Neal Dunkinson — Up-to-date business planning

Earlier this year, Thomson Reuters released the 2009 Edition of the CMR International Pharmaceutical R&D Factbook, which provides data to help companies make more informed business decisions. Pharmaceutical Technology Europe speaks to Neal Dunkinson, Commercial Development Manager at CMR International, Thomson Reuters, to find out more.

Q1: The CMR International Pharmaceutical R&D Factbook has been described as an "up-to-date business planning tool". Can you give us examples of information included in the book that can aid decision making?
CMR International runs an annual series of pharmaceutical R&D benchmarking programmes. Pharma companies that participate in these programmes provide current drug development information and receive a variety of detailed reports measuring various key performance indicators. The R&D Factbook collates a number of top-level metrics to create an industry summary.

Success rate and cycle time analyses can support capacity planning decisions by estimating the likelihood of success and the time required for drugs reaching final stages of development.

Q2: What emerging trends in global pharma R&D are discussed?
The R&D factbook reports on the key areas of global pharma R&D including therapeutic area focus, patents and R&D resources.

Some key trends observed include:

• Reduced numbers of launched NMEs, and increasing development times and costs during the last 10 years provides an accurate summary of the current situation faced by the pharma industry.
• Therapeutic area creates considerable variance in both the probability of success to market and the cycle times for individual phases.
• Generic pharmaceutical activity in India is growing at a faster rate than the rest of the world. The number of ANDA final approvals has almost doubled since 2006 and is now on a par with the USA.

Q3: Have any surprising statistics been published in this year's edition of the factbook?

• The number of new active substances (NAS) is at an all time low of 23. (“New active substances” include 21 NMEs (including biologics) plus radiopharmaceuticals).
• Clinical research consumes 37% of R&D expenditure.
• In 2008, 33% of NMEs were first marketed in the US, down from 61% in 2006 and 46% in 2004.
• 31% of anti-infective NASs that reach the stage of first patient dose are successfully marketed compared to 12% of CNS drugs.
• 51% of new biopharmaceutical entities (NBE) that reach the stage of first patient dose are successfully marketed compared to 19% of new chemical entities (NCE).

Q4: The number of new molecular entities being launched is at a 20-year low. What factors are contributing to this situation?
It is becoming increasingly difficult and costly to bring NMEs to market. Late stage attrition rates are responsible for the failure of many promising candidates; numbers of Phase III terminations between 2006 and 2009 almost doubled in comparison to pervious year ranges.

The R&D factbook updates many of the popular analyses in each annual cycle. Changes over time in these metrics can be observed as the industry responds to the many challenges faced.

Q5: How is this lack of innovation impacting the pharmaceutical manufacturing industry?
The growth of the pharmaceutical industry has dropped below double-digit increments for the first time in many years. When coupled with the increasing generic competition to products reaching patent expiry, companies are introducing significant cost-cutting measures, such as large-scale redundancy schemes, to minimize the impact and risks caused by reduced sales potential and manufacturing requirements. The market is currently evolving as the hunt for blockbuster drugs is not providing the necessary results.

The US accounted for 60% of NME launches in 2006, though this has dropped to 33% more recently. However, despite the reduction in NME launches, sales are still increasing through effective globalization and lifecycle management strategies.

Q6: Do you think there are any possible solutions that could help improve the situation?
Recent strategy workshops held with CMR clients highlighted the importance of proof of concept in measuring the transfer of projects from discovery through to clinical development.

It is also vital to address the high rates of attrition in Phase II. Effective understanding and management of R&D performance metrics can help identify the differences between high and low performing projects, and reduce the risk of costly late stage failures.

Q7: India leads the way in new molecular entity research. What factors have contributed to the country's success?
The distinction between generic and innovative pharmaceutical companies is becoming more blurred. Generic medicine companies are now venturing into innovative medicine research with those based in India leading the way.

The Factbook discusses the growing influence and activity of emerging market generic companies. The numbers of products predicted to lose exclusivity are listed through to 2013, giving insight into potential future patent challenges and generic opportunities.

Q8: What impact is the threat of generics having on the pharma industry?
Generic competition for innovative products is fierce. Upon patent expiry, sales from a blockbuster drug can reduce to a fraction of previous levels through the introduction of cheaper generic alternatives.

Without the continued innovation and launch of new drugs, the pharmaceutical industry cannot survive.

http://cmr.thomsonreuters.com/http://cmr.thomsonreuters.com/services/factbook