Industry Briefs July 2014

U.S. Senate Confirms Burwell to Lead HHS

Sylvia Mathews Burwell, the former director of the White House Office of Management and Budget, will now serve as the 22nd United States Secretary of Health and Human Services. Confirmed by a vote of 78 to 17, Burwell will be responsible for delivering health insurance, both Medicare and Medicaid, to more than one-third of all Americans.

According to the New York Times, White House officials stated that President Obama selected Burwell because he wanted a proven manager to carry out the healthcare law, which got off to a rocky start under Kathleen Sebelius, the former health secretary. The immediate task for Burwell is to defend the Affordable Care Act, a target of Republican criticism in many of this year’s mid-term election campaigns.

Merck Acquisition Expands Hep C Products

On June 22nd, Merck announced a definitive agreement to acquire Idenix Pharmaceuticals for $24.50 per share in cash—approximately $3.85 billion. The deal will allow Merck to add an Idenix product to two of its own hepatitis C drugs. Dr. Roger Perlmutter, President of Merck Research Laboratories, said in a statement, “Idenix has established a promising portfolio of hepatitis C candidates based on its expertise in nucleoside and nucleotide chemistry and pro-drug technologies.”

Off-label Promotion Costs Jazz $20 million

Jazz Pharmaceuticals agreed to pay $20 million in penalties and victim compensation to the federal government to settle charges regarding illegal practices involving the company’s subsidiary, Orphan Medical Inc. The Jazz subsidiary pleaded guilty to felony misbranding in violation of the FDC in connection with the unapproved medical use of prescription Xyrem.

Approved for treating cataplexy and narcolepsy, Xyrem was “off-labeled” to treat fatigue, insomnia, chronic pain, bipolar disorder and weight loss. As part of the settlement, Jazz agreed to implement a corporate integrity agreement, as required by the Office of the Inspector General for the Department of Health and Human Services.

Three Pharmaceutical Giants Join The Informatics Challenge

Eli Lilly, Novartis and Pfizer joined with the Broad Institute to become part of a competition, The Informatics Challenge, to create predictive models that could lead to new targets for cancer drugs. These companies, along with the Broad Institute, are funding the data focused on the development of models that show how essential a gene is to the survival of a cancer cell.

At the same time, IBM is contributing computational resources. The competition is part of the Dialogue for Reverse Engineering Assessments and Methods (DREAM) project, which has now successfully run 27 such challenges.

Roche Buys DNA Sequencing Firm

Roche, the Swiss drug and healthcare diagnostics maker, is buying Genia Technologies, the privately held U.S. gene-sequencing firm for up to $350 million. Genia’s shareholders will receive $125 million in cash and up to $225 million in contingent payments if the business reaches certain milestones.

Genia is developing technology that is expected to reduce the price of DNA sequencing while increasing the speed and sensitivity of such sequencing. Roche’s acquisition is a further step in securing access to a technology that should allow it to decipher human genes at a cheaper cost.

Purdue Cuts R&D by One-Third

Purdue Pharma is reorganizing its company by eliminating one-third of its research and development apparatus and will instead now emphasize acquiring or licensing medicines that are developed elsewhere. According to the Wall Street Journal, a Purdue spokesman stated, “We’re moving the organization from a historical focus on internal innovation toward a more business-oriented model—consistent with what the overall industry is doing.”

Medtronic Buys Rival, Covidien

Medical-device maker Medtronic Inc., plans to acquire its Irish rival, Covidien, for $42.9 billion. With this deal, Minneapolis-based Medtronic, a manufacturer of cardiovascular and orthopedic devices with a market value of about $61 billion, will become the latest—and largest—U.S. company to try to change its tax domicile through this acquisition process, which is called an inversion.

According to the New York Times, a Medtronic’s spokesperson says the company’s purpose is much broader than shifting tax domiciles. The acquisition of Covidien will shift its legal domicile to Ireland, which taxes companies at 15% compared to the U.S. tax rate of 35%. With this merger, Medtronic is able to invest more into research and development.

Fight the Fakes Gains 11 New Members


According to the World Health Organization (WHO), fake medicines can account for up to 30% of the drug supply chain, whether lifestyle or life treatment, branded or generic, in parts of Asia, Africa and Latin America. To combat the proliferation of fake drugs, the organization, Fight the Fakes (, is coordinating efforts among a number of groups with the same goal—and recently added 11 new partners to help in the effort.

New Fight the Fakes partners include the Alliance for Safe Online Pharmacies (ASOP), the Alliance for Safe Online Pharmacy in the EU (ASOP EU), the Center for Safe Internet Pharmacies (CSIP), the European Association of Pharmaceutical Wholesalers (GIRP), the Generic Pharmaceutical Association (GPhA), the International Federation of Pharmaceutical Wholesalers (IFPW), the International Pharmaceutical Students Federation (IPSF), Mobilium, the Partnership for Safe Medicines (PSM), PSM India and the Pharmaceutical Security Institute (PSI). All groups joining the campaign intend to speak out and spread the word about the devastating impact of fake medicines on patient lives.

Novo Nordisk Honored with 2014 New Good Neighbor Award


Novo Nordisk, a global healthcare company geared toward innovation and leadership in diabetes care, received a 2014 New Good Neighbor Award from the New Jersey Business & Industry Association. The award, which is based on economic benefit, architectural merit and community involvement, was given to the healthcare company for its new environmentally friendly LEED Silver certified U.S. headquarters in Plainsboro, New Jersey. The redesigned headquarters makes use of an existing structure and features sustainable and locally sourced materials to limit environmental impact.


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