Guerard: Ophthalmology Important to Novartis

Frederic Guerard, worldwide business franchise head, ophthalmology for Novartis, sits down with OIS TV to explain how the “conscious uncoupling” with Alcon will impact Novartis’ ophthalmology franchise. Guerard explains that ophthalmology now counts as the “largest business franchise” within Novartis Pharma, so the sector will command considerable attention from the global pharmaceutical company. “I would say what we can expect from Novartis is more innovation in the years to come,” he said. He also lays out where Novartis will be pushing for innovation within ophthalmology.

Participant:

Transcript:

Tom Salemi: Hi, this is Tom Salemi at OIS TV. I am at OIS@ASRS, and I’m here with our new Master of the Industry, Fred Guerard, world wide business franchise head, Novartis Ophthalmology. Thank you for joining us.

Fred Guerard: Thank you, Tom.

TS: So let’s talk a bit about Novartis and Alcon. You were with Novartis for sixteen years, and had switched over to Alcon Pharma. Now you’ve got Novartis again on your business card. Can you give us an update sort of on the remixing?

FG: Sure. So what we’ve recently done is actually to integrate the Alcon Pharma portfolio together with the retina franchise at Novartis Pharma, and move that under the Novartis Pharma umbrella. So it’s basically putting together the two entities that we’re working in ophthalmology under the same roof, and make sure that – that roof being Novartis Pharma – that somehow we’ll be able to benefit from the power of research, the power of development of this organization. And therefore, we believe we’ll be able to generate more innovation and ensure quicker access to the markets.

TS: And the focus will be, obviously, on pharma. The device will be left to Alcon?

FG: So the medical device piece stays under Alcon. And that is now what Alcon does. So the whole pharmaceutical piece now moved under Novartis Pharma.

TS: Well, that must be very exciting to bring all that under one –

FG: No, it is, and actually we are – it’s not a divorce. We are still talking to our friends at Alcon.

TS: Of course.

FG: And we decided it’s a conscious uncoupling, I think it’s called now. So we are still talking to each other about the kids, and ensuring that we are coordinating our efforts in research and development. And knowing that we going to enter very soon some drug device development. So we have put the mechanisms in place to ensure that the physicians and the patients will not see the difference.

TS: So going forward, what will Novartis Ophthalmology look like? You’re on the Masters of the Industry panel today. Will Novartis Ophthalmology be a name that we hoe to hear from, making perhaps strategic investments or acquisitions? Or where does Novartis Ophthalmology go from here?

FG: So just to dimensionalize the business franchise, this is the largest business franchise from Novartis Pharma. So it’s critically important for us to be successful for the whole organization, actually. This is also the second largest investment we have in research. We have a very large team of researchers in Cambridge in the US, and therefore this is for us a key area of focus. Actually, the second area of focus in research is oncology for the group. So no risk of defocusing from ophthalmology. What you can expect from us is being a key player and do everything we can to bring innovation that can answer unmet medical need. We had a very interesting discussion today on the panel about the risk of defocusing from retina, and every panelist was actually very clear there is no risk of us defocusing from retina because it’s such a large segment in eye care. And the unmet medical need in retina is probably even higher than other segments of the eye. So I would say what we can expect from Novartis is more innovation, more innovations in the year to come.

TS: Can we spend a moment just to explain what do you currently have in retina, and what are some of the leading products that Novartis Ophthalmology is offering today?

FG: So as you know, we have the rights of Lucentis outside of the US, with Pfenex that’s been a very, very fruitful partnership for both organizations. We also acquired the rights of Fovista also outside of the US. So we are looking forward to getting the results of the phase 3 trials very soon, and looking forward to make this drug available outside of the US if the results are positive. We also have a very good early stage pipeline coming out of our Cambridge organization, spanning a number of diseases with a number of different technologies. Those are very early stages, so I can’t really comment on what they are. But I mean when they come to proof of concept we will be keeping everyone informed. We have a very good retina pipeline.

TS: : And I’m a Boston guy, so I know the Cambridge facility very well. It’s a very important part of the Cambridge landscape.

FG: It is.

TS: Which is a significant biotech area. Does it have a greater emphasis on the back of the eye or the front of the eye, your pipeline? Or is it a mix between both?

FG: We’re essentially very balanced. We probably have the equal number of projects for the front – the definition of front and back is a bit balkanized always not quite find in the right place. So I would say we have external of the eye disease, we have glaucoma, and we have retina. And we have a pretty good balance across the whole thing. So which is what we want to have. We do not want to become necessarily only focusing on the one segment. We want to be offering a complete panel of solutions for the physicians.

TS: And will you look externally for R&D, either making investments or M&A? I assume that’s always a plan, but –

FG: Hard to comment on M&A.

TS: Sure.

FG: But looking for partnerships, certainly. That’s what everyone does from the research side or the development side. We’re in constant contact with smaller companies coming with compounds. And everything we find of interest we actually partner with. We are not very vocal about the number of deals we sign every year. We tend to be more secretive than others, but we are very active.

TS: If I guess the number, will you tell me?

FG: No.

TS: It was worth a shot.

FG: Very secretive.

TS: So where do you anticipate seeing growth in the next two years? Maybe you could look more broadly at ophthalmology so you can give me a more specific answer. But what kind of milestones or successes would you like to see the sector generate in the next couple years?

FG: Well, so for us in the next couple of years is basically doing more with what we have because we are going to have a wave of launches that are going to come, but are not a significant difference because our size is such that actually new launches don’t move the needle in the first year. So it takes a bit longer. For us, clearly we have a focus on three key areas. One is dry eye, and we have a very good growth coming from our palliative drug, Systane, our family of drugs. We also have very, very dynamic growth coming from our combination treatments in glaucoma. And of course retina is very important for us because Lucentis is a very big product for us outside of the US. So I think it’s a very balance answer, no across these three pillars. And of course we have multiple drugs. We have more than 150 brands, so depending on the country, the growth is coming from very different places. But in a nutshell, those are the 3 big ones.

TS: And is the interest in ophthalmology outside the US, is it as high as inside the US? I focus more on inside the US. I obviously do look globally, but I don’t, obviously, I don’t have as deep a view as you do. What is the – how is ophthalmology seen outside of the US, and what are those markets like?

FG: So it’s just the balance between the diseases is a bit different. So for instance, in emerging countries you have more acute drugs, for instance, like anti-inflammatories, anti-infectives. Maybe some dry eye as well. And the focus in Europe or in the US is going to be more in retina and others. So it’s just the diversity of the geographies is actually very extreme in ophthalmology. Now we see like in every segment is after a while, when innovation has been anchored in developed countries, you see that emerging countries are picking up, and actually you see that even drugs like anti-VEGFs actually penetrating emerging countries now quite nicely. But there is almost a ten year gap between these countries and [European?] countries. What we try to do with our next launches is to make sure this gap gets shorter and shorter because otherwise the patients are missing out.

TS: That’s great. And just finally, we’re very pleased with this first day, this marriage of OIS and ASCRS. The retina is an exciting space. Any takeaways from the day, any thoughts on the event itself?

FG: I think there was a very interesting discussion about combination treatments and how they are going to change the approach to treating the retina disorders like wet AMD or maybe DME in the future. I’m also very excited. I think this is going to be a change probably as big as the changes we’ve seen in oncology. And oncology, you know, ten, fifteen years ago moved from monotherapies to combination treatments. So I think we have very, very exciting years ahead of us, and I think clinicians are going to take these drugs, they’re going to play with them, and they’re going to define their own protocols on how to best use them to deliver the best patient outcomes. So I think it’s very exciting.

TS: Excellent. Well, thank you for being part of it and for joining us on the interview.

FG: Thank you, Tom.