Thousands of life sciences jobs lost in N.J.
The pharmaceutical and medical device industries in New Jersey lost 4,900 jobs last year as business pressures led to a dramatic wave of consolidation that cost the state two venerable drug makers, according to the latest economic impact report by the industry’s trade group.
The severe job losses did not diminish the industry’s impact on the state economy, which reached a record level of $29.2 billion. The industry’s economic impact is calculated based on such things as payroll, vendor spending and capital spending. In 2008, the industry’s economic impact amounted to $28.6 billion.
The Healthcare Institute of New Jersey, which works on behalf of the prescription drug and medical device makers, started doing the study in 1997 to provide a snapshot of one of the key drivers of the state economy. The latest report was completed by Deloitte.
The stature of the state’s pharmaceutical industry changed dramatically in 2009 when acquisitions erased two large drug makers. Pfizer paid $68 billion to bring Madison-based Wyeth into its folds and Merck merged with Schering-Plough in a transaction valued at $41.1 billion.
Roche, the Swiss pharmaceutical giant which had its U.S. offices in Nutley, also diminished its footprint in the state last year when it moved its headquarters to South San Francisco. The Nutley campus now serves predominantly as a research facility.
Steve Issenman, senior vice president of the healthcare institute, said the industry’s significance to the economy inspite of the hemorrhaging of jobs should serve as a “wake-up call’’ to state lawmakers to take steps to keep New Jersey competitive.
The state Legislature has already taken some steps. Officials in the state assembly are proposing to compile an inventory of lab space, research projects and other assets at all of the state’s universities and colleges. State officials are also encouraging more collaborations between academia and the industry, which have enabled states like California and Massachusetts to create “life science hubs.”
Ernest Landante, a spokesman for the healthcare institute, said such collaborations are “an area New Jersey needs to address.’’
Research and Markets: The Pharmaceutical Market: Norway
The macroenvironment for the pharmaceutical industry is improving. Politically, the centre-left coalition is expected to hold together for at least the first two years of the parliamentary term up to 2011, despite a number of policy disagreements. The recession was far less pronounced in Norway than in most other European countries and the economy is now recovering at a moderate rate. Legally, laws on intellectual property and patent provision are in line with WTO/TRIPS regulations. However, Norway remains on the USTRs Watch List in 2010 for concerns over patent protection. Demographically, the population is ageing, increasing demand for pharmaceuticals in the near term.
The introduction of international reference pricing has had a moderating effect on Norwegian pharmaceutical price levels, and a step-price system for off-patent drugs has ensured that prices for all generics have fallen. Important steps towards cost-containment have also been taken for reimbursable pharmaceuticals, including the use of a first-choice system. A report by the Business Research Foundation (SNF) has shown that Norwegian pharmaceutical prices are among the lowest in Western Europe. Therefore, market growth is a result of increased consumption, largely due to the ageing population and the introduction of new drugs on the market. Norway is receptive to new drugs, as long as they are cost-effective and have proven therapeutic benefits.
Although Norway is not part of the European Union, the process for pharmaceutical registration has been aligned to EU regulations. The 2004 regulatory reforms made the centralised procedure mandatory for all new active substances, and all drugs in a number of drug categories, including all biotech products. In June 2010, the Oslo city court issued a ruling preventing the Norwegian Medicines Agency (NoMA) from placing the biosimilar filgrastim on its list of switchable medicines (byttelisten). In November 2009, it was announced that Clavis Pharma had signed a licensing deal with a US-based company for its investigational anti-cancer drug, which was extended in November 2010. In September 2009, Algeta signed an agreement with a multinational company for the development and global commercialisation of its leading drug to treat bone metastases in cancer patients.
Medical School Professors Violate Rules By Accepting Paid Speaking Roles
GHARIB: Many medical schools and teaching hospitals have new policies to put your interests first. Those rules ban faculty members from serving as paid speakers for drug products. A new investigation by the independent newsroom Propublica found those policies look good on paper, but don`t always work in practice. Tonight Darren Gersh continues our “Dollars for Doctors” coverage, with an ongoing examination of the monetary ties between drug companies and your doctor.
DARREN GERSH, NIGHTLY BUSINESS REPORT CORRESPONDENT: They are some of the most prestigious medical schools in the country: Stanford University, the University of Pennsylvania, the University of Pittsburgh, the University of Colorado Denver. But reporters for the independent newsroom Propublica found dozens of faculty members at these schools were accepting payments to speak on behalf of drug companies, an apparent violation of university policies banning the practice. The names were found by searching a new database developed by Propublica, which tracks payments to doctors from some of the nation`s largest drug companies.
CHARLES ORNSTEIN, SR. REPORTER, PROPUBLICA: At Stanford we identified more than a dozen doctors who were giving drug industry talks and Stanford`s policy is very clear on banning that sort of thing.
GERSH: Propublica`s Charles Ornstein says the violations at Stanford are surprising, given that the university has taken the lead in restricting drug company sales reps on its campus and put in place a ban on speakers` programs last year.
ORNSTEIN: We`re not talking about $1,000 or $2,000. One of the doctors who was the vice chair of the medicine department and he brought in more than $50,000 speaking on behalf of Eli Lilly. Then there were two doctors who each took in more than $100,000 in their speeches.
GERSH: In an email to faculty, Stanford Dean Philip Pizzo called the conduct unacceptable.
PHILIP PIZZO, DEAN, STANFORD UNIVERSITY SCHOOL OF MEDICINE: We simply do not believe, do not advocate for or affirm in any way that physicians, particularly on our faculty, should be involved in marketing for industry.
GERSH: Pizzo says there`s no question some faculty violated Stanford policy and he says the university is evaluating what the consequences should be.
PIZZO: Across the board, everyone who has seen their names on the list has been very, very remorseful and very apologetic, didn`t realize that they were violating the policy and very quick to say that they were going to be ceasing and desisting this going forward. That`s important. That`s how change occurs.
GERSH: The Association of American Medical Colleges advises its members to ban drug- company sponsored talks. But its President Dr. Darrell Kirch, says the group doesn`t have the power to monitor enforcement of those policies.
DR. DARRELL KIRCH, CEO, ASSN. OF AMERICAN MEDICAL COLLEGES: Have we attained the degree of adherence that we want? Not yet. But we`re moving much more quickly than I and others thought we might be able to given the complexity of the national health care system.
GERSH: For some medical schools, the key issue is not how much drug companies pay faculty to speak, but how much control the professor has over his or her presentation. In response to Federal lawsuits charging illegal marketing, drug companies have gotten much stricter, requiring speakers to stick to carefully crafted company-provided slides. But critics told Propublica in the academic world, that`s like using someone else`s work.
ORNSTEIN: And here you are teaching students not to take other peoples` work, but yet at the same time, you`re using somebody else`s slides to make a presentation and they see sort of an inherent disconnect in that.
GERSH: Medical schools argue they are striking a balance — banning drug company marketing while encouraging industry to bring discoveries that begin here to the patients who need them here.
PIZZO: We want those kinds of connections to occur. We can`t, as a university, bring things to the public good in terms of products. We can develop ideas that others can work on to develop further. What we don`t want to do is use our name and our reputation to serve as the marketing for industry.
GERSH: But critics of drug company marketing practices say if medical schools want to protect their reputation, they will have to rely less on the honor system if they want to make sure some faculty member names don`t end up on a database like this.
ORNSTEIN: And this is sort of the quintessential surprise is when you discover somebody on a list that you didn`t know about.
GERSH: Tomorrow we`ll learn why medical students are grading their own schools and changing the relationship between doctors and industry in the process. Darren Gersh, NIGHTLY BUSINESS REPORT, Washington.