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Thought-provoking


The Evolution Of Pharmaceutical R&D Model

   by Andrii Buvailo    1185
The Evolution Of Pharmaceutical R&D Model

There is a plethora of analytics reports, including ones by Deloitte, DKV Global, and Ernst and Young, all pointing out to a declining business performance of the pharmaceutical industry. They all convey a similar bottomline message: the decline is not due to a lack of innovation (the innovations are growing). And not because sales are falling or markets are shrinking (revenues are growing in general, and the markets are expanding with the expanding and ageing population). The key reason of the declining financial performance is the fact that research and development (R&D) costs are growing substantially faster over an average investment period, than the actual revenues over the same period. This kills operational profits, leading to a decline in the overall business gain. A direct consequence of that -- an increasingly stagnating industry, cutting sometimes promising R&D programs, jobs etc.  

There are two more relevant questions here: 

1) why R&D costs are growing faster than revenues, considering that technological progress is seemingly providing more and more optimal and powerful technologies to pharma companies at a constantly decreasing specific price (e.g. costs of computation, sequencing, screening and many other things are falling), and 

2) what to do about it to reverse the decline in pharma industry performance? 

The Growth Imperative: Why The Next Big Pharma Competitor Could Be Google Or Apple

   by Jacob LaPorte    415
The Growth Imperative: Why The Next Big Pharma Competitor Could Be Google Or Apple

In a seminal work published by McKinsey & Company – The Granularity of Growth, a detailed study of the performance of the 100 largest US corporations over the two most recent business cycles – a key finding emerged: top-line growth is vital for survival.

To dig a bit deeper, the study found that a company whose revenue increased slower than the growth of U.S. GDP was five times more likely to falter in the next cycle than a company that expanded more rapidly. Companies have a “Growth Imperative,” which is to either “grow or go,” the authors concluded; in other words, companies must grow faster than their peers or else be left behind.

Antibiotic Research and Development - Public vs. Private Funding

   by David Shlaes    486
Antibiotic Research and Development - Public vs. Private Funding

Over the past decade, pull incentives as a solution to the broken antibiotic market have been proposed to entice companies into antibiotic research and development.  These incentives would essentially provide a market, and therefore a return on investment for pharmaceutical companies. Almost all of today’s inadequate antibiotic pipeline is provided by biotech and small pharma.  All are threatened with loss of investor interest because of the failed marketplace and many are experiencing difficulty in raising funds either from public or private markets.  One alternative to providing money to the “evil” pharmaceutical industry via a substantial pull incentive is to create publicly funded non-profit organizations or public-private ventures that would essentially replace the industry in antibiotic research, development and commercialization. Two proponents of this approach are Lord Jim O’Neill (of the O’Neill Commission or Antimicrobial Resistance Review fame) and Ramanan Laxminarayan of the Center for Disease Dynamics, Economics and Policy and of GARDP. Both, clearly, are key thought leaders in the area. 

Will 2019 Bring Positive Signals for the Declining Antibiotics R&D Market?

   by David Shlaes    985
Will 2019 Bring Positive Signals for the Declining Antibiotics R&D Market?

Antibiotic R&D has had a particularly bad year starting with The Medicines Company who abandoned their antibiotic R&D efforts and sold their antibiotic assets to Melinta late last year right after getting approval for vabomere. This year both Sanofi and Novartis abandoned their antibiotic R&D efforts and divested their clinical and preclinical assets. Allergan, holder of the North American rights to ceftaroline, dalbavancin and ceftazidime-avibactam, also announced that they would divest their antibiotic assets. I have not heard that they were successful. Achaogen has now undergone two efforts at “restructuring” involving virtually eliminating all R&D and has essentially put up the “for sale” sign just after achieving approval for plazomicin. Finally, Melinta abandoned their antibiotic R&D efforts in the face of miserable sales of their recently launched antibiotics including delafloxacin and vabomere.

Get Ready For “Super-platforms” In Healthcare and Pharmaceutical Research

   by Andrii Buvailo    3057
Get Ready For “Super-platforms” In Healthcare and Pharmaceutical Research

What is a super-platform?

A “super-platform” is a term which describes a relatively new phenomenon in a modern technological world -- an online-to-offline (O2O) type of digital infrastructure, which spans across multiple sectors of economic activity providing a way for users (both businesses and consumers) to operate with multiple resources, products and services within a uniform, standardized, and highly interconnected way.

Imagine, you want to be able to search for information, shop online, pay for products and services, communicate with someone by email, or chat, create and manage text and spreadsheet documents, translate them into any language on the go, store and organize data like photos and videos, find local restaurants and get driving directions, or just entertain yourself by playing games -- and you prefer to have all of that in one place without needing to search for numerous websites and resources? You can do just that in your single Google account. This is what a super-platform does: it provides a way to conveniently engage in totally different types of activity across different sectors.