Big Pharma vs. 'growth pharma'? Let Actavis chief detail the differences

Actavis CEO Brent Saunders

SAN FRANCISCO--Actavis may be a big pharma now that it's joining hands with Allergan ($AGN), but it's not a Big Pharma, CEO Brent Saunders insists. The merger partners are taking the term "growth pharma" and running with it as they set out to differentiate themselves from the industry's slow-growing stalwarts.

As opposed to the peers Actavis ($ACT) will join on the list of top-10 drugmakers by worldwide revenue, the Dublin drugmaker envisions compound annual growth of 10% for its branded drug business, its chief exec said Tuesday at the JP Morgan Healthcare Conference. It'll hit that mark by exemplifying 5 key characteristics it's identified to define "growth pharma," including highly efficient SG&A spending, sustainable commercial franchises with extended IP protection, and a strong global commercial footprint, Saunders said. They're not unfamiliar goals in Big Pharma, of course, but execution is everything.

And while Actavis may not want to follow in Big Pharma's footsteps where growth is concerned, it's certainly singing a familiar tune when it comes to core therapeutic areas. Over the past few years, drug giants have been slimming down to make sure they can prioritize their key areas and focus on what they do well--something Actavis says it'll do with gastrointestinal treatments, eye care, women's health, CNS drugs, and aesthetic dermatology.

If it can be No. 1 or No. 2 in each of those areas, Actavis can create an "ecosystem where everybody wants to bring us their ideas, their innovations, so that we can continually source new things," Saunders said. And he's convinced Actavis can draw in those forward-thinkers. "We're easy to work with. We're action-oriented, we make fast decisions, we're thorough. But we also make polite 'no's' very quickly," he said--something entrepreneurs, VCs and academics respect. Big Pharma isn't exactly known for the same thing.

In the meantime, the company is still working to fold in Allergan's operations--an integration Saunders says is going exceptionally well. "This is probably going along the best of any I've been involved in," he noted--which is saying a lot considering the jump he's made from Bausch + Lomb to Forest Labs to Actavis in the past two years alone. Of course, that's "not to say we don't have our issues or challenges," Saunders said. "But we're working through everything and making very good progress."

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