Wyeth CEO sees good days ahead for drugs

[Guest guest]

FYI DeSiena

USA TODAY 5-3-2005

Wyeth CEO sees good days ahead for drugs

The pharmaceutical industry has been under fire amid

safety concerns surrounding blockbuster drugs such as

Vioxx, Celebrex and Bextra. There have been concerns

about tainted flu vaccines and the drug-approval

process itself. But Wyeth has been quietly swimming

against the tide and put many of its legal and

regulatory issues behind it. Wyeth has produced solid

numbers, including a 44% gain in first-quarter net

income.

Wyeth CEO Essner says a strong pipeline of

new drugs will keep his company going strong. A

promising vaccine is aimed at Alzheimer's.

By Todd Plitt, USA TODAY

CEO Essner is convinced that, unlike some of

his bigger rivals, his company's best days are ahead.

I talked business with Essner for a deeper look into a

drug company that appears to have a promising

pipeline. Following are excerpts, edited for clarity

and space.

Ron Insana: The first quarter looked strong. How about

the rest of the year?

Essner: As we announced with the first quarter,

we're expecting another strong year for the company.

Last year, the business performance overall was good.

We started the first quarter off very well, and we've

upped our estimates for the year. We're very

optimistic that the general trends that we've been

seeing for some time are going to continue. We have a

very strong performance from a line of products that

are growing all over the world, very good progression

through our research pipeline with new drugs moving

their way through and coming to market.

Insana: What will drive your growth?

Essner: There are a couple of big products and some

smaller ones that are really driving our growth. And

some of our major brands, like Effexor, an

antidepressant, and Protonix (for heartburn), continue

to grow. There was outstanding growth from Enbrel, a

remarkable drug for rheumatoid arthritis and

psoriasis. Prevnar, our pneumococcal vaccine, is also

doing well and was the first vaccine ever to top the

$1 billion mark in annual sales last year. Rapamune,

our drug for organ transplantation, is doing well. And

we're hoping an important drug called Tygacil, which

is a new kind of antibiotic, will add to our growth in

the second half.

Insana: What about the concerns with respect to

antidepressants and suicide in teenagers?

Essner: Let me be clear. Antidepressants prevent

suicide. They don't cause it, although some evidence

suggests that in adolescents you can see some

activation where kids who may be suicidal to begin

with become more active and able to act out their

impulses. We certainly have not seen a pattern of

suicide with Effexor. Effexor is a drug that really is

not labeled for kids. It's not used in kids. Although

the general concern about suicide has definitely

curtailed the overall use of antidepressants, Effexor

still grew last year. It's is our largest-selling

drug: over $3 billion in sales last year. It's the No.

1-selling antidepressant in the world.

Insana: How is Enbrel different from pain pills such

as Vioxx or Celebrex that have been hurt by adverse

Food and Drug Administration decisions?

Essner: Enbrel is a completely different category of

drug than the NSAIDs or COX-2 anti-inflammatory drugs.

It's a biologic treatment that works on a completely

different mechanism and isn't used for the kind of

osteoarthritis that people associate with drugs like

Vioxx and Celebrex. It's used for rheumatoid

arthritis, which is an autoimmune disease where the

body's autoimmune system goes wrong. And Enbrel is

able to correct that problem and not only reduce the

pain that comes from rheumatoid arthritis but has been

shown to slow or even reverse some of the joint

destruction.

Insana: Do you have other promising vaccines?

Essner: One really interesting one we have right now

is in Alzheimer's. We have one of the most extensive

Alzheimer's disease development programs. We have a

vaccine approach where we've created a way of

modifying the immune system so that it can rid the

body of this beta-amyloid plaque that most people feel

is an important component in developing Alzheimer's.

Insana: What do you make of the direct-to-consumer

ads? Do you think the pharmaceutical industry has gone

a little too far getting consumers to bug their

doctors for particular products?

Essner: No. I think, overall, direct-to-consumer

advertising is useful. I think it alerts patients to

the possibility that treatment is available for them.

When it encourages them to see their doctor, it works

in everybody's interest. I don't like the tone of some

of the ads, but I think giving consumers as much

information as possible about the choices that they

can make with their doctor is a very good thing for

the health care system.

Insana: Your stock is up 18% the past year and almost

at a 52-week high, unlike a lot of other

pharmaceutical companies. What about your strategy

allows you to differentiate yourself?

Essner: There's no mystery in it. We have been very

effective in bringing to market some very exciting

drugs that really make a difference in patients' lives

(and) improve doctors' abilities to deal with the

problems, and we've done so in a productive and

efficient way. If you look at our pipeline today, it

represents an even higher component of innovation.

We're now going to development with the first major

treatment for muscular dystrophy. In the last 48

months, we've put 48 new drugs into development,

moving them from the laboratories into clinical

trials. That's a productivity measure that few

companies, even those that spend a lot more than we do

on research, can match.

Insana: Of those 48 different compounds, which are the

most exciting?

Essner: We have a very interesting drug called

Temsirolimus, which is going to be used in a variety

of cancers. It's being studied in renal cell carcinoma

right now, but it'll also be moving into breast and

other cancers. We hope to file six new drug

applications for important new therapies in the next

two years.

Insana: Does your vibrant pipeline make you vulnerable

to a takeover?

Essner: Wyeth is committed to being successful on its

own. We're not talking to anybody. We're not listening

to anybody. And if a combination were to come along

that clearly would make us a faster-growing, better

company, like any CEO and any board, we'd look at it.

But that's not on the horizon right now.

Insana: Can another firm just bid for you, without

your consent?

Essner: We have a market cap of around $60 billion, so

for someone just to put out a bid in an unwelcome way

requires a little more than just saying it.

Insana: What is your biggest challenge?

Essner: Execution. Our issues are not strategy. We

know where we want to go. We're focusing on a high

degree of innovation. So far, we've been successful in

bringing that to market, making it successful around

the world. We've got a great pipeline which, if it

comes to fruition, will continue us on the good path

we're on right now. What we have to do is to continue

to execute very well. If we do that, we'll be even

more successful in the future than we are today.

Dr. DeSiena, D.C.

Washington Street Chiropractic Center, L.L.C.

771 Washington Street

Eugene, OR 97401

(541) 686-BACK (2225)

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