2014 review of pharmaceutical R and D: challenges and what to expect
Following an overwhelming number of drug approvals in 2014, is the world of Big Pharma returning to business as usual?
The past year has been outstanding with the US FDA approving 41 new chemical entities. Significant progress was made in new drugs for use in oncology and virology;however, pricing for these new therapies has become an issue raising ethical concerns.As of mid 2015, many of the issues discussed in 2014 remain, including employment, corporate restructuring and the effects of the rising drug prices on medical ethics and innovation.
Staff reductions by major pharmaceutical companies continued to make headlines in 2015.However, there are glimmers of positive movement in R&D especially in the smaller Biotech’s.As summarized by David Sell (The Philadelphia Inquirer, 6/l4/l5), large Pharma’s positions have seen a 6% decline between 2007-2013 while Biotech’s positions have increased 5%.There has been an increase in average salary in major Pharma to $113,000 and in the Biotech industry to $129,000.
As indicated in the 2014 review, the hot area in today’s research is immunotherapeutics. Among the key players in the chimeric antigen receptor T cell (CAR-T) area are Juno Therapeutics, Kite Pharma, Bellicum Pharmaceuticals and Bluebird Bio.Complimentary to the CAR-T class are the checkpoint inhibitors.
Merck and BMS lead this field with Pfizer/ Merck Serono rapidly becoming competitive.The US FDA has approved use in patients with melanoma and non-small cell lung cancer.A promising alternative approach to checkpoint modulators is the target indoleamine-2,3-dioxygenase (IDO) alone or in combination with anti-D1 antibody (Incyte) or the anti-PDL1 antibody(Astra Zeneca).
One of the obstacles to the immunotherapeutic approach is associated with the high cost of research and manufacturing.Advanced service based companies are looking to fill that gap through their outsourcing capabilities.For example, WuXi Apptec is constructing a 143,000 sq.ft.facility at its Philadelphia location for just this purpose.The issue of cost will not just go away – it is a major issue facing the pharmaceutical companies.With a calculated average internal rate of return (IRR) of less than 5%, it is difficult to understand how innovative drugs can be discovered and brought to market at a price that is acceptable to society.Arthur Caplan , from Division of Medical Ethics NYU Langone Medical Center (NY, USA) expressed his concern: “there is no sustainable program for access for poor people for hepatitis treatment” ().To better define the issue of medical ethics and drug prices, Peter Bach, Director of Memorial Sloan Kettering's Center for Health Policy and Outcomes (NY, USA), has developed a program, ABACUS, to calculate fair prices for oncology therapeutics. In a similar vein, The American Society of Clinical Oncology has published a drug scorecard to aid frontline physicians and patients through the difficult decision-making process. However, the issue may be larger than oncology and virology. There appears to be an increase in drug prices in general with a 12.2% rise in the first half of this year. One third of the top 140 drugs experienced an increase in cost.( http://www.fiercepharma.com/story/drug-price-increases-hit-record-q2-no-sign-slowdown-analysts-say/2015-07-02))
The 2014 review saw pricing as an issue that required creative thinking, for a new generation of medications have appeared, a generation that has the potential to cure seemingly incurable diseases such as hepatitis C andcancer, based on an understanding and manipulation of the biology of the cell.Such advances take decades of R&D.The gap between the IRR from R&D investments and the availability of such innovative therapies at “affordable prices” will likely widen.This will force extremely difficult decisions on governments, pharmaceutical industry and the many other stakeholders.
For a comprehensive update of drug discovery and development in 2014, read my recent article in Future Medicinal Chemistry found here.