Top exec at GE Medical Diagnostics describes effect of folding in Amersham

March 7, 2005

The promise of personalized medicine, with treatments defined and adjusted to fit individual patients, is drawing GE Biosciences into the future. This vision is nothing new for the group’s leaders. For years, they have talked about customizing radiopharmaceuticals, as well as x-ray and MR contrast agents, to unmask the molecular signs of dementia, cancer, and cardiovascular disorders.

The promise of personalized medicine, with treatments defined and adjusted to fit individual patients, is drawing GE Biosciences into the future. This vision is nothing new for the group's leaders. For years, they have talked about customizing radiopharmaceuticals, as well as x-ray and MR contrast agents, to unmask the molecular signs of dementia, cancer, and cardiovascular disorders.

Their vision, articulated a decade ago when they were part of Nycomed Amersham, matched that of leaders at GE. Last year, these leaders successfully negotiated to make the company called Amersham Health since 2001 part of GE. Before and since the merger, Amersham has dominated the in vivo diagnostics marketplace, generating more than a billion dollars annually from the sale of imaging agents.

The prospect of hooking into a market segment distinct from its own, the complementary nature of Amersham's products, and potential synergies between equipment and pharmaceuticals convinced GE to acquire the company.

Daniel L. Peters, COO and president of Medical Diagnostics at Amersham Health, today oversees the operations of Medical Diagnostics at GE Biosciences. In an interview with DI SCAN, Peters discussed how the merger has changed operations at the former Amersham business unit, the opportunities coming from the merger, and the blending of cultures in the pharmaceutical and equipment sides of GE Healthcare.

SCAN: From your perspective, what has come of the merger?

Peters: I think we are fortunate in the sense that this is the blending of two market leading companies in two different areas: a diagnostic pharmaceutical business and a diagnostic imaging equipment business. That has minimized the conflicts. We have disciplines and skill sets that must be maintained in the respective areas, and this has allowed us to start talking about some best practices that we can bring forward to each other.

We have some discipline and rigor on the pharmaceutical side that is necessary because of the regulatory process. Those skill sets can be transferred to the technology teams. As an example, the technology teams can draw upon the skill set in Medical Diagnostics regulatory submissions to get the best value out of the work they are doing. We're also starting to bring teams together to talk about how to take these practices and bring them to bear on projects of mutual interest.

SCAN: Are there examples of the two sides working together?

Peters: It's still early in the integration, but the use of carbon 13 in regard to molecular imaging with MR is an example. This work is requiring a good bit of coordination. We have to build image recognition capabilities on the equipment in conjunction with the medical chemistry to make sure we can make the right product to capture the best diagnostic image. It would be possible, if we weren't integrated, but it would be very painful. Everyone would be wondering about whose proprietary information each side was stepping on. Not having to worry about this is going to help.

SCAN: Has the merger affected your corporate vision?

Peters: The vision of personalized healthcare had been shared between GE and Amersham long before the merger. It's what really drove this union to happen. If anything, the merger is making it possible for us to realize our vision of personalized healthcare in a way that brings benefit to patients and customers. But much of this is longer term. Vision is, by definition, room to keep inventing.

SCAN: Has the merger changed what you do?

Peters: It probably has given us more of a bullish attitude that the vision is doable. There still is some evolution that has to take place. Every little step along the way hasn't been fleshed out completely yet, but the continuum is coming together and we are starting to see what we have to do. We have the chemistry. Now we have the imaging hardware. So we have the critical mass to actually put the resources behind the vision and make it come true. We think we are the best positioned company in personalized healthcare.

SCAN: In the past we've talked about the need for Amersham to be more closely tied to the development of therapeutics (SCAN 2/28/01). Are you still working toward that end?

Peters: We are working with Pfizer in this regard, and other companies are interested in working with us. In working more closely with pharma companies, we can make sure that our diagnostics are on the market when the therapeutics are on the market and vice versa so there will be a true benefit to the patient.

We have always believed that effective diagnosis is critical to effective therapy application. We are looking at developing the proper molecular diagnostics to actually see the progression or remission of disease as therapies are applied. We think our connectivity to therapy will strengthen as time goes on, particularly as molecular diagnostic products come to the forefront.

SCAN: Does being part of GE affect your ability to develop relationships with pharma companies?

Peters: In terms of working with pharmaceutical companies, certainly people will know who we are when we call with the GE name. Knowing that we now bring good medicinal chemistry research and technological capabilities increases our ability to deliver good solutions to pharma companies. However, in terms of basic diagnostic pharmaceutical research, we will still be relying on the medical diagnostics team.

SCAN: How do you develop synergy from the R&D groups of these two distinctly different companies?

Peters: The blending of the companies is creating great opportunities for cross-fertilization of some really smart people. We're bringing those talents together to come up with new ideas that previously had been limited because of concerns about maintaining proprietary positions.

We have started working as project teams on initiatives that we think have value-adding opportunities for GE, customers, and patients. People working on CT scanners and MR scanners are working with the people who make the compounds. They're excited about the opportunity to get together and talk about how they can make the image resolution better and make sure they have the right chemistry or hardware or pulse sequences. These people just love doing this. We already have people moving from the Biosciences business up to GE's Global Research Center to help work on projects that have mutual benefit across both businesses. They are excited to do that.

SCAN: What projects are they working on?

Peters: I won't mention any specific products at this juncture. But we will certainly be working with our x-ray (contrast) people and their CT and x-ray people to identify opportunities to grow the business as well as MR's piece of the business. We're doing the same in molecular imaging with the PET (equipment) team. There are clearly opportunities to work together there - to bring products to market.

SCAN: One great opportunity would be to find a better PET agent than rubidium for cardiac PET/CT. Are you looking at that?

Peters: Good suggestion. We will certainly take that under advisement.

SCAN: You are already developing something on that, aren't you?

Peters: We are doing a lot of work across many disease areas. The disease areas we work on are cardiology, oncology, and neurology. There is no question we will be working with all modalities in those disease areas to find the best opportunity to get molecular imaging, so that we can really diagnose disease as it occurs.

SCAN: I see a difference in culture between the Biosciences and equipment businesses. Whereas I see an openness in discussing what's coming next, for example, in PET/CT with the Discovery VCT (PET hybrid with 64-slice CT), I see great caution from you in being too specific about the things you are working on. Is this because you have a longer development time and you have to be more cautious because of it?

Peters: I think that is a fair statement. We have talked about the fact that we have products in development for angiogenesis, which is oncology. We have products for Alzheimer's. We are not trying to be secretive, but we try not to talk about products until we have completed extensive clinical trials. It's just a policy that we have so that when we give you information, it is information you can count on.

SCAN: I don't see a lot of joint customer marketing opportunities coming out of this merger. In speaking with Joe Hogan, who addressed the equipment side (SCAN 1/24/05), he noted only ultrasound.

Peters: Ultrasound is very technique-specific, more so than any of the other modalities. The equipment settings are important. Understanding how to read the images with ultrasound contrast media is critical. So combining our two forces together to do the technical sell - and ultrasound is a very technical sell - makes a lot of sense. Education is one of the keys to being successful in this segment, and I think bringing these together for that particular segment makes a lot of sense.

SCAN: Are there no other segments that this combining of forces would help? What about PET and PET radiopharmaceuticals?

Peters: We will look at all opportunities to create value for the business and better support our customers. At present, the unifying of ultrasound makes the most sense. Relative to PET, a similar synergistic effect is not that obvious. However, we will evaluate other opportunities as our product offerings expand.

SCAN: We've seen an evolution from GE's "see and treat" to its new "predict, diagnose, inform, and treat." It's an elaboration of this earlier philosophy that requires the use of biomarkers to achieve visualization. When in this paradigm do you use these agents as in vitro diagnostics and when do you go to in vivo?

Peters: I think this comes back to personalized healthcare. Every one of us is different. Every disease is different. There is a general categorization of disease, but the way it affects each patient is different. So in some patients, maybe in vitro will give the information we need to make the diagnosis and identify the treatment we need. In other patients, it will be a combination of in vitro and in vivo. Maybe in some patients, we will see the disease process perfectly with the first PET scan. In others, maybe we won't. Personalized healthcare will enable us to best treat patients across a broad continuum based on their specific needs.

SCAN: How do you decide whether to use an in vivo test?

Peters: It will be up to the physician as to what test to use. It is our responsibility to bring them as many tools as we can so they can give the best diagnosis. That is the direction we are taking. We are going to help doctors identify disease when it is occurring. So if there is an opportunity with in vitro to do that, we will do it there as well as in vivo.