Big Pharma consolidation - is Germany the start of the next round?

As the FT says:

If once is happenstance and twice is coincidence, the third pharmaceuticals deal in a week begins to look like a clear trend towards accelerated industry consolidation.

Belgian UCB yesterday announced a €4.4bn ($5.6bn) takeover of Germany's Schwarz Pharma; Merck of Germany last week acquired Serono of Switzerland for €10.6bn; and Nycomed of Denmark swiftly followed with a €4.5bn agreed purchase of the drugs division of Altana of Germany.

Add to this the Bayer /Schering AG merger and we might be seeing the start of what many, including Insider and GSK's CEO JP Garnier have been predicting:

'Of the 15 pharma companies that have a significant role in the world, only a handful will remain,' Garnier said in an interview to be published on Friday. 'Hardly any of the large companies are in the position right now to invest enough money into research,' Garnier continued.

Finally, a cold hard look at Big Pharma's recent R&D track record, thanks to Derek Lowe's excellent In The Pipeline , reveals the paucity of success:

Macugen: Expected launch 1Q 05, sales potential 1.25 to 1.5 billion. The reality: the launch went off pretty much as expected, but the sales, well. . .they're running at about 10% of that peak estimate. OSI bought the drug's developer, Eyetech, and people wondered at the time what they were thinking. Maybe they're wondering now, too. . .

Indiplon: Expected launch 4Q 05, sales potential 1.25 to 1.5 billion. The reality: oh, dear. Neurocrine is trying to go it alone until they find a new partner, and they're still in there pitching, but this has been a real development disaster.

Let's pause a moment to note that both of these were printed in green type, which the chart helpfully informs us were considered "low risk" at the time. After meditating on the implications of that statement, we move on to:

Edifoligide: Expected launch 4Q 05, sales potential 1.25 to 1.5 billion. The reality: Aaargh. The drug, an oligonucleotide "decoy" designed to tie up a particular set of transcription factors involved in vein graft failure, completely missed its clinical endpoints in a major trial. Bristol-Meyers Squibb dropped it; its developer (Corgentech) went through a near-death experience and emerged with a changed name and an (appropriate) focus on pain management.

Acomplia: Expected launch 1st half 06, sales potential 1.5 to 2.75 billion. The reality: the drug is slowly, slowly creeping into the market in Europe. But no one has any idea of when it might be approved in the US (where most of that money is going to be made, if it ever is), and Sanofi-Aventis has been extraordinarily uncommunicative on the issue. It won't be 2006, that's for sure. Next year? That's what they thought last year. . .

Plavix (for Japanese market): Expected launch 1st half 06, sales potential 1.25 to 1.5 billion. The reality: they made it in May of this year, but the cost has been heavy. And, of course, Plavix and its profits have been making the news for other reasons entirely.

Asoprisnil: Expected launch 2nd half 06, sales potential 1.25 to 1.5 billion. The reality: who knows? Takeda/Abbott and Schering, after some clinical difficulties, have written off 2006 and refuse to say when the uterine bleeding drug might be submitted for approval. Judging from the lack of recent statements, the outlook isn't good.

Not a pretty picture.

How true Derek, how true. And that's without including the Pargluva debacle!

So, back to the $64,000 (million) dollar question.

Is the next round of Big Pharma consolidation about to start?

Has the recent German activity sparked the flame?

Possibly, but not certainly, is Insider's reading.

We need a few more "old schoolers" like JP to come clean and admit it has to happen, then it will.