Interesting Trends Future Predictions

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Interesting Trends Future Predictions What
Companies Are Saying What They Are Doing
Food Drug Administration in the
U.S. Copenhagen, Denmark November 4,
2008 Schuyler Ritter, Senior Vice President
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Pharmaceutical Revenue

• 2007 Global Prescription Market
• 712B
• North America
• 42.7 304.5B

Source www.imshealth.com, 04/16/2008
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2007 Pharmaceutical Revenue

• Major European markets 140B (19.7)
• France
• Germany
• UK
• Italy
• Spain
• Other European markets combined 81.6B (11.5)

Source www.imshealth.com, 04/16/2008
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2007 Pharmaceutical Revenue

• Japan 65.2B (9.2)
• Asian markets (excluding Japan)
• 78.32B (11)
• Latin America 42.4B (5.9)

Source www.imshealth.com, 04/16/2008
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2007 Pharmaceutical Revenue
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2007 RD Investment

• U.S. Pharmaceutical Biotechnology 58.8
  Billion for 2007 (www.phrma.org, 03/24/2008)
• Top 20 pharmaceutical companies
• 77.5 Billion (Contract Pharma, July/August
  2008)

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Trends
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Trends

• Mergers Acquisitions
• Workforce Reductions
• Rising Cost of Drug Development
• Outsourcing

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Mergers Acquisitions
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Mergers Acquisitions-Why?

• The number of new drugs being approved is slowly
  declining buyouts or mergers may help increase
  the pipeline
• Patents on many drugs are expiring
• Investors are pressuring firms to buy their way
  out of current woes
• Acquisitions provide an exit strategy
• MA provide opportunities to expand into new
  geographic or therapeutic markets

Source Pipeline problems are increasing the
urge to merge, www.nature.com, 12/2006
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Mergers/Teaming

• Teva Pharmaceutical Industries Ltd. and Kowa
  Company Ltd. are jointly developing generic
  products for the Japanese market beginning in
  2009 (www.reuters.com, 09/24/2008)
• Invitrogen merged with Applied Biosystems
• (www.biospace.com, 10/09/2008 10/13/2008)

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Mergers/Teaming

• Valeant and Meda intend to collaborate, market
  and commercialize certain current and future Meda
  products in Australia, Canada and Mexico
  (www.valeant.com, news release, 08/07/08)
• GlaxoSmithKline teaming with Valeant
  Pharmaceuticals International to develop
  Retigabine to treat epilepsy
• (Wall Street Journal, 08/28/2008)

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Acquisitions

• Eli Lilly paid 64M for SGX Pharmas cancer drug
  discovery platform
• Bristol-Myers Squibb purchased Kosan Biosciences
  for its cancer drug pipeline
• Stiefel Labs bought Barrier Therapeutics
• Pfizer put up 164M for Coley Pharma
• Shionogi completed a 1.4B buyout of Sciele
  Pharma

Source (www.seekingalpha.com, 10/17/2008)
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Pending Acquisitions

• Roche Genentech Roche seeks purchase of 44 it
  doesnt already own for 43.7B
• (Wall Street Journal, 10/02/2008)
• King Pharma aims at Alpharma for 1.6B
  (www.biospace.com, 10/13/2008)
• GlaxoSmithKline buying Egyptian mature products
  business from Bristol-Myers Squibb for 210M
• (www.biospace.com, 10/15/2008)

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Acquisitions

• Eli Lilly on track with 6.1B for ImClone Systems
  Inc.
• (Wall Street Journal, 10/02/2008)
• Teva Pharmaceuticals spending 7.46B for Barr
  Pharmaceuticals Barr shareholders voting on
  proposed plan in November
• (Wall Street Journal, 07/19/2008
  www.biospace.com, 10/16/2008)
• Bayer put up 300M for Direvo Biotech in
  September
• (Wall Street Journal, 09/17/2008)

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Workforce Reductions(2007-2008)
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Workforce Reductions(2007-2008)In of
Positions

• Abbott -1,000 (by 2011)
• (Wall Street Journal, 08/22/2008)
• Merck 7,200
• (Wall Street Journal, 10/22/2008)
• 10,400 posts between 2005 and 2008
• Amgen 2,600
• (www.pharmtech.com, 07/02/2008)
• Schering-Plough 6,500
• (www.pharmtech.com, 07/02/2008)

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Workforce Reductions(2007-2008)In of Positions

• GlaxoSmithKline 5,500 (1,200 in RD)
• (Wall Street Journal, 10/01/2008
  www.pharmtech.com, 07/02/2008)
• Wyeth 6,200 (by 2011)
• (www.pharmtech.com, 07/02/2008
  www.datamonitor.com, 03/28/2008)
• Johnson Johnson 5,000
• (www.pharmtech.com, 07/02/2008)

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Workforce Reductions(2007-2008)In of Positions

• Novartis 3,700
• (www.pharmtech.com, 07/02/2008)
• Bristol-Myers Squibb 4,800
• (www.pharmtech.com, 07/02/2008)
• Bayer 6,100 (by 2009)
• (www.pharmtech.com, 03/08/2007, 07/02/2008)
• Pfizer 10,000 (by 2008)
• (www.marketwatch.com, 01/22/2007)

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Rising Cost of Drug Development
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Rising Cost of Drug Development

• 2007
• 1.3B
• Biggest cost - human clinical trials
• gt 8B spent globally in clinical grants
• 1/2 of all investigative sites under-enroll
  patients in clinical trials
• 1 in 5 marketed drugs recoups RD costs
• Source (Outlook 2008, Tufts CSDD)

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The average cost to bring a drug to market.
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Rising Cost of Drug Development

• EXPIRIES
• Between 2007 and 2012, Top 50 Pharma companies
  face patent expirations on
• 115B worth of drugs
• Source (www.bizcommunity.com, 04/11/2008)

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Rising Cost of Drug Development

• FDA Amendments Act of 2007 granted the FDA
  authority to require post-marketing studies to be
  conducted throughout the life cycle of many
  products.
• The new regulations alleviate the burden on drug
  developers and FDA to determine everything that
  might need to be known about a drug before it
  even enters the marketplace, but there is
  increased cost.

(Source Outlook 2008, Tufts CSDD)
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Gates Foundation Seeks Out Nontypical Research
to Fund

• The Gates foundation, the world's largest private
  philanthropy, said Wednesday that it will grant
  104 scientists and experimenters in 22 countries
  100,000 each for research into areas that
  include how to prevent or cure HIV/AIDS and
  tuberculosis. The 100 million earmarked for the
  program will be distributed over five years.

(Source Wall Street Journal, 10/23/08)
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Outsourcing
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Outsourcing

• Driven by mounting market pressures
• Companies speeding up drug development and
  increasing revenues with increased outsourcing
  strategies
• Decreasing in-house facilities and staff and
  outsourcing more RD functions, aids
  pharmaceutical and biotechnology companies in
  reshaping the drug development services industry

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Outsourcing

• 2007
• Estimated at 8.6B
• Spent worldwide by biopharmaceutical companies
  for contract research service providers (not
  including pass-through costs)
• Source (Outlook 2008, Tufts CSDD)

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Outsourcing
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Outsourcing

• High CRO usage provides, on average
• A median 78 days, from protocol readiness to
  First Patient, First Visit (FPFV) compared to 98
  days
• 196 days to study data availability from protocol
  readiness, compared to 231 days
• 294 days from protocol readiness to Last Patient,
  First Visit (LPFV) in compared to 308 days
• 42 days from Last Patient, Last Visit (LPLV) to
  database lock, compared to 56 days

Clinical Research Outsourcing by Kenneth Getz
and Rachael Zuckerman, Contract Pharma, June 2008
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Outsourcing

• Eli Lilly announced three deals with CROs
• Covance for clinical/preclinical research
  services
• Quintiles Transnational for all clinical
  monitoring work in U.S. and Puerto Rico
• i3Global for data management operations
• Source (www.pharmtech.com, 10/08/2008)

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Outsourcing

• 16
• Predicted increasing demand for contract research
  organization (CRO) services over the next 3 years
  
• WHY?
• Sponsors are seeking assistance managing large,
  complex global projects without increasing their
  internal headcount
• Source (Outlook 2008, Tufts CSDD)

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Beaufort Advisors Clients

• What Beaufort clients are asking for
• Quality Management
• Writing Standard Operating Procedures (SOPs)
• Part-time On-site Quality Personnel
• Auditing (Internal Vendor)
• Helping to develop and establish applicable
  Quality Systems

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Beaufort Advisors Clients

• What Beaufort clients are asking for
• Regulatory Strategies
• Developing product regulatory strategies
• Coordinating communications with FDA
• Pre-IND Meetings
• NDA ANDA Submissions
• IND Submissions
• Orphan Drug Applications

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Beaufort Advisors Clients

• What Beaufort clients are asking for
• Clinical Trial Management
• Study Planning Design
• Protocol Development
• Site Identification Qualification
• Phase II Support
• Site Monitoring
• Data Management
• Statistical Analysis
• Final Study Reports/Submissions
• API Sourcing

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Well Folks.Its Election Day
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TOMORROW
?
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Beaufort Advisors LLC 500 East Main Street Suite
1301 Norfolk, Virginia 23510 (757)
383-6000 www.beaufortadvisors.com