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Week-in-review editorial

Cost-cutting and safety fears overshadow industry achievements

A week of extreme ups and downs for the industry as pharma companies profits continue to be eroded by generic product entries, while revenues have dipped further as the US dollar dropped to a 26-year low against sterling and the sub-prime housing market there collapsed.

J&J announced it was to slash nearly 5,000 jobs from its global workforce because of the anaemia rulings and generic erosion of its products. In the UK, AstraZeneca followed suit by ridding itself of 7,600 jobs on the back of falling sales and failing patents.

In the US, the Centers for Medicare and Medicaid Services eased some of the restrictions it had proposed in May 2007 for the use of anaemia drugs in cancer patients. The agency was concerned that the products might be making some cancers worse, but relented in the face of an outcry from cancer patients and their doctors.

The agency qualified its u-turn by saying that it would deny Medicare reimbursement for drugs like Aranesp and Epogen from Amgen and Procrit from J&J if a patient's haemoglobin was above a certain level. The company countered that limiting reimbursement to these patients was contrary to the FDA's approved labelling for the drugs.

Good news came in the form of Takeda and GSK battling to save the reputations of their flagship diabetes products, Actos and Avandia. Both companies attacked the science behind the article in the New England Journal of Medicine, which used meta-analyses to evaluate product safety, and won.

Both firms presented longitudinal trial data, which both said was robust and scientifically more reliable when considering the safety of drugs. In both cases, the FDA decided that the drugs could stay on the US market, but with changes to Avandiaís label to indicate possible cardiac damage. Takeda also revealed a second potential successor to Actos, which almost a third of the revenue earned by the company. SYR-472 is in the second of three stages of patient studies needed for regulatory review.

Finally, GSK revealed it would launch 25 new drugs between 2007 and 2009. Peak sales of USD 1bn are expected from cervical cancer vaccine Cervarix, blood platelet growth factor drug Promacta and the new breast cancer treatment Tykerb.

2nd August 2007

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