Roche Switzerland outlines strategy to face Biosimilar medicines

The future of the global pharmaceutical industry will be much more creative than it has been until now, thanks to technological advances, and the Swiss group Roche bet on better products to face the first wave of Biosimilars that enters the market. So says Andrew Hoffman, the great-grandson of the founder of Roche and head of the "pool" of seven shareholders of the family that still controls the group, in an interview with Value, something rare, since I prefer to keep a low profile. He is non-Executive Vice President of the Board of Directors, and know where the company is targeting.
The Swiss group faces the expiration of patents for cancer drugs Mabthera, Herceptin and Avastin, which together generated sales of $ 20.4 billion in 2015. In the case of Mabthera, the value reached US $ 7.1 billion, nearly 15% of the total turnover of the company last year.
Competition from Biosimilars in Europe will begin in the second half of 2017 and u.s. patent expires in 2018. Pfizer, Teva Pharmaceutical and Merck are in dispute. The first Biosimilar version of Herceptin also could enter the market in the second half of 2017. The Biosimilars can cost up to 75% less than the remedy copied, according to sources in the industry.
"The principle is that the medicine is expensive when you''re with the patent. Currently, we are seeing the first wave of Biosimilars, and Roche we need to find a better product to have new patent. What we want is new products at Roche, "says André Hoffmann.
According to analysts, the Swiss group will continue having a profit even with a loss of 40% to 50% of the market for Biosimilars in the three years following its entry into the market. Is that Roche has an important reserve of products in advanced stages of development. Includes the potential of a new medicine against plaque sclerosis and new opportunities in anticancer immunotherapy.
Mark Belsey, of UBS, in a note to clients that exemplifies Roche is one of the groups susceptible to impose on the market of more than $ 20 billion of lung cancer.
The decision to Roche, as Hoffmann, is to keep on the edge of medicines for diseases that put his life on the line, which in the jargon of the industry are called "ethical medicines". Oncology is the most profitable of the group activity, contributing 47% of revenues. The Diagnostics sector weighs 22%.
For him, the use of data, gene sequence and other technological instruments are giving you new ways to deepen the examination of the causes of the disease, like never before. "The technology enables specific targets to attack and that the future of the industry to be more creative to advance the health, with new remedies," he said.
Hoffmann regrets, however, certain legal limitations. "What I was using the identification of risk of each patient to prevent the disease," he said. "And then the important thing is to have legal conditions to put into action a true prevention system. But, at the moment, we have no right to use such data, which belong to the patient ". The situation is more comfortable for Drugmakers in the United States, where Congress has set comprehensive rules as "desidentificar" the data, to enable research and development. "But in Europe the situation is different. And in Brazil is too complicated, "he says.
Hoffmann makes clear that the family keeps full controller support for the long-term strategy of the company. "If you buy shares of Roche, have to understand that we are and we will be there in the long term". Towards shareholders, activists interested in larger gains in the short term, the message is clear: "those who come and want to change things, will not work. The right of holders of bonds (bonds) is not the same of shareholders ".
Roche has two types of titles: the bond and the stock. The company has 160 million shares with a nominal value of 1 Swiss franc. And 702 million of bonds, without the right to vote, with current market value 239.70 Swiss francs. The Hoffmann and Oeri families members have together 50.1% of the shares, representing 9.3% of all titles (including bonds).
The family decided not to have never in executive position group. Asked, in the event of EY consulting in Monaco, on what he does in the related group, Andrew replied: "my main job is managing the family."
The economic situation of Brazil "a bit worried" the Swiss group, says Hoffmann. "The health sector is complicated," he says. It highlights the importance of the Brazilian market, and Rock''s strategy of differentiated pricing policy for more access to drugs in developing countries.
"We are open to any discussion (about price reductions). The important thing is that the medicine reaches the patient. But if I have to beat to get the reimbursement of medicine is difficult, the patient needs medication. " Roche is investing in increased manufacturing capacity in the State of Rio by trust in the long term.