Pharmaceutical Innovation at a Crossroads
Transcript of Pharmaceutical Innovation at a Crossroads
Kenneth I Kaitin, Ph.D. Director and Research Professor
Tufts Center for the Study of Drug Development
Global Clinical Supply Group Annual Meeting Jacksonville, FL, April 4, 2011
The New Face of Pharma R&D
Pharmaceutical Innovation at a Crossroads
The Tufts Center for the Study of Drug Development
Academic
Independent
Multidisciplinary
Strategy and Policy Research Group
Tufts CSDD is an . . .
The Tufts Center for the Study of Drug Development
Agenda
Environment for pharmaceutical innovation
TCSDD’s current drug development metrics
The evolving landscape for innovation
The Current Landscape for Pharma Innovation
Current Realities for Pharmaceutical Developers
Patents on many high revenue products are expiring
Marketplace is highly competitive and reimbursement environment is increasingly restrictive
Public support is low
Regulatory hurdles are increasing
Pharmaceutical R&D remains a long, risky, and expensive process
Patent Expirations of 10 Top Selling Drugs Each Year
2010 2011 2012 2013
Product 2009 Sales
($MM) Product
2009 Sales ($MM)
Product 2009 Sales
($MM) Product
2009 Sales ($MM)
Aricept 3,991 Lipitor 12,535 Plavix 9,801 Cymbalta 4,660
Cozaar 3,561 Advair 7,794 Enbrel 6,575 AcipHex 2,728
Effexor XR 3,182 Zyprexa 4,916 Diovan 6,013 Humalog 1,959
Taxotere 3,034 Levaquin 2,648 Seroquel 5,126 Zometa 1,469
Protonix 2,052 Xalatan 1,737 Singulair 4,660 Niaspan* 853
Flomax 1,970 Concerta* 1,326 Lexapro 3,263 Lovaza 705
Arimidex 1,921 Femara 1,292 Avapro 3,088 Xopenex^ 357
Gemzar 1,363 Xeloda 1,160 Actos 2,532 Zomig^ 166
NovoSeven 1,320 Avelox 1,020 Viagra 1,892 Advicor^ 80
Coreg^ 253 Caduet 548 Avandia 724 Fuzeon^ 26
Total $22,647 Total $34,976 Total $43,674 Total $13,003
*Year of first available generic
^US Sales only
Sources: Kaitin, Clin Pharmcol Ther, 2010;87:356-361; Medco; FDA Orange Book;
(sales data): MedAdNews; www.drugs.com/top200; Medco
Patent Expirations of 10 Top Selling Drugs Each Year – By Company
2010 2011 2012 2013
Product 2009 Sales
($MM) Product
2009 Sales ($MM)
Product 2009 Sales
($MM) Product
2009 Sales ($MM)
Pfizer 3,991 Pfizer 12,535 BMS 9,801 Lilly 4,660
Merck 3,561 GSK 7,794 Amgen/Pfizer 6,575 Eisai 2,728
Pfizer 3,182 Lilly 4,916 Novartis 6,013 Lilly 1,959
Sanofi Aventis 3,034 J&J 2,648 AstraZeneca 5,126 Novartis 1,469
Pfizer 2,052 Pfizer 1,737 Merck 4,660 Abbott 853
Boehringer Ingl 1,970 J&J 1,326 Forest 3,263 GSK 705
AstraZeneca 1,921 Novartis 1,292 BMS/SAN 3,088 Sunovian 357
Lilly 1,363 Roche/Genentech 1,160 Takeda 2,532 AstraZeneca 166
Novo Nordisk 1,320 Bayer 1,020 Pfizer 1,892 Abbott 80
GSK 253 Pfizer 548 GSK 724 Roche/Genentech 26
Total $22,647 Total $34,976 Total $43,674 Total $13,003
Sources: Kaitin, Clin Pharmcol Ther, 2010;87:356-361; Medco; FDA Orange Book;
(sales data): MedAdNews; www.drugs.com/top200; Medco
$3.3
$4.0
$4.6
$4.7
$7.2
$8.8
$9.5
$11.3
$12.9
$29.2
0 35
Forest
J&J
Sanofi Aventis
Merck
AstraZeneca
Novartis
GSK
BMS
Lilly
Pfizer
Billions of US$
‘Industry Leaders’ in Lost Revenues Due to 2010-13 Patent Expirations
Sources: Kaitin, Clin Pharmcol Ther, 2010;87:356-361; Medco; FDA Orange Book;
(sales data): MedAdNews; www.drugs.com/top200; Medco
$3.6
$4.9
$5.3
$5.9
$6.1
$6.8
$8.1
$8.1
$9.2
$9.4
BMS
Lilly
AstraZeneca
Sanofi Aventis
GSK
J&J
Novartis
Merck
Roche
Pfizer
Billions of US$
Top Ten R&D Spenders for 2010
Sources: FierceBiotech, 3/8/11
New Drug Approvals Are Not Keeping Pace with Rising R&D Spending
0
13
26
39
52
0
15
30
45
60
1963 1968 1973 1978 1983 1988 1993 1998 2003 2008
R&
D E
xp
en
ditu
res
(B
illion
s o
f 20
08
$) N
ew
Dru
g A
pp
rov
als
R&D Expenditures
New Drug Approvals
* Trend line is 3-year moving average; R&D expenditure adjusted for inflation
Source: Kaitin, Clin Pharmacol Ther, 2010;87:356-361
http://www.nature.com/clpt/journal/v87/n3/full/clpt2009293a.html
Market Caps for Top-Tier Firms have Dropped $578b in 10 Years
* Market caps for WYE and SGP on 9-10-09
Source: Kaitin, Clin Pharmacol Ther, 2010;87:356-361
http://www.nature.com/clpt/journal/v87/n3/full/clpt2009293a.html
$287
$213
$173
$143
$104 $90 $85 $83
$76
$134
$108 $101
$44 $38
$68 $64
$46
$73
$0
$320
PFE MRK GSK BMY LLY AZN WYE SGP ABT
Bil
lio
ns
of
US
Do
lla
rs
Market Cap on 1-1-01
Market Cap on 11-23-10
.
“Apple Unveils New iPods”, Roger Cheng and Ben Charny
WSJ OnLine, September 5, 2007
High Profits and Falling Stock Prices Reflect Investor Concern About Pipeline Viability and
R&D Performance
Bringing a New Drug to Market: Current Development Metrics
0 11
AIDS Antivirals
Anesthetic/Analgesic
Antiinfective*
Gastrointestinal
Immunologic
Cardiovascular
Endocrine
Antineoplastic
CNS
4.6
5.3
5.4
5.8
6.4
6.5
6.5
6.9
8.1
0.5
0.8
1.2
2.4
1.0
1.3
1.2
0.7
1.9
Years
Clinical Phase Approval Phase
10.0
7.7
7.8
8.2
6.6
5.1
6.1
7.4
7.6
* excludes AIDS antivirals
Clinical and Approval Times Vary Across Therapeutic Classes, 2005-09
Source: Kaitin & DiMasi, Clin Pharmacol Ther, 2011;89:183-188
Overall Clinical Approval Success Rate for NCEs has Dropped to 16%
0 27
CNS
Cardiovascular
GI/Metabolism
Oncology/Immunology
Musculoskeletal
Sys. Antiinfective
8.2%
8.7%
9.4%
19.4%
20.4%
23.9%
Clinical Approval Success Rate
Source: DiMasi et al, Clin Pharmacol Ther, 2010;87:272-277
http://www.nature.com/clpt/journal/v87/n3/full/clpt2009295a.html
Phase Transition Probabilities by Therapeutic Class
0
100
Phase 1-2 Phase 2-3 Phase 3-NDA subm
72%
35%
80%
72%
49%
55%
68%
35%
50%
63%
32%
64%
60%
33%
46%
58%
52%
79%
Tra
ns
itio
n P
rob
ab
ilit
y
Musculoskeletal
Onc/Immunologic
GI/Metabolic
Cardiovascular
CNS
Syst Antiinfective
Source: DiMasi et al, Clin Pharmacol Ther, 2010;87:272-277
http://www.nature.com/clpt/journal/v87/n3/full/clpt2009295a.html
Long Development Times + Low Success Rates = High R&D Costs
0
1500
Non-Clinical Clinical Total Costs
615 626
1,241
439
879
1,318
Millio
ns o
f 2005 D
ollars
Biotech Pharma (Time Adjusted)
Source: DiMasi & Grabowski, Managerial Decision Econ, 2007;28:469-479
Chronic and complex indications
Clinical trial size
Increased protocol complexity
Patient recruitment/retention
Poor preclinical screens and predictive models
Regulatory demands
Commercial demands
Drivers of High Cost, Low Success Drug Development
Source: Tufts CSDD Impact Report, Vol 12, No 3, May/June 2010
For the Research-Based Industry “Business as Usual”
is No Longer an Option
Reported Success Factors – Best Practices of Top-Performing Firms
Focus on core competencies, higher
level of outsourcing, prioritize
resources
Active collaboration with global
regulatory agencies
Enhanced utilization of e-data
management technologies
Global development strategy
Source: Tufts CSDD, 2011
R&D Reorganization
Focused units: e.g., GSK (CEDDs DPUs), PFE, ROG, NVS, BMS, SAN, LLY, AZN
Divested functions: e.g., LLY-Chorus/Vanthys; LLY-Covance; SAN-Covance; BMS-Accenture; AZN-(API); LLY-Advion (bioanalytics)
Partnerships and Alliances
Academic institutions, PPPs, Patient groups
Risk-sharing: e.g., LLY & Quintiles; MRK & PRXL (follow-on biols.)
Pharma/Pharma: e.g., MRK & AZN, SAN & DE:MRK (onc); GSK &
PFE (HIV); Enlight Biosciences (JNJ, LLY, MRK, NVS, PFE, ABT); Asian Cancer Research Group (LLY, PFE, MRK); ADNI (12 companies); BI & LLY (diabetes)
New R&D Strategies: 2 Approaches
Source: Tufts CSDD, 2011
A FIPNet Model for Drug Development: The Emergence of Innovation Nodes
Phase IV
Studies Approval
Late Stage
Development
Early Stage
Development
Discovery
Preclinical
Research
Pre-Discovery
Large Pharma
Academia
Biotechs/
Small Pharma
CROs/Other
Partners
Basic Research Translational Medicine
Execution, Monitoring, Analysis
Innovation, Partnerships
Coordination, Management Execution, Monitoring, Analysis
Large Scale Clinical Trials
Data Analysis
Medical Writing
Regulatory Approval
Source: Kaitin, Clin Pharmacol Ther, 2010;87:356-361
http://www.nature.com/clpt/journal/v87/n3/full/clpt2009293a.html
BOTTOM LINE:
The Innovation Landscape is
shifting. In the new environment,
all stakeholders will have a place at
the table and will share in the risks
and rewards of bioinnovation.
Conclusions
Conclusions
The time, cost, and risk to bring a new
medicine to market continue to represent
formidable challenges for drug developers.
These challenges have led to heightened
focus on R&D efficiency and performance,
and on new strategies, including R&D
reorganization, partnerships, and network
innovation.
Global clinical trial strategies introduce logistical complexity and increase clinical supplies costs (distribution, shipping, packaging, etc.)
Biologics magnify the challenges (cold storage, specialty courier services, etc.)
Industry’s move to targeted medicines increases costs for clinical supplies tailored to stratified patient populations
There is a growing move to FSP relationships with clinical supply providers
Current Trends in Clinical Supplies
Source: Tufts CSDD, 2011
“You can be on the right track,
and moving in the right direction,
but if you’re not moving fast enough,
the train will still run you over.”
Will Rogers
Tufts Center for the Study of Drug Development Tufts University, Boston, Massachusetts, USA
Kenneth I Kaitin, Ph.D. Director and Research Professor
Tufts University School of Medicine
Website http://csdd.tufts.edu
Email [email protected]