IMS recently interviewed Dr Melanie Lee, Executive VP, Research & Development at UCB. An excerpt from the transcript follows in which she discusses the major highlights for the company in the last few years and also how the acquisition of Schwarz Pharma has affected UCB's R&D strategy.
IMS: "It's been an interesting couple of years for UCB. In your opinion, what have been the major highlights for UCB R&D in the last couple of years?"
Melanie Lee: "We made tremendous progress with the projects that were in our pipeline from two years ago, bringing them to submission and, in some cases, approval. Xyrem (sodium oxybate) and Xyzal (levocetirizine) are achievements which we are very proud of. Cimzia's (certolizumab pegol) now got to the submission stages and that has been a great mountain to climb - for a company such as ours to get a first biologic to that stage was a big exercise and one that we had to really build the infrastructure to do. We've also seen progress in terms of partnership so that those products that we felt would be better partnered have been successfully partnered; for example, CDP 323 with Biogen Idec in multiple sclerosis. We've in-licensed epratuzumab (Emab), which filled what was a gap in the antibody portfolio. We've got CDP 791, our angiogenesis inhibitor, going through phase II. In fact there's been a lot of progress and throughout the entire pipeline things have moved forward. We have also stopped one or two projects as well as we make choices. But the real major highlight of the last 18 months was the Schwarz Pharma merger, which has enriched the late phase pipeline. This has, of course, changed our profile and our growth prospects."
IMS: "The Schwarz Pharma acquisition has been quite different to the Celltech one of a few years ago. Then, UCB needed Celltech's pipeline, platform, and technologies. What, in your opinion, is the most important thing that Schwarz Pharma brought to UCB?"
ML: "What Schwarz Pharma has brought are three major products, compounds that have enriched the late-stage portfolio and increased the prospects for our future growth. These compounds are fesoterodine which, of course, is partnered with Pfizer, Vimpat (lacosamide) and Neupro (rotigotine CDS), with potential in numerous indications each. These are all potentially significant products and will hopefully bring new options to a range of patients.
IMS: "When we last spoke, you told me how UCB had preserved Celltech's R&D and was integrating it in a way that you felt really comfortable with. Is the same approach going to be used to integrate Schwarz Pharma R&D?"
ML: "Schwarz Pharma were very interesting in that they had only very limited research. Their model was to in-licence early development products and using their Pharmaceutical science and Development expertise, maximise the product potential. That means that this integration has largely been in the Development and Commercial functions.
IMS: "I find it interesting that they were such very different companies - not so much the philosophy perhaps as much as the internal approach within the companies. That kind of integration in general is difficult let alone across such different corporate cultures, countries and markets. Were there any problems with regards to personnel or personalities?"
ML: "It's an interesting question. UCB has 40 different nationalities - it's a hugely international and global company. Schwarz Pharma, of course, had a US contingent and in the Development organisation, the Research Triangle Park development team brings real strength, with the R&D expertise located within this part of North Carolina. The culture and philosophy of Schwarz Pharma was different to UCB's, but intellectually and conceptually everybody bought in to the fact that [UCB] is on a journey of change. So Schwarz Pharma joined UCB with the understanding we would all move forward together - as 'new UCB', a new entity that is emerging following the merger.
"I think there's a truth in that because, for example, we're developing very strong project management and cross functional project teams. Project leadership across all the functions is actually a big focus for us, and that changes the interaction between line and project managers. So in many ways, we are a new company - we have moved on yet again."
IMS: "How difficult was it for you to assess the two pipelines and make a decision on what to progress and what to leave behind?"
ML: "Not very difficult. We're lucky that we didn't have two large research teams merging. That's always very tough. But what we did was hold very open discussions involving people from both legacy companies very early on, so people saw what was in the portfolio, building enthusiasm around what the joint organisation had. So in research it was listening to views rather than having to sort two into one. In the late phase, really we'd done so much due diligence on Schwarz Pharma we knew what we were buying and the objective for both legacy companies was to 'get on with it'."
IMS: "So how has the Schwarz Pharma acquisition changed UCB's R&D strategy?"
ML: "One of the things it's done is it's made the potential growth phase really exciting - that's what I'm most enthused about. We talk about delivering the breakthrough, but you can't really deliver a breakthrough if you're pottering along with small incremental steps. The challenge, however, is in the short term. How do you prepare for that breakthrough period? We are sorting our early-stage projects. We've got quite a lot of transitioning projects from research to development at the moment. We're sorting through those and we're picking ones we really like. We're thinking about what ones we might partner, because partnership brings with it the opportunity for skills and resources. We're also thinking of other things we might do, and it's an ongoing discussion at the moment. To prepare ourselves for that breakthrough period which will be a time of increased growth - by which time you can't go running around finding new targets or finding new technologies - you have to invest now."
Dr Lee clarified that the increased investment in R&D stated in recent UCB presentations was to support late-phase delivery in the short term. This investment level is expected to be ramped up over the next 5-10 years to further support early-stage programmes.
ML: "If you look at the cost of late phase, it's very high and you only need a fraction of that to be released to make a big difference early on. As we get money released back into the early phase and into the technologies area, I've got a lot of ideas [about] what we [should] do with it, and the preparation for that is ongoing. So yes, overall I do anticipate seeing the budget increase."
IMS: "Has your global strategy in terms of R&D changed because of the Schwarz Pharma acquisition?"
ML: "In terms of research no, but we are having to address how we deliver the breakthrough. That's asking a lot of deep questions about where you put your money, where are the best centres for investment, what about outsourcing, what about partnerships? So that's one thing that's running. So how has our strategy changed? We're definitely sticking with inflammation and immunology and immune response alteration and with our focus on CNS. Actually one of the things Schwarz has done is enhance the movement disorders area by having restless leg syndrome and Parkinson's disease drugs - this will open a new therapy area for us, which is very exciting for the CNS Centre of Excellence. Epilepsy, of course, is common [to both companies] so that's expanded and enriched the CNS area. Then there's oncology - the question mark there is about the balance of building a new therapeutic area that goes along the entire pipeline, and we still haven't really answered that question even for ourselves."
The full transcript of this interview will be available in the May 2008 IMS Company Profile on UCB, where the company also discusses the outlook for its Crohn's disease therapy Cimzia.
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