Positioning for the Future
Prof. Hugh B. MarriottLong Island University (Brooklyn)orphan drugs, it was not their strategic focus. Positioning for the Future. It is estimated that there are between 5,000 and 8,000 known rare diseases in the world. In the decade leading up to 1983, only 10 orphan drugs entered the market, according to the FDA. Since the act was passed, over 300 orphan drugs have been developed and approved. Most were developed by biotechs and nearly all of them have been clinically important. Genzyme proved that a business could be built around small disease populations and demonstrated its ability to profitably serve markets that seemed financially unjustified. Since Cerezyme, it has introduced three more “zyme” therapies—drugs for genetic diseases caused by enzyme deficiencies. Aldurazyme treats 400 children and adults in over 30 countries who have MPS–1 in what is referred to as an “ultraorphan” disease. More than 1,700 patients in over 40 countries receive Fabrazyme for Fabry disease. In 2006, Myozyme was approved in Europe and the United States for Pompe disease, a debilitating and often fatal muscle disorder that affects fewer than 10,000 people.
Genzyme maintained the diversified posture that had enabled it to survive the early years of developing Cerezyme, and in 2008 its businesses were organized into four reporting units: genetic diseases (the division that homed the enzyme disorder treatments), cardiometabolic and renal (which produced treatments for renal diseases and cardiovascular diseases), biosurgery (which produced biotherapeutics and biomaterials),and hematologic oncology (which produced treatments for cancer). In 2009 the company had seven major late–stage projects in its pipeline, including alemtuzumab for multiple sclerosis, Clolar for adult acute myeloid leukemia, and mipomersen for familial hypercholesterolemia. In 2011, Sanofi (a French drug company) bought Genzyme for $20 billion.
Both companies argued that the deal expanded their reach: For Sanofi, Genzyme offered deeper know–how in biological drugs and a greater research presence in the United States; for Genzyme, Sanofi offered broader manufacturing and sales resources.
Instructions
Based on your reading of the case, please provide a report in the case study format giving a summary, the key issues you identified and why you consider them issues, and your recommendations for addressing the issues you have identified