Where the drugs are [from]?

11/04/2010

The In the Pipeline blog called a new article from Nature Reviews Drug Discovery to my attention this morning. The article details where the 252 drugs approved between 1997 and 2005 came from. Your choices are pharma, biotech and universities. Any takers on the results?

58% came from pharmaceutical companies
18% came from biotech companies
24% came from universities

Looks like pharma is ahead thus far. And 76% of drugs come out of industry and not academia.

Using FDA priority date as an "endpoint" for unmet medical need, then 123 of the 252 received priority review. Where did these come from? Any takers on results?

46% were from pharmaceutical companies
30% were from biotech companies
23% were from universities (going to either pharma or biotech)

Looking at the data this way, it looks like the biotech and universities are making the majority of drugs that receive priority review - and most biotech drugs receive priority review. By contrast, most pharma drugs do not receive such.

What if we look at scientific novelty? Forty-six (46%) or 118 drugs were considered to be novel. The survey says.

44% were from pharmaceutical companies
25% were from biotech companies
31% were from universities

Therefore 65% of biotech drugs were classifed as novel, 62% of universities output was deemed novel, and only 36% of pharma was classifed as novel. Uh-oh! One can argue persuasively, perhaps, that the pharma companies tend to shoot for the bigger market applications, and the biotech/universities are overrepresented in comparison in orphan or rare disease categories. However, the pharma companies are producing more me-too products in the bigger categories. This isn't going to cut it in an environment of health care cost control and a need to show comparative value to earn your medical reimbursement. Why approve an also-ran drug?

My take given this data. I think it is rational for Pharma CEOs to conclude that their R&D groups are not delivering as much value as they need. We seem to have created a group of large companies going after similar classes of drugs - a lot of branded "me-tooism". It should not be shocking then when R&D departments are downsized and pharma companies acquire or license from biotech's, or cut deals with academic institutions to bolster their pipelines. Nor should the new push toward orphan and rare diseases by several big companies (Pfizer, Sanofi, GSK, etc.) be surprising - as this is a novel area of unmet need.

Now, I couple this observation with the report from Roland Berger Strategy Consultants that I cited last week. In it, 65% of pharma executives said the industry was in crisis and 78% of these execs said generics was their salvation. Uh-oh! So much for innovation. This would seem to be counter to the actions taken above. It is another version (and less profitable one) of me-tooism - this time generic and or "branded generic". If it quacks like a duck..........

I'd like to re-quote Roche CEO, Severin Schwan from an interview I posted last week on his view of innovative pharma companies going after generics -- and why Roche will NOT follow suit. Roche firmly rejects the idea of "diversifying" into generic drugs, consumer health or animal health. Roche believes that it needs to innovate - i.e. produce novel drugs for unmet needs.

Says CEO Severin Schwann, "A lot of people call it diversification. I call it giving up. Call me biased, but I really believe we have one of the best industry pipelines." Roche may have but it looks like many of the other pharma boys have their work cut out for them.