One week it was Pfizer buying GlaxoSmithKline. Then it was Johnson & Johnson or Roche swallowing GSK.It was a busy spring.And wasn't GSK giving up research on new drugs anyway?

Wrong on the research and ignore the "hullabaloo" about a takeover, Moncef Slaoui, GSK's chief of vaccines, said in a recent interview.

GSK, which is based in London and employs thousands in and around Philadelphia, got approval July 24 from a European Medicines Agency committee for what would be the first malaria vaccine.

Selling vaccines worldwide is a key part of GSK's strategy, especially because of the market trends in the United States.

A KPMG survey of industry leaders released Tuesday said 47 percent described "increasing payer pressure on drug pricing" and showing positive outcomes as having the biggest effect on commercial operations during the next five years.

"These are dramatic changes in bringing drugs to market and are far removed from the blockbuster model of marketing drugs," Alison Little, KPMG's U.S. life-sciences leader, said in a statement.

Slaoui suggested some reality for pharma cheerleaders: First, most Americans think drug prices are way too high and sooner or later the bottom will fall out from those firms trying to milk the big profits. Second, high-priced drugs that treat only a few patients and claim a disproportionate share of national health spending will cripple the broken system even faster.

"Our conviction - with the board, [CEO] Andrew Witty and the other executives - is that the current pricing model is unsustainable in the long run," Slaoui said. "We need to prepare ourselves to be an equally profitable business by shifting a little bit the volume-price equation. It doesn't mean we only do non-innovative products. Not for a second. So, for our partners, there is nothing that changes, even in oncology, where people think we're exiting. We have some quite exciting programs to talk about at our research-and-development day in November."

In the hours after GSK chief executive officer Witty spoke to securities analysts and reporters in London on May 6, some wondered whether he would have his job at the end of the week, much less in November. With realistic pricing, GSK will use its vaccine, over-the-counter, and prescription-drug units to "swim with" the global tide of developed nations trying to cut health costs rather than against it, Witty said.

"Going forward, the anxiety and pressure on this industry will only increase," Witty said. "The ability of companies to achieve super-high prices, for product after product, in a small number of markets is limited."

The pushback has already begun. Three doctor and hospital groups recently proposed guidelines to curb high-cost cancer drugs. University of Pennsylvania ethicist Ezekiel Emanuel railed at the high prices and lack of a sensible system at a June 15 conference here.

GSK's new chairman, Sir Philip Hampton, backed Witty, saying at the shareholders' meeting May 7, "I hope Andrew is here for a good while to come," according to the Financial Times.

Witty has cut U.S. jobs and consolidated facilities. GSK will eventually vacate a rented office in Renaissance Corporate Center in Upper Merion, with some people moving to the larger nearby facility in Upper Merion and others to Upper Providence.

Gilead Sciences has been criticized because its hepatitis C drugs, Sovaldi and Harvoni, have 12-week price tags of $87,000 and $95,000. But they almost always cure the disease, eliminating the need for costly liver transplants. Merck's Keytruda and other new high-priced immunotherapy cancer drugs often only slow tumor growth in a tiny group of patients. Keytruda is approved so far only for advanced melanoma, which has 76,000 new patients a year.

"From a pricing standpoint, we really need to be aware that a very small percentage of patients in the U.S. consume a very large percentage of the cost of health care for a benefit that is expressed in months to prolong survival," said Slaoui, who trained in immunology.

"It is a very hard message to send. If I was that cancer patient and I have a chance to live five more years - not the average six more months - I would like that opportunity," Slaoui said. "Unfortunately in today's world, at some point, society is going to ask the question: Is this the best allocation of our resources or shouldn't we ask the system to price medicines lower? This is exacerbated by new immunotherapies.

"Our analysis is that something is going to have to give and part of that give is on the pricing dimension, because it is quite disproportionate."

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