Productivity in Medical Innovation

Yesterday morning, I read an article in the New York Times about a new federal drug development effort housed at the National Institute of Health (NIH) whose purpose will be to help produce new medicines.  Gardiner Harris writes, "the Obama administration has become so concerned about the slowing pace of new drugs coming out of the pharmaceutical industry that officials have decided to start a billion dollar government drug development center to help create new medicines."  I thought about this article for most of the day (in between football games, of course). Aside from the obvious questions about the government competing in the market place (didn't it just sell its share of General Motors), a few things kept coming up in my mind:

  1. Innovating new medications isn't easy. It is incredibly complex, time consuming and expensive.
  2. The role of the FDA is critical.
  3. Public-private partnerships are important.

The challenge of discovering new medications continues to grow.In one of our first LillyPad articles, my colleague, Greg Kueterman, writes about how innovation requires thick skin.  It does!  In an open letter in the Indianapolis Star, our CEO, John Lechleiter, wrote, "The path we have chosen is not an easy path, nor has it ever been. Because the path is rooted in scientific and medical innovation, there will be times when we will suffer setbacks and experience failure. That is the nature of the work we undertake."

Innovating in the bio-pharmaceutical space is risky, there are no guarantees to the significant investments we must make to bring a new medication to market.  Below are a few things to consider regarding innovation in our industry (Check out our Value of Medicine (the link doesn't exist anymore) for more details):

  1. In 2009, biopharmaceutical companies invested about $65 billion in research and development (R&D).  Lilly invests approximately 20% of our revenues into R&D activities.  This is more than any other industry. This is also more than 15 times the amount spent on direct to consumer advertising.
  2. The R&D process is very long (about 10-15 years), complex, and expensive (about $1.3 billion to discover and bring one medication to market).  To put this into perspective, $1.3 billion is the cost it took to build the new Yankee Stadium.
  3. Only 1 out of every 5,000 to 10,000 potential molecules ever makes it to the marketplace.  Of the molecules that make it to market, only 20% ever make enough profit to coverage average R&D costs.

Productivity in the biopharmaceutical industry can naturally fluctuate. The complexity of a disease, stage in clinical trials, and requirements of the FDA all impact how quickly medicines are brought to market.

The FDA plays a central role in bringing medications to market.  The partnership between biopharmaceutical companies and the FDA doesn't begin when a new drug application (NDA) is submitted.  The collaboration begins with phase 1 clinical trials and continues until after the drug review is submitted. The FDA is charged with examining the effectiveness and safety of medications, and this can take time.  The Prescription Drug User Fee Act (PDUFA) allows the FDA to collect user fees from companies for the purpose of drug review.  (For a brief primer on PDUFA, check out Eye on the FDA's blog). For nearly 20 years, PDUFA has helped to speed drug review times, advancing public health. 

According to the PhRMA website (the link doesn't exist anymore):

"Despite its considerable progress, the FDA has suffered recent setbacks. By its own admission, the Agency has been struggling to make new medicines available to patients efficiently and to provide physicians with additional tools in the fight against serious and life-threatening disease. FDA missed user fee goals for nearly 40 percent of certain priority drug and biologics applications it reviewed in Fiscal Year 2008. It is essential to return to the original mission of PDUFA: New drug reviews must be accomplished in a way that is efficient, predictable and well-coordinated within FDA."

Collaborations between the NIH, academia, and biopharmaceutical companies are important to bringing new treatments to market.  Funding for the NIH, and similar bodies, represents a critical public investment. Insights into basic science provided by the NIH and academia have led to some new treatment approaches, drug targets, or new medications.  However, public investment in development instead of basic research may not be the answer.    One NIH study reveals that of the 47 top-selling medications, 43 were developed without NIH funded technologies.  The public-private partnership between NIH, academia, and bio-pharmaceutical companies will continue to be critical for the future discovery of new treatments.

Innovating new medications isn't easy. It is incredibly complex, time consuming and expensive.  Innovation for new treatments often doesn't occur at the pace that patients (or we) wish. Innovation takes time, years.  But we are not giving up.  We will continue to invest in R&D for new treatments. The future of medicine is changing.  We are the on the precipice of delivering tailored therapies, delivering the right medication to the right patient at the right time.  Imagine what our future can look like.