In November 2006, in an interview with IMS, Dr Claus Braestrup, CEO of Lundbeck, commented on a number of issues including Lundbeck's continued focus on central nervous system (CNS) therapy areas, the plans for expansion into the US market, and his thoughts on the EU and US regulatory models.
IMS: "Last time we spoke you told me about the CNS-only focus that you’ve had for many years now, which has obviously proved very successful for Lundbeck. But within CNS you’re focused on a relatively small number of areas - Alzheimer’s, Parkinson’s, antidepressants and antipsychotics. If you look at the different markets within CNS and the different players and the competition, do you think you will continue to succeed with this relatively narrow focus?"
Claus Braestrup: "We don’t have a narrow focus. The apparent narrow focus is caused by the fact that these are the areas where we have had products available. That means that we started very narrow in depression, then we moved from depression into schizophrenia, and we were in depression and schizophrenia for 50 years or so, and then we expanded from there. And we will expand into other CNS diseases as new medicines become available, which means that either we in-licence from the outside or we invent new medicines in our own laboratories. If we look at the preclinical portfolio of projects, we experiment in a lot of the CNS diseases. I think stroke is an area where we see a potential but we also have others."
IMS: "With regards to the CNS market, to what extent do you evaluate the market and the growth within the different areas of CNS?"
CB: "If you look at the two most significant and important areas, depression and schizophrenia, depression comes first. In depression the usage of antidepressants is still growing, as it should, because even today there is a great percentage of depressed patients who are not treated the way they should be treated. So there’s still a demand for therapy. On top of that, the ageing of the population goes in the same direction because the occurrence of depression is higher among the elderly population in general so, in that respect, the usage should be increasing. The market will also be a benefactor on top of that from generic entries in the market. Because of generic entries into the depression market the total market will not be increasing, or increasing only slightly depending on where you are, so that is the situation there.
“If you look at schizophrenia, the situation still is that the transition from the old antipsychotics, which are all generic, into the atypical, the present generation of antipsychotics, has not been finalised yet. And for that reason, the psychosis market is still growing because the newer products offer better value and of course, also higher prices. That will probably continue until the new generation starts to be exposed to copies, which will happen at the end of maybe 2008/2009. So this will happen in the years to come. That’s for the two most important [areas].
"Then the Alzheimer’s market has been growing dramatically over a period of five to six years, and is now coming to a more natural development [where] the growth in the Alzheimer’s market is still high, still double digit, but the growth is decreasing. And then the other CNS diseases are rather stable, partly because there has been very little innovation over a couple of years. For example, for stroke there’s almost nothing you can do with stroke patients, and clearly the day that you can offer an effective medicine for treating stroke then that market will grow very fast."
IMS: "So you’re confident that a CNS-only focus is the right direction for Lundbeck to continue in?"
CB: "First of all there is growth in the market - that is surely the first benefit. Secondly, there’s a very significant unmet need which means that there is a lot of patients with a lot of needs which we cannot satisfy today. Further there is research in some of the areas, for example Alzheimer’s, which gives you a handle onto the reason for the disease, which again gives you the hope that you can actually introduce therapy. And fourthly, CNS is the only thing that we understand which means that that’s where we’re competitive, and we don’t think we should compete if we’re not competitive."
IMS: "If I could just ask you a little bit about your regional strategy. When we last spoke, we talked quite a lot about Europe and the situation in Europe at the time. Have things become more difficult in recent years, and has your strategy had to change to account for that?"
CB: "In a way it’s been going very well. We were in the process of expanding outside the old market, so to speak, and today we have with two exceptions finalised that. The two exceptions I mentioned; one is the US and the other one is Japan - number one and number two in the world market where basically we are too behind. Apart from that, we have established ourselves in South America and that we think has been very successful. And we have established ourselves in the Far East, so that we today are present in reality in all the countries where we think it’s right for us to be present, which means that we have a presence in the Near East, and the Middle East, and in Asia we have a presence in Pakistan, India, China, Korea, Singapore, Hong Kong, Malaysia, Indonesia, and we are establishing ourselves in Vietnam, which means that we are basically established now in all the Asian countries. Of course, we have been in Australia for many years.
“That means that we have the US and Japan to go. For the US, the strategy is under execution and we’re establishing a headquarters in the US. We have hired the first couple of people and we intend to have a sales force ready when gaboxadol is approved for sleep disorders in the US. So that’s the plan for the US. And then, of course, we will add products from our pipeline and elsewhere to that sales force, if and when they become available."
IMS: "In say five to ten years from now, where would you like to see Lundbeck positioned in the US market?"
CB: "In ten years we would have a significant sales force and three or four relevant products on the US market. That’s what we would like to see. We can only see part of that today; we can see gaboxadol, though we are still considering whether we can put that in the US market or not [licensee Merck & Co has exclusive US commercialisation rights]. And then our own pipeline products will also be available for the US market. We don’t see all those products yet, but the vision is to have a reasonable number of products available for our own sales force in the US."
IMS: "How difficult is it, do you think, to establish a company like Lundbeck in the US market, which is already so full with the big American players?"
CB: "First of all, it’s not easy at all. We think we increase our chances of being successful by having a partner like Merck, so we team up with them and that helps. Secondly, I’m convinced that the key to being successful is that you have branded products that are valuable to the market, because then they’ll be used and then you’ll have the possibility of establishing a business, and that’s what we will try to achieve. So the difficulty there is the difficulty of the business, which is innovative products."
IMS: "In a recent interview with another European CEO we had an interesting discussion on why it seemed to be more problematic gaining approval in Europe compared with the USA. In fact, we were discussing bifeprunox and the extra trials required by the European regulators, but with the non-approvable letters for Lexapro (escitalopram), we see the opposite as well. So, my question would be, in your opinion is one model better than the other and what changes if any would you like to see?"
CB: "I think there’s a tendency now in the approval phase where because the approving authorities in principle can always be attacked for something that happens, they try to safeguard themselves, which means that they ask too much because then they can say that if something goes wrong then they have asked all they should. So there’s a tendency to add a number of things they would like to know. Couldn’t we investigate this also? And the answer is yes you can, but then you eventually end up with so many things to investigate that do not increase the safety [of the product] and you actually pay too much for that. So I think that the European approach causes the cost of getting a new medicine to [market] to rise more than they should. I think what they should do instead is that they should be slightly more reluctant with the set of data they demand before they approve, and then maybe increase the post-marketing surveillance so that you actually follow the product on the market more closely than now so that will give you more value."
IMS: "Would that satisfy the safety requirements?"
CB: "That’s a post-marketing sector requirement, which is being established now, but as a consequence of that I think you could easily reduce the demand for data before you approve without reducing the safety. The number of things they ask is growing, and it’s growing more in Europe than it is in US where they are more scientifically focused."
The full transcript of this interview will be available in the March 2007 IMS Company Profiles on Lundbeck, where Claus Braestrup also discusses with IMS’ editor Dr Shehla Sheikh the success of the launches of Cipralex and Ebixa, replacing revenue from Cipramil, the prospects for new antipsychotic bifeprunox, Lundbeck’s other R&D pipeline compounds, and his views on mergers and acquisitions.
Covering approximately 100 of the top pharmaceutical and biotechnology companies, IMS Company Profiles offer authoritative insight into company strategy, finances, portfolio management, R&D and history and also contain top-line IMS sales data. They are available for immediate purchase online, or by subscription as a stand-alone product or as part of IMS Knowledge Link. For more information about either product, please contact Stephanie Earle via e-mail, or call +44 203 075 5757.