Member Healthcare Editorial Team
Traditionally, the medical devices and pharmaceutical sectors have represented two different facets of the life sciences industry. Both the sectors have charted their own paths to growth on a similar terrain. Therefore, ‘convergence’ between the two never quite went beyond basic drug delivery instruments such as injections. That was, of course, before the introduction of Drug Eluting Stents (DESs)—the most successful combination product so far with a market size of US$ 5.5 billion worldwide. Meant to treat coronary disease, the stents proved to be a huge success as they allowed delivery of drugs directly and in low doses to targeted areas unlike oral consumption that would require higher quantities to be consumed. The DES had proved that combination products could play a major role in improving patient care—and provide new areas of growth for the companies.
The early and huge success of DESs sparked a sort of frenzy in both the sectors to collaborate and create a whole new line of products. This was evident from the fact that the number of applications for combination products with the FDA increased from less than 100 in 2003 to 275 by 2005. Today, this convergence stretches across device makers, pharma, biotechs and diagnostics. This convergence has already resulted in the creation of many combination products (Table 1) and with further research and development, the horizon for combination products is only likely to get wider. Market figures too indicate the same. According to Chris Cramer, Principal, Life Sciences Practice, PRTM Management Consultants, the market for combination products is currently estimated to be around US$ 40-50 billion and growing at 14% annually.
However, this area is still in its early stages. Several questions will have to be answered and challenges that convergence presents will have to be overcome to ensure that the products are innovative and safe. As products get smaller in size and are implanted in the patient’s body to reach the targeted area, their safety will be of utmost importance. Hence, regulatory agencies like the US Food and Drug Administration (FDA) will play a crucial role in the development of the combination products market.
Both device and pharma companies are looking for new avenues of growth. Pharma is struggling to cope with pipeline shortages, high R&D costs resulting in low returns and increasing competition from generics. The blockbuster model seems no longer sustainable. For biotechs this convergence brings in access to better funding and sharing of resources. For device makers, integrating devices with drugs is helping them develop new products, something that was much needed given the fact that they were finding it increasingly difficult to come up with innovative products until recently. The initial push for developing combination products did therefore come from them.
The diagnostics sector is perhaps the best placed sector in terms of performance over the last few years thanks to the emergence of in-vivo and in-vitro diagnostics market size for the latter is expected to reach US$ 40 billion by 2010 according to a research report by Business Insights. As a result, device manufacturers have shown keen interest in diagnostics makers. A key example of this being the big acquisition of Bayer Diagnostics for US$ 5.7 billion by Siemens Healthcare and Abbott’s diagnostics arm by GE Healthcare for US$ 8.13 billion last year (although it was recently).
Diagnostics companies can gain by collaborating in development of patient monitoring equipment for chronic diseases that have become highly prevalent around the world among the ageing population.
In recent years, there has been a remarkable improvement in the technologies that support the R&D and manufacturing processes in life sciences. As a result, scientific advances such as genetic tests, stem cells and genomics are helping companies to develop better tests to identify and treat diseases.
Apart from this, rising healthcare costs and a more informed customer have played their part as well. Aided by better knowledge about the options available, consumers are demanding better treatment at lower costs. And it is safe to say that convergence has enabled companies deliver such solutions. In the case of patients with diabetes, for example, blood glucose monitors combined with implanted insulin pumps offer round-the-clock monitoring with timely, controlled release of insulin, providing diabetes patients with a less invasive and more effective treatment alternative, says Robert Go, Managing Director, Global Life Sciences and Health Care, Deloitte Touche Tohmatsu.
These factors have shown the way to convergence within the life sciences industry. Cramer sums it up when he says, “combining drugs, devices and biologics appears to be the logical next step.”
The consumer is slowly but surely becoming the centre of the healthcare universe and as a result, treatments too are becoming patient-centric in nature. Ageing population all over the world has meant that technologies have to become more patient-friendly, so that they not only help in patient monitoring but also help the doctors in taking the right decisions and the hospitals to manage their operations better. While companies might have their own business motives behind this, the biggest beneficiary of this convergence will be the patient. Says Go, “by bringing more self-administered healthcare solutions to the market and enabling remote patient monitoring by physicians, convergence may reduce the number of care visits that are needed, potentially resulting in services that are more cost-effective.” Combination products are also helping to reduce the side-effects that only add to the patient's woes and expenses.
Several combination products have received the FDA's nod in the recent past (see box item). Further down the line, these devices will get smaller in size, innovative and more effective. Says Cramer, “Miniaturisation will change the way we use medical devices as manufacturers will be able to create implantable devices for diagnostic and therapeutic delivery at the micro to nano level.”
Device – Drug
• Drug-eluting stent that opens and prevents restenosis in coronary and peripheral arteries
• Bone grafting scaffold/sponge coated with a growth protein that promotes bone regeneration
• Implantable, programmable pump that delivers a drug or biologic in small, timely doses
• Implantable polymer wafer that releases a chemotherapy agent to a specific site
• Implantable neuromodulator that enables the targeted, regulated delivery of a drug or electrical stimulation
• Transdermal patch that transports drugs locally and systematically through the skin
• Pre-filled, metered dose syringe, injector pen, or inhaler
Diagnostic – Drug
• Screening test for the presence of a specific gene or protein coupled with targeted drug therapy
• Use of passive pharmaceuticals and radiopharmaceutical tracers as contrast
agents for positron emission tomography (PET) scanners
Diagnostic – Device – Drug
• Glucose monitor with an insulin pump
The coming together of hitherto mostly independent industries presents a unique challenge for the regulatory agencies like the FDA. Medical devices typically take shorter times to get approvals from FDA than a drug which has to under go several stages of trials and might take many years. FDA was the first regulatory body to recognise a need to develop guidelines to regulate combination products. FDA’s Office of Combination Products was set up to manage the review of these products. Currently, three centres of the FDA namely, Center for Biologics Evaluation and Research (CBER), Center Devices and Radiological Health (CDRH) and Center Drug Evaluation and Research (CDER) take care of the regulatory function. Depending on the primary mode of action the product is allocated to the respective centre and will be under its jurisdiction.
Defining the primary mode of action for a product though is not that easy. If a disagreement arises over this, it results in lengthy disputes over who’ll get the jurisdiction over the product. Given the rate at which the number of applications from combination product makers for approval is growing, this could prove to be a major hurdle to the growth of the industry. Opines Go, “regulators need to develop a strong understanding of the technologies that are involved and how exactly they are integrated.”
It will be some time before a comprehensive approach to regulate combination is in place. “Till then”, says Cramer, “companies looking to bring new products to market should take a proactive approach to working with the FDA on pre-market review/approvals”
As attractive as the rewards might be, making a convergence successful is easier said than done. This will be a first time experience for many of the companies involved, as they have never worked together. Says Cramer, “most device manufacturers have little or no experience working with the drug that will be included in the device or its coating. They not only have to decide how to select, modify and incorporate the drug into the product, but also demonstrate its acceptable toxicity and shelf life and characterise its release into the body.”
Finding a suitable convergence partner could, itself, prove to be the biggest hurdle. The companies need to identify specific opportunities with respect to each others expertise while making sure that technological support needed to integrate the two or more products exist and that the venture would be profitable. They have to understand the various risks that come along with the convergence path they choose. While there is a growing demand for combination products, industry dynamics make it tough for the companies to make these decisions, and when made, to stick to them and go the distance.
Risks, of course, are not just external. When coming together, companies need to address issues related to knowledge sharing and creating teams that will not just work together but cooperate in all the aspects of product development. In addition to this, says Cramer, “the people aspect should not be overlooked; i.e., the difficulty in bringing together the various viewpoints, practices, and experiences from the different worlds of drug, biologic, and device development.”
Device companies have been the proactive partners in this convergence—which has been attributed to the fact that pharma sector is many times bigger than the device sector and hence offers better opportunities. This has made several industry observers doubt the interest level a pharma company would show in a convergence effort. “Generally speaking, pharma opportunities and therefore pharma deals tend to be much larger than those of devices.” says David Cassak, Managing Partner at Windhover Information, a healthcare industry analysis firm based in the US. He further adds, “the whole drug-eluting stent market, which will be shared by a number of companies is now pegged at around US$ 5-5.5 billion, which just about qualifies as one blockbuster drug and isn’t even the size of Plavix by itself.” Thus, he says, a biotech firm would see much bigger incentive in licensing its products to a pharma company than a device company. Further, device companies have tended to target existing drugs to be used in the combination products. By doing so, says Cassak, “device companies hope to avoid their own extensive trials and the safety and efficacy issues that might arise.” Therefore, initial convergence has occurred at the later stages of product development.
But this is changing, observes Go, “convergence is now increasingly occurring at earlier stages of research and development, and companies in all sectors are forming alliances and co-creating technologies and products from the earliest phases of R&D through clinical validation, manufacturing, and product commercialisation.”
In conclusion, it is fair to say that the convergence within the life sciences sector presents a unique opportunity to all the players involved to develop solutions that will have a long lasting impact on patient care, which in turn will provide growth in the long run. However, the key to this will be innovation. And innovation can only result when companies work together. As Go observers, “success will depend on the level and intensity of participation from all the sectors of the life sciences industry.”
Schwarz Bioscience’s transdermal patch
Neupro Patch, used for the treatment of symptoms of Parkinson's disease, combines a new dopamine agonist, rotigotine, with the convenience of a transdermal patch delivery system.
Medtronic’s absorbable collagen sponge with genetically engineered human protein
INFUSE® Bone Graft used in the Anterior Lumbar Interbody Fusion (ALIF) surgical
procedure in combination with an interbody fusion device.
Orthovita Inc.’s biological product gel for surgical hemostasis
Vitagel™ Surgical Hemostat contains an enzyme that assists in the clotting of blood.
Vitagel is intended to assist in clotting when conventional means fail or are impractical.
Alza Corporation’s Iontophoretic transdermal system
IONSYS™ is a patient-controlled iontophoretic transdermal system providing ondemand systemic delivery of fentanyl, an opioid agonist.
Shire US. Inc.’s transdermal patch for attention deficit hyperactive disorder
Daytrana is a treatment containing the drug methylphenidate, a central nervous system (CNS) stimulant for treating Attention Deficit Hyperactivity Disorder (ADHD) in children.
Somerset Pharmaceuticals, Inc.’s transdermal patch for depression
Emsam transdermal patch used for treating major depression, delivers selegiline, a monoamine oxidase inhibitor or MAOI, through the skin and into the bloodstream.
Pfizer’s inhaled insulin combination product for diabetes
Exubera is an inhaled powder form of recombinant human insulin (rDNA) for the treatment of adult patients with type 1 and type 2 diabetes.