Ben Ellis, general manager at Lupin UK and Ireland, talks about the strategic challenges of transitioning from the sphere of generics to specialist pharma and how he hopes Lupin can change how it is perceived. Furthermore, he comments on the uncertainty Brexit brings to the industry and how healthcare should be the number one priority going forward.
What were your experiences of transitioning from your previous role as market access director at AbbVie to becoming head of the British affiliate of Lupin? What are some of the challenges you had to overcome?
At Abbott and Abbvie I led the Operations division and then latterly the Market Access Division. As Lupin in the UK is looking to evolve from being a pure generics player to a specialty care company, having the operations experience as well as market access, pricing and reimbursement, will hopefully put us in a good position going forward.
Transitioning from a giant like Abbvie to Lupin was an interesting move. What attracted me to Lupin was the real desire to transition into specialty pharma in the EU along with a real entrepreneurial spirit, flexibility and autonomy. By comparison, big pharma roles are becoming increasingly highly specialized and functions are centrally led. If you are purely a functional specialist that is great, but if you prefer breadth and flexibility, big pharma could be a less favorable environment.
What attracted you to Lupin in particular?
I had already worked for 12 years in a big US corporate organization and I did not want to go back into that space. I wanted something different and was attracted in particular to a family-led business. I was very impressed with what Lupin had achieved, along with their strong values. I was also impressed by the senior leaders in the organization. I report into Thierry Volle in Europe and he is also from a specialist pharma background. We speak the same language and he is a senior leader in the Lupin organization with regard to driving the specialty agenda. I was brought in to try and help accelerate the transition towards becoming a specialty company and having worked in generics prior to Abbott, I had the experience of operating on both sides of the spectrum, generics and specialty.
Overall for me, Lupin offered the possibility of starting something new. All through my career, I have enjoyed building functions, capabilities and organizations. I knew that when I joined I would have to relocate the business from the North and reopen a new office near Heathrow. This meant hiring a brand-new team and that really excited me. It’s rare to have an opportunity to rebuild a brand-new UK organization and to lead the transition.
Looking at the scope of Lupin. What is the focus of the activities in the UK?
With a relatively new team, strategy and location we are now going into more specialist areas with biosimilars and neurology opportunities in the pipeline, along with a third area that I cannot disclose for now. We have about 30 products in our UK portfolio implying that we have reduced our product range significantly as we are trying to get away from “vanilla generics,” where there is very little margin at all in the UK. We are still a small player in the UK but we anticipate significant growth that will enable us to become a mid-size player in the UK market. We are building specialist capabilities in the UK with a focus on market access and we also lead several access projects across Europe from the UK office.
What are the challenges in making this transition from a pure generics focused player to a specialty company smooth and successful? And how hard is it to maintain a balance?
Optimising the generics opportunity as well as building specialist capability is an ongoing challenge. It may seem obvious, but product selection is key and getting the right products and capability going forward will make the transition a successful one. Other companies have tried to transition and with mixed success. Often companies over estimate the true value of a product and reality hits when the disconnect of the perceived value from a payer’s perspective to the company’s perspective are significantly different. Having the capability to understand value from the payer or clinician’s perspective is key and not necessarily within the capability of a traditional generic marketer.
In a large generic market like the UK, who has the final say in pricing for specialty generics?
For generics pricing is largely determined by market forces – the more suppliers the lower the price. For specialist products one can list the price pretty much where they want. However, the product needs to have routine funding and requires assessment from a HTA body such as NICE or an NHSE policy. Both will review cost effectiveness and budget impact. These are lengthy and complex processes and require sophisticated evidence-based value dossiers and economic models.
Around the world, NICE is considered to be ‘the ideal’ assessment body. Why is NICE not as well received in the UK?
Orphan drugs in Germany are generally automatically approved for funding, however, in the UK it takes on average more than two years to get a funding policy for this type of drug, with only a 50:50 chance of success. Other countries do hold the NICE access route in high regard, but the reality is patient access is slower than other European countries, the ICER threshold is lower in the UK than other countries and many drugs never get approved for funding when they do elsewhere.
How is Lupin regarded by the NHS and NICE?
The NHS will currently know us as a company that provides oral contraceptives and HIV generics on hospital frameworks. We will be appearing on NICE’s horizon scanning tool in the near future for our future specialist launces. We are currently building value propositions around the products offered to demonstrate how they are presenting value to the health economy for future HTA/Payer reviews.
Brexit has created a lot of uncertainty, and the government understands that there are many questions they cannot answer. Are the regulators too tough towards companies or have you noticed any changes here?
Industry wants EMA-MHRA close affiliation to ensure patients access the products they need. UK positioning on Brexit is tough. On the one hand senior stakeholders are saying all the right things for the EMA and the Europeans to hear so that they believe we will be good partners going forward, but at the same time, others are articulating that the UK can survive and be strong in isolation. Either way, it is very confusing for the Europeans to hear Theresa May say we want close affiliation and some other senior politicians claiming we can do our own thing and be stronger. I highly doubt that anything will be resolved until March next year as nobody wants to play their cards too early.
What is disappointing, however, is how low on the agenda healthcare has been at government level in relation to Brexit. Healthcare provisions, access to healthcare and medicines should be a much higher priority for negotiators. The public do not appreciate that so many products come through the EU regulatory process and products manufactured outside the EU are tested and quality released in EU laboratories. It is not clear what is going to happen going forward and whether these activities need to happen in the UK specifically or in any EU member state which is currently the case. This means that we are trying to second guess a hard or soft Brexit and are building infrastructure assuming the worse. If the MHRA end up a partner with the EMA then that will be great, but the cost and time lost in realigning infrastructure to cover all eventualities, will be detrimental to company performance for all UK players. We have to assume the worse and we’ve even started the process to change our company from Lupin Europe Ltd to Lupin Healthcare UK Ltd.
Another leg of this strategy is biosimilars. How do you see biosimilars helping Lupin move forward?
Lupin will soon file their first biosimilar development in Europe. By the time the license is approved it will be quite a well-trodden path from our perspective in terms of changing from originator to biosimilar. There will certainly be more confidence in switching between products by then, and that can already be seen across the EU with infliximab. The implementation of biosimilars will be a lot more aggressive to realize savings quicker. What will be fascinating by then, will be to see what the situation is between biosimilars themselves, as currently most of the competition and payer activity is between the originator and the biosimilar. When there are 4-6 biosimilars plus the originator with much of the price erosion already established it will be interesting to see the dynamic.
Talking about the future for Lupin, what results do you want to see happening?
We will achieve our UK targets set this year, and we are on the right trajectory with our long-range plan commitments. Lupin is investing in the UK and Europe for growth and longer term we will be a significant contributor to Lupin in Europe as we move away from the low margin generics business
What is the perception of the Lupin brand in the UK and your goals of becoming a mid-sized company?
Whilst being a small player we have taken pride in our customer service level and I would like to believe we have punched above our weight. However, our presence as a specialty company is almost nonexistent. We need to be a credible partner going forward in the specialty space and educate on who Lupin is and what our vision is for the future is. We need to be patient centric whilst adding value to the healthcare system and without the big pharma resources. Within specialty care there are often fewer stakeholders and whilst that is attractive from a marketing perspective it also means the impact of getting it wrong is a lot more severe.
Overall, I believe these are exciting times in the UK, especially within Lupin. As leader of the UK organization, I have got to look at the opportunity that Brexit will present, whether hard or soft my job is to successfully lead the UK organization through whatever outcome Brexit brings. As we transition into more specialist medicines, I need to ensure we have the capability to build external credibility and success and deliver value to the NHS and to patients who will receive our specialist products in the future.