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for sale, they would simply invest in other industries (e.g. software) that had a much shorter time frame to product launch as well as a significantly lower cost of entry into the industry. Because of this, the investors are then looking for an acquisition or an IPO. These events generally will not occur before a company has its drug in clinical trials, and demonstrated some really solid evidence that it is safe and effective. As a result, many investors (i.e. VC firms) will only provide money if the entrepreneurs can get their drug into clinical trials in a period of 18 to 24 months.
So is this time frame possible? Absolutely. It happens all the time. With many molecular targets, a drug can be found, manufactured at small scale under exacting conditions, and be declared ready to enter the clinic. This early stage is where the critical choices get made, often with little or no data. There are so many decisions to make. Defining the basic biology experiments. Choosing the ultimate composition of the molecule. Establishing a manufacturing process. Biological testing in multiple species. Stability testing. Analytics to define uniformity. Toxicology. The success rate for a drug making it through clinical trials is only about 7 percent. I’ve heard many people blame the FDA for the current low rate of drug approvals. They say they’re too conservative, too focused on safety.
I’d like to propose an alternate interpretation of the data. Drugs are currently failing in clinical trials at a high rate because they enter clinical testing before they are truly ready. And drugs, like people, usually get but a single chance to make a good first impression with both the FDA and investors. Fail in the clinic once as a new drug, and you are done for.
The current approach is simply a formula for failure for biotech startups. This recipe mixes equal parts hubris, financial pressure, and unresolved scientific/medical questions that are whipped together to form half-baked drugs that are poorly understood, designed, and vetted. Cutting corners to save money often backfires. Those of you who have tried to do your own plumbing or electrical work know the meaning of the phrase “the cheap comes out expensive” when you need to hire a pro to fix your mistakes. The drug development process is no different, but is vastly more expensive to repair.
There’s no getting around it: biomedical research is very expensive. So how do we pay for drug discovery research going forward, if Big Pharma doesn’t want to pay for it, and smaller companies can’t always afford to as a result of their limited funding? New approaches are required. Getting the federal government to pay for this doesn’t seem like a viable path; it’s not their job, and they’re already financially constrained (i.e. broke). Industry has been testing out two other approaches in the past few years: shipping research offshore, and establishing agreements with contract research organizations. Can these approaches get the job done?
I’m afraid I have reservations about both of these efforts to boost research productivity. Offshore jobs will certainly be cheaper, but the countries that are getting most of these jobs (e.g. China, India) don’t have a strong record of novel drug development, and quality control is a serious concern. Contract research organizations that perform critical tasks for a fee, but don’t take equity in a drug, can free a biotech company from hiring/firing cycles, as well as provide expertise not available in a small company. There would seem to be some merit to that approach. My concern here, … Next Page »
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