When TS Eliot said humankind cannot stand very much reality, he obviously did not consider the virtual kind which is now heralded as the key for curing and preventing disease and picked as the potential lifeline for R&D in the pharmaceutical industry.
As the blockbuster drugs of the 90s that earned the industry billions reach their patent shelf lives, pharmaceutical companies require new medicines to sustain an estimated $157bn worth of sales.
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The industry sits at a pivotal point in its evolution and analysts say it can no longer rest on its laurels happy to produce generic drugs while expending vast sums on marketing at the expense of R&D.
Virtual reality
The future, says a report from PricewaterhouseCoopers, lies in computer modelling which has the potential to create a ‘virtual man’ and potentially transform the future for pharmaceuticals.
With academics around the globe already developing models of the heart, organ and cell system and musculoskeletal architecture also being developed, the report says the technology could be used to simulate the physiological effects of certain drugs.
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By GlobalData“To remain at the forefront of medical research, pharma needs a faster, more predictive way of testing molecules before they go into humans,” says Steve Arlington, global life sciences industry advisor leader at PwC.
The technology would allow companies, through computer modelling, to determine which drugs actually have a bearing on a disease before they reach clinical trials, cutting out huge expenses and what is now akin to guesswork in determining medical need.
Some companies using virtual technology have already reduced clinical trial times by 40% and reduced the number of patients required for testing by two thirds, says Arlington.
While virtually modelled molecules will still have to be tested in humans, pharmaceutical companies could optimise their trial designs and minimise the number of patients required for testing, in turn helping them to develop medicines which have value in the eyes of patients and to develop them faster.
The past
Global figures from PwC show that in 2006 only two big pharmaceutical companies earned more than 10% of their revenues from major products that were less than three years old. Those 38 products generated just $10bn of the $316bn industry’s entire portfolio of medicines.
When you consider only five big companies managed to earn 10% of their revenues from products launched after 2001 and those products still only generated income of $30.4bn, you are left with an industry where 90% of its revenue comes from medicines which are more than five years old.
Even so, current figures show firms’ biggest portion of spend is still on marketing and administration at 33.1%, while R&D accounts for just 17.1%. An earlier report from PwC says companies have been playing it safe, developing line extensions as distinct from new development projects.
This is confirmed by the Centre for Medicines Research International which shows in 2004 that more than 20% of the money invested in R&D by ten of the largest pharmaceutical companies went on line extensions, as opposed to new development projects. In smaller companies, it was over 40%.
The present
Richard Ley, spokesman for the Association of the British Pharmaceutical Industry, says the industry in the UK is investing more than £10m daily into new medicine but the benefits will not be seen for more than ten years.
“What you’re seeing [on the market] today is the investment that was made ten or 12 years ago, so you can’t look at today’s [R&D] investment and say that’s applicable to the medicines coming through today.”
Unlike the US where the Food and Drug Administration has been slated for delaying the approval of new medicines, Ley says the British industry has no quarrel with the Medicines and Healthcare products Regulatory Agency.
What it does have a quarrel with is the NHS which, he says, will find excuses not to prescribe approved medicines all the time, referring back to generic options available and almost discouraging new development.
With it currently taking ten to 12 years and up to £550m to get a medicine through testing and approval, he says the UK is effectively turning its back on the most recent developments in medical sciences.
“It’s very disappointing. I think that if you look at the uptake of new medicines…we are pretty well the lowest in Western Europe at 14% and that’s the lowest it’s been in this country since we started records, which is ten or 11 years ago.”
Arlington believes issues which suffocate investments made in R&D by the industry should be high on the socio-political agenda and the report suggests the industry must move toward a more aligned regulatory system.
Currently, in most countries, companies are still prevented from seeking guidance from the relevant government agencies as to medical need, leaving them in the dark over whether a drug will be eligible for reimbursement if it reaches the market, unless of course it treats a disease for which there is no existing therapy.
The report says the infrastructure around regulators vendors and the support industry will have to significantly change.
The future of R&D
By 2020 the in-depth knowledge of the human body and the pathophysiology of disease will be generated through a collaborative research network of companies, academia, independent research houses, IT providers, industry regulators, payers and providers.
“For the first time pharma will have to consider sharing intellectual property with other research bodies and potential new entrants like IT providers,” says Arlington.
The report suggests the industry needs to move toward a situation where once there is sufficient evidence to show a medicine genuinely works and is cost effective a regulator would then be able to issue a live licence allowing the company to market the treatment on a restricted basis.
“The pharmaceutical industry requires better incentives to research and develop medicines that prevent or cure diseases,” says Arlington.
In the UK, Ley says, the association has been trying to communicate this to the government as he believes there is a real threat the pharmaceutical R&D industry could move offshore.
While the UK has been seen as a world leader producing 15% of the world’s top-selling medicines, competition is coming from America, Western Europe, India and China which offer good science, good facilities and good environments to a research-based industry.
Companies are already getting a foothold on R&D in Asia with the likes of Wyeth opening a joint development centre in Beijing with Peking Union Medical College, Roche setting up a research base in Zhangjiang and AstraZeneca planning to do the same.
Eli Lilly, Novartis and GlaxoSmithKline have also set up research bases in Singapore. Ley says the UK can no longer sit back but instead needs to offer incentives for the big players to remain.
“There is a danger of course that they [UK-based companies] could shift. And it’s something I think the UK has to keep its eye very closely on.”
