Pharmaceutical Companies Will Use Virtual R&D to Increase Innovation and Reduce Commercial Deficit, According to New PricewaterhouseCoopers Report, Pharma 2020
NEW YORK, June 20, 2008 (PRIME NEWSWIRE) — By 2020 the pharmaceutical research and development (R&D) process may be shortened by two-thirds, success rates may dramatically increase and clinical trial costs could be cut substantially, according to a report issued today by PricewaterhouseCoopers entitled Pharma 2020: Virtual R&D, which path will you take?
The report forecasts that new computer-based technologies will create a greater understanding of the biology of disease and the evolution of ‘virtual man’ to enable researchers to predict the effects of new drug candidates before they are tested in human beings. Along with changes underway in the regulatory and socio-political environment, this will enable the pharmaceutical industry to overcome one of the most fundamental issues it needs to resolve over the next decade: The lack of innovative new drugs being introduced into the market.
As outlined in PricewaterhouseCoopers’ previous report Pharma 2020: The Vision, the pharmaceutical industry is at a pivotal point in its evolution, particularly in relation to R&D. The patents on many medicines launched in the 1990s will expire over the next few years, leaving pharma very exposed. Only four out of the top 10 companies have enough products in their pipelines to fill the impending revenue gap.
“Plummeting productivity of effective novel treatments in the lab means incremental improvements to R&D are no longer enough,” said Steve Arlington, PricewaterhouseCoopers’ global pharmaceutical and life sciences industry advisory leader. “The resulting commercial deficit in pharma has enormous implications for the industry, society and governments as a whole. To remain at the forefront of medical research, help patients live longer, healthier lives and deliver the revenue returns shareholders have come to expect, pharma needs a faster, more predictive way of testing molecules before they go into humans.”
“Equally, as a society we must acknowledge that we cannot afford to suffocate the investments made by the pharmaceutical industry in R&D; a concern that should be high on the socio-political agenda,” added Arlington. “We have to face the issue that if pharma is no longer financially capable of this, there is a question where the next new medicine will come from.”
‘Virtual man’ could ultimately evolve from the deployment of existing technologies that are connected in a new way. Some companies using virtual technology have reduced clinical trial times by 40 percent and reduced the number of patients required by two-thirds. Models of the heart, organ, cells systems and musculoskeletal architecture are already being developed by academics around the world. Such technologies can be used to simulate the physiological effects of interacting with specific drugs and identify which drugs have a bearing on the course of a disease.
Of course, virtually-modeled molecules will still have to be tested in real human beings. However, as a complete picture is developed of human biology and as reliable biomarkers for identifying and monitoring patients become widely available, pharma companies will be able to optimize their trial designs and minimize the number of patients on whom new medicines are tested. They will develop treatments that have value in the eyes of patients, healthcare payers and for the companies themselves.
The necessary in-depth knowledge about the human body and the pathophysiology of disease will be generated through a collaborative research network of pharmaceutical companies, academia, independent research houses, IT providers, industry regulators, payers and providers. For the first time pharma will have to consider sharing intellectual property (IP) with other research bodies and potentially new entrants such as IT providers.
By 2020, decisions about reimbursement and licensing will fall under the auspices of regulatory bodies that are much more aligned with industry and other stakeholders. By 2020, the cumbersome, all-or-nothing approach will be replaced by a cumulative process, based on the gradual accumulation of data. Once there is sufficient evidence to show that a medicine genuinely works and is cost effective in the initial trial population, the regulator will be able to issue a “live license”, allowing the sponsoring company to market the treatment on a restricted basis. With each incremental increase in evidence of safety, efficacy and value, the regulator will extend the license to cover more patients, different indications or different formulations, the study predicts.
The pharmaceutical industry requires assistance in the form of better incentives to research and develop medicines that prevent or cure disease. Today the industry IP frameworks do not provide the incentives needed to alter the agenda from one of treatment to that of prevention and cure, note the authors.
“New technologies can play a major role in helping pharmaceutical companies move forward — enhancing its ability to produce treatments that deliver measurable improvements in safety, efficacy and ease of compliance – treatments that have value in the eyes of healthcare payers as well as those of the companies making them,” said Anthony Farino, PricewaterhouseCoopers’ U.S. pharmaceutical and life sciences advisory leaders. “They will also deliver substantial savings — they could collectively halve development times and attrition rates, thereby reducing costs per drug dramatically.
He added, “Technology is not the answer to all pharma’s problems. Many companies as well as the infrastructure of regulators and vendors that support the industry will have to make significant strategic, organizational and behavioral changes. Overhauling R&D requires a decision on whether the organization wants to produce mass-market medicines or specialty therapies, where they want to be located geographically to have access to the best skills or cost base and whether they want to outsource most of their research and development or keep it in-house. The choices they make will have a profound bearing on the business models and mix of skills they require as well as the skills of those who support them. Connectivity – technological, intellectual and social – will ultimately enable us to make sense of ourselves and the diseases from which we suffer.”
About PricewaterhouseCoopers’ Health Industries Group
PricewaterhouseCoopers’ Health Industries serves as a catalyst for change and the leading advisor to organizations across the health continuum, including payers, providers, health sciences, biotech/medical devices, pharmaceutical and employer practices in the public, private and academic sectors. With a distinctive approach that is collaborative, multi-disciplinary and multi-industry, PricewaterhouseCoopers draws from its broad perspective and capabilities across and beyond the health industries to help solve the array of emerging complex problems health organizations face, lead cultural and clinical transformation, and create a new sustainable model for care delivery that is quality-driven, patient-centered and technology-enabled.
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CONTACT: PricewaterhouseCoopers LLP Clare Chachere (512) 867 8737 clare.cachare@us.pwc.com The Hubbell Group, Inc. Lisa Stearns (781) 878-8882 lstearns@hubbellgroup.com