Getting personal

A shifting landscape in personalized medicine is leading to a more competitive market as drugmakers scramble to find the right partners to develop diagnostics, regulators place more scrutiny on laboratory-developed tests and third-party payers demand to see more evidence of treatments that can deliver results for their customers

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As personalized medicine grows inimportance as new stakeholders enter the fray, the result is achanging dynamic for the entire industry.

As a result of this shifting landscape,competitiveness is on the rise as drugmakers scramble to find theright partners to develop diagnostics, regulators place more scrutinyon laboratory-developed tests and third-party payers demand to seemore evidence of treatments that can deliver results for theircustomers.

In a webinar presented by Pharmalot andthe publishers of PharmaLive, Harry Glorikian, managing partner ofScientia Advisors and a former biotech executive, presented a sessiontitled "How a New Set of Players is Changing PersonalizedMedicine."

According to Glorikian, a key area isthe in vitro diagnostics landscape, including reagents,instruments and systems.

"This area has been around for a longtime and people used to look at it as pennies-for-poundsdiagnostics," he says. "This area has been changing rapidly andgetting a lot of attention. The market has been growing at a prettyhealthy clip of about 8 percent."

The growth rate, he explains, isdragged down a bit though by older technology such as clinicalchemistry.

"That is what we classify as alongthe lines of analog medicine and what we are moving towards is morealong the lines of digital medicine," Glorikian notes, pointing outthat with so much potential for growth, there is plenty at stake forall of the participants. "The areas of growth that are happeningthat are driving clinical decisions include pathology and moleculardiagnostics."

While still in the early stages,personalized medicine is steadily emerging as the new healthcareparadigm. In the U.S., the total market for personalized medicinecurrently is estimated at $232 billion and is projected to grow 11percent annually, nearly doubling in size by 2015, to a total of $452billion, according to PricewaterhouseCoopers' estimates.

The core diagnostic and therapeuticsegment of the market—comprised primarily of pharmaceutical,medical device and diagnostics companies—is estimated at $24billion, and is expected to $42 billion by 2015. The rest of themarket is taken up by the currently estimated $4 billion to $12billion personalized medical care portion of the market—such astelemedicine, health information technology and disease managementservices offered by traditional health and technology companies—andthe nutrition and wellness market that is geared toward retail,complementary and alternative medicine, which is currently estimatedat $196 billion.

Personalized medicine, Glorikian notes,is defined as the right therapy for the right patient at the righttime but he notes, "I would add one more caveat to that—with theright technology." As such, he points out that there is asignificant shift in the space in terms of technology being used todrive how patients are being treated. As a result, the questionarises as to exactly how companies can affect the efficacy and thecost of drugs while avoiding adverse drug reactions.

"What we are seeing is that cost andefficacy are gaining more attention than adverse reaction when itcomes to development of new therapeutics," he says. "A focus onimproved efficacy and safety will have a ripple effect through thesegment."

From the perspective of drugdevelopers, Glorikian says the end result could lead to improvementsin the drug discovery process and a reduction in time, cost andfailure rates of trials.

At Scientifica Advisors, Glorikian saysthe two things he is talking to clients about is improved safety andefficacy.

"I believe that pharma companies areinterested from a number of different angles, including the potentialfor higher efficacies," Glorikian notes. "The diagnosticscompanies are interested in finding new biomarkers and new revenuestreams. As a result, there are many new companies that are coming onthe block almost daily or weekly that are focused on diagnostics andsee opportunities."

For pharma companies, a growingquestion about companion diagnostics and pharmacogenomics is whetherthey are necessary internally to push their therapeutics. Otherpharma companies are questioning whether they need to be indiagnostics as a stand-alone business and whether it will help withcompanion strategies.

"Right now, it is a partnershipaspect," Glorikian says. "People are forming many differentpartnerships in the market to have a diagnostic company work withthem and vice versa. What we are seeing over time is that growing inthe market."

As a result, three key areas areforming: companion diagnostics, adverse testing and predictivetesting.

The predictive testing area isn'tnecessarily a partnership with two companies, but rather a companytaking on both combinations of a novel treatment to take to market.

Going forward, Glorikian says there isan increasing number of biomarkers on the market today and he expectsthat to continue over the next couple of years.

"In the next three or four years, weare going to see a rush of new products entering the system andhaving an affect on how people are diagnosed and what prognosis testsare out there," he says. "Not all products will be molecular,some may be protein-based. Some may be based on sequencing."

Moreover, there are more deals going onfrom an oncology standpoint, where tests are being licensed andacquisitions are being finalized that would drive a deals or researchposition in a particular way. There are also organizational changes,with some companies working to outsource diagnostics and othersaiming to be completely integrated organizations with therapeuticgroups and diagnostic groups working together to determine how theywill take a product to market.

In addition to every genomics andproteomics company that now is interested in diagnostics, Glorikiannotes that a key emerging stakeholder is next-generation sequencingcompanies, many of which are hiring their own diagnostics personnel.

"They are looking for new biomarkersand simplifying the technology to make the platform an universalplatform for diagnostic decision-making," he says. "Companieslike Illumina, for example, are looking at diagnostics as a way tomake their mark in the industry."

Glorikian contends that if technicalhurdles are cleared, "the prediction that we now have is that by2014 you will be at the sub-$1,000 genome. Instead of doing the wholegenome, we expect that people will be conducting targeted sequencingon tumor samples and the data that comes out of that tumor samplewill directly impact the therapeutic regime that comes downstream."

As a result, personalized medicine isseeing an increase in stakeholder activity, with many emergingstakeholders affecting the landscape of the market in ways differentthan current stakeholders may anticipate.

Glorikian says that personalizedmedicine can be seen as a way of leveling out what has been arollercoaster ride of seeking the next blockbuster drug. As a result,it will dilute the impact of patent expiration and create an industrythat is more stable and sustainable.

Glorikian notes, too, that many pharmacompanies have been "blindsided" by biomarkers on their productsand can't afford to let it happen again. "They need to look atbiomarkers that are moving their way through the system that willaffect their existing products," he says.
 


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