Health Industry CEOs: More Confidence, Challenges

Tuesday, 10 Jan 2012 | 3:12 PM ET

Chief executives at some of the biggest U.S. biotech and pharmaceutical companies are at the annual JPMorgan health care conference in San Francisco for a number of reasons: showing off new products, meeting with analysts, talking to peers about possible collaborations and, perhaps most importantly, meeting with potential investors.

Here's what some of the CEOs told CNBC on Tuesday.

Dendreon CEO Mitchell Gold

Dendreon CEO: Oncology Investments
Dendreon's revenues for its solo product, Provenge, has more than tripled from a year ago. Insight on the drug's treatment of prostate cancer and an outlook on the healthcare sector, with Mitchell Gold, Dendreon president/CEO.

We had a very strong fourth quarter really driven, I think, by increasing physician confidence in utilizing [prostate cancer drug] Provenge. …The reimbursement landscape dramatically improved in the second half of the year, and we saw that in the fourth-quarter numbers. … If you think about Provenge and where it’s indicated, it sits right at the intersection between when urologists are taking care of the patient and typically when they would hand them off to a medical oncologist. So we’re targeting both.

Sanofi-Aventis CEO Chris Viehbacher

Sanofi CEO's 2012 Health Care Outlook
A check up on the health care sector, with Chris Viehbacher, Sanofi-Aventis CEO, who shares his outlook for 2012.

We did a lot of acquisitions in 2011 and certainly the acquisition of Genzyme [in February 2011 for $20.1 billion] really changed the profile of the company. 2012 is a critical year for our industry and certainly Sanofi. We will lose close to $3 billion in after-tax profits [when some patents expire]. Clearly part of the formula has to be about renewing research. Coming to a conference like this allows us to connect with other companies [and] think about more external research collaborations.

Medtronic CEO Omar Ishrak

Medical Device Titans on Obamacare
Discussing how Obamacare's new 2.3% tax on the biggest medical device makers is impacting business, with Omar Ishrak, Medtronic CEO; Michael Mussallem, Edwards Lifesciences CEO; and Stephen MacMillan, Stryker Corporation CEO.

There is much more patient control over the choices that they make today simply because of the changes in the health-care plans. The deductibles are greater, patients have a greater choice, and in an uncertain economic environment if there’s anything even close to being elective, patients will decide not to do them. So it has a direct impact on our marketplace.

Stryker CEO Stephen MacMillan

[Asked about the federal health-care reform law and a 2 percent medical device excise tax to be implemented in 2013] There’s so much uncertainty, and the investment community doesn’t like uncertainty. It’s what we as business leaders are facing. ... We do hope that ultimately there will be corporate tax reform but, let’s face it, it will probably not happen until after the 2012 election, which puts us into 2013. So we have to plan for that.

Anthony Coles, CEO, Onyx Pharmaceuticals

Onyx Pharma CEO's 2012 Plan
Dr. Tony Coles, president & CEO of Onyx Pharmaceuticals, discusses his outlook on pharma in the new year. Biotech stocks were up 7% in 2011. "The emerging markets should be great for us," he adds.

[Asked if the company is an acquisition target] We very much like our prospects with the three new approved therapies, seven new cancers that we could have data for or could have an approval for with the FDA. We like our prospects as an independent company and we’re really, really focused on bringing new therapies to patients. So that’s the course we’re going to follow for now.

Oliver Fetzer, CEO of privately held Cerulean Pharmaceuticals

VC Backs Life Sciences
Sanofi and two venture capital firms announced Tuesday that they are investing in bio-tech start-up "Warp Drive," with Oliver Fetzer, Cerulean Pharma Inc. CEO, and Terry McGuire, Polaris Venture Partners.

It’s certainly a tough market, but good science and a good team continue to command a premium. The key is to have a syndicate in which you have people like Terry McGuire from Polaris [Ventures] and other strong investors that really take the long-term perspective. Drug development, drug discovery is not a short-term investment. It’s a longer-term business and we are able to do some breakthroughs because of the support we get from investors.

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