By Shane Cooke
The pharmaceutical industry faces a significant challenge to provide genuinely improved treatment options for patients and healthcare systems that are also cost-effective. New drug output continues to stagnate, while NCE (new chemical entity)-related R&D costs continue to escalate. Addressing these challenges requires pharmaceutical companies to rethink their approaches to new drug discovery and development by creating and commercializing sustainable product portfolios that address real patient needs. Drug delivery has a key role to play in providing companies with a source of new product opportunities to enhance their ailing portfolios.
Drug Delivery-Based Products — Driving Industry Growth
Drug delivery-based product growth has outpaced total pharma growth in the last decade and is expected to account for 32% of U.S. pharmaceutical product sales by 2012, according to IMS. This positive trend is clearly reflected in the fact that approximately 75% of drug approvals by the FDA in the past 10 years have been for new or improved formulations of existing drugs that incorporate drug delivery technology. More than 200 drug delivery products were launched in the last decade with 20 approvals alone in 2009.
While many approaches exist to “life cycle manage” a product, those pursued using drug delivery approaches have proven more effective than most, particularly where patient/clinical benefits are apparent. New formulation strategies have been shown to deliver the best returns on investment, proving significantly more effective than an OTC/branded generic route, repositioning, or new indication. Indeed a Merrill Lynch industry report found that 87% of “switch-and-grow” strategies not only sustained the value of the original franchise, but increased its sales following the switch to the improved product.
A Platform Of Solutions — Key To Success
For a drug delivery company to remain viable and provide real value, it is imperative that it offer its clients not only a number of validated protected technology solutions but also a set of sophisticated capabilities that add real value to their projects. There are over 1,000 companies that class themselves as drug delivery companies, and while many of these offer simple controlled-release technologies, many are one-technology companies with limited capabilities and track records. Companies that have been most successful are those that offer a whole platform of solutions.
While oral drug delivery is still the most active in terms of deals signed, the market has evolved over the past number of years with a variety of solutions now being sought beyond the more traditional oral extended/controlled release options.
Importance Of Validated Technologies
When speed to market for a life cycle management strategy is key, a drug delivery solution is a significantly faster way of getting approval than, for example, an NCE with average time from initial development to market approval being approximately 6 years (NCE average over 10 years). A recent Bionumbers report showed that a product with a validated technology has twice the chance of gaining approval over an unvalidated one. Considering that every six-month delay in launch results in an average revenue loss of around $100M as calculated by PriceWaterhouseCoopers, having a proven technology supported by proven capabilities behind the product innovation is key.
Drug delivery systems can play a significant role in portfolio enhancement for the pharmaceutical industry. Advancement in technologies and intensifying industry competition will lead to drug delivery systems growth as companies seek opportunities to extend the lives of, and indeed enable, their drug candidates. Changes in healthcare approaches internationally will also favor drug delivery where improving therapeutic outcomes, compliance, and the reduction of the overall cost of patient treatment will be helped through the application of such solutions.
Shane Cooke is EVP and head of Elan Drug Technologies. He was appointed a director of Elan in May 2005. He joined the company as executive VP and CFO in July 2001 and was additionally appointed head of EDT in May 2007. Prior to joining Elan, he held a number of senior positions in the banking and aviation industries. Mr. Cooke is a chartered accountant and a graduate of University College Dublin, Ireland.