A New Business Model in Pharmaceuticals

As drug discovery and development becomes a more global pursuit, merely knowing how to navigate the various regulatory and approving bodies becomes a valuable service in its own right.  For small companies, gaining approval for a new drug in multiple countries is a difficult and costly affair, which must partly explain the various alliances in the pharmaceutical industry. 

Considering this, Par Pharmaceuticals (NYSE: PRX) made an interesting announcement, Monday, declaring a partnership with Turkish generics manufacturer MN Pharmaceuticals:

Under the terms of the agreement, MN will be responsible for the development and manufacture of all products.  Par will provide regulatory affairs support and submit each Abbreviated New Drug Application (ANDA) to the U.S. Food and Drug Administration as the U.S. filing agent on behalf of MN. Par will be responsible for any litigation expenses arising from the ANDA submissions.  Par will have exclusive rights to market, sell and distribute the products in the U.S.  Par and MN will share the net profits generated by all marketed products.

For a third-tier generics maker like Par, this seems like a wise strategic decision.  Their ability to market and understand the U.S. market may very well be more valuable, in the long run, than their ability to produce generic pills to which they have no particular competitive advantage. 

Last year, James Surowiecki, writing in the New Yorker, had an interesting analogy which helps to understand deals like this:

Peering into the future, one can see the faint outlines of a pharmaceutical industry that looks a bit like the movie business, with big pharmaceutical “studios” marketing, distributing, and perhaps even underwriting the costs of smaller drug “producers.” The only difference is that the drug studios might actually make money.

This is insightful, and it would not be surprising to see more and more deals like Par's play out in the future.

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[ティンバーランド]

集英社（東京都千代田区）が隔週で発行する漫画雑誌「グランドジャンプ」に連載中の料理漫画「ダシマスター」に登場する背景や食材などの絵の中に、ウェブサイト上の写真画像に類似したものがあることが分かった。現在事実関係の確認を進めており、今月２１日発売の第３号から、当面の間、同作品を休載する。

　ティンバーランドグランドジャンプは「ビジネスジャンプ」と「スーパージャンプ」を統合し、１１月１６日に創刊されたばかり。ダシマスターは平成２１年９月にビジネスジャンプで連載を開始。６巻まで単行本が発売され、累計発行部数は１５万６千部。