is complete,
companies should empower process
owners to take corrective action
when they detect a change in the risk
environment. Such empowerment enables
companies to respond more effectively to
their changing risk profile and move ahead
of companies that are slower to react to
new risk issues.
Feature articles
Ana
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Audit compliance activities
Mo
Auditing goes hand in hand with
assessment. Medical device companies
take differing approaches to compliance
auditing, with the responsibility most
often placed with their compliance staff,
designated compliance auditors, or
external auditors.
Mon
asse
To ef
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1 Advanced Medical Technology Association Code of Ethics
on Interactions with Health Care Professionals revisions
effective July 1, 2009.
2 | PricewaterhouseCoopers’ KnowledgeLine
BioForum: October – December 2009 | 17
•
T
•
E
a
Analysis
Analysis
At high-performing companies, the audit
function offers independent, objective
analysis to evaluate and improve the
effectiveness of risk management.
Auditors work with functional departments
to consider how new company initiatives
might affect risk management controls.
Their audits also inform management and
the board about how well key risks and
compliance priorities are addressed.
Establish governance
Although written disciplinary policies and
procedures should govern the resolution
of compliance policy infractions, more
than one third of respondents to the PwC
survey said their companies did not have
them. Additionally, more than one third did
not have formal procedures for notifying
the board of pending investigations or
compliance mishaps.
In every company, a governing board or
committee should provide compliance
oversight, following written policies
and procedures. Ultimately the board
should assume responsibility for risk
management, investigations, and
response.
Setting the proper tone at the top
and following through to all levels of
management will help establish a culture
of compliance. Frequent and consistent
communication by leaders to employees
should emphasize the role each
person plays in living the values of the
organization.
Monitor compliance progress
Monitoring completes the cycle that
assessment and auditing set in motion.
To effectively monitor compliance,
companies must designate KPIs to serve
as formalized reporting mechanisms.
KPIs can provide early warning of
deviations from accepted practices.
Common KPIs include:
•
Training metrics
•
Expense reporting violations
and anomalies
•
Number and type of investigations
and hotline calls
•
Metrics for committee activities
•
Measurement of development and
completion of compliance plans
•
Metrics for due diligence on vendors
•
Tracking of patient complaints and
their resolution
•
Use of a compliance incident
reporting database
•
Tracking of number of
contracts reviewed
•
Self assessments by business units
monitors, it can send color-coded alerts
to reporting dashboards and generate
e-mail notifications to predetermined
recipients. With so many legacy systems
already in place, companies that choose
to pursue BPM concepts can profit best
by integrating them with their existing
systems. Conversely, small companies
with simple IT infrastructures can benefit
from the installation of pure BPM-enabled
technologies designed to monitor their
most important business processes.
Investigate, report, and
respond
Companies must clearly assign
responsibility for monitoring KPIs.
Although the compliance department
is ultimately accountable, the business
process owners should track KPIs and
monitor the effectiveness of internal
controls on a daily basis.
How companies choose to use the
information they gain from assessing,
auditing, and monitoring can be critical
to their survival. Highly ethical companies
always document and act on compliance
deficiencies, no matter how insignificant
they seem.
In the PwC survey, about 40 percent
of respondents said they have not
defined and measured KPIs to determine
the effectiveness of their compliance
programs, and another 40 percent are
still developing KPIs. About 19 percent,
however, have forged ahead in using
KPIs and dashboard metrics to improve
compliance reporting.
Whether uncovered by internal monitoring,
whistle-blowers, or external regulators,
when misconduct or aberrations from
accepted practices occur, companies
must investigate and respond immediately.
Proactive investigations help companies
lessen the impact of noncompliance
incidents. Moreover, they can use the
information gained to improve controls
and training so that the same type of
incident will not recur.
Use technology to
aid monitoring
Technology can streamline compliance
monitoring. Automated software that
monitors and reports on business
processes can make monitoring more
efficient and less labor-intensive. Realtime automation can enable timely
compliance with regulatory demands,
enhance control of internal operations,
and lessen the risk of missing profit
opportunities.
Implementing monitoring systems
using business process management
(BPM) technology allows companies to
track transactions and apply controls in
gaps between stand-alone IT systems.
When rules within the BPM detect an
abnormality in the KPIs that the system
In addition, management should
encourage employees at all levels
to report ethics violations and equip
them with procedures and authority to
handle ethical breaches. The identity of
employees who report through hotlines
or other channels should always be
protected. Leaders should communicate
to employees that they will not suffer
repercussions for reporting violations.
Companies that take responsibility for
wrongdoing or damage to customers
and pursue corrective action quickly
also decrease negative impact to their
reputation and financial strength. Voluntary
disclosure to authorities can reduce the
likelihood of criminal prosecution and
lessen monetary and other penalties.
PricewaterhouseCoopers’ KnowledgeLine | 3
18 | PricewaterhouseCoopers
Analysis
Feature articles
K
Analysis
Novem
Accepting responsibility for correcting
noncompliance—even when the company
itself is a victim of fraud or abuse in
violation of strict policies—sends the right
message to investors and customers.
Boost reputation
through compliance
Moving forward, companies need to
solidify their compliance by taking the next
steps to fully assess, audit, and monitor
their programs.
AdvaMed will publish a list of companies
certifying that they have implemented
the stricter Code of Ethics on its website
beginning Jan. 1, 2010. In addition, these
companies may apply for a license to use
AdvaMed’s “Code of Ethics Supporter”
logo. The companies on this list should
aspire to serve as role models; they have
the ability to lift the ethical culture of the
industry beyond what is required by law.
In the eyes of the OIG and of many
prosecutors, compliance plans are
effective only if the corporate culture
clearly reflects adherence to the plan.
Companies that live their code of ethics
day to day benefit from stronger corporate
reputation, better execution of their
strategic goals, fewer ethics violations,
greater trust in business relationships,
higher employee satisfaction, and lower
compliance costs.
Q. Who should be responsible for
auditing compliance activities?
Q. What is the role of business process
management (BPM) software?
A. Compliance staff, designated
compliance auditors, or external auditors
can be assigned this responsibility. An
independent, objective analysis will
help improve the effectiveness of risk
management.
A. BPM technology can help companies
track transactions and apply controls in
gaps between stand-alone IT systems.
Large companies may choose to integrate
BPM concepts with existing systems.
Small companies may want to install pure
BPM-enabled technologies to monitor
their most important business processes.
A. A governing board or committee
should provide compliance oversight,
following written policies and procedures.
It’s important, however, for leaders to
emphasize that each person plays a role in
living the values of the organization.
Peter Claude, Partner
Pharmaceuticals and Life Sciences
peter.claude@us.pwc.com
(415) 498 5024
Doug Mowen, Managing Director
Pharmaceuticals and Life Sciences
doug.mowen@us.pwc.com
(973) 236 5355
Jean Sands, Manager
Pharmaceuticals and Life Sciences
jean.sands@us.pwc.com
(312) 298 3026
Attila Karacsony, Director
Pharmaceuticals and Life Sciences Marketing
attila.karacsony@us.pwc.com
(973) 236 5640
About PricewaterhouseCoopers’
Pharmaceutical and Life Sciences
Industry Group
Questions and answers
Q. Where does ultimate responsibility
for risk management, investigations,
and response lie?
Contacts:
Q. Why should companies disclose
incidents of noncompliance?
A. Taking responsibility for wrongdoing
or damage to customers and pursuing
correction action quickly decreases
negative impact to reputation and
financial strength. Voluntary disclosure to
authorities can reduce the likelihood of
criminal prosecution and lessen monetary
and other penalties.
PricewaterhouseCoopers’ Pharmaceutical and
Life Sciences Industry Group (www.pwc.com/
meddevice) is dedicated to delivering effective
solutions to the complex strategic, operational,
and financial challenges facing medical device
companies. We provide industry-focused
assurance, tax, and advisory services to build
public trust and enhance value for our clients and
their stakeholders. More than 163,000 people
in 151 countries across our network share their
thinking, experience, and solutions to develop
fresh perspectives and practical advice.
The information contained in this document is
for general guidance on matters of interest only.
The application and impact of laws can vary widely
based on the specific facts involved. Given the
changing nature of laws, rules, and regulations,
there may be omissions or inaccuracies in
information contained in this document. Before
making any decision or taking any action, you
should consult a competent professional adviser.
© 2009 PricewaterhouseCoopers LLP. All rights reserved.
“PricewaterhouseCoopers” refers to PricewaterhouseCoopers
LLP, a Delaware limited liability partnership, or, as the context
requires, the PricewaterhouseCoopers global network or other
member firms of the network, each of which is a separate
and independent legal entity. This document is for general
information purposes only, and should not be used as a
substitute for consultation with professional advisors.
PH-10-0068
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4 | PricewaterhouseCoopers’ KnowledgeLine
BioForum: October – December 2009 | 19
20 | PricewaterhouseCoopers
Market performance
Market performance
BioForum: October – December 2009 | 21
Performance overview
Figure 1: Weekly performance over the quarter of the Australian life sciences compared to major indices
20%
15%
10%
5%
0%
-5%
-10%
-15%
30-Sep
02-Oct
09-Oct
16-Oct
ASX All Ordinaries
23-Oct
30-Oct
06-Nov
NASDAQ Composite
13-Nov
20-Nov
27-Nov
NASDAQ Biotech
04-Dec
11-Dec
Life Sciences
18-Dec
25-Dec
31-Dec
Life Sciences ex majors
Table 1: Quarterly movements of the Australian life sciences sector compared to major indices
Index
18.0%
Value
30-Sep-09 31-Dec-09 % Change
ASX All Ordinaries (Index)
4,739
4,883
3.0%
NASDAQ Composite (Index)
2,122
2,269
6.9%
840
844
0.5%
33,541
34,094
1.6%
NASDAQ Biotech (Index)
14.0%
12.0%
10.0%
6.0%
5,856
6,786
3.0%
2.0%
0.0%
Life Sciences ex majors
(Market Cap A$m)
6.9%
8.0%
4.0%
Life Sciences
(Market Cap A$m)
15.9%
16.0%
15.9%
0.5%
ASX All
Ordinaries
(Index)
NASDAQ
Composite
(Index)
NASDAQ
Biotech
(Index)
1.6%
Life Sciences
Life Sciences ex
(Market Cap A$m) majors (Market
Cap A$m)
Figure 2: Two-year comparison of the Australian life sciences sector by market capitalisation compared to major indicies
10%
0%
-10%
-20%
-30%
-40%
-50%
-60%
31-Dec-07
31-Mar-08
30-Jun-08
ASX All Ordinaries
30-Sep-08
NASDAQ Composite
31-Dec-08
31-Mar-09
NASDAQ Biotech
30-Jun-09
Life Sciences
30-Sep-09
31-Dec-09
Life Sciences ex majors
Table 2: Yearly movements of the Australian life sciences sector by market capitalisation compared to major indices
Index
140.0%
Value
30-Sep-09
31-Dec-09
ASX All Ordinaries (Index)
3,659
4,883
33.4%
NASDAQ Composite (Index)
1,577
2,269
43.9%
730
844
15.6%
30,587
34,094
11.5%
3,108
6,786
118.3%
NASDAQ Biotech (Index)
Life Sciences
(Market Cap A$m)
Life Sciences ex majors
(Market Cap A$m)
22 | PricewaterhouseCoopers
% Change
118.3%
120.0%
100.0%
80.0%
60.0%
40.0%
33.4%
43.9%
15.6%
20.0%
0.0%
ASX All
Ordinaries
(Index)
NASDAQ
Composite
(Index)
NASDAQ
Biotech
(Index)
11.5%
Life Sciences Life Sciences ex
(Market Cap A$m) majors (Market
Cap A$m)
Figure 3: Quarterly performance of the Australian life sciences sector and subsectors
30%
25%
Market performance
20%
15%
10%
5%
0%
-5%
-10%
30-Sep
02-Oct
09-Oct
Life Sciences
16-Oct
23-Oct
30-Oct
Life Sciences ex majors
06-Nov
13-Nov
20-Nov
Pharma/Biotech
27-Nov
04-Dec
Pharma/Biotech ex CSL
11-Dec
18-Dec
Med Device
25-Dec
31-Dec
Med Device ex COH, RMD
Table 3: Quarterly summary of the Australian life sciences sector’s performance
Pharma/Biotech
Pharma/Biotech ex CSL
Med Device
Med Device ex COH, RMD
Life Sciences
Life Sciences ex majors
MCap
(A$m)
% of
total
value
Companies
with share
price gains
Proportion of
subsector up
Companies
with share
price losses
Companies
with share
price flat
Proportion of
subsector flat
Total
number of
companies
23,895
70%
28
39%
39
55%
4
6%
71
4,925
73%
28
40%
38
54%
4
6%
70
10,198
30%
21
49%
18
42%
4
9%
43
1,861
27%
19
46%
18
44%
4
10%
41
34,094
100%
49
43%
57
50%
8
7%
114
6,786
100%
47
42%
56
50%
8
7%
111
Proportion of
subsector down
Table 4: Quarterly movements of the Australian life sciences sectors
Index
35.0%
Market capitalisation (A$m)
Pharma/Biotech
30-Sep-09
31-Dec-09
24,426
23,895
% Change
-2.2%
Pharma/Biotech ex CSL
4,415
4,925
11.6%
Med Device
9,114
10,198
11.9%
Med Device ex COH, RMD
1,441
1,861
29.2%
Life Sciences
Life Sciences ex majors
33,541
34,094
1.6%
5,856
6,786
15.9%
29.2%
30.0%
25.0%
20.0%
15.9%
15.0%
11.6%
10.0%
11.9%
5.0%
1.6%
0.0%
-5.0%
-2.2%
Pharma/
Biotech
Pharma/
Biotech
ex CSL
Med
Device
Med Device
ex COH,
RMD
Life
Life Sciences
Sciences ex majors
Figure 4: Two-year comparison of the Australian life sciences sectors’s performance by market cap
20%
0%
-20%
-40%
-60%
-80%
31-Dec-07
31-Mar-08
Life Sciences
30-Jun-08
Life Sciences ex majors
30-Sep-08
31-Dec-08
Pharma/Biotech
31-Mar-09
Pharma/Biotech ex CSL
30-Jun-09
Med Device
30-Sep-09
31-Dec-09
Med Device ex COH, RMD
BioForum: October – December 2009 | 23
Quarterly financing
IPO market
Figures 5 and 6: Quarterly comparison of IPOs in Australia and the US
US
Australia
Biotech
Biotech
Medical Devices
0
25
20
15
24.1
10
5
0
0
Q2FY09
0
0
Q3FY09
Q4FY09
Med Device: $6m
1000
800
1,215
600
400
219
200
0
Q1FY10
-
1200
Capital Raised (A$m)
Capital Raised (A$m)*
Medical Devices
1400
30
0
Q2FY10
75
6
Q2FY09
Q3FY09
Q4FY09
Q1FY10
Q2FY10
* Amounts shown are total market cap additions to the LS Index from IPOs on first day of trading
Table 5: Number of Australian IPO listings
Table 6: Number of US IPO listings
Biotech
Med Devices
ASX total
Biotech
Med Devices
Q2FY10
0
0
27
Q2FY10
1
1
Q1FY10
0
0
3
Q1FY10
2
0
Q4FY09
0
0
0
Q4FY09
0
1
Q3FY09
0
0
3
Q3FY09
0
0
Q2FY09
1
0
5
Q2FY09
0
0
Table 7: Total of quarterly Australian IPO listings
Company
Table 8: Total of quarterly US IPO listings
Company
Capital raised (A$m)
Issue Price
Capital raised (A$m)
Nil
-
-
Omeros Corp
Total
-
-
AGA Medical Holdings Inc
219.0
Total
293.9
74.9
Secondary finance market
Figures 7 and 8: Quarterly comparison of secondary financing in Australia and the US
US
Australia
80
150
16
100
50
-
5
6
101
121
113
67
34
Q3FY09
10,000
Q4FY09
Q1FY10
Avg. amount
Biotech raised (A$m)
970
6,000
3,161
4,000
2,000
Q2FY10
Table 9: Number of Australian secondary raisings
Biotech: $172m
Med Device: $65m
8,000
-
6
Q2FY09
Medical Devices
12,000
Biotech: $6m
Med Device: $6m
200
Biotech
Medical Devices
Capital Raised (A$m)
Capital Raised (A$m)
Biotech
250
65
47
172
Q2FY09
647
Q3FY09
67
1,276
Q4FY09
795
1,794
Q1FY10
Q2FY10
Table 10: Number of US secondary raisings
Med
Devices
Avg. amount
raised (A$m)
Biotech
Med Devices
Q2FY10
33
3.7
18
4.4
Q2FY10
29
16
Q1FY10
30
2.2
11
9.2
Q1FY10
40
17
Q4FY09
21
5.4
9
1.8
Q4FY09
7
3
Q3FY09
22
1.5
4
1.3
Q3FY09
15
7
Q2FY09
15
0.4
9
0.7
Q2FY09
8
4
24 | PricewaterhouseCoopers
Yearly financing
Figures 9 and 10: Annual comparison of IPOs in Australia and the US
US
Australia
Biotech
Medical Devices
5,000
153
250
200
105
150
100
176
118
63
50
24
22
0
FY06
Biotech
6,000
300
Capital Raised (A$m)
Capital Raised (A$m)
350
FY07
FY08
Med Device: $6m
4,000
3,000
2,000
517
1,000
1,636
-FY10 - YTD
FY09
1,013
Medical Devices
4,277
219
0
FY06
FY07
1,354
588
325
6
FY08
FY09
FY10 - YTD
* Amount shown is total market cap addition to the LS Index from IPOs based on first day
of trading
Table 11: Number of Australian IPO listings
Table 12: Number of US IPO listings
Biotech
Med Devices
ASX total
Biotech
Med Devices
FY10 - YTD
0
0
30
FY10 - YTD
3
1
FY09
1
0
24
FY09
0
1
FY08
4
3
79
FY08
8
8
FY07
6
7
245
FY07
42
12
FY06
3
8
172
FY06
20
8
Secondary finance market
Figures 11 and 12: Annual comparison of secondary finance in Australia and the US
Australia
US
2,500
Biotech
25,000
Medical Devices
Biotech
Medical Devices
Capital Raised (A$m)
Capital Raised (A$m)
71
2,000
1,500
2,081
1,000
500
42
236
297
438
FY06
FY07
0
6,202
5,542
15,000
1,765
10,000
16,766
1,699
15,810
5,000
229
182
188
274
FY08
20,000
FY09
8,603
4,955
719
3,330
0
FY10 - YTD
Table 13: Number of Australian secondary raisings
Biotech
Med Devices
FY10 - YTD
63
29
FY09
87
41
FY08
99
FY07
FY06
FY06
FY07
FY08
FY09
FY10-YTD
Table 14: Number of US secondary raisings
Biotech
Med Devices
FY10 - YTD
69
33
FY09
48
24
66
FY08
80
29
98
75
FY07
258
59
56
28
FY06
257
123
BioForum: October – December 2009 | 25
Market
Market performance
financing
IPO market
Top 10 performers over the past four quarters
1
PRR
PRIMA BIOMED LTD (PRR)
SIE
Return:
Closing Price:
MCap:
BTA
OBJ
BZI
A Prima subsidiary was granted a Japanese
patent for its CVac therapeutic cancer
vaccine. Additionally, the company received
FDA clearance for a phase IIb clinical trial
of CVac. Prima engaged two universities
to research the development of an oral
delivery system for cervical cancer vaccines.
ACL
ACR
AVH
SRX
PCC
0%
500%
2900%
$0.15
A$96.04m
1000%
1500%
2000%
2
3000%
3500%
3
SCIGEN LTD (SIE)
Return:
Closing Price:
MCap:
2500%
900%
$0.35
A$193.29m
4
BIOTA HOLDINGS LTD (BTA)
OBJ LTD (OBJ)
Return:
Closing Price:
MCap:
Return:
Closing Price:
MCap:
619%
$2.41
A$431.27m
480%
$0.030
A$32.58m
The company’s net operating cash flow
for Q2 FY10 was US$591k. There were
substantial changes to the board of
directors with several resignations. SciGen
appointed a new chairman and CEO, two
new non-executive directors and two new
executive directors.
Biota received royalties from the sale of
GlaxoSmithKline’s Relenza of approximately
A$24.1m. The company also acquired the
key assets and drug development programs
of Prolysis and Max Thera. A phase III
clinical trial of Biota’s anti-influenza drug
CS-8958 commenced during the quarter.
The company executed a materials transfer
agreement with 3M. OBJ also announced
a private placement to raise up to $1.9m
before costs and a rights issue to raise an
estimated $2.1m before costs.
5
6
7
BRAINZ INSTRUMENTS LTD
(BZI)
ALCHEMIA LTD (ACL)
ACRUX LTD (ACR)
Return:
Closing Price:
MCap:
443%
$0.038
A$2.28m
Return:
Closing Price:
MCap:
365%
$0.70
A$136.98
Return:
Closing Price:
MCap:
359%
$2.12
A$349.63m
Alchemia completed a rights issue, raising
A$15.5m with the issue oversubscribed.
The company realised a net cash increase
of A$21.26m during the quarter.
The company received the AusBiotech
2009 Excellence Award for outstanding
company contribution to the biotechnology
industry. The Therapeutic Goods
Administration advised that approval
of Ellavie for marketing in Australia will
require additional supporting data
8
9
10
AVITA MEDICAL LTD (AVH)
SIRTEX MEDICAL LTD (SRX)
PROBIOMICS LTD (PCC)
Return:
Closing Price:
MCap:
Return:
Closing Price:
MCap:
BrainZ Instruments appointed James
Robinson as its new company secretary.
The company raised a net cash amount
of A$336k from the issue of securities.
Return: 358%
Closing Price:
$0.165
MCap: A$17.18m
Avita received FDA approval to begin its
clinical trial for ReCell Spray-On Skin, which
is a wound, burn and chronic skin defect
treatment. The company was granted a
Japanese patent for various products.
348%
$7.55
A$421.05m
Michael Mangano was appointed president
of Sirtex Medical in the US. The company
settled its claims for costs in legal
proceedings brought by the University
of Western Australia (UWA). Under the
terms of settlement, UWA agreed to pay
Sirtex A$3.25m plus interest on its costs.
The company signed an exclusive global
distribution agreement with the Danish
company Chr Hansen A/S. Under the
agreement, Chr Hansen will manufacture
and market Probiomics’ Lactobacillus
fermentum PCC globally.
Note: The company announcements referred to above were made in the latest quarter and were sourced
from the Australian Securities Exchange website, www.asx.com.au
26 | PricewaterhouseCoopers
340%
$0.022
A$6.47
1
RBY
ROCKEBY BIOMED LTD
(RBY)
NSP
ATW
Return: -80%
Closing Price:
MCap:
Top and bottom performers
Bottom 10 performers over the past four quarters
SFP
$0.013
A$0.97m
ICV
PBT
The company announced an intention to
delist from the ASX, citing limited ability
to raise funds from the equity markets
and the cost of maintaining listing being
disproportionate to its market capitalisation
TDX
XCD
ADO
CYT
-90%
-80%
-70%
-60%
-50%
-40%
-30%
-20%
-10%
2
3
4
NUSEP LTD (NSP)
ATOS WELLNESS LTD (ATW)
SAFETY MEDICAL
PRODUCTS LTD (SFP)
Return:
Closing Price:
MCap:
-72%
$0.265
A$6.50m
Return:
Closing Price:
MCap:
-64%
$0.015
A$2.86m
Return:
Closing Price:
MCap:
-60%
$0.042
A$3.34m
NuSep signed a letter of intent to purchase
BioInquire, a US-based mass spectrometry
software development company. The deal
is worth US$2m plus additional payments
contingent upon profit results.
The company settled a loan from
Bestempire, with no issue of shares as part
of repayment. Johnson Teh was appointed
as a non-executive director. ATOS Wellness
had a net decrease in cash for the quarter
of A$669k.
5
6
7
INCITIVE LTD (ICV)
PRANA BIOTECHNOLOGY
LTD (PBT)
TYRIAN DIAGNOSTICS LTD
(TDX)
Return:
Closing Price:
MCap:
Return:
Closing Price:
MCap:
Return:
Closing Price:
MCap:
-59%
$0.007
A$3.57m
Incitive announced that it will not proceed
with its acquisition of V-Path Medical Systems.
The company also entered into an agreement
to raise A$750k via a placement
to sophisticated investors.
-52%
$0.15
A$35.07m
0%
The company’s share purchase plan raised
$143k which will be used to further advance
a Hungarian joint venture.
-45%
$0.016
A$7.98m
The company resolved at its AGM to
increase the share plan pool by 15m
ordinary shares. Resolutions were passed
regarding the issue of 30.75m fully paid
ordinary shares and 13.5m options.
Tyrian Diagnostics announced that it will not
continue to collaborate with Becton, Dickson
& Company to develop a point-of-care test
for the diagnosis of active tuberculosis.
The company completed the manufacture
of several thousand prototype tests for a
multi-site evaluation of the second agricultural
diagnostic test as part of its collaboration
with Bayer CropScience.
8
9
10
XCEED CAPITAL LTD (XCD)
ANTEO DIAGNOSTICS LTD
(ADO)
CYTOPIA LTD (CYT)
Return:
Closing Price:
MCap:
-44%
$0.022
A$4.40m
The company sold its interest in PolyNovo
Biomaterials to Calzada for $836k. Xceed
also announced its intention to conduct a
non-renounceable rights issue. Additionally,
the company stated that sales revenue for its
wholly owned subsidiary Boron Molecular was
33% lower in the current financial year than
the equivalent period in the previous year.
Return:
Closing Price:
MCap:
-42%
$0.007
A$2.80m
The company announced that $350k will
be raised from an entitlement issue and an
additional placement to sophisticated investors.
The company made a net loss of $1.95m in
FY09. This was approximately A$187k
greater than its previous year loss.
Return:
Closing Price:
MCap:
-42%
$0.105
A$8.89m
Cytopia entered into a binding agreement to
merge with YM BioSciences. The company
announced the retirement from the board
of Roderick Lyle, a non executive director.
It announced that dosing commenced in its
phase I/II clinical study of CYT387 targeting
Myelofibrosis and also received approval to
commence dosing patients in its phase II
clinical trial for CYT997.
Note: The company announcements referred to above were made in the latest quarter and were sourced
from the Australian Securities Exchange website, www.asx.com.au
BioForum: October – December 2009 | 27
28 | PricewaterhouseCoopers
Announcements – Australia
Announcements –
Australia
BioForum: July – September 2009 | 29
Partnerships
Company
Pharma/biotech partner
Application
Total
25
Ascent Pharmahealth
(APH)
Pfizer Australia
Not disclosed
Not disclosed
Ascent business Genepharm has entered into
a distribution and services agreement with Pfizer
Australia.
Avexa (AVX)
Tibotec
HIV integrase program
Not disclosed
Extension of option agreement with Tibotec
related to research and licensing of Avexa’s HIV
integrase inhibitor.
BioDiem (BDM)
Nobilon
Influenza vaccination
Not disclosed
BioDiem has acquired full rights for the
manufacturing and marketing of its LAIV
technology in Japan. The marketing rights were
previously held in conjunction with Nobilon.
BioProspect (BPO)
Ensystex Corporation
Termite solution
Not disclosed
International development agreement signed
with US company Ensystex for BioProspect’s
Termilone product.
Biota Holdings (BTA)
GlaxoSmithKline
Neuraminidase inhibitor
$24m
GlaxoSmithKline has advised that Biota’s
royalties from the sales of Relenza were
approximately $24m.
ChemGenex
Pharmaceuticals (CXS)
Hospira
Chronic myeloid
leukaemia
$18m
Exclusive agreement announced to license,
develop and commercialise ChemGenex leukaemia
drug in Europe, the Middle East and parts of Africa.
CSL (CSL)
National Blood Authority
Plasma-derived
medicines
Not disclosed
Eight year agreement for CSL to continue to
provide plasma therapeutic products to the
Australian community.
Genetic Technologies
(GTG)
Rosetta Genomics
Cancer
Not disclosed
Genetic Technologies has executed an exclusive
test and services agreement with Rosetta.
HalcyGen
Pharmaceuticals (HGN)
Mayne Pharma International
High functionality
generics
Not disclosed
Marketing and distribution arrangement for
products sold in Australian and Asian markets.
HealthLinx (HTX)
Spire Healthcare
Ovarian cancer
diagnostic
Not disclosed
HealthLinx’s UK distributor has contracted
with Spire Healthcare to process and market
HealthLinx’s OvPlex product in the UK.
Hexima (HXL)
Australian Centre for Plant
Functional Genomics
(ACPFG)
Improvement of cereal
crops
Not disclosed
Hexima has entered into a strategic alliance with
ACPFG to research and develop technologies for
the improvement of cereal crops.
Living Cell Technologies
(LCT)
Centocor Research
and Development
Not disclosed
Not disclosed
The research collaboration with Centocor has
been extended. An exclusive two year option was
granted for a world-wide licence of Living Cell’s
encapsulation technology.
Medical Therapies (MTY)
Celera
Lung cancer
Not disclosed
Medical Therapies has signed a licence agreement
with Celera for the development of a lung cancer
diagnostic product.
Medical Therapies (MTY)
Yamasa
Not disclosed
Not disclosed
Medical Therapies has signed a non-exclusive
distribution agreement for its anti-midkine
antibodies for research purposes.
OBJ (OBJ)
3M
Not disclosed
Not disclosed
OBJ has executed a materials transfer agreement
with 3M.
Phylogica (PYC)
Roche
Inflammatory diseases
Not disclosed
Agreement with Roche to evaluate Phylogica’s
Phylomer technology in transporting large
molecules to attack disease targets within cells.
Prima BioMed (PRR)
The University of New South
Wales and University of
Queensland
Cervical cancer
Not disclosed
Prima BioMed has engaged the universities to
undertake a research program to develop an oral
delivery system for vaccines for cervical cancer.
Probiomics (PCC)
Chr Hansen A/S
Not disclosed
Not disclosed
The two companies have signed a global
distribution agreement.
QRxPharma (QRX)
Patheon
Moderate to severe
chronic pain
Not disclosed
Contractual agreement signed to manufacture
clinical supplies of QRxPharma’s controlled
release dual-opioid formulation.
QRxPharma (QRX)
Liaoning Nuokang
Medicines Co Ltd
Haemostasis products
US$5m
Completion of strategic alliance deal to develop
and commercialise QRxPharma’s venomics assets
for the China market.
Starpharma Holdings
(SPL)
US-based agricultural
chemicals company
Not disclosed
Not disclosed
Starpharma’s US subsidiary DNT has signed a
research and collaboration agreement with a USbased agricultural chemicals company.
Stirling Products (STI)
Innovative Biotech
Tuberculosis, HIV and
TB/HIV co-infection
Not disclosed
Stirling Products has entered into an agreement to
register, trial and market Dzherelo in Nigeria and
other regions of Africa.
Stirling Products (STI)
Sheiman Ultrasonic
Research Foundation
Not disclosed
Not disclosed
Stirling Products and its joint venture partner
have entered into a final agreement with Sheiman
Ultrasonic Research Foundation.
Biotechnolgy
30 | PricewaterhouseCoopers
Value (A$m)
Comments
Pharma/biotech partner
Application
Value (A$m)
Comments
Stirling Products (STI)
Cipla
AIDS and TB drugs;
OTC and generic
prescription drugs
Not disclosed
Agreed working relationship established with Cipla,
an Indian drug manufacturer.
Viralytics (VLA)
Royal Adelaide
Head and neck cancer
Not disclosed
Royal Adelaide has joined forces with Viralytics
to trial a revolutionary treatment for head and neck
cancer.
Total
14
BMDI TUTA (BMI)
Unisurge International
Not disclosed
Not disclosed
BMDI TUTA has further expanded into international
markets with a five year supply agreement with
Unisurge International.
Compumedics (CMP)
University Medical Center,
Freiburg, Germany
Neurology (EEG)
systems
$600k
Compumedics Neuvo LTM system has been
chosen by University Medical Center to equip
its epileptology center.
Compumedics (CMP)
ZSL (Zentral Sleep Lab)
Service GmbH
Sleep diagnostics
$366k
Compumedics has won a sleep diagnostics
devices contract with another customer in Berlin.
ImpediMed (IPD)
3 Kings Holding
Clinical assessment of
lymphoedema
Not disclosed
Distribution agreement for ImpediMed’s L-Dex
products in Hong Kong, China, Taiwan and Macau.
KarmelSonix (KSX)
Clear Sales Australia
Detection of wheeze
Not disclosed
Distribution agreement signed for Clear Sales
to market and distribute the KarmelSonix
Personal WheezoMeter to retail pharmacies
throughout Australia.
KarmelSonix (KSX)
MR Diagnostics
Not disclosed
Not disclosed
KarmelSonix has signed an interim agreement
with MR Diagnostics as exclusive distributor of
its products in the Czech Republic and Slovenia.
KarmelSonix (KSX)
Sanrosan
Not disclosed
Not disclosed
KarmelSonix has signed an interim agreement with
Sanrosan as the exclusive distributor for Spain.
KarmelSonix (KSX)
Sapco Laboratories
Asthma management
Not disclosed
KarmelSonix has received its first substantial order
in India following the signing of a new distribution
agreement for Southern India and Sri Lanka
with Sapco.
LabTech Systems (LBT)
bioMérieux
Not disclosed
$111k
LabTech Systems announces that it has received
the first royalty payment under its agreement
with bioMérieux.
Medigard (MGZ)
Not disclosed
Prevention of
needlestick injury
Not disclosed
Heads of agreement executed with an American
medical device manufacturer to produce
a patented blood collection device.
SomnoMed (SOM)
Watermark Medical and
SleepQuest
Sleep testing
equipment
Not disclosed
SomnoMed has signed two independent
agreements with two home sleep diagnostics and
patient treatment care companies.
Tyrian Diagnostics (TDX)
Becton, Dickson & Company
Tuberculosis
Not disclosed
Tyrian announced that it will not continue to
collaborate with BD to develop a point-of-care test
for the diagnosis of active tuberculosis.
Tyrian Diagnostics (TDX)
Bayer CropScience
Assess grain crops for
contaminants
Not disclosed
The company completed the manufacture of
several thousand prototype tests for a multi-site
evaluation of the second agricultural diagnostic
test as part of its collaboration.
Unilife Medical Solutions
(UNI)
Mikron Group
Ready-to-fill syringe
Not disclosed
Unilife Medical Solutions has appointed Mikron
Group as its contracted supply partner.
Medical Devices
BioForum: October – December 2009 | 31
Announcements – Australia
Company
Mergers, acquisitions and divestments
Dominant company
Target company
Type of deal
Total
11
Biota Holdings (BTA)
Prolysis
Acquisition
Not disclosed
Biota has acquired the key assets
and programs of Prolysis.
Biota Holdings (BTA)
MaxThera
Acquisition
US$1.5m
The company has acquired the
assets and drug development
programs of MaxThera.
Cytopia (CYT)
YM BioSciences
Merger
Not disclosed
The companies have entered into a
binding agreement to merge.
Genetic Technologies (GTG)
Perlegen Sciences
Acquisition
Not disclosed
Genetic Technologies has executed
an exclusive option to evaluate the
purchase of the BREVAGen breast
cancer diagnostic product from
Perlegen.
Incitive (ICV)
V-Patch Medical
Systems
Acquisition
Not disclosed
Incitive has determined not to
proceed further with the acquisition.
NuSep (NSP)
BioInquire
Acquisition
US$2m plus
earn-out
NuSep has signed a letter of intent
to purchase BioInquire, a USbased mass spectrometry software
development company.
Patrys (PAB)
Debiopharm
Acquisition
Not disclosed
Patrys has acquired exclusive rights
to commercialise the gastric cancer
antibody product SC1.
Peplin (PLI)
LEO Pharma A/S
Merger
US$287.5m
The two companies have merged
after receiving approval from the
majority of Peplin stockholders.
Prima BioMed (PRR)
Not disclosed
Divestment
Not disclosed
Prima BioMed has completed the
divestment of one of its non-core
products, DCtag.
Telesso Technologies (TEO)
Not disclosed
Acquisition
Not disclosed
Telesso has signed a memorandum
of understanding to purchase all
of the issued share capital in an
undisclosed biotech.
Xceed Capital (XCD)
Calzada
Divestment
$836k
Agreement to sell Xceed’s interest in
PolyNovo Biomaterials to Calzada.
AquaCarotene (AQL)
Aurora Biofuels
Divestment
$2m plus a royalty
agreement
AquaCarotene has signed an
agreement to transfer the leases held
on Karratha Ponds for the production
of marine algae to Aurora Biofuels.
CordLife (CBB)
China Stem Cell (South)
Company
Acquisition
US$10m
CordLife has completed a sale and
purchase agreement with existing
minority shareholders of China Stem
Cell.
Medic Vision (MVH)
Leading Edge
Instruments
Divestment
$6.1m
Heads of agreement to sell medical
simulation assets to Leading Edge
Instruments.
Medic Vision (MVH)
Red Paragon
Acquisition
Not disclosed
Medic Vision has signed an
agreement to acquire a further
9.29% of the share capital in Red
Paragon.
ResMed (RMD)
Laboratoires Narval
Acquisition
Not disclosed
ResMed has acquired Laboratoires
Narval for an undisclosed amount.
Biotechnology
Medical Devices
32 | PricewaterhouseCoopers
Value (A$m)
Total
Comments
5
Company
Drug
Pre-Clinical
Application
Comments
Total
4
Circadian Technologies (CIR)
VGX-300
Cancer
Circadian has achieved a key manufacturing milestone
allowing the company to progress to pre-clinical
development.
CSL (CSL)
CSL112
Acute coronary syndrome
CSL is undertaking pre-clinical safety studies of CSL112,
which targets acute coronary syndrome. Phase I clinical
trials are anticipated to begin in 2010.
Mesoblast (MSB)
Not disclosed
Diabetes treatment
Positive pre-clinical results have been reported using
Mesoblast’s patented adult stem cell technology platform.
Progen Pharmaceuticals (PGL)
PG545
Cancer
Progen is to present its new pre-clinical data on PG545 at
an international cancer therapeutics conference.
Phase I
10
Bionomics (BNO)
BNC210
Anxiety disorders
Bionomics has announced the completion of the first stage
of its current phase I clinical trial.
Biotron (BIT)
BIT225
Hepatitis C virus (HCV)
Biotron has successfully completed a proof-of-concept
study of BIT225 in HCV infected subjects.
Biotron (BIT)
BIT225
Chronic hepatitis C infection
Phase I clinical trials have shown promising results. Phase II
trial planned to commence in early 2010.
Biotron (BIT)
BIT225
HIV treatment
Biotron is progressing protocols for a phase Ib/IIa trial of
BIT225 in HIV patients.
Cytopia (CYT)
CYT387
Myelofibrosis
Cytopia has announced that dosing in its phase I/II clinical
study has commenced.
Living Cell Technologies (LCT)
Diabecell
Diabetes
Living Cell Technologies has reported that the phaseI/IIa
clinical trial has shown positive results.
Phosphagenics (POH)
Oxycodone Patch
Pain management
A phase Ib clinical trial has commenced for the company’s
patented oxycodone/Target Penetration Matrix transdermal
patch system.
Sunshine Heart (SHC)
C-Pulse
Heart assist system
The C-Pulse heart assist system was successfully
implanted in a patient under FDA approved phase I clinical
trial protocol.
Viralytics (VLA)
Cavatak
Head and neck cancer
Viralytics has announced that a second hospital has
commenced recruitment of patients for the company’s
phase I trial.
Viralytics (VLA)
Cavatak
Head and neck cancer
Head and neck cancer phase I trial patients have completed
treatment. Approval has been granted to progress to phase
II.
bioMD (BOD)
Gynecel Adapt
Pelvic floor reconstruction
surgery
bioMD has successfully completed a phase II clinical trial
of Gynecel Adapt.
Bionomics (BNO)
BNC105
Mesothelioma treatment
Bionomics is conducting a phase II clinical trial
of its BNC105 anti-cancer drug following successful
phase I trials.
Cytopia (CYT)
CYT997
Glioblastoma multiforme
(GBM)
Cytopia has received approval to commence dosing
patients in its phase II clinical trial.
Mesoblast (MSB)
Revascor
Heart failure
Patients in the ongoing phase II trial have continued to
show sustained improvement in heart muscle function
at six months.
Phosphagenics (POH)
Phospha-E
Metabolic syndrome
Clinical trial did not meet the primary end point, although
marked improvement in heart disease and diabetes risk
factors was shown.
Phosphagenics (POH)
TPM
Insulin delivery
Targeted penetration matrix insulin project anticipated to
return to human clinical trials in the first half of 2010.
Prima BioMed (PRR)
CVac
Ovarian cancer
FDA clearance received to commence phase IIb clinical
trial of the company’s ovarian cancer treatment vaccine.
pSivida (PVA)
BrachySil
Pancreatic cancer
pSivida has announced the completion of a
second pancreatic clinical trial of BrachySil.
Avexa (AVX)
Apricitabine (ATC)
Treatment of HIV
Avexa has announced that data from the phase III study
is to be unblended and further analysed.
Biota Holdings (BTA)
CS-8958
Anti-influenza
Biota Holdings has commenced the phase III trial
for CS-8958.
Clinuvel Pharmaceuticals (CUV)
Afamelanotide
Eumelanin production
The phase III clinical trials in erythropoietic protoporphyria
indication have shown positive four-month results.
Eastland Medical Systems (EMS)
ArTiMist
Malaria
Kigali University Teaching Hospital has approved a phase III
clinical trial of ArTiMist in children.
Phase II
8
Phase III
8
BioForum: October – December 2009 | 33
Announcements – Australia
Clinical trials
Company
Drug
Application
Comments
Pharmaxis (PXS)
Bronchitol
Bronchiectasis
Pharmaxis has commenced screening patients in its
12-month phase III trial.
pSivida (PVA)
Iluvien
Diabetic macular oedema
(DME)
pSivida has announced that the last patient in the phase III
clinical trial has completed their follow-up visit.
pSivida (PVA)
Iluvien
Diabetic macular oedema
The company has received positive results from the
phase III clinical trials of Iluvien, meaning that the primary
efficacy endpoint was met with statistical significance.
QRxPharma (QRX)
MoxDuoIR
Moderate to severe
acute pain
As part of its phase III program, QRxPharma has initiated a
registration (or pivotal) study of MoxDuoIR.
Antisense Therapeutics (ANP)
ATL1103
Excessive growth hormone
action.
Antisense has completed repeat-dosing toxicology studies
for ATL1103 in two species – mice and primates.
Ellex Medical Lasers (ELX)
Ellex 2RT Research
Program
Age-related macular
degeneration
Ellex has been awarded a $540k Victorian Government
grant to conduct a clinical trial.
HealthLinx (HTX )
OvPlex
Ovarian cancer
HealthLinx has received a $750k grant to support its next
generation early stage ovarian cancer diagnostic trial.
HealthLinx (HTX)
OvPlex
Ovarian cancer
Queensland’s Mater Hospital will participate in a second
and larger clinical study of OvPlex.
KarmelSonix (KSX)
PulmoTrack
Nocturnal Asthma
Management
KarmelSonix clinical study published in the Journal of
Asthma.
Medigard (MGZ)
Blood collection device
Blood collection
A preliminary product evaluation by Quest Diagnostics has
been successful.
Mesoblast (MSB)
Mesenchymal Precursor
Cells (MPCs)
Bone marrow transplants
Mesoblast has announced successful results from the first
18 patients who have received a bone marrow transplant
using umbilical cord blood expanded by Mesoblast’s MPCs.
Nanosonics (NAN)
Trophon EPR
Disinfection of ultrasound
transducers
Further micro-biocidal validation testing has confirmed the
efficacy of Trophon EPR.
NeuroDiscovery (NDL)
NSL-043
Not disclosed
The company will not commit to a phase II clinical trial of
NSL-043, in order to preserve cash reserves.
Patrys (PAB)
PAT-SM6
Treatment of solid tumours
and metastases
Patrys scientific collaborators at the University of
Melbourne have been awarded a $300,000 grant to support
the development of Patrys’ lead clinical candidate PAT-SM6.
Tissue Therapies (TIS)
VitroGro
Treatment of venous ulcers
Tissue Therapies has received positive final results from the
Australian human trial of VitroGro.
Unilife (UNI)
Unitract 1mL
Syringe
Successful completion of device ageing studies for product
manufactured at FDA-registered manufacturing facility in
Pennsylvania.
Viralytics (VLA)
Cavatak
Anti-cancer therapy
A major NSW hospital has been named as a second site to
trial a late stage anti-cancer therapy.
Virax Holdings (VHL)
VIR201
HIV immunotherapeutic
vaccine
Virax Holdings has received a positive review from the
second meeting of the Data Safety Monitoring Board for the
Southern African trial of VIR201.
Other
34 | PricewaterhouseCoopers
14
Company
Product
Biotechnology
Application
Comments
Total
24
Acrux (ACR)
Ellavie
Estradiol spray
Acrux has been advised by the Therapeutic Goods
Association (TGA) that approval of Ellavie for marketing in
Australia will require additional supporting data.
Analytica (ALT)
AutoStart Burette
Intravenous fluid infusion
The FDA has accepted a Pre-market Notification
application for the Analytica device.
Analytica (ALT)
AutoStart Burette
Intravenous fluid infusion
Analytica’s Pre-market Notification application for the
AutoStart Burette is still under the FDA’s consideration.
Antisense Therapeutics (ANP)
ATL1103
Acromegaly and diabetic
retinopathy
US Patent Office approved a patent for the
ATL1103 compound.
Avita Medical (AVH)
Not disclosed
Not disclosed
The Japan Patent Office has granted Avita a Japanese
patent for various undisclosed products.
Avita Medical (AVH)
ReCell Spray-On Skin
Wound, burn and chronic skin
defect treatment
Avita has received FDA approval to begin its clinical trial for
ReCell Spray-On Skin.
Benitec (BLT)
Not disclosed
HIV
Benitec has secured intellectual property rights that
underpin its second HIV therapeutic program.
Bone Medical (BNE)
Capsitonin
Treatment of
osteoarthritic pain
Bone Medical has filed an Investigational New Drug
application with the FDA.
ChemGenex Pharmaceuticals (CXS)
Omapro
Chronic myeloid leukaemia
(CML)
The FDA has accepted the company’s New Drug
Application for Omapro.
ChemGenex Pharmaceuticals (CXS)
Omacetaxine
mepesuccinate
Treatment of chronic myeloid
leukaemia (CML)
European Medicines Agency has determined that the
Marketing Authorisation Application for omacetaxine
mepesuccinate is valid.
Clinuvel Pharmaceuticals (CUV)
Afamelanotide
Sun-induced solar urticaria
The company’s photoprotective drug Afamelanotide has
been granted orphan drug designation by the FDA.
CSL (CSL)
Berinert
Hereditary angioedema
The FDA has approved the company’s Berinert product,
which treats abdominal or facial attacks of hereditary
angioedema.
Genera Biosystems (GBI)
PapType
Human papillomavirus
detection and genotyping test
Genera Biosystems has submitted an application for
PapType to be approved by the TGA.
HalcyGen Pharmaceuticals (HGN)
SUBA-Itraconazole
Anti-fungal
HalcyGen has received approval from the UK Medicines
and Healthcare Products Regulatory Agency for a
pharmacokinetic study in the UK.
Living Cell Technologies (LCT)
Xenotransplantation
Life threatening diseases
Living Cell Technology intends to expand its clinical
trial program in Australia following lifting of a ban on
xenotransplantation by the National Health and Medical
Research Council.
NuSep (NSP)
SpermSep
Assisted Reproductive
Technology (ART) treatments
Australian patent for SpermSep has been granted.
Pharmaxis (PXS)
Aridol
Asthma management
The FDA has determined that Pharmaxis’ New Drug
Application for Aridol cannot be approved in its current
form.
Pharmaxis (PXS)
Bronchitol
Bronchiectasis
The company has withdrawn its marketing application to
the TGA for the use of Bronchitol to treat bronchiectasis.
Pharmaxis (PXS)
Bronchitol
Cystic fibrosis
An application to market Bronchitol for the treatment of
cystic fibrosis has been submitted to the TGA.
Prima BioMed (PRR)
CVac
Ovarian cancer treatment
A Prima BioMed subsidiary has been granted a patent for
its CVac therapeutic cancer vaccine, expiring in 2016.
Stirling Products (STI)
ProVale beta glucan
Not disclosed
Stirling Products has been granted a patent for its ProVale
beta glucan by the South African Patents office.
Tissue Therapies (TIS)
VitroGro
Wound healing, tissue
regeneration and stem cell
therapies
US Patent and Trademark Office has granted a second core
patent for VitroGro.
Virax Holdings (VHL)
TG4010 / Co-X-Gene
Lung cancer treatment
The FDA has granted a French licensee of Virax’s Co-XGene technology fast track development designation for its
TG4010 treatment.
Virax Holdings (VHL)
VIR201
HIV therapeutic vaccine
Patent application for VIR201 has been submitted.
Total
15
Medical Devices
Advanced Surgical Design &
Manufacture (AMT)
Active Knee
Knee replacement
Flagship product has been granted Class III CE mark
approval. Active Knee is now fully compliant with the
revised EU Medical Device Directive.
BioMD (BOD)
Adapt
Tissue engineering process
Biocompatibility testing of Adapt biomaterial has
commenced at NASMA testing facility. Testing required as
part of regulatory submissions to TGA/FDA/CE in late 2010.
BioForum: October – December 2009 | 35
Announcements – Australia
Regulatory
Company
Product
Application
Comments
Compumedics (CMP)
SomniLink SPAP
Sleep treatment device
The SPAP device has been introduced into the
Australian market.
Ellex Medical Lasers (ELX)
Eye Cubed diagnostic
ultrasound system
Diagnostic ultrasound system
The company has created another version of the Eye
Cubed diagnostic ultrasound system.
HeartWare International (HIN)
Ventricular Assist
System (HVAD)
Bridge-to-transplant trial
HeartWare has received approval from the FDA to expand
the number of clinical sites participating in its US bridge-totransplant trial.
HeartWare International (HIN)
Ventricular Assist
System (HVAD)
End-stage heart failure
therapy
HeartWare International has filed a submission for an
Investigational Device Exemption with the FDA.
ImpediMed (IPD)
L-Dex technology
Lymphoedema
An application for a Category 1 Current Procedural
Terminology Code has been filed with the American Medical
Association.
ITL (ITL)
TEGOTM
Animal blood collection kit for
livestock
ITL has launched the TEGOTM blood collection device.
KarmelSonix (KSX)
PulmoTrack
WheezoMeter
Lung sound recorder
KarmelSonix has announced that its products have
been licensed by Health Canada’s Therapeutic Products
Directorate.
KarmelSonix (KSX)
WheezeRATE
Treatment of asthma
American College of Chest Physicians’ Clinical Practice
Committee has submitted an application to the American
Medical Association for a Category III CPT code.
MediVac (MDV)
SunnyWipes
Sanitisation
A subsidiary has received licences from the Natural Health
Products Directorate of Health Canada to sell its range of
all-natural hand sanitising gels and hard surface wipes.
SomnoMed (SOM)
SomnoDent MAS oral
appliance
Treatment of sleep disordered
breathing
Japanese authorities have granted SomnoMed an import
licence for the SMH BFlex material.
Unilife Medical Solutions (UNI)
Unifill syringe
Injection
Unilife has filed international trademarks for its Unifill
product.
Unilife Medical Solutions (UNI)
Unifill Select
Ready-to-fill syringe
Several US patent applications have been submitted
for Unifill.
Universal Biosensors (UBI)
Not disclosed
Blood glucose monitoring
Initial regulatory clearance has been granted for UBI’s
product, developed in conjunction with LifeScan, a
subsidiary of Johnson & Johnson.
36 | PricewaterhouseCoopers
Company
Product
Biotechnology
Application
Comments
Total
28
Acuvax (ACU)
Acuvax has appointed Andrew Bursill
as company secretary.
Agenix (AGX)
Agenix has appointed Graeme Tyshing to the role of CFO.
Agenix (AGX)
Shanghai Rui Gang Bio-Pharma Development Company
has failed to pay Agenix the $7m it owed as a result
of a settlement regarding Agenix’s bio-pharmaceutical
investments in China. Agenix is seeking further
advice thereon.
Ascent Pharmahealth (APH)
Ravi Seth has resigned as non-executive director and has
been replaced by T.S. Rangan.
Avexa (AVX)
Lawrence Gozlan has resigned from the board.
Bionomics (BNO)
Trevor Thiele has been appointed chief financial officer and
company secretary.
BioPharmica (BPH)
The company has changed its name to BPH Corporate.
BioProspect (BPO)
BioProspect has appointed Charles Pellegrino as managing
director and Peter May as chief operating officer.
Biotron (BIT)
BIT225
Hepatitis C
Biotron’s drug development program has been highlighted
in a recent edition of Proceedings of the National Academy
of Sciences of the United States of America.
ChemGenex Pharmaceuticals (CXS)
Greg Collier (CEO of ChemGenex) has received the
AusBiotech 2009 Excellence Award for outstanding
individual contribution to the biotechnology industry.
CSL (CSL)
Brian McNamee will continue as CEO and managing
director for at least three to four years. Peter Turner has
been appointed as chief operating officer. Gordon Naylor
will replace Tony Cipa as chief financial officer in
October 2010.
Cytopia (CYT)
The company announced the retirement from the board
of Roderick Lyle, a non executive director.
Genetic Technologies (GTG)
Genetic Technologies has appointed Malcolm Brandon as
a non-executive director.
Genetic Technologies (GTG)
Fred Bart has resigned as a director of the company and
has been replaced by Tommaso Bonvino.
Hexima (HXL)
Hexima has announced the reappointment of Steven Skala
as chairman.
Immuron (IMC)
Dr Elane Zelcer has been appointed as a director of the
company.
Medical Therapies (MTY)
Medical Therapies has appointed Robin Beaumont as a
non-executive director of the company.
Neuren Pharmaceuticals (NEU)
Dr John Holaday has been appointed to the board.
Novogen (NRT)
CEO and managing director Christopher Naughton has
ceased employment with the company. David Seaton,
Novogen’s CFO, has been appointed acting CEO until a
replacement is found.
Prima BioMed (PRR)
Prima BioMed has appointed Dr Neil Frazer as chief
medical officer.
Progen Pharmaceuticals (PGL)
Dr John Chiplin has been appointed interim chief executive
officer.
Rockeby Biomed (RBY)
The company’s resolution to delist was approved at a
shareholder meeting in November 2009. The ASX has
resolved to remove the company from the list no earlier
than 27 December 2009.
SciGen (SIE)
Adam Allerhand has resigned as charmain, CEO and
director of the company. Ryszard Krauze has been
appointed as the new chairman. Slawomir Ziegert has been
appointed as new CEO and as a director of the company.
Non-executive directors Janusz Guy and Waldemar
Krzewski have resigned. Amol Shah and Mateusz Kosecki
were appointed as non-executive directors. Martin Cooper
and Jenny Low were appointed as executive directors.
Sirtex Medical (SRX)
Michael Mangano has been appointed president of Sirtex
Medical in the US. He replaces Dr John Reddington.
Solagran (SLA)
David Croll has been appointed chief financial officer.
BioForum: October – December 2009 | 37
Announcements – Australia
Other news
Company
Product
Application
Comments
Stirling Products (STI)
Stirling has negotiated an acquisition of a new fully
equipped and licensed pharmaceutical manufacturing
facility in Canada from an administrator of a Canadian
listed company.
Stirling Products (STI)
Appointment of Bob Pritchard as specialist product, brand
and marketing consultant.
Viralytics (VLA)
Professor Flossie Wong-Staal has been appointed to the
Clinical and Scientific Advisory Board of Viralytics.
Medical Devices
Total
19
ATOS Wellness (ATW)
ATOS Wellness has appointed Johnson Teh as a nonexecutive director.
BrainZ Instruments (BZI)
James Robinson has been appointed company secretary,
following the resignation of Ian Hadwin as secretary and
Keith Aitchison as director.
Clover Corporation (CLV)
Andrew Beeson has been appointed as CFO.
CogState (CGS)
Lauren Delaney has been appointed as company secretary.
Compumedics (CMP)
Compumedics’s Germany based DWL business has been
awarded a $200,000 grant from the German Government.
Fermiscan Holdings (FER)
Greg West has been appointed as company secretary
of Fermiscan.
Fermiscan Holdings (FER)
Fermiscan’s administrator has provided memoranda of
information to certain interested parties for the purchase
of intellectual property, plant, equipment and business
undertakings of Fermiscan.
ImpediMed (IPD)
ImpediMed has announced the appointment of Alden Kay
as the VP of Quality and Regulatory at ImpediMed.
ImpediMed (IPD)
Donald Myll has been appointed as CFO.
Labtech Systems (LBT)
LabTech Systems has changed its name to LBT
Innovations.
Medic Vision (MVH)
Justyn Stedwell has replaced Jitto Arulampalam as
company secretary.
Occupational & Medical Innovations
(OMI)
Loan agreements executed with Chelsea Printing and
other undisclosed parties to obtain further working capital.
OMI has also received litigation funding support from its
US lawyers, Howrey LLP, in relation to claims made by
Retractable Technologies Inc.
Occupational & Medical Innovations
(OMI)
Unfavourable jury verdict rendered in US District Court
case regarding claims made by Retractable Technologies
Inc. The company is seeking advice regarding post verdict
motions.
Occupational & Medical Innovations
(OMI)
OMI was suspended from official quotation on the ASX
during the quarter following an adverse audit opinion as to
whether the company could continue as a going-concern.
Occupational & Medical Innovations
(OMI)
The board has appointed David Simpson and Terrence
Rose of SV Partners as voluntary administrators.
Sunshine Heart (SHC)
Sunshine Heart has announced the retirement of Don
Rohrbaugh, who has been CEO for the past seven years
and has been a director of the company.
Sunshine Heart
C-Pulse
Heart assist system
Expansion in number of sites implanting C-Pulse. Hospital
approval anticipated in 2010.
Unilife Medical Solutions (UNI)
Unilife has obtained Australian Federal Court approval to
convene security holder meetings to vote on a proposal to
re-domicile the company to the US.
Uscom (USC)
Professor David Bennett has been appointed to the Uscom
Medical Advisory Board.
38 | PricewaterhouseCoopers
Announcements – Australia
BioForum: October – December 2009 | 39
40 | PricewaterhouseCoopers
Announcements
– US USA
Announcements
Announcements –
US
BioForum: July – September 2009 | 41
Partnerships
Company
Pharma/biotech partner
Application
Value (US$m)
Total
7
Acronet Corp
Richmond Pharmacology
Clinical research
Not disclosed
Strategic alliance to assist Japanese
pharmaceutical firms and bioventures to conduct
early phase clinical trials in Europe. As a result,
Acronet is now in a position to offer clinical
research services to Japanese companies.
Applied NeuroSolutions
Eli Lilly and Co
Alzheimer’s disease
$750k upfront plus
potential $25.5m
The companies have increased the scope of their
Alzheimer’s disease drug discovery collaboration
agreement. Additional value dependent on
achieving milestones.
Generex Biotechnology
Sanofi-Aventis Deutschland
Human insulin crystals
Not disclosed
Long term agreement for Sanofi-Aventis to
manufacture recombinant human insulin crystals
for a proprietary Generex product.
GlaxoSmithKline
NanoBio
Cold sore treatment
$14.5m
The company has licensed a developing OTC cold
sore treatment from NanoBio.
Pfizer
Protalix Biotherapeutics
Guacher’s disease
$60m
Pfizer has signed an agreement for the rights to
Protalix’s experimental drug for a rare metabolic
disorder.
Theraclone Sciences
Zenyaku Kogyo Co
Pandemic influenza
treatment
Not disclosed
Strategic alliance formed to research and discover
broadly protective monoclonal antibodies for
the treatment of pandemic influenza and severe
seasonal influenza.
Unigene Laboratories
Tarsa Therapeutics
Phase III oral calcitonin
program
Not disclosed
The company has licensed its phase III oral
calcitonin program to Tarsa Therapeutics.
Biotechnology
Medical Devices
Total
Comments
3
Biomoda
Christiana Care Health
Systems’s Helen F Graham
Cancer Center
Lung cancer
diagnostics
Not disclosed
The companies have entered into an agreement
whereby Christiana Care will recruit a cohort of
patients diagnosed with lung cancer to participate
in the final stage of its phase II clinical study.
Neurowave Medical
Technologies
Alaven Pharmaceutical
Pregnancy related
vomiting and nausea
Not disclosed
The companies have entered into an exclusive
licensing agreement allowing Alaven to
commercialise a patented Neurowave
neuromodulation pulse generator device.
Stellartech Research
Corp
OrthoMEMS
Measurement of spinal
disc pressures
Not disclosed
Strategic alliance to deliver a miniature implanted
sensor in the spine through the design and
development of a custom external reader device
for non-invasively reading measurements made by
the OrthoChip, a miniature, battery-less, wireless
pressure sensor.
42 | PricewaterhouseCoopers
Dominant company
Target company
Type of deal
Value (US$m)
Comments
Total
20
Adamis Pharmaceuticals
Corp
La Jolla Pharmaceutical Co
Merger
$16.4m
Adamis definitively agreed to merge with La
Jolla Pharmaceutical in a reverse stock swap
transaction.
Almirall Prodesfarma SA
Ironwood Pharmaceuticals
Acquisition
$15m
Almirall Prodesfarma agreed to acquire an
undisclosed minority stake in Ironwood
Pharmaceuticals.
Azimuth Opportunity
MAP Pharmaceuticals
Acquisition
$60m
Azimuth agreed to acquire 9.9% of MAP
Pharmaceuticals.
Biotechnology
BioMarin Pharmaceutical
Huxley Pharmaceuticals
Acquisition
$43.5m
BioMarin acquired Huxley Pharmaceuticals.
Boehringer Ingelheim
Wyeth - Fort Dodge
Animal Health
Acquisition
Not disclosed
Boehringer Ingelheim acquired the Fort Dodge
Animal Health business from Wyeth.
BQ Acquisition Corp
Bio-Quant
Acquisition
$2.78m
BQ Acquisition Corp, a wholly-owned subsidiary
of NexMed, acquired Bio-Quant, a provider of
biotechnology services.
Celgene Corp
Gloucester Pharmaceuticals
Acquisition
$640m
Celgene Corp definitively agreed to acquire
Gloucester Pharmaceuticals, a Cambridge-based
biotechnology company.
Cubist Pharmaceuticals
Calixa Therapeutics
Acquisition
$402.5m
Cubist Pharmaceuticals acquired Calixa
Therapeutics.
Entest BioMedical
Therinject
Acquisition
Not disclosed
Entest BioMedical signed a letter of intent to
acquire Therinject, a biotechnology research
company.
Myriad Pharmaceuticals
Javelin Pharmaceuticals
Acquisition
$96m
Myriad Pharmaceuticals definitively agreed to
acquire Javelin Pharmaceuticals in a stock swap
transaction.
Ondine Biopharma
Advanced Photodynamic
Technologies
Acquisition
$0.43m
Ondine Biopharma acquired Advanced
Photodynamic Technologies.
OXiGENE
VaxGen
Acquisition
$22.2m
OXiGENE definitively agreed to acquire VaxGen in
a stock swap transaction.
Pensa Pharma SA
Breckenridge
Pharmaceuticals
Acquisition
Not disclosed
Pensa Pharma acquired Breckenridge
Pharmaceutical.
Pillar Capital
Medico Labs
Acquisition
Not disclosed
Pillar Capital acquired Medico Labs.
Sana Pharma AS
Immunocorp
Acquisition
$5.4m
Sana Pharma AS acquired Immunocorp,
a California- based manufacturer of
pharmaceuticals.
Sciele Pharma
Addrenex Pharmaceuticals
Acquisition
$29m
Sciele Pharma agreed to acquire the remaining
interest in Addrenex Pharmaceuticals.
Sigma Tau Finanziaria
SpA
Enzon Pharmaceuticals
Acquisition
$327m
Sigma Tau Finanziaria definitively agreed to acquire
the specialty pharmaceutical business of Enzon
Pharmaceuticals.
Teva Pharm Inds
OncoGenex
Pharmaceuticals
Pending
$430m
Teva Pharmaceutical Industries agreed to acquire
OncoGenex Pharmaceuticals, a manufacturer and
wholesaler of pharmaceuticals.
Tolmar Holdings
QLT USA
Acquisition
$230m
Tolmar Holdings acquired QLT USA, a Californiabased biopharmaceutical company.
Westaim Corp
Nucryst Pharmaceuticals
Corp
Acquisition
$8.1m
Westaim agreed to acquire the remaining 25%
stake in Nucryst Pharmaceuticals.
Medical Devices
Total
22
AxioMed Spine Corp
Not disclosed
Divestment
Not disclosed
AxioMed Spine, a manufacturer of spinal implants,
divested a 5% equity stake.
Becton Dickinson & Co
HandyLab
Acquisition
$275m
Becton Dickinson & Co acquired HandyLab.
Biomet
Cartilix
Acquisition
Not disclosed
Biomet acquired Cartilix, a manufacturer of tissue
repair technology.
Cardo Medical
Vertebron
Acquisition
$1.3m
Cardo Medical acquired bankrupt Vertebron, a
manufacturer of spinal implant technology.
Castillo
TechniScan
Merger
Not disclosed
Castillo merged with TechniScan, a manufacturer
and wholesaler of breast imaging systems.
Cell Biosciences
Protein Forest
Acquisition
Not disclosed
Cell Biosciences acquired Protein Forest, a
manufacturer of proteomics tools.
Circle Medical Devices
Texcel Medical
Merger
Not disclosed
Circle Medical Devices merged with Texcel
Medical. The merged entity was renamed Cirtec
Medical Systems.
BioForum: October – December 2009 | 43
Announcements – US
Mergers, acquisitions and divestments
Dominant company
Target company
Type of deal
Value (US$m)
Comments
Clarient
Applied Genomics
Acquisition
$18.9m
Clarient acquired Applied Genomics, a
manufacturer of diagnostic technologies.
Ethicon
Acclarent
Merger
US$785m
Ethicon, a subsidiary of Johnson & Johnson,
definitively agreed to merge with Acclarent.
Facet Solutions
Archus OrthoArchus
Orthopedics
Acquisition
Not disclosed
Facet Solutions acquired a manufacturer of spinal
implants.
Fresenius Medical Care
AG & Co
National Quality Care
Acquisition
$8m
Fresenius Medical Care definitively agreed to
acquire National Quality Care, a manufacturer of
artificial kidneys.
GE Healthcare
Living Independently Group
Acquisition
Not disclosed
GE Healthcare acquired the remaining interest in
Living Independently, a manufacturer of passive
monitoring systems.
Gen-Probe
Prodesse
Acquisition
$85m
Gen-Probe acquired Prodesse, a manufacturer of
diagnostic test kits.
Hospira
TheraDoc
Acquisition
Not disclosed
Hospira acquired TheraDoc, a developer of
medical surveillance systems.
Knee Creations
Not disclosed
Divestment
Not disclosed
Knee Creations divested a 21% equity stake.
Life Technologies Corp
Biotrove
Acquisition
$120m
Life Technologies acquired BioTrove, a
manufacturer of laboratory analytical instruments.
Medical Imaging Holdings
Acoustic Marketing
Research
Acquisition
$8m
Medical Imaging Holdings acquired Acoustic
Marketing Research.
Nexus Biosystems
Aurora Biotechnologies
Acquisition
Not disclosed
Nexus Biosystems acquired a manufacturer of
microplates.
SAIC
Spectrum San Diego
Acquisition
$13.5m
SAIC agreed to acquire a majority interest in a
manufacturer of electronic imaging systems.
Seaside 88 Advisors
Nephros
Acquisition
$2m
Seaside 88 Advisors agreed to acquire a 5.66%
stake in a New York-based manufacturer of
medical devices and equipment.
Sonova Holding AG
Advanced Bionics Corp
Acquisition
$489m
Sonova Holding AG acquired Advanced Bionics
Corp, a manufacturer and wholesaler of cochlear
implant devices.
Welltek
MedX Systems
Merger
$21m
Welltek merged with MedX Systems in a shareexchange transaction.
44 | PricewaterhouseCoopers
Company
Drug
Application
Comments
Pharming Group NV
rhC1INH
Ischemic brain injury
Pre-clinical studies have demonstrated a benefit in using
rhC1INH in ischemic brain injury.
PulmoBiotech
PulmoBind
Pulmonary vascular diagnosis
The company has successfully completed the experimental
work necessary for approval to commence phase I clinical
trials.
Total
3
Pre-clinical
2
Phase I
PolyMedix
PMX-30063
Acute cardiovascular
disorders and infectious
diseases
The company has completed the first two segments of its
phase Ib clinical trial of PMX-30063, with results showing
the drug is safe and well-tolerated at varying levels.
PolyMedix
Heparin Antagonist
PMX-60056
Infectious diseases and acute
cardiovascular disorders
The company has successfully completed its phase 1B
clinical study of Heparin Antagonist PMX-60056.
Soligenix
SGX201
Acute radiation enteritis
prevention
The company has initiated a phase I/II clinical study of
SGX201.
Total
6
Phase II
Argos Therapeutics
Arcelis HIV Program
HIV-1 treatment
The company’s phase IIa proof-of-concept trial has shown
favourable immune response, viral load and safety data.
BioDelivery Sciences International
BEMA Buprenorphine
Pain management
The primary efficacy endpoint was achieved in a phase II
pain study of BEMA Buprenorphine.
BioModa
CyPath
Early stage lung cancer
diagnostics
The company has entered into an agreement with
Christiana Care Health System’s Helen F. Graham Cancer
Center to recruit patients diagnosed with lung cancer to
participate in the final stage of its phase II clinical study.
ProChon Biotech
BioCart Cartilage
Regeneration System
Cartilage regeneration
The company has expanded its phase II clinical trial to
have 10 study sites in the US and Israel.
Raptor Pharmaceutical
Delayed-release
cysteamine
Non-alcoholic steatohepatitis
(liver disease)
Preliminary results indicate that the liver disease treatment
met its primary endpoint in a mid-stage trial.
Ziopharm Oncology
Zymafos
Unresectable or metastatic
soft-tissue sarcoma
The company met a key efficacy goal in a mid-stage trial.
Enrolment in the trial has now stopped.
Phase III
Total
19
Affymax
Hematide
Erythopoiesis stimulating
agent
The independent Data Monitoring Committee has
completed its final review of the phase III Hematide
program, with cumulative safety data generated thus far
supporting the continuation of the studies.
Biomoda
CyPath
Early-stage lung cancer
The company is taking preliminary steps to launch multisite
phase III clinical trials of CyPath, its in-vitro diagnostic for
early stage lung cancer.
Biovail
Pimavanserin
Parkinson’s disease psychosis
The company’s phase III study did not meet its primary
end point.
Celsion Corporation and Yakult
Honsha
ThermoDox
Hepatocellular carcinoma
The first patient has been treated in Japan as part of
Celsion’s global phase III ThermoDox Heat trial for the
treatment of primary liver cancer. The study is enrolling
patients in 11 countries for its 600 patient clinical trial.
Delcath Systems
Delcath PHP System
Delivery of anti-cancer drugs
The company’s phase III study for its PHP System is fully
enrolled.
Depomed
Serada
Treatment of menopausal hot
flashes
Two phase III clinical trials evaluating the safety and
efficacy of Serada have produced varying results.
Depomed
DM-1796
Postherpetic neuralgia
Positive results from the company’s phase III clinical trial
demonstrate a statistically significant reduction in pain
associated with postherpetic neuralgia.
Dynavax Technologies
Heplisav
Hepatitis B vaccination
in chronic kidney disease
patients
Clinical data shows increased protection rate against
hepatitis B viral infection in chronic kidney disease
patients.
Emisphere Technologies
Eligen
Osteoporosis and
osteoarthritis
The independent Data Monitoring Committee has
recommended that the company proceed with phase
III clinical trials exploring the safety and efficacy of
Oral Salmon Calcitonin using its Eligen drug delivery
technology.
Genta
Genasense Injection
Advanced melanoma
Preliminary results from phase III clinical trials did not show
a statistically significant benefit for its co-primary endpoint
of progression-free survival.
Genzyme
FluCAM (Fludara in
combination with
Campath)
Chronic lymphocytic
leukaemia
Phase III clinical trial results demonstrate that FluCAM
significantly reduced the risk of disease progression or
death compared with single-agent Fludara.
LifeCycle Pharma
LCP-Tacro
De novo kidney transplants
The company has submitted the protocol for its phase
III clinical trial to the FDA and expects enrolment to
commence in mid 2010.
BioForum: October – December 2009 | 45
Announcements – US
Clinical trials
Company
Drug
Application
Comments
Neoprobe
Lymphoseek
Breast cancer and melanoma
The company has completed phase III clinical trials with
positive results.
Pacira Pharmaceuticals
Exparel
(DepoBupivacaine)
Analgesic for patients
undergoing bunionectomy
The phase III clinical study of Exparel achieved the primary
pain relief endpoint.
Pico-Tesla
Resonator System using
Magneceutical Therapy
Parkinson’s disease
The company has commenced phase III clinical trials
of its Resonator System, which uses its proprietary
Magneceutical therapy to treat Parkinson’s disease
patients.
Soligenix
orBec
Acute gastrointestinal
Graft-versus-Host disease
The company has initiated enrolment in its phase III clinical
trial of orBec.
Spinal Restoration
Biostat
Chronic discogenic low back
pain
The company has reached an agreement with the FDA
concerning the design of its phase III study of Biostat.
Transdel Pharmaceuticals
Ketotransdel
Acute soft tissue injuries
Phase III clinical study results were positive for the lead
topical pain drug Ketotransdel.
Vical
Allovectin-7
Metastatic melanoma
An independent Safety Monitoring Board has completed
the third safety analysis in the phase III trial and
recommended the trial continue.
Total
17
Other
Avedro
Keraflex
Keratoconus treatment
The company has initiated clinical trials for Keraflex,
with significant corneal flattening and improved visual
outcomes demonstrated from initial results.
Biogen Idec and Elan
Tysabri
Crohn’s disease
Three late-stage clinical trials have returned positive
results, reducing hospitalisations of people with Crohn’s
disease.
Boston Scientific
Promus and Taxus
Express2 Stents
Diabetes
One year data from the Spirit IV clinical trial comparing
Promus and Taxus support the benefits of paclitaxelexulting stents in diabetic patients.
Cohera Medical
TissuGlu
Surgical adhesive product
The first patient has been treated in a clinical study of
TissuGlu, a surgical adhesive.
CVRx
Rheos Therapy
Cardiovascular disease
The company has enrolled its first patient in a clinical
study evaluating the use of its Rheos Therapy as a nonpharmaceutical approach to heart failure treatment.
EnteroMedics
Maestro
Obesity and gastrointestinal
disorders
Preliminary findings from an Empower study of the
company’s Maestro system did not meet primary or
secondary efficacy endpoints, but met all safety endpoints.
GeneNews
ColonSentry
Colorectal cancer test
The company has published positive validation data for
its ColonSentry colorectal cancer test in the International
Journal of Cancer.
Gilead Sciences and GlaxoSmithKline
AMBrIsentan and
Tadalafil
Pulmonary arterial
hypertension (PAH)
The companies will undertake a phase IV clinical trial,
comparing first-line combination therapy and monotherapy
for treating PAH.
Halozyme Therapeutics
Insulin Lispro plus PH20
Enzyme
Diabetes
Study results show reduced absorption variability when
combining insulin lispro with PH20 enzyme, compared to
single-agent lispro.
Human Genome Sciences
Benlysta
Lupus treatment
Positive results were obtained from the company’s second
trial of Benlysta. The company now expects to obtain
approval to begin production.
IRIS International
NADiA ProsVue
Identification of postprostatectomy patients with
low risk of prostate cancer
recurrence
The company has initiated a retrospective clinical study
to assess whether NADiA ProsVue can be used to
prognosticate post radical prostatectomy patients with low
risk of prostate cancer recurrence.
Medtronic
Medtronic Deep Brain
Stimulation Therapy
Severe Epilepsy
Long term data from an investigational study of Medtronic
Deep Brain Stimulation Therapy for epilepsy has shown
improvement with mid-point reduction in seizure frequency,
in conjunction with antiepileptic medication.
Medtronic
Melody Transcatheter
Pulmonary Valve
Congenital Heart Disease
Clinical trial results published in the Journal of the
American College of Cardiology show encouraging results.
Medtronic
Infuse Bone Graft
Bone grafting
A recent study has shown the effectiveness of Infuse Bone
Graft when used in maxillary sinus floor augmentation and
dental restoration.
Medtronic
Resolute ZotarolimusEluting Coronary Stent
Drug-eluting stent
Clinical data in long-term follow-up shows strong and
sustained efficacy and safety of the company’s Resolute
drug-eluting stent.
Shire
Intuniv
Attention deficit/hyperactivity
disorder (ADHD)
A study has demonstrated that Intuniv extended release
tablets cause significant ADHD symptom reduction.
TargeGen
JAK2 Inhibitor
TG101348
Myelofibrosis
The company has successfully completed a multicentre
clinical trial of its JAK2 Inhibitor.
46 | PricewaterhouseCoopers
Regulatory
Drug
Biotechnology
Application
Comments
Total
47
Acorda Therapeutics
Fampridine
Multiple sclerosis
An FDA panel has recommended that Fampridine be
approved for sale for multiple sclerosis treatment.
Amylin Pharmaceuticals
and Eli Lilly Company
Byetta
Glycemic control
An expanded indication for Byetta, as a standalone
medicine for glycemic control, was approved by the FDA.
APP Pharmaceuticals
Sumatriptan Succinate
Injection
Acute treatment
of migraine attacks
The FDA has granted approval for Sumatriptan Succinate
Injection, which is therapeutically equivalent
to GlaxoSmithKline’s Imitrex.
Arena Pharmaceuticals
Lorcaserin
Not disclosed
Arena has applied to the FDA for approval of its drug
candidate lorcaserin.
AstraZeneca
Crestor
Heterozygous familial
hypercholesterolemia
The FDA has approved Crestor for treatment of
heterozygous familial hypercholesterolemia in pediatric
patients between 10 and 17 years.
Baxter International
Celvapan
H1N1 Influenza vaccine
The company has received marketing authorisation from
the EMEA.
BioMarin Pharmaceutical
3,4-DAP
Lambert eaton myasthenic
syndrome
The FDA has granted orphan drug designation to 3,4-DAP.
An EMEA advisory committee has also recommended
approval of the drug in Europe.
Biomedical
RAMP Influenza A/B
Assay
H1N1 Influenza
The FDA has granted the company special clearance to
add analytical reactivity information to the RAMP Influenza
A/B assay package insert.
Cell Therapeutics
Pixatrone
Diffuse large B-cell lymphoma
Pixatrone has been granted orphan drug designation by
the EMEA.
Cepheid
Xpert Flu A Panel Test
H1N1 Influenza
Cepheid has received Emergency Use Authorisation from
the FDA for its Xpert Flu test that identifies H1N1 influenza
in under an hour.
CombinatoRx and Neuromed
Pharmaceuticals
Exalgo
Not disclosed
The FDA has extended its review of the companies’
Exalgo product by three months.
Cornerstone Therapeutics
Deconsal CT and
Deconsal DM
Not disclosed
The FDA has sent the company a warning letter
concerning the marketing of Deconsal chewable tablets
without an approved application.
Covidien and Nuvo Research
Pennsaid Topical
Solution
Pain management
The FDA has approved the companies’ New Drug
Application (NDA) for Pennsaid.
Cydex Pharmaceuticals
Captisol
Stabilisation and taste
masking of active
pharmaceutical ingredients
The company has received a patent from the US Patent
and Trademark Office for sulfoalkyl ether cyclodextrin.
Doctors Research Group
Kryptonite Bone
Cement
Cranioplasty
Kryptonite Bone Cement has been granted approval by
the FDA to treat cranial defects due to surgery and trauma.
Dyax
Kalbitor
Hereditary angioedema
The company has received FDA approval for its treatment
of the rare genetic disorder hereditary angioedema.
Enzon Pharmaceuticals
Pegintron
Metastatic melanoma
An FDA advisory committee has recommended Pegintron
be approved as a treatment in addition to surgery for
metastatic melanoma.
Generex
Oral-lyn
Diabetes mellitus
The FDA has granted price approval for Oral-lyn under its
Treatment Investigational New Drug program.
GenVec
TNFerade
Pancreatic cancer treatment
The company’s drug TNFerade has received orphan drug
designation by the FDA.
Genzyme
Lumizyme
Pompe disease
The company has cancelled its current FDA application to
review alternative avenues of producing the drug on
a larger scale.
Genzyme
Clolar
Acute myeloid leukaemia
The FDA has recommended a randomised, controlled
clinical study be conducted for Clolar before approval of
Genzyme’s supplemental NDA.
Gilead Sciences
Aztreonam
Cystic fibrosis
An FDA advisory committee has recommended the
aztreonam for inhalation be approved for lung infections in
patients with cystic fibrosis.
GlaxoSmithKline
Vortient
Renal cell carcinoma
The FDA has approved Votrient as treatment for patients
with an advanced form of kidney cancer.
GlaxoSmithKline and Genmab
Arzerra
Chronic lymphocytic
leukaemia
Arzerra received accelerated approval and is available for
prescription use as a monoclonal antibody.
Hemispherx Biopharma
Ampligen
Autoimmune disease
The company has received a complete response letter
from the FDA indicating that its NDA for Ampligen cannot
be approved in its current form. At least one additional
clinical study will be necessary.
Human Genome Sciences
Joulferon
Chronic hepatitis C treatment
A marketing authorisation application to approve
Joulferon in Europe has been submitted to the EMEA.
BioForum: October – December 2009 | 47
Announcements – US
Company
Company
Drug
Application
Comments
Human Genome Sciences
Zalbin
Hepatitis C
The company has filed for marketing approval of Zalbin
from the FDA. A licensing partner will submit a similar
application to the EMEA.
Human Genome Sciences
Raxibacumab
Anthrax treatment
The FDA has requested further information about
Raxibacumab before a final decision on the company’s
licence application can be made.
Hyperbranch Medical Technology
NuSeal 30
Hernia treatment
The company has received a CE Mark for its NuSeal
30 hernia mesh fixation sealant product.
Impax Laboratories
Generic Flomax
Benign prostatic hyperplasia
The company’s abbreviated NDA has been granted
tentative approval by the FDA.
Isis Pharmaceuticals
and Alnylam Pharmaceuticals
RNAi Therapeutics
Chemically modified RNAcontaining therapeutics
The companies have received a Notice of Allowance from
the USPTO for their patent application for
RNAi Therapeutics.
InVivo Therapeutics
Not disclosed
Spinal cord injury treatment
The company is seeking an Investigational Drug Exemption
from the FDA to advance to human clinical studies.
Keryx Pharmaceuticals and AEterna
Zentaris
KRX-0401 (Perifosine)
Relapsed/refractory
multiple myeloma
The FDA has granted fast track designation for the
company’s pathway inhibitor compound, Perifosine.
Mylan Pharmaceuticals
Levetiracetam
Not disclosed
Final approval from FDA for Levetiracetam 1000mg
has been received.
NeurogesX
Qutenza
Postherpetic Neuralgia
The FDA has approved Qutenza for neuropathic pain
management.
OSI Pharmaceuticals
Tarceva
Non-small cell lung cancer
The FDA’s Oncologic Drugs Advisory Committee has
voted against the approval of the company’s Tarceva drug.
Pharmacia & Upjohn Co
Bextra, Geodon, Zyvox
and Lyrica
Various applications
A US District Court has imposed a $1.3bn fine and
forfeiture on a Pfizer subsidiary for the misbranding of
several of its products with intent to defraud or mislead.
Proteo
Elafin
Esophagus carcinoma
An EMEA advisory committee has recommended that
Elafin be granted orphan drug status.
Roche (through subsidiary
Genentech) and Biogen Idec
Rituxan
Rhuematoid arthritis
The companies’ application to expand the approved
uses of Rituxan to include treatment for patients in the
early stages of rheumatoid arthritis has been rejected
by the FDA.
Spectrum Pharmaceuticals
Fusilev
Advanced metastatic
colorectal cancer
Spectrum has received a complete response letter from
the FDA stating that the company’s submissions did not
indicate that Fusilev is non-inferior to leucovorin.
Sunesis Pharmaceuticals
Voreloxin
Acute myeloid leukaemia
The FDA has granted Voreloxin orphan drug designation.
Talecris Biotherapeutics
Prolastin-C
Emphysema
Prolastin-C has been approved by the FDA.
The Medicines Company
Angiox
Anticoagulant for patients with
heart attacks
The EMEA has approved Angiox for patients undergoing
emergency heart procedures.
Tibotec Therapeutics
Intelence (etravirine)
Virologic failure with HIV-1
The FDA has granted approval for Intelence, a nonnucleoside reverse transcriptase inhibitor.
Tris Pharma
OralXR+
Drug delivery technology
The FDA has approved two NDAs based on the company’s
OralXR+ platform technology, including a liquid stained
release product.
Vermillon
OVA1
Ovarian cancer diagnosis
The FDA has approved the company’s OVA1 blood test
procedure which will assist decisions as to the kinds of
operations required to treat ovarian cancer.
Wilmington Pharmaceuticals and
Salix Pharmaceuticals
Metozolv ODT
Acute and recurrent diabetic
gastroparesis
The FDA has approved Metozolv for use in Catalent
Pharma Solutions’ Zydis fast dissolve technology.
Total
47
Medical Devices
Abbott Diagnostics
Architect Immunoassay
Analyser
Rheumatoid arthritis
The FDA has granted the company 510(k) clearance for its
Architect product.
AdvanDx
Staphylococcus
Diagnostic Test
Staphylococcus aureus and
Saureus/ coagulase-negative
Staphylococci
The company’s Staphylococcus diagnostic test has
received FDA approval.
Anika Therapeutics
Elevess Light
Aesthetic dermatology
The company’s product Elevess Light has received CE
mark approval.
Asthmatx
Alair System
Severe persistent asthma
An FDA advisory committee has recommended that
the company’s Alair System should be approved with
conditions.
ATS Medical
ATS 3f Enable Aortic
Bioprothesis
Cardiac surgery
The company has received CE Mark approval for its Enable
valve, a surgical aortic valve replacement.
48 | PricewaterhouseCoopers
Drug
Application
Comments
Avioq
Avioq HIV-1 Microelisa
System
HIV-1 detection
The company has received pre-market approval from
the FDA for its HIV-1 Microelisa System.
BioMimetic Therapeutics
Augment Bone Graft
Synthetic grafting system for
bone regeneration
The company has received approval from Health Canada
to market its Augment Bone Graft product in Canada.
Boston Scientific
WallFlex Fully Covered
Esophageal Stent
Esophageal cancer
The company has received 510(k) clearance from the
FDA and CE Mark approval.
Boston Scientific
WallFlex Biliary RXCovered Stent
Tumour minimisation
The company has received FDA pre-market approval to
commercialise its WallFlex Biliary RX-Covered
Stent device.
Covidien
Oral fentanyl citrate (CII)
Cancer pain management
The FDA has approved the company’s product, which
is a generic alternative to Actiq.
CryoLife
BioFoam
Sealing of liver parenchymal
tissue
The FDA has granted the company an Investigational
Device Exemption to begin a human clinical trial for
BioFoam surgical matrix.
CryoLife
SynerGraft
Aortic human heart valve
The company has received Humanitarian Use Device
designation from the FDA.
CryoLife
CryoValve SG
Aortic human heart valve
The FDA has granted the company’s CryoValve SG
device Humanitarian Use Device designation.
DexCom
Seven Plus Continuous
Glucose Monitoring
System
Diabetes
The company has received a CE Mark for its Seven
Plus Continuous Glucose Monitoring System.
Diagnostic Hybrids
D(3) FastPoint L-DFA
Influenza A/B Virus
Identification Kit
Influenza A/B identification
The FDA has granted the company 510(k) clearance for
its FastPoint influenza identification product.
Diatherix Laboratories
Diatherix H1N1
Influenza test
H1N1 Influenza
The FDA has granted emergency use authorisation
for Diatherix H1N1 Influenza test.
DUSA Pharmaceuticals
Kerastick Krusher
Preparation of Levulan
Kerastick for Levulan
Photodynamic Therapy
The company has received FDA approval for its Kerastick
Krusher product.
Ellipse Technologies
Magec
Spinal Scoliosis
Ellipse’s Magec system has received CE mark approval
for non-invasive remote control spine therapy.
Endologix
IntuiTrak
Endovascular abdominal
aortic aneurysm repair (EVAR)
The FDA has granted an investigational device exemption
for the company to begin a clinical trial for a bilateral
percutaneous approach to EVAR using IntuiTrak.
Fenwal
InterSol
Storage of donated blood
platelets
The FDA has granted the company approval to market
InterSol platelet additive solution, for use with Fenwal’s
Amicus device.
Flexible Stenting Solutions
FlexStent
Femoropopliteal Self
Expanding Stent
System
Stent placement for vascular
intervention
The company has received conditional investigational
device exemption approval from the FDA for its
FlexStent system.
GI Dynamics
EndoBarrier
Type 2 Diabetes and Obesity
The company has received CE Mark approval for
its EndoBarrier gastrointestinal liner system, an
investigational, non-surgical medical device.
Henry Schein
Waterlase MD
Removal of subgingival calculi
The company has received 510(k) clearance from the
FDA for its Waterlase MD product.
IVAX Diagnostics
Mago 4S Enzyme-linked
Immunosorbent Assay
System
Autoimmune and infectious
disease testing
The company has filed a 510(k) premarket submission to
the FDA for Mago 4S, which is an enhanced version of its
existing Mago Plus product for autoimmune and infectious
disease testing.
Lumenis
PolyScope Flexible
Endoscope
Flexible endoscopes
The FDA has granted 510(k) clearance for the PolyScope
Flexible Endoscope.
Masimo
Rainbow SET Acoustic
Monitoring
Respiration rate monitoring
The FDA has cleared the company’s product, Raindow
SET Acoustic Monitoring.
Merit Medical Systems
Merit Laureate
hydrophilic guide wire
Insertion of catheters
The FDA has approved the company’s Merit Laureate
hydrophilic guide wire device.
NovaPharma
NovaMist Oral Spray
Technology
Insomnia treatment
The company has received a Notice of Allowance from the
USPTO for a method of treating insomnia that utilises its
NovaMist Oral Spray Technology.
Onset Medical Corporation
SoloPath TransFemoral
Endovascular Access
Catheter
Conduit for the delivery of
larger diameter devices
The company has received 510(k) clearance from the FDA
for its SoloPath device.
OraSure Technologies
OraQuick Rapid HCV
Antibody Test
Hepatitis C
The company has received CE Mark approval for its
OraQuick Rapid HCV Antibody Test.
BioForum: October – December 2009 | 49
Announcements – US
Company
Company
Drug
Application
Comments
Ortho Clinical Diagnostics
Vitros Anti-HIV 1+2
Assay
Detection of antibodies to
HIV types 1+2
The company has received FDA approval for the use
of its Vitros test on a random access, integrated laboratory
testing system.
Pathway Medical Technologies
Jetstream G2TM NXT
Peripheral arterial disease
The company has received CE Mark approval for its
peripheral atherectomy catheter.
Quest Diagnostics
Simplexa Influenza A
H1N1 test
H1N1 Influenza
The FDA has issued an emergency use authorisation
for Quest Diagnostic’s Simplexa Influenza A H1N1 test.
Reverse Medical Corporation
ReStore Microcatheter
Treatment of
neurovascular disorders
The company has received conditional investigational
device exemption approval from the FDA to begin a
neurothrombectomy a clinical study for its ReStore
microcatheter.
Solace Therapeutics
Solace Balloon
Non-surgical bladder control
The company has received CE Mark approval for its
Solace Balloon.
Solta Medical
re:store Dual Laser
System
Clearance of pigmentation
and other skin conditions
The company has received CE Mark approval for its re:
store Dual Laser System.
Spectranetics
VisiSheath
Tissue dilation around
cardiac leads
The FDA has approved VisiSheath, which can be used
to help physicians dilate scar tissue around cardiac
leads requiring removal.
SpectraScience
WavSTAT Optical
Biopsy System
Detection of pre-cancer
and cancer in colon and
cervix tissue
The FDA has approved enhancements to the company’s
WavSTAT Optical Biopsy System.
St Jude Medical
Penta
Neurostimulation therapy
for chronic pain management
The company has received FDA approval of its Penta
surgical lead.
St Jude Medical
Quartet
Pacing system for cardiac
resynchronisation therapy
defibrillators
The company’s Quartet device has received
CE Mark approval.
St Jude Medical
Quadripolar pacing
system
Cardiac resynchronisation
therapy defibrillators
The company has received CE mark approval for its
quadripolar pacing system.
St Jude Medical
EnSite Velocity Cardiac
Mapping System
Diagnosis of abnormal
heart rhythms
The FDA has approved the company’s EnSite Velocity
Cardiac Mapping System.
Stereotaxis
Celsius RMT
ThermoCool Catheter
Cardiology instrument
control systems
The company’s Celsius RMT ThermoCool Catheter has
received CE Mark approval.
SynCardia
Companion Driver
System
Power for pulsatile devices
The company’s Companion Driver System has received
CE Mark approval to power its CardioWest Total Artificial
Heart in Europe.
Vascular Solutions and Zerusa
Guardian II
Hemostasis valve
The companies have received 510(k) clearance from the
FDA for their Guardian II hemostasis valve.
W.L. Gore & Associates
Gore Tag Thoracic
Endoprothesis
Thoracic aortic aneurysms,
traumatic aortic transections
and thoracic aortic dissections
The company has received CE Mark approval for its
Gore Tag device.
Wright Medical Group
Conserve Plus Total Hip
Resurfacing System
Total surface arthroplasty
The FDA has granted marketing approval for Conserve
Plus, a bone-conserving alternative to traditional
hip replacement.
50 | PricewaterhouseCoopers
Announcements – US
BioForum: October – December 2009 | 51
52 | PricewaterhouseCoopers
Appendix
Appendix
BioForum: July – September 2009 | 53
Companies in the PwC Life Sciences Index
Med Device
Closing Mcap (A$m)
AMT
ADVANCED SURGICAL DESIGN & MANUFACTURE LIMITED
ADO
ANTEO DIAGNOSTICS LIMITED
AQL
AQUACAROTENE LIMITED
ACG
ATCOR MEDICAL HOLDINGS LIMITED
ATW
ATOS WELLNESS LTD
AYX
AUSTOFIX GROUP LIMITED
BOD
BIOMD LIMITED
BRC
BRAIN RESOURCE COMPANY LIMITED (THE)
BZI
BRAINZ INSTRUMENTS LIMITED
CXD
CLV
COH
COCHLEAR LIMITED
CGS
CMP
Quarterly return
21.18
63%
2.80
-22%
2.93
-6%
18.57
15%
2.86
-63%
14.24
37%
5.41
-40%
27.51
9%
2.28
15%
CATHRX LTD
43.54
65%
CLOVER CORPORATION LIMITED
40.47
23%
3,892.22
3.5%
COGSTATE LTD
20.72
29%
COMPUMEDICS LIMITED
29.01
-3%
CBB
CORDLIFE LIMITED
59.62
40%
CYC
CYCLOPHARM LIMITED
18.81
41%
EMS
EASTLAND MEDICAL SYSTEMS LTD
26.67
15%
ELX
ELLEX MEDICAL LASERS LIMITED
15.28
0%
GBI
GENERA BIOSYSTEMS LIMITED
48.99
-1%
HIN
HEARTWARE INTERNATIONAL, INC
IAT
IATIA LIMITED
IPD
ITD
479.67
7%
3.96
29%
IMPEDIMED LIMITED
85.04
18%
ITL LIMITED
10.40
-1%
KSX
KARMELSONIX LIMITED
25.80
-34%
LBT
LABTECH SYSTEMS LIMITED
11.93
-20%
MVH
MEDIC VISION LIMITED
3.68
-22%
MLA
MEDICAL AUSTRALIA LIMITED
10.40
0%
MOD
MEDICAL CORPORATION AUSTRALASIA LIMITED
5.48
0%
MGZ
MEDIGARD LIMITED
7.38
-17%
MDV
MEDIVAC LIMITED
12.32
-27%
MDG
MEDTECH GLOBAL LIMITED
NAN
NANOSONICS LIMITED
NDL
NEURODISCOVERY LIMITED
OBJ
OBJ LIMITED
OIL
OPTISCAN IMAGING LIMITED
RMD
RESMED INC
SFP
SAFETY MEDICAL PRODUCTS LIMITED
SOM
SOMNOMED LIMITED
33.01
43%
SHC
SUNSHINE HEART, INC.
20.49
-19%
TDX
TYRIAN DIAGNOSTICS LIMITED
7.98
-30%
UNI
UNILIFE MEDICAL SOLUTIONS LIMITED
278.54
-34%
UBI
UNIVERSAL BIOSENSORS, INC.
290.66
31%
UCM
USCOM LIMITED
29.26
-18%
5.01
0%
144.17
35%
2.01
2%
32.58
480%
10.69
-25%
4,444.99
14%
3.34
-16%
Pharma and Biotech
ACR
ACRUX LIMITED
ACW
ACTINOGEN LIMITED
349.63
28%
1.99
-17%
ACU
AGX
ACUVAX LIMITED
11.09
-26%
AGENIX LIMITED
8.42
ACL
0%
ALCHEMIA LIMITED
136.98
31%
ALT
ANALYTICA LIMITED
14.90
110%
ANP
ANTISENSE THERAPEUTICS LIMITED
32.41
10%
AOP
APOLLO CONSOLIDATED LIMITED
4.85
-75%
APH
ASCENT PHARMAHEALTH LTD
52.38
-11%
AVX
AVEXA LIMITED
114.43
35%
AVH
AVITA MEDICAL LTD
17.18
-3%
BLT
BENITEC LIMITED
13.71
-17%
BDM
BIODIEM LIMITED
17.57
15%
BNO
BIONOMICS LIMITED
BPH
119.15
39%
BIOPHARMICA LIMITED
25.39
-23%
BPO
BIOPROSPECT LIMITED
19.03
70%
BOS
BIOSIGNAL LIMITED
BTA
BIOTA HOLDINGS LIMITED
54 | PricewaterhouseCoopers
3.00
0%
431.27
-12%
Closing Mcap
10.88
Quarterly return
-32%
13.02
-3%
9.04
-9%
BNE
BONE MEDICAL LIMITED
CZD
CALZADA LIMITED
CST
CELLESTIS LIMITED
CDY
CELLMID LIMITED
CXS
CHEMGENEX PHARMACEUTICALS LTD
278.72
34%
CIR
CIRCADIAN TECHNOLOGIES LIMITED
31.67
-17%
CUV
CLINUVEL PHARMACEUTICALS LIMITED
81.85
-19%
CTE
CRYOSITE LIMITED
CSL
CSL LIMITED
CYT
GEN
GTG
GENETIC TECHNOLOGIES LIMITED
GIA
GIACONDA LIMITED
HGN
HALCYGEN PHARMACEUTICALS LIMITED
HTX
HEALTHLINX LIMITED
10.79
-1%
HXL
HEXIMA LIMITED
38.15
-13%
HCT
HOLISTA COLLTECH LIMITED4
18.79
-24%
IMC
IMMURON LIMITED
23.11
14%
IMU
IMUGENE LIMITED
12.64
-35%
ICV
INCITIVE LIMITED
3.57
-22%
IDT
INSTITUTE OF DRUG TECHNOLOGY AUSTRALIA LIMITED
60.24
-21%
LCT
LIVING CELL TECHNOLOGIES LIMITED
59.96
-6%
MVP
MEDICAL DEVELOPMENTS INTERNATIONAL LIMITED
MSB
MESOBLAST LIMITED
NEU
NEUREN PHARMACEUTICALS LIMITED
13.03
3%
NRT
NOVOGEN LIMITED
60.76
-18%
NSP
NUSEP LIMITED
6.50
56%
PAB
PATRYS LIMITED
23.28
-14%
PAA
PHARMAUST LIMITED
11.21
-18%
PXS
PHARMAXIS LTD
POH
314.42
-3%
11.08
26%
7.00
0%
18,970.21
-3%
CYTOPIA LIMITED
8.89
-13%
GENESIS RESEARCH AND DEVELOPMENT CORPORATION LIMITED
1.57
0%
15.74
-24%
3.53
-22%
94.99
47%
9.69
9%
190.86
32%
595.87
13%
PHOSPHAGENICS LIMITED
50.30
-29%
PYC
PHYLOGICA LIMITED
31.83
23%
PBT
PRANA BIOTECHNOLOGY LIMITED
35.07
-36%
PRR
PRIMA BIOMED LTD
96.04
-14%
PCC
PROBIOMICS LIMITED
6.47
83%
PBP
PROBIOTEC LIMITED
PGL
135.32
0%
PROGEN PHARMACEUTICALS LIMITED.
13.59
-12%
PVA
PSIVIDA CORP.
77.93
-14%
QRX
QRXPHARMA LIMITED
79.56
-10%
RBY
ROCKEBY BIOMED LIMITED
SIE
SCIGEN LIMITED
SLT
SELECT VACCINES LIMITED
SRX
SIRTEX MEDICAL LIMITED
SLA
SOLAGRAN LIMITED
SPL
STARPHARMA HOLDINGS LIMITED
STI
STIRLING PRODUCTS LIMITED
TEO
TELESSO TECHNOLOGIES LIMITED
TIS
0.97
-58%
193.29
169%
1.79
75%
421.05
56%
74.30
61%
164.87
22%
12.11
56%
2.11
6%
TISSUE THERAPIES LIMITED
22.11
-22%
VLA
VIRALYTICS LIMITED
12.85
23%
VHL
VIRAX HOLDINGS LIMITED
9.42
-24%
XCD
XCEED CAPITAL LTD
4.40
22%
Notes:
1. APOLLO LIFE SCIENCES LIMITED (AOP) – changed its name to Apollo Consolidated Limited (AOP)
2. BMDI TUTA LIMITED (BMI) – changed its name to Medical Australia Limited (MAL)
3. MEDICAL THERAPIES LIMITED (MTY) – changed its name to Cellmid Limited (CDY)
4. METABOLIC PHARMACEUTICALS LIMITED (MBP) – changed its name to Calzada Limited (CZD)
5. FERMISCAN HOLDINGS LIMITED (FER) – removed from index
6. NORWOOD ABBEY (NAL) – removed from index
7. OCCUPATIONAL AND MEDICAL INNOVATIONS LIMITED (OMI) – removed from the index
8. POLARTECHNICS LIMITED (PLT) – removed from the index
9. PEPLIN, INC (PLI) – removed from the index
BioForum: October – December 2009 | 55
Appendix
Pharma and Biotech
BIT
BIOTRON LIMITED
Methodology
Sources
BioForum draws on historical data from the following sources:
• Bloomberg
• Connect 4
• the ASX
• company websites
• PwC Global Pharma and Life Science Quarterly Newsbriefs
Market performance
The Australian life sciences sector’s market performance
is tracked through two indices:
i) PwC Life Sciences Index
ii) PwC Life Sciences Index ex majors (CSL, ResMed
and Cochlear)
Analysis is provided without the large-capitalisation stocks
(majors) so the performance of smaller-capitalisation stocks
can be observed.
The PwC Life Sciences Index is based on the performance
of life sciences companies listed on the Australian Securities
Exchange (ASX). It comprises two subsectors:
i) pharmaceutical/biotechnology
ii) medical devices
These sectors have been classified according to the
Global Industry Classification Standard. The index includes
life sciences companies primarily involved in research,
development, commercialisation and manufacturing of
pharmaceutical and biotechnology products and medical
devices. It excludes healthcare, medical software and
distribution companies. Companies included in the
PwC Life Sciences Index are listed at the end of each
issue of BioForum.
The PwC Life Sciences Index is based on the combined
market capitalisation of the listed companies and calculates
the change of their value over the quarter and change over the
previous year. These changes are compared to the changes in
the market performance of the following indices:
• ASX All Ordinaries
• NASDAQ Composite
• NASDAQ Biotech
56 | PricewaterhouseCoopers
Different formulae are used to calculate the value of these
indices and track their performance. These formulae use
a combination of company market prices and a weighted
average of market capitalisation. Because of these different
methods of calculating value, the absolute value of the indices
cannot be directly compared. Only their changes over time can
be sensibly compared.
Top and bottom performers
Annual data on these companies is sourced from Bloomberg
each quarter. Company announcements are sourced from the
ASX or directly from company websites.
IPO and secondary finance markets
IPO and secondary financing data is sourced from the
Connect 4 database’s health-care industry category. We include
data from companies on the PwC Life Sciences Index only.
Data on options, rights and bonus issues is excluded.
The US IPO and secondary financing data is sourced from our
quarterly PwC Global Pharma and Life Sciences Newsbrief.
Announcements
These are from companies listed on the PwC Life Sciences
Index only. They are sourced from Connect 4 using the
health-care industry category. We include announcements
on partnerships, mergers and acquisitions and divestments,
clinical results, regulatory activity and other information.
Examples of other information include management and board
changes, the closing or opening of offices, and successful
grant applications.
Announcements on the following are excluded:
• trading halts
• capital raisings
• proposed (versus actual) mergers, acquisitions
and partnerships
• progress reports on clinical trials (results only are included)
• market registration approval
The US announcement data is sourced from our quarterly
PwC Global Pharma and Life Sciences Newsbrief.
Appendix
Acknowledgements
Written and edited by:
PricewaterhouseCoopers (www.pwcglobal.com), a global professional services
organisation serving the life sciences sector and other industries.
External contributors:
Mr David Shoolman, Managing Principal, Ascot Martin Patent & Trade Mark Attorneys
PwC Global Pharmaceutical Team
Quantitative research and analysis by the PricewaterhouseCoopers BioForum team:
Tony Gellert, Manager, Principal Author
Calvin Lim, Senior Consultant
Joe Adendorff, Consultant
Angelique Fitzgerald, Consultant
Frank Danieli, Undergraduate
Chamindu Balasuriya, Undergraduate Consultant
PwC Life Sciences Practice contributors
PricewaterhouseCoopers – Life Sciences Practice
Craig Lawn, Partner, National Life Science Industry Leader
Manoj Santiago, Partner, Sydney Life Science Industry Leader
Adrian Bunter, Director
Stephanie Wood, Administration
External
Karen Hunt, Editor and proof reader
BioForum: October – December 2009 | 57
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