Big Pharma is poised for a financial comeback this year, even as both industry leaders and ambitious upstarts will navigate through choppy waters.

J.P. Morgan analyst Chris Schott wrote in mid-December that 2020 will be a recovery year for the stocks of major pharmaceutical companies. After a year in which the S&P 500 was up 25%, the S&P 500 Pharmaceuticals grew not even half that.

Schott basis his forecast on several new drug launches and significant growth for the category of cancer drugs known as PD-1 inhibitors. He also discounts the possibility of drug pricing legislation, suggesting “there appears to be more headline risk than fundamental risk.”

Meanwhile, a CPHi outlook article discusses 10 trends pharma leaders expect the industry to confront during the year. Artificial intelligence and its application in developing, not drugs or clinical outcomes surprisingly, but in predicting timelines and in compliance and regulatory matters.

Cell and gene therapies (CGT) will likely continue to be one of the focus areas in 2020, while the importance of biologicals will continue to grow. Pharma will increasingly turn to CDMOs to take their research from clinical development through regulatory approval.

Peter Bigelow, president of xCel Strategic Consulting, sees more “transformational partnerships between CDMOs and big pharma” in 2020, as the major companies refocus their traditional methods of operation.

“Whereas in the past Big Pharma has been very transactional and has put driving product costs down as a priority, they are instead looking now at partnerships on baskets of products. This means the CDMOs must operate differently, be longer-term in the way they envision these relationships and they must commit to very high degrees of operational and quality improvement.”

Another prediction, this from Jim Miller, founder and former president of Pharmsource, is that CDMOs will continue to be the targets of acquisition. He expects some of the bigger private equity firms to be attracted to the mid-size CDMOs as will larger, public firms.

Morgan analyst Schott agrees. Rather than more mega-mergers, “We see biz dev pivoting towards bolt-on deals in 2020 with focus on building out existing therapeutic verticals and adding potential mid-2020s launch opportunities.”

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Green Key
Jun 6, 2023

Spinach May One Day Produce New Drugs

Almost a century ago the comic strip hero Popeye popularized spinach, attributing his amazing strength to the leafy green. Within a few short years of Popeye’s first appearance in 1929, spinach sales soared.

Now, spinach has a new claim to fame. Biologists are using microscopic parts of the plant to speed up photosynthesis, the process of using light to convert carbon dioxide into energy and oxygen.

Still limited to laboratory research, the implications of the research, published this month in Science, are profound. The faster process — up to 100 times faster — could be harnessed to manufacture drugs, accelerate the growth of crops and even help fight climate change.

Tobias Erb, a synthetic biologist at the Max Planck Institute for Terrestrial Microbiology and a lead researcher on the project, said his team expects to be able to modify the output of their photosynthesis process to produce different types of organic compounds, including drugs.

By engineering the new photosynthesis into agricultural crops, they could go from seedling to harvest in far less time, enabling farmers to produce more food than is now possible.

One particularly intriguing possibility is to use this new, faster photosynthesis process to help fight climate change by enabling plants to absorb up to 10 times more carbon dioxide than they do naturally.

“Artificial trees, that’s a cool idea,” Erb told the online magazine Inverse.

Erb and the research team caution that much work remains before the process can be scaled – right now the artificial structure degrades after just a few hours.

“In the natural system there are automatic repair systems,” Chemical & Engineering News quotes Erb as saying. “In our system that is not possible yet.”

Nevertheless, bioscientists not involved with the research, see it as a major step forward.

“It’s a profound discovery,” says Paul King, a physical biochemist at the National Renewable Energy Laboratory in Golden, Colorado.

Declaring it “very ambitious,” Frances Arnold, professor of chemical engineering, bioengineering and biochemistry at the California Institute of Technology, predicted the work will improve current efforts to convert carbon dioxide directly into useful chemicals.

Photo by Louis Hansel @shotsoflouis on Unsplash


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Green Key

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