"Pharmaceutical companies currently challenged with replacing the $65 billion worth of product expected to go off patent in the next four years must dramatically rethink their R&D models for future success,..."
That's the problem...But how does Big Pharma resolve these problems? The article goes on to discuss a new report just released by Deloitte that just might contain a viable set of solutions. Pharmaceutical companies need modify "...current R&D programs focused on developing a small portfolio of high revenue blockbusters...to R&D programs focused on high efficacy treatments developed for smaller patient populations based on specific genotypes."
Deloitte's study goes on to state that:
"The R&D model of the future will incorporate:
-- R&D strategies which support the assembly of treatment portfolios for the entire disease life cycle and the various genotype specific patient segments in the life cycle, rather than the traditional one-off "blockbuster"
-- Focused R&D programs based on genotyped patients/subjects and biomarkers
-- Virtual, disease-specific R&D networks, incorporating patients, physicians and the medical treatment infrastructure, which involves extensive partnering and collaboration with all the disease knowledge communities
-- Virtual R&D processes with significant outsourcing to maximize flexibility and manage development risk"
The complete report from Deloitte can be viewed here.
Interesting food for thought.
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1 comment:
I read the Deloitte report. I found it a little disappointing. It was long on personalized medicine. I can't quibble with that. It makes sense. Every company is talking about it, yet, few are walking the talk. The number of clinical trials involving biomarkers, for example, is a small percentage of the number of trials that are under way or recruiting.
Personalized medicine alone, however, will not solve the pharma R&D productivity problem. Other measures will be required, and fast, but on that count, the Deloitte report is short on specifics.
It does talk about "virtual disease-specific R&D networks". They are onto something there, but it is fuzzy, as if it needed to be thought through some more. A better way to articulate what I believe they have in mind would be to talk about open-source clinical research. This is a powerful, and proven, discovery engine that the drug industry has yet to harness.
They also talk about virtual R&D processes. This is an essential part of the equation that will solve the R&D productivity crisis, but there again the report is sketchy. This is unfortunate as there are interesting experiments under way.
Lastly, the report misses an important aspect of things by failing to recognize that blockbuster economics, the real root of the problem, is a strange world that has little in common with traditional economics. Ignoring this leads to costly management inefficiencies. Thanks to the work of economists, we now start understanding the quirks of that model. For instance, the fact that blockbusters are completely random, and attempts to predict them are pointless. (I actually checked the data and confirmed this.) Another finding is that risk mitigation through portfolio management is impossible. Attempting it actually piles on risk instead of diversifying it, an outcome consistent with industry experience.
What this adds up to is that the pharma model is due for some serious updating. No single measure, or catalog of measures, is going to fix it. There are systemic weaknesses that must be addressed. Unfortunately, the industry is ponderous and wary of change, especially the disruptive kind. This does not bode well. For instance, all big pharmas are staking their future on their ability to register 2 to 3 NMEs per year by 2010. Unfortunately, no one has ever come close to that, even when R&D was much cheaper and easier. (The best that was ever done was slightly less than one per year, and only a couple of companies came close to that. The rest barely averaged 0.5) So I am afraid that, instead of witnessing a resurrection of the industry through personalized medicine, we are going to have lots of broken glass. This does not mean that the industry will disappear, or that pharmacogenomics won't happen, but it does suggest that the industry will be transformed in ways that no report has yet been able to sketch.
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