Interview: Jaume Masana, Esteve Phamaceuticals
Jaume Masana, Esteve Pharmaceuticals
New ventures and strategic alliances for Esteve Pharmaceuticals are presented to the Board of Directors of the privately funded Spanish pharmaceutical group through Jaume Masana, who is the Scientific and Business Development Director of Esteve. At BIO-Europe Spring® in Barcelona, Esteve is searching for innovative products and services to develop with partners, as well as opportunities for in-licensing agreements for its major markets.
In an exclusive interview with partneringNEWS, Dr Masana sets out the strategic directions for Esteve through to 2015 and describes the qualities the company seeks in new programs.
partneringNEWS: The Esteve pipeline is divided half and half between in-house development and out-licensing projects with partners. Can Esteve maintain its level of internal innovation at a time when other large pharma companies are reducing their internal programs?
Jaume Masana: We not only expect we can maintain innovation with research and development (R&D), but we expect to grow this capability at Esteve. In 2009 R&D invested over EUR 60 million in internal development and discovery programs, and in 2015 we are projecting the R&D spend to more than double to EUR 125 million. The reason for our confidence and success is narrowing our target and a clear outline of objectives.
Several years ago we decided to focus discovery programs in analgesia and determined this is where we wanted to maintain, and even grow, our know-how and build our strengths. Our core strategy in new molecular entities then says that at a certain point where we achieve the clinical proof of concept, we will look for partners to contribute, either financially or with their know-how, in order to move that product as soon as possible to patients, to the market.
In summary, we have a sharp focus on analgesia, we stay focused on the aspects of development that we know how to do, and then we seek partners where we understand that others can contribute to the success of the project. The key to our success is in these two strengths: innovation and partnership. And when I say innovation, I refer not only to R&D but to all areas of the organization, including business development. We like to say that innovation and partnerships are embedded in Esteve DNA.
partneringNEWS: How are you approaching the meetings at BIO-Europe Spring in Barcelona?
Jaume Masana: I will be making a presentation, and we will have four people from my department attending for business development and licensing opportunities. These people will be seeking meetings with two main objectives. First, to show Esteve as a company with strong and focused R&D, and we expect to meet with many companies proposing innovative ideas. Meanwhile, our people will also be looking for projects to in-license, seeking best-in-class, or first-in-class projects for our major markets of Spain and Portugal. We have been highly successful co-marketing drugs under license in these markets, primarily with large multinational pharmaceutical, such as Novartis or Pfizer, often under a different brand name. These are successful partnerships with excellent and durable relationships where, in several instances, we have achieved for our partner the highest market share worldwide for their product.
partneringNEWS: You also form strategic alliances, often maintaining an interest of 50 percent or greater. Do you continue to seek that kind of control in partnerships?
Jaume Masana: It is true that currently we do not have any ventures in which we are the minority partner. In our 50-50 joint ventures, there is a level of trust and confidence, which becomes very important for making any number of decisions that can not be imposed on the partner. We enjoy for more than 30 years now a 50-50 joint venture called ISDIN with another Spanish group called PUIG that is devoted to skin care. Our most recent strategic alliance with the Japanese company Teijin Pharma in the field of respiratory illnesses is also a 50-50 joint venture. In China we have two joint ventures, with Esteve Huayi Pharmaceutical (EHP) and Zhejiang Huayi Pharmaceutical Co (ZHP), for the production of active pharmaceutical ingredients, and in these cases we have a 61 percent majority stake.
We are ready to participate in a minority role in a venture providing we are assured of the deal’s positive and sustainable impact for Esteve, and that the final target or objective is interesting for us to pursue. The reality is that so far we have not seen such a proposal.
However, the percentage of participation is not the most important thing. Instead, we have very clear criteria for why we join in a venture, and these criteria are defined clearly in what we call the ‘3i’s, which stand for Innovation, International and Interest. Interest you might call profitability, but we prefer the Spanish root of the word in interés. The board of Esteve is not considering any new initiatives that do not contain all these three elements.
We like to serve society in the field of health and are open to any ideas or new projects that will help us to meet this goal.
partneringNEWS: Is Esteve open to partnerships beyond its core focus on analgesia?
Jaume Masana: Once we are satisfied a venture can meet the objectives of ‘3i’s, we can be very flexible and open to a different focus. In fact, we are quite innovative ourselves in establishing frameworks for cooperation.
I can give you two recent examples. The first is the agreement with the Japanese firm Teijin Pharma where we are joining our experience and know-how to introduce a new concept in the treatment of respiratory illnesses at the patient’s own home. This is very different than providing medications, unless you consider oxygen a medication. This service targets patients who have COPD (Chronic Occluded Pulmonary Disorders) or sleep apnea. It brings us closer to the patient, which is important to us. And it contributes to the sustainability of the public health system because the care for patients at home avoids hospitalization, better control of the patients and it results in savings for the healthcare system. The agreement with Teijin Pharma has a European scope that meets our objective toward internationalization. It will be developed in Spain, but it is our intention in a very short time, to bring this service to other key countries of Europe.
The second example is an agreement we signed for the development of an new category of HIV vaccine, creating the HIVACAT program. The ‘CAT’ in the program’s name stands for Catalonia, yet this work truly moves into the international research arena. More than 40 researchers are to carry out a series of clinical trials aimed at developing a vaccine treatment that stops the progression of the virus in those already infected, and a preventive vaccine to prevent the infection in case of possible exposure to HIV. Esteve’s role here is to translate the science into a product that can be administered to people, increasing speed and efficiency in the development, and assuring that once research results have been obtained, they are quickly brought up to the production stage.
What is interesting in the HIVACAT collaboration is that we were able to create a public-private partnership, bringing together two important scientific centers in Spain in a pioneering agreement with the Catalonian authorities, a pharmaceutical company and a bank foundation to assure the viability of the project.
Esteve is not ruling out further growth in vaccines, which could involve either taking part in other R&D projects or, at some point in the future, production activities. Beyond the focus on painkillers, Esteve is open to preventive medicines, specifically in vaccines, a field that offers many opportunities in terms of research and we aim to play an important role in that research.
Currently we are considering, and I can not be more specific, other new businesses in the area of health that are not related purely to the marketing of medicines. I would point to the novel service we have created with Esteve Teijin Healthcare for respiratory illnesses at the patient’s own home. We are considering projects like this that are not based on medications, that may be based on therapies, that can contribute to people’s health. Any proposals that achieve this objective can be considered.
partneringNEWS: The recent Sustainability Report from Esteve, audited by KPMG, was given the highest rating of A+ by Global Reporting Initiative. Considerable time, effort and investment go into this reporting. Why is this so important to Esteve?
Jaume Masana: Sustainability is precisely our major objective. We are a private company, and as such we understand we can be more focused on long term goals rather than short term horizons. We are always taking into account the “triple bottom line”, which means taking care of company’s profitability while being socially conscious and responsible to the environment.
partneringNEWS: Esteve is a large multinational company that is strongly anchored to its roots in Spain. How does this create a competitive advantage for Esteve?
Jaume Masana: It is our strongly held belief that we can only grow internationally if we are first strong in Spain. This is a very important point. It may seem paradoxical, but it is not incongruous. In 2009, Esteve earned 46 percent of its sales outside of Spain. Our goal for 2015 is to have two-thirds of our sales outside of Spain, and we expect that in just two years the majority of sales will be generated outside of Spain. Yet Spain will always serve as the base for this international growth.
partneringNEWS: Over the past 20 years, Esteve has regularly collaborated with the Autonomous University of Barcelona on research projects. Last year Esteve formed a collaborative agreement with a focus on professional development. Can you explain the company’s interest in this agreement?
Jaume Masana: There is a special relationship between Esteve and the Autonomous University, and now we have a a framework agreement that makes the university a partner to help identify talented people. Esteve is going to build a new R&D center in a suburb of Barcelona called San Cugat, which is near the university.
At the beginning of the interview I mentioned the ‘3i’s of innovation, internationalization and interest. In fact the equation is a bit more complex. At Esteve we like to say 3i divided by P squared (3i/P2) where the ‘P’ stands for people. Bringing people to the exponential power of two means that Esteve likes to incorporate into its culture a highly professional person who are also outstanding individuals. This is the way we are able to nurture and expand the Esteve culture as we become international, and it assures that we further develop the company’s DNA. This program with the Autonomous University of Barcelona shows the board is committed to this equation as more than just words.
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