Pharma ‘could have done a better job’ explaining drug costs

Since December 2013, Albert Bourla has served as group president of vaccines, oncology and consumer healthcare businesses at Pfizer.

Under his leadership, Pfizer, with revenue of $49.6 billion and net income of $9 billion in 2014, received accelerated approval from the Food and Drug Administration for Ibrance, the first new medicine approved in more than a decade for postmenopausal women with certain types of advanced breast cancer. Pfizer Consumer Healthcare is a major over-the-counter healthcare-product business, marketing Advil, Centrum and Nexium 24HR. Pfizer recently announced its $160 billion merger with Irish drugmaker Allergan, which will create the world’s largest drugmaker by sales and reduce Pfizer’s corporate tax rate. Bourla, a veterinarian who holds a doctorate, previously served as president and general manager of Pfizer’s established products business unit, where he led strategic development for Pfizer’s off-patent drug portfolio. Modern Healthcare reporter Steven Ross Johnson recently spoke with Bourla about his company’s research and development strategies, how Pfizer is responding to consumer-directed healthcare and the controversy over high drug prices. This is an edited transcript.

Modern Healthcare: Where do you see Pfizer’s role within the current healthcare landscape?

Albert Bourla: Our role is to develop and deliver healthcare products that significantly improve patients’ and consumers’ lives. So far, we have made significant strides. We have a leading portfolio of products and medicines that support people at every stage of life.

However, bringing new medicine to market is a complex and lengthy journey where the probability of success is less than certain. Investments will bring products that can challenge diseases like Alzheimer’s or cancer. Our role is to continue investing in R&D.

MH: How might that evolve?

Bourla: During the 25 years of my career, I have witnessed tremendous changes in healthcare, from new data tools to diagnostic instruments. But nothing compares to the transformation currently happening. We are in the middle of a scientific renaissance. The healthcare environment of the future will occupy entirely new dimensions.

People are taking a more active role in their own health management. Increasing consumer responsibility, choice, and digital and social media are transforming healthcare. Pfizer needs to proactively adapt to stay ahead of the game. Also, big data will open new possibilities, from drug discovery and development to using realworld data to collect product-user trends.

MH: Where do you see the greatest opportunities for growth in the vaccine market?

Bourla: We are focused on two things: The first is saving and accelerating our adult vaccination program, while protecting and growing our pediatric one. The second is establishing and building our meningitis franchise.

We have a separate focus on the most promising areas of vaccine research. One is prophylactic vaccines. We have active programs for staphylococcus aureus and clostridium difficile, diseases that do not currently have any vaccine solution. We are working on maternal vaccines that could protect against Group B streptococcus and RSV and CMV, important infant diseases. Also, we have very active immuno-oncology programs that include vaccines against cancer.

MH: What are the biggest opportunities in the cancer market?

Bourla: We have two growth platforms: Ibrance and immuno-oncology.

Ibrance is our treatment for metastatic breast cancer. About 1 million breast cancer patients are ER-positive, HER2negative, which is an area where Ibrance is active. We are working to build a broad franchise around breast cancer, starting with firstline metastatic breast cancer, moving then to recurrent metastatic breast cancer, and then going to early breast cancer. We are running studies in nonbreast cancer tumor types with Ibrance.

The second growth pillar is immuno-oncology. We are well positioned to be a strong player, particularly in the combination space. Recently, the FDA granted orphan-drug designation

“We are in the middle of a scientific renaissance. The healthcare environment of the future will occupy entirely new dimensions.”

and fast-track designations for Avelumab, with which we are partnering with Merck KGaA, the European Merck, to treat a rare and aggressive form of skin cancer.

The first potential commercial launch for Avelumab is anticipated in 2017, and we expect to have at least one or more additional launches each year through 2022.

Also, by the end of this year, we expect to have five immuno-oncology compounds in clinical status. All of them could potentially provide, through intelligent combinations, great therapeutic solutions for a variety of tumors. And we expect to have up to 10 different immuno-oncology compounds in the clinic by the end of 2016.

MH: Why integrate vaccines, oncology and consumer healthcare into a single unit?

Bourla: Each of those global integrated businesses is unique. They have distinct specializations, go-to-market strategies, R&D priorities and operating models. There are only a few meaningful operational synergies, as for example, in R&D. There is an intersection between vaccines and oncology by harnessing the power of the immune system to fight tumors with cancer vaccines.

But all three business units are poised for strong organic growth, and although smaller in size, they’re extremely valuable, given the growth performance. This structure allows us to provide these businesses with a growth culture and the dedicated resources that are required to further strengthen them to be market leaders.

The vaccine-oncology-consumer (VOC) unit is exceeding expectations. Our operational growth for the first nine months of this year was 52% for VOC, as compared to 3% for Pfizer as a whole.

MH: What can be done to address public concerns about the high costs of new specialty drugs?

Bourla: Given next year’s elections, it will continue to be debated. Medicines are among the most effective uses of private and public healthcare dollars. They represent around 10% of total healthcare costs, and that percentage is expected to remain the same over the next several years.

It’s difficult when individuals cannot afford increases in their copays when their treatment is on a specialty tier.

Our position is that no individuals should have to bear the full cost of their treatment when they become sick. The insurance industry hasn’t evolved with the rest of the field.

Medicines are now the least-insured benefit. On average, patients pay out of pocket nearly 20% of their total prescription-drug costs, compared with 5% of hospital costs.

Having an affordable healthcare system requires incentives through which insurance plans can be successful when they invest in long-term health, and providers are successful by insuring wellness rather than treating sickness. To sustain the most vibrant, innovative biopharmaceutical industry in the world, we must preserve the market-based system that enables us to continue to develop breakthrough treatments and cures.

MH: Have drug companies done a good job of conveying a message to the public about what it costs them to develop innovative drugs?

Bourla: The pharma industry could have done a better job in explaining that.