Pfizer diverting drug development away from Japan

by Kanoko Matsuyama


Pfizer Inc., the world’s biggest drugmaker, is diverting drug studies and tests from Japan as part of an industry push to avoid this nation’s regulatory delays and higher costs.

The New York-based maker of Lipitor, the No. 1 cholesterol medicine in the world, is increasing development spending in South Korea, said Akihisa Harada, head of clinical research at Pfizer’s local unit in Tokyo.

Many Japanese hospitals are unable to test dozens of people, making it faster and cheaper to recruit patients elsewhere in Asia, he said.

Slower regulatory review in Japan means products typically enter the market here four years after release in the U.S. or Europe, delaying drugmakers’ profits.

Pfizer last year tested 30 medicines in Japan, compared with 99 worldwide. Studies in Japan can cost twice as much as in the U.S. and Europe, according to Harada.

“Japan is an extremely large market, but there is no growth,” Harada told this year’s medical symposium by Kitasato University and the Harvard School of Public Health, held Tuesday in Tokyo. “The markets in China and (South) Korea are relatively small, but companies can expect growth from their investments.”

Japan’s pharmaceutical market is forecast to expand 2 percent this year. Government-mandated price cuts on medications every two years erode growth, according to IMS Health Inc. The U.S.-based health research company predicts 12 percent to 13 percent growth in China and South Korea.

Pfizer in June announced plans to spend $300 million on research and development in South Korea, five months after saying its research center in Japan will close.

The cost of late-stage tests on Fablyn, an experimental osteoporosis medicine, was 2.5 times higher per patient in Japan than in the U.S. and more than three times higher than in South Korea, according to a study presented at the 2003 Kitasato-Harvard symposium.

“It’s somewhat natural to pick South Korea as an alternative R&D center in Asia because it costs less, while Korean doctors have relatively good medical expertise,” said Bae Ki Dal, a pharmaceutical analyst with Good Morning Shinhan Securities Co. in Seoul. “It’s likely South Korea will see more companies following Pfizer.”

Japanese approval is also slower than in the U.S. or Europe because of regulatory hurdles.

In most cases, Japan’s drug agency requires that experimental medicines be studied in at least some Japanese patients to prove efficacy and safety. The proportion differs according to the therapeutic category and consideration is given for data from other parts of East Asia.

Japan wants doctors to undertake as many clinical studies as other parts of Asia by 2012, according to a five-year plan released by the health ministry in 2007.

The country aims to supply at least a quarter of new drugs developed globally, Toshihiko Takeda, director of the health ministry’s economic affairs division, told participants at the Tuesday conference.

“We are happy to work with anybody who is interested in helping Japanese patients,” Takeda said.

The health ministry wants Japan included in international trials so local regulators can review the research data at the same time as their counterparts overseas, he said.

More than 236 drug reviewers are being hired to cut 30 months off the time taken to approve medicines, according to the Pharmaceuticals and Medical Devices Agency.

Last year, 40 hospitals were selected for an upgrading of their research capabilities, enabling each to handle bigger patient groups.

Hospitals undertaking clinical research in Europe enroll 3.5 times more patients than Japanese facilities and U.S. hospitals recruit 18 times more patients, the Office of Pharmaceutical Industry Research in Tokyo said in a 2006 report, its latest on the subject.

About 100 patient studies are now being run in Japan, Takeda said. The number fell to 56 in 2004 from 95 in 1996, according to health ministry data.

Amgen Inc., the world’s biggest biotechnology company, sold its local unit to Osaka-based Takeda Pharmaceutical Co. in February, citing Japan’s “very complex market with specific regulatory requirements.”

Pfizer’s antidepressant Zoloft was released in Japan in 2006, 15 years after it was first prescribed to U.S. patients. Its painkiller Celebrex began selling in Japan in June, more than five years after approval was sought.

GlaxoSmithKline PLC’s asthma treatment Advair was introduced last year, nine years after its release in Europe, where it is sold as Seretide.

Glaxo, the world’s second-largest pharmaceutical company, plans to shut its drug research base in Japan to concentrate on its U.S. and U.K. laboratories, the Nikkei newspaper reported in March.

The London-based company said in July it is spending an initial $40 million on its first Chinese site, and plans to hire as many as 50 scientists at the Shanghai facility.

Novartis AG in January said it will close a research center in Japan this year. The Basel, Switzerland-based company is building a $100 million center in Shanghai that will employ 400 people by 2010. AstraZeneca PLC, the U.K.’s second-largest drugmaker, based in London, says it will open a research facility in China in 2009.

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