With pipelines drying up drug companies turn to schools for help
May/11/2008 08:06 Filed in: Pharma
Business
From
this weeks Business Week
Magazine:
On
a rainy Friday in early May, two scientists from
vastly different worlds met at a bar near Boston's
Fenway Park to talk business. One was Dr. Stephen
Friend, a top cancer executive at struggling
drugmaker Merck. The other was Dr. Ronald DePinho, a
professor of medicine at Harvard University. The
topic: a new alliance Merck and Harvard have formed
in the war against cancer. This is nothing like past
partnerships between industry and academia, in which
drugmakers helped fund discoveries at the university
but relied on their own teams to come up with
commercial products. In this case, Merck expects its
Harvard allies to stay involved throughout the drug
development process. "We're creating a larger
discovery enterprise," says DePinho.
No matter where the new products come from the fact remains that pharma is doing everything possible to find the next new blockbuster. However, the question remains; "How many blockbusters are out there?" Are the days of the billion dollar drugs gone and should pharma be concentrating on The Long Tail in drug development and marketing?
The environment is not conducive for blockbusters. New & improved replacements for aging drugs have to prove efficacy against generics and insurers are doing all they can to hold down costs. Pfizer's took a risk with a possible replacement for Lipitor and as a result lost hundreds of millions of dollars in development costs. So where do drug companies invest their R&D dollars?
This author believes that in fact a new class of products will begin to appear in the market for serious diseases like diabetes and cancer. There is already a great PR campaign underway to showcase these new products as more and more stories begin to appear in everything from business magazines to consumer health magazines. The race is on to patent these new therapies but as development takes longer it means more dollars for R&D and higher costs for patients and payers as drug companies recoup costs.
With the new bread of CEO's taking over new business models will need to be developed and DTC marketing will need to be reexamined. Already the big players in the pharma world are downsizing their sales force but sales forces today are still bloated and there are cost effective better ways to reach physicians with messages.
So alliances with universities to find new treatments is a great idea and good investment. The next great blockbuster just might come courtesy of Harvard Medical School from someone who is not bogged down by drug company development guidelines and is not afraid to ask "what if..."
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