Merck 2014 Annual Report Download - page 57

52 GROUP MANAGEMENT REPORT → FUNDAMENTAL INFORMATION ABOUT THE GROUP → Objectives and strategies of the Group
BUSINESS STRATEGIES
Healthcare business sector
Biopharmaceuticals
The Biopharmaceuticals business aims to become a preferred global
biopharmaceutical
partner through its enduring commitment to
transforming patients’
lives with innovative specialty medicines,
leading brands and
high- value solutions. Global megatrends such
as world population
growth and a general increase in life expec-
tancy are bolstering the demand for the Biopharmaceuticals busi-
ness’ products. The Biopharmaceuticals business is well- positioned
for sustainable growth.
The first pillar of the Biopharmaceuticals business’ strategy is
to deliver innovation globally. The portfolio decision-making
process has been improved and a rigorous project prioritization
implemented with shorter timelines to phase transitions. Efficiency
in R&D has been strengthened with the development of bio markers
to improve patient outcomes, with a focus on selected core
thera-
peutic areas and with the creation of Translational Innovation
Platforms. The Biopharmaceuticals business has three priority
development programs: atacicept in immunology, evofosfamide
(TH-302) in oncology and avelumab in immuno-oncology, an
anti-PD-L1 antibody that the Biopharmaceuticals business will
develop and commercialize with Pfizer as a potential treatment for
multiple tumor types.
The second pillar of the Biopharmaceuticals business’ strategy
is to maximize the existing portfolio in developed markets. In the
Multiple Sclerosis franchise, the vision is to remain a leader by
providing innovative solutions that include drugs, devices and
services to help people living with multiple sclerosis. The Biophar-
maceuticals business plans to fully exploit the potential of Rebif®,
its top-selling product, in an increasingly competitive multiple
sclerosis market and to position it as the best interferon-based
therapeutic option for patients who suffer from the relapsing form
of the disease, driving differentiation via smart injection devices
and the first multiple sclerosis e-Health platform. In Fertility, the
focus is on expanding market leadership and on providing inno-
vative services and technologies beyond drugs. In Oncology, the
Biopharmaceuticals business promotes the value of Erbitux® to
personalized treatments, especially in Europe and Japan, and
emphasizes the importance of offering patients complete testing
for RAS status in order to ensure optimum treatment. The Bio-
pharmaceuticals business will also ensure launch readiness in
these innovation- driven markets. Through the co-promotion of
Xalkori® with Pfizer, the Biopharmaceuticals business is entering
the U.S. oncology market and preparing for the future launch of
its anti-PD-L1 antibody.
The third pillar of the Biopharmaceuticals business strategy is to
expand further in Emerging Markets. With a growing middle class,
extended health care coverage, a shift towards chronic diseases,
and rising demand for biologics, Emerging Markets are a key
driver for the Biopharmaceuticals business, accounting for over
60 % of organic growth between 2011 and 2013. In Emerging
Markets, the Biopharmaceuticals business is implementing strate-
gic growth initiatives in its General Medicine and specialty medi-
cine franchises to address specific needs. The Biopharmaceuticals
business is leveraging capabilities and local channels, for example
by extending the breadth and depth of promotion in China,
expanding its portfolio via regional and local licensing, and sup-
porting market developments in Fertility. The Biopharmaceuticals
business is also investing selectively and growing its flagship
brands with new formulations (Euthyrox® or Glucophage®), fixed-
dose combinations ( Concor®) and devices ( Saizen®). The Biopharma-
ceuticals business is repatriating business, taking back the promo-
tion of Merck KGaA, Darmstadt, Germany, products from industry
partners where attractive. And it is expanding the focus of its
portfolio with growth initiatives in biologics.
Biosimilars
The Biosimilars business is committed to providing access to
high-quality biologics to more patients all over the globe. The
unit is developing a biosimilars portfolio focused on oncology
and inflammatory disorders, through both in-house research and
development expertise in biologics, and partnerships with other
biosimilar players. The initiation of PhaseIII trials is planned for
2015 / 2016 onwards. Biosimilars is an attractive market in which
the company is well-positioned as it can build on existing strengths
and capabilities across the biosimilars value chain. This includes
the ability to leverage internal assets or source capabilities from
suppliers to ensure compliance with regulatory requirements,
secure market access across key markets such as the Emerging
Markets region, leverage commercial manufacturing capabilities
and flexibility,
aswell as adopt a tailored go-to-market approach .
The company has also established strategic alliances with Dr.
Reddy’s in India to co- develop several oncology compounds and
with Bionovis in
Brazil to supply the Brazilian market with bio-
logical products under the Product Development Partnership (PDP)
policy of the Brazilian Ministry of Health.
This is to be expanded by another, as yet undisclosed in-
licensing agreement for a late-stage biosimilar.