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Biotech / Medical : Pharma News Only (pfe,mrk,wla, sgp, ahp, bmy, lly) -- Ignore unavailable to you. Want to Upgrade?

To: Anthony Wong who wrote (536)	7/13/1998 9:47:00 PM
From: John Carragher	Respond to of 1722

I have held vanguard Health for 12 years and no regrets, maybe just one. I only bought a little and never added to it... John

To: Anthony Wong who wrote (536)	7/14/1998 12:23:00 AM
From: Anthony Wong	Read Replies (1) \| Respond to of 1722

Roche Bets On Genetic Research To Return As Industry's Drug Leader July 13, 1998 10:50 PM By Stephen D. Moore, Staff Reporter of The Wall Street Journal BASEL, Switzerland -- Since scientists at Roche Holding Ltd. discovered Valium, the tranquilizer that became the world's first billion-dollar medicine, the Swiss company has bet heavily on research. But despite leading many of the industry's major players by spending more than 20% of annual sales on research each year, the company lately has had more embarrassments than blockbusters. Roche's most promising drug - an obesity medication called Xenical - languishes in regulatory limbo at the U.S. Food and Drug Administration. Posicor, a widely heralded heart drug, was recently yanked from the shelves due to potentially dangerous reactions with other medicines. Now Roche is trying to make its labs more productive. To that end, the company has appointed Jonathan Knowles, a littleknown Glaxo Wellcome PLC research executive. As research director, he succeeds Juergen Drews, who Roche pressured to retire ahead of schedule last year. The selection of Dr. Knowles raised eyebrows. He has spent less than a decade in the industry, virtually all of it running a little-known Glaxo lab in Geneva. The 50-year-old geneticist admits that he has never actually discovered any new drugs nor managed a billion-dollar budget. But Roche is betting Dr. Knowles can lead a foray into unchartered waters of disease management, which has been made possible by breakthroughs in genetic research. If he's successful, Roche could ride a wave of new drugs and diagnostic tools that promise healthier and longer lives for millions of people. Under the disease-management approach, drugs will be packaged with sophisticated diagnostic tests -- and ultimately detailed maps of a patient's genetic inheritance -- to transform today's wasteful, hit-and-miss system of prescribing medicines. Besides improving the quality of care for patients, disease management could save billions of dollars a year for governments and insurers who pick up most of the health-care tab. AIDS therapy offers the strongest proof of the concept so far. Applying a Nobel Prize-winning technology called polymerase chain reaction, or PCR, Roche developed a widely used test to measure levels of HIV in patients' blood. Tracking the "viral load" in a patient's body during treatment shows physicians if a particular combination of drugs is effective. Therapy based on the tests and a powerful new class of drugs called protease inhibitors, including Invirase from Roche, is helping thousands of people live with HIV. A PCR test can cost hundreds of dollars. But insurers and governments consider the money well spent if it averts futile use of AIDS medicines that cost up to $15,000 a year. Chasing the disease-management dream, Roche spent $11 billion last year to acquire Corange Ltd., the parent of Germany's Boehringer Mannheim group. The transaction made Roche the world's biggest diagnostics company. Then, in one of his first moves after joining Roche, Dr. Knowles forged a $200 million research partnership with Decode Genetics Inc., a fledgling Icelandic biotech firm whose vision is to turn Iceland into a giant genetics lab. Roche scientists are racing to develop drug-diagnostic combinations to treat everything from osteoporosis and flu to cancer. Nonetheless, some analysts claim the money would have been better spent on a pure pharmaceutical takeover to reinforce the flagship drug division's thin research pipeline. Roche currently ranks sixth among global drug makers in terms of annual prescription-drug sales, but fastgrowing rivals such as Pfizer Inc. and Eli Lilly & Co. are closing in fast. They add that the revolution in genetic research may wind up like the ballyhooed biotechnology revolution a decade agolong on promise but short on profitable drugs. "There probably will be some low-hanging fruit," says James McKean, a London-based pharmaceutical analyst with Morgan Stanley Dean Witter. "But I suspect there will be limits on where the industry really wants to go with all this." Roche is betting on disease management as a way to make up for some recent setbacks. Posicor and Xenical were supposed to fuel a recovery from several years of sluggish sales growth. Even if Xenical eventually makes it to market, peak sales potential has shrunk as a result of cancer worries, analysts caution. (The FDA has stalled the drug for fear of a possible link with breast cancer.) The situation isn't entirely bleak. Last year, sales of Roche's prescription drugs inched up 4%, excluding effects of currency fluctuations. During this year's first quarter, revenue growth accelerated to 12%, excluding effects of the Corange takeover. But that growth rate still lags behind major U.S. competitors. And Roche's recent lab drought means major product reinforcements aren't likely until at least 2000. Moreover, even ardent proponents of disease management admit it won't produce profits for years. But Dr. Knowles takes the skepticism in stride. "None of this is watertight," he says with a shrug. "But refusing to evolve at a time when the health-care environment is changing very rapidly could be the biggest risk of all. Roche certainly is better placed than most other drug companies to make this vision work. And I came here because it's something I wanted to be part of." Copyright (c) 1998 Dow Jones & Company, Inc. All Rights Reserved.