With the global economy remaining stagnant, big pharma companies are keen to develop blockbuster drugs that have a high financial ceiling. Rodger McMillan, VP of R&D at Astra Zeneca has said that “big pharma is a cash-rich industry – it has to be,” namely because of the huge costs in developing new drugs – sometimes as much as $200 million.
However major change is championed by the illustrious NGP20 consortium chaired by Ted Torphy, the VP & Head External Research with Johnson & Johnson, Alexander Alanine the Head Chemistry Technologies and Innovating at Hoffman-La Roche, Michael Hepperle the Director and Head of Medical Chemistry and Drugability Properties at Nycomed, Hassan Ramoure the Head of Translational Medicine and Discovery Biomarkers at the University of Cambridge and Patrice Talaga the Director for Chemistry Outsourcing with UCB who are currently looking to discuss how outsourcing and open innovation can bring Big pharma companies closer to blockbuster drug development.
Ted Torphy is set to outline at the NGP20 the need for open innovation looking at the transition between the current utilization of vertically integrated business models to a dis-integration model. The dis-integration model provides a shift that allows for the growth of innovation that becomes stagnant at the peak of vertical integrated models.
Not only can the process of dis-integration afford the opportunity to create radical new business models that align the interests of large pharma with other key constituencies, but R&D productivity can improve only if the various industry stakeholders markedly improve capital efficiency by focusing on the unique contributions that each bring to the drug discovery and development process.
There are both pros and cons to these new collaborative models; the pros include an increase in industry wide outsourcing and the ability for the reduction of costs through drug discovery and development process by giving this process to CROs in emerging regions like Eastern Europe. There will also be a number of CROs like Aptuit, Future Diagnostics, PRA International and Evotec also meeting Ted Torphy to look at how the process can generate blockbuster drugs. This will be in conjunction with understanding strict guidelines set by big pharma and how Intellectual Property will get differentiated when unique corporate development process moves to another company.
With a move to a dis-integration model on the horizon and European outsourcing gaining prominence, the relationship between pharma and CROs will certainly be changing. Concerns about whether the big pharma market can continue to succumb to the communication of price differences between drugs to market – like China and Europe – are shared globally soon after drug release.
Last updated on: 22/11/2010 17:05:54