Click to buy Guest Editorial (2 pages)

New Developments in Pharmacogenetics Marvin Cassman, Ph.D.

Abstract: Voltaire complained that doctors poured drugs of which they knew little to cure diseases of which they knew less into human beings of whom they knew nothing. Since Voltaire's time we have learned a great deal about drugs and diseases, but much less about the humans who are being treated. Pharmacogenetics is an attempt to understand individual differences in drug response by looking at the inherited variations in the receptors for drugs as well as at enzymes and other proteins involved in their modification and excretion. Although the use of broad genome-wide information (sometimes called pharmacogenomics) is a relatively new field, pharmacogenetics research goes back at least 40 years.

©2000 by The Journal of BioLaw & Business. All Rights Reserved.

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Click to buy Feature Article (5 pages)

Transaction Trends: The Loss of Pooling: How Well Can Biotechnology Stay Afloat If Mergers Dry Up? Eileen Smith Ewing

Abstract: The organization responsible for setting United States accounting standards has announced its plans to eliminate "pooling of interests," a technique of accounting for mergers and acquisitions, late in 2000. Pooling has fueled the mergers and acquisitions frenzy in technology-based industries in recent years. This is because book value has little relation to purchase price in these industries. If a purchaser uses the pooling method, it need not jeopardize future reported earnings by having to amortize as goodwill any premium it paid over the target's book value. The alternative approach to merger accounting, the "purchase" method, requires amortization of goodwill and thus can deflate an acquiror's stock prices years into the future. High technology industry groups, including those representing biotechnology, have protested the planned elimination of pooling as likely to inhibit merger activity and thus slow industry growth. This article analyzes the potential impact of the pooling decision on the biotechnology industry and identifies some unique features of the industry that may insulate it from ill effects.

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Abstract: Financially troubled biotechnology companies should consider the powerful protections and rights afforded by theUnited States (U.S.) Bankruptcy Code. The Bankruptcy Codeoffers companies an opportunity to gain shelter from creditor and shareholder harassment, focus on core strengths, restructure their businesses, raise additional capital, and obtain a "fresh start," usually in one forum. Biotechnology companies, however, face a unique array of issues because of the nature of the biotechnology business. Complicated license arrangements and strategic partnerships, volatile stock price movement (often leading to shareholder litigation), and the ever-pressing need for additional capital pose significant legal and business challenges. Biotechnology management teams should be aware of the opportunities and the potential need for innovative solutions, including bankruptcy and reorganization. Some of the key issues likely to face biotechnology companies considering bankruptcy, which can be dealt with advantageously, include 1) technology transfers, 2) shareholder lawsuits, and 3) public offerings of securities. Of course, each particular set of facts and circumstances must be carefully considered in determining a proper corporate strategy. 1 This article reviews U.S. bankruptcy law and provides an overview of the legal and business issues and opportunities that financially troubled biotechnology companies ought to consider.

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Abstract: Increasing interactions between private biomedical interests and academic researchers have led to the emergence of concern about possible financial conflicts of interest which could affect the integrity of scientific research. Academic institutions and professional societies have developed policies to encourage full disclosure of such conflicts. The U.S. Food and Drug Administration has now adopted new regulations requiring sponsors of most clinical studies to either certify that each of their extramural researchers, including spouses and dependent children, have no financial conflicts of interest or to enumerate, with some specificity, the nature of such conflicts. Conflicts which arise during clinical studies and for one year thereafter must be reported. Therefore, Investigator Agreements should now include provisions for such disclosure by investigators; and corporate policies should be developed to accommodate business consulting needs with the need to avoid potential bias by clinical investigators.

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Click to buy Feature Article (6 pages)

The Law of Misconduct in Biological Research: Implications for Research Institutions, Biotechnology, and Pharmaceutical Companies James A. G. Hamilton

Abstract: Investigation, exoneration, and punishment of scientific misconduct in biomedical research have, over the last fifteen years, become the subject of regulation enforced by the Office of Research Integrity of the Public Health Service. Over the same period, universities, independent research institutions, and small businesses taking advantage of increased technology transfer from government-funded research have struggled with incidents of misconduct, particularly because ORI requires preliminary assessments and investigations by the funded entity. From these experiences, model procedures and a body of precedent have developed, providing substantial guidance to concerned institutions and individuals. This article, appearing in The Journal of BioLaw & Business, addresses issues of scientific misconduct in biological research, with specific emphasis on the implications for research institutions, biotechnology, and pharmaceutical companies.

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Abstract: One of the more distressing formulations of the second law of thermodynamics is that there are a great many more ways for something to be broken than whole. The human form is (unfortunately) no exception. It is difficult not to be overcome with a certain wonder that living creatures maintain their forms against the undeviating onslaught of entropy for as long as they do. But over time there is a steady loss of useful information for all complex biological entities, a process that results ultimately in death and manifests itself along the way as disease. Sometimes the loss of useful information is caused by little understood processes that we refer to, collectively, as aging. Other times information is lost due to unsuccessful encounters with microorganisms or the myriad hard, hot, cold, pointy, or heavy items in the world that can so easily disrupt the delicate balance of a living body. Over the past five decades, scientists have unraveled the secrets of the genetic code and domesticated yeast, bacteria, and mammalian cells to synthesize proteins useful to humankind. Our understanding and mastery of single cell organisms is nothing short of astounding. Our knowledge of multi-cellular organisms, by comparison, remains rudimentary. There is nothing comparable to the simplicity and elegance of the double helix that explains the development, differentiation, maintenance, and repair of the tissues that comprise a complex organism such as man. The signals that keep a trillion cells humming along in perfect cooperation for most of a normal lifespan are just beginning to be unraveled. While medical doctors are quite adept in waging war against microorganisms and in fine tuning biological processes so as to stave off tissue damage, they are nearly powerless in correcting severe tissue damage once it has occurred. If the damage is not too great, the body can often heal itself with minimal physician assistance once the harmful circumstance is eliminated. Examples are setting a broken bone or bandaging a superficial wound. But if the damage is too great the body may no longer possess the information necessary to recreate itself. The result is unorganized scar in place of functional tissue. If severe damage occurs to a vital organ, such as the heart, kidney or liver, then the informational loss is so severe that homeostasis is compromised. A replacement organ provided by a donor is then necessary for the patient's survival. This Commentary provides an overview of emerging issues and precedes selected Abstract: s of Remarks from the first annual conference organized by Techvest, LLC.

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Genomics: A Systematic Approach to Regenerative Medicine
William A. Haseltine, Ph.D.
Human Genome Sciences

The Engineering of Living Tissues: Core Technologies for an Emerging Industry
Robert M. Nerem, Ph.D.

Georgia Tech/Emory Center for the Engineering of Living Tissue
 The Business of Tissue Engineering and Cellular Medicine
 Michael J. Lysaght, Ph.D. and Nancy Nguy, Ph.D.
 Center for Biomedical Engineering
 Brown University

The Life Initiative: A Multi-Center Collaboration to Address The Vital Organ Shortage
 Michael V. Sefton, Ph.D.
 Institute of Biomaterials and Biomedical Engineering
 University of Toronto

Overview of Advanced Tissue Sciences
 Gail K. Naughton, Ph.D.
 Advanced Tissue Sciences, Inc.

Tissue Replacement: Here Today at a Medical Center Near You
 Alan Tuck and Carol Hausner
 Organogenesis, Inc.

Current Status of Articular Cartilage Repair: A Practicing
Orthopaedic Surgeonís View
Vladimir Bobic, M.D.
Royal Liverpool University Hospitals/The Grosvenor Nuffield Hospital

Orthobiologics: "Software" for Musculoskeletal Repair
James M. DeMesa, M.D.
GenSci Regeneration Sciences, Inc.

Tissue Engineered Heart Valves
Kirby S. Black, Ph.D.
CryoLife, Inc.

Developmental Biology as a Drug Development Platform
George Eldridge
Vice President, Finance and Chief Financial Officer
Ontogeny, Inc.

Hyaluronan-Based Scaffolds in Tissue Engineering
Dr. Alessandra Pavesio
FAB srlóFidia Advanced Biopolymers

Tissue Transplantation Technologies, Inc.
George Oram, Executive Vice President
Musculoskeletal Transplant Foundation

©2000 by The Journal of BioLaw & Business. All Rights Reserved.

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Abstract: The genomics revolution has yet to result in actual sales of diagnostics and therapeutics. Rather, participants are still doing deals and making valuations based on future expectations of genomics technology and its impact. The leading edge of the genomics enterprise, and the area where pharmaceutical companies (which are underwriting the majority of the genomics industry) are expecting the biggest payoff is pharmacogenomics. Pharmacogenomics is perhaps the key route to commercializing genomics and associated disciplines such as proteomics and bioinformatics. From a clinical and drug development standpoint, pharmacogenomics seeks to correlate the genotype of the patient—determined through molecular diagnostics—with the patients response to particular medications.Many pharmacogenomics enterprises are taking shape. Including the development of gene-based molecular diagnostics tests, gene-based therapeutics, and informatics-based products for health care applications. The entire enterprise is driven by the wealth of new targets being generated by genomics. Ultimately, the goal of pharmacogenomics is to streamline drug discovery and development into a scientific process, rather than a hit-or-miss approach.

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Click to buy Biocolumn Federal Circuit (4 pages)

Recent Federal Case Undermines Multi-Filing Patent Strategies: A Routine Foreign Filing Trips Up a Patent Holder Title Bruce D. Sunstein

Abstract: In Tronzo v. Biomet, the Federal Circuit placed limits on the right of priority enjoyed by a later-filed application with respect to subject matter that is in common with that of an original application. The intervening publication of a foreign counterpart to the original application was held to invalidate claims in the patent issuing on the later application. Although the holding is flawed, it is still important. Companies with multi-filing patent strategies will need to plan in order to avoid unintended loss of patent rights.

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Abstract: The Internet offers a tremendous opportunity to improve the efficiency of communication. Traditional business processes that rely on interpersonal interactions are enhanced, not replaced, by the World Wide Web. In the field of technology transfer of intellectual property (IP), platformsystems have been created and commercialized to assist licensing professionals with the process of identification and introduction of scientific innovations. This article presents one unique model and describes the advantages of “e-licensing” in the life sciences.

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Abstract: Clinical trials are the crucible of the biotech industry. For many of the nation’s more than 1300 biotech companies, years of discovery research for their new products culminate in the human testing process, leading inexorably either to positive data, successful regulatory review and commercialization, or to inconclusive or negative results that can easily destroy the company’s viability. Any clinical data that drives a company’s plans to continue or discontinue clinical development of the product are likely to be viewed as “material” news from a legal point of view. Public disclosure of material information (that is, information considered to affect an investor’s decision on whether to purchase a company’s stock) must be not only accurate but complete. “Companies more often get in trouble not for what they say in a press release but for what they don’t say,” points out Constantine Alexander of the Boston law firm of Nutter, McClennen & Fish. The announcement of Phase I results, primarily to establish safety of the product, is generally viewed as a routine event. Phase II outcomes, which may establish the proof of principle for the product in man, and thereby provide an initial indication of whether the product will be efficacious, are viewed as key. Phase III results, demonstrating both safety and efficacy of the product, constitute the core of a New Drug Application filing and are therefore critically important.

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Abstract: The United Kingdom (UK) National Health Service (NHS) began another period of extensive reform following the election of a Labour Government in May 1997. New bodies have been created to improve the quality of NHS services. The new agencies include a National Institute of Clinical Excellence (NICE) which issues guidance on new technologies and clinical practice, and a Commission for Health Improvement (CHI) which monitors compliance with national regulations. The UK spends about 8 % of gross domestic product (GDP) on healthcare, but this seems to be inadequate to meet demand. Overt rationing of healthcare is now on the national agenda. Health Technology Assessment (HTA) is used as the “scientific fix” for rationing. This article discusses some of the issues arising from the attempts at “scientific rationing” within the UK, particularly as they impact on the UK pharmaceutical industry.

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Click to buy Financing Biocolumn (7 pages)

1999 Ends on a Positive Note for Biotechnology The Public Equity Markets Soar, Boding Well for the Industry as the New Millennium Begins G. Steven Burrill

Abstract: The year 1999 ended on a high note for the biotech industry with renewed interest in biotech stocks (even "effervescent" public markets at year-end), many stocks more than doubling in value during the year, and a number of companies completing successful initial public offerings (IPOs) during the fourth quarter. But even with all the industry's promise, the year 2000 looks to be another turbulent one for biotech, as it faces many challenges, including increased consumer anxiety over genetically modified organisms (GMOs), election year politics about reforming the healthcare system, continued integration and disintegration in the pharmaceutical industry (and the attendant question of the "life sciences" strategy for the big pharma/chemical companies), volatile public equity markets, and the ethical challenges presented by increased access to information about the human genome changing drug discovery/development and disease diagnosis/treatment.

©2000 by The Journal of BioLaw & Business. All Rights Reserved.

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