The price of innovation: new estimates of drug development costs.

The research and development costs of 68 randomly selected new drugs were obtained from a survey of 10 pharmaceutical firms. These data were used to estimate the average pre-tax cost of new drug development. The costs of compounds abandoned during testing were linked to the costs of compounds that obtained marketing approval. The estimated average out-of-pocket cost per new drug is 403 million US dollars (2000 dollars). Capitalizing out-of-pocket costs to the point of marketing approval at a real discount rate of 11% yields a total pre-approval cost estimate of 802 million US dollars (2000 dollars). When compared to the results of an earlier study with a similar methodology, total capitalized costs were shown to have increased at an annual rate of 7.4% above general price inflation.

Innovation in the pharmaceutical industry: New estimates of R&D costs.

The research and development costs of 106 randomly selected new drugs were obtained from a survey of 10 pharmaceutical firms. These data were used to estimate the average pre-tax cost of new drug and biologics development. The costs of compounds abandoned during testing were linked to the costs of compounds that obtained marketing approval. The estimated average out-of-pocket cost per approved new compound is $1395 million (2013 dollars). Capitalizing out-of-pocket costs to the point of marketing approval at a real discount rate of 10.5% yields a total pre-approval cost estimate of $2558 million (2013 dollars). When compared to the results of the previous study in this series, total capitalized costs were shown to have increased at an annual rate of 8.5% above general price inflation. Adding an estimate of post-approval R&D costs increases the cost estimate to $2870 million (2013 dollars).

Animal models of soft-tissue sarcoma.

Soft-tissue sarcomas (STSs) are rare mesenchymal tumors that arise from muscle, fat and connective tissue. Currently, over 75 subtypes of STS are recognized. The rarity and heterogeneity of patient samples complicate clinical investigations into sarcoma biology. Model organisms might provide traction to our understanding and treatment of the disease. Over the past 10 years, many successful animal models of STS have been developed, primarily genetically engineered mice and zebrafish. These models are useful for studying the relevant oncogenes, signaling pathways and other cell changes involved in generating STSs. Recently, these model systems have become preclinical platforms in which to evaluate new drugs and treatment regimens. Thus, animal models are useful surrogates for understanding STS disease susceptibility and pathogenesis as well as for testing potential therapeutic strategies.

The cost of biopharmaceutical R&D: Is biotech different?

The costs of developing the types of new drugs that have been pursued by traditional pharmaceutical firms have been estimated in a number of studies. However, similar analyses have not been published on the costs of developing the types of molecules on which biotech firms have focused. This study represents a first attempt to get a sense for the magnitude of the R&D costs associated with the discovery and development of new therapeutic biopharmaceuticals (specifically, recombinant proteins and monoclonal antibodies [mAbs]). We utilize drug-specific data on cash outlays, development times, and success in obtaining regulatory marketing approval to estimate the average pre-tax R&D resource cost for biopharmaceuticals up to the point of initial US marketing approval (in year 2005 dollars). We found average out-of-pocket (cash outlay) cost estimates per approved biopharmaceutical of $198 million, $361 million, and $559 million for the preclinical period, the clinical period, and in total, respectively. Including the time costs associated with biopharmaceutical R&D, we found average capitalized cost estimates per approved biopharmaceutical of $615 million, $626 million, and $1241 million for the preclinical period, the clinical period, and in total, respectively. Adjusting previously published estimates of R&D costs for traditional pharmaceutical firms by using past growth rates for pharmaceutical company costs to correspond to the more recent period to which our biopharmaceutical data apply, we found that total out-of-pocket cost per approved biopharmaceutical was somewhat lower than for the pharmaceutical company data ($559 million vs $672 million). However, estimated total capitalized cost per approved new molecule was nearly the same for biopharmaceuticals as for the adjusted pharmaceutical company data ($1241 million versus $1318 million). The results should be viewed with some caution for now given a limited number of biopharmaceutical molecules with data on cash outlays, different therapeutic class distributions for biopharmaceuticals and for pharmaceutical company drugs, and uncertainty about whether recent growth rates in pharmaceutical company costs are different from immediate past growth rates. Copyright © 2007 John Wiley & Sons, Ltd.

The distribution of sales revenues from pharmaceutical innovation.

OBJECTIVE: This report updates our earlier work on the returns to pharmaceutical research and development (R&D) in the US (1980 to 1984), which showed that the returns distributions are highly skewed. It evaluates a more recent cohort of new drug introductions in the US (1988 to 1992) and examines how the returns distribution is emerging for drugs with life cycles concentrated in the 1990s versus the 1980s. DESIGN AND SETTING: Methods were described in detail in our earlier reports. The current sample included 110 new drug entities (including 28 orphan drugs), and sales data were obtained for the period 1988 to 1998, which represented between 7 and 11 years of sales for the drugs included. 20 years was chosen as the expected market life for this cohort, and a 2-step procedure was used to project future sales for the drugs--during the period until patent expiry and then beyond patent expiry until the 20-year time-horizon was completed. Thus, the values in the first half of the life cycle are essentially based on realised sales, while those in the second half are projected using information on patent expiry and other inputs. MAIN OUTCOME MEASURES AND RESULTS: Peak annual sales for the top decile of drugs introduced between 1988 and 1992 in the US amounted to almost $US1.1 billion compared with peak sales of less than $US175 million (1992 values) for the mean compound. In particular, the top decile accounted for 56% of overall sales revenue. Although the sales distributions were skewed in both our earlier and current analysis, the top decile in the later time-period exhibited more rapid rates of growth after launch, a peak that was more than 50% greater in real terms than for the 1980 to 1984 cohort, and a faster rate of expected decline in sales after patent expiry. One factor contributing to the distribution of sales revenues becoming more skewed over time is the orphan drug phenomenon (i.e. most of the orphan drugs are concentrated at the bottom of the distribution). CONCLUSION: The distribution of sales revenues for new drug compounds is highly skewed in nature. In this regard, the top decile of new drugs accounts for more than half of the total sales generated by the 1988 to 1992 cohort analysed. Furthermore, the distribution of sales revenues for this cohort is more skewed than that of the 1980 to 1984 cohort we analysed in previous research.

Salmeterol enhances the cardiac response to gene therapy in Pompe disease.

Enzyme replacement therapy (ERT) with recombinant human (rh) acid α-glucosidase (GAA) has prolonged the survival of patients. However, the paucity of cation-independent mannose-6-phosphate receptor (CI-MPR) in skeletal muscle, where it is needed to take up rhGAA, correlated with a poor response to ERT by muscle in Pompe disease. Clenbuterol, a selective β2 receptor agonist, enhanced the CI-MPR expression in striated muscle through Igf-1 mediated muscle hypertrophy, which correlated with increased CI-MPR (also the Igf-2 receptor) expression. In this study we have evaluated 4 new drugs in GAA knockout (KO) mice in combination with an adeno-associated virus (AAV) vector encoding human GAA, 3 alternative β2 agonists and dehydroepiandrosterone (DHEA). Mice were injected with AAV2/9-CBhGAA (1E+11 vector particles) at a dose that was not effective at clearing glycogen storage from the heart. Heart GAA activity was significantly increased by either salmeterol (p<0.01) or DHEA (p<0.05), in comparison with untreated mice. Furthermore, glycogen content was reduced in the heart by treatment with DHEA (p<0.001), salmeterol (p<0.05), formoterol (p<0.01), or clenbuterol (p<0.01) in combination with the AAV vector, in comparison with untreated GAA-KO mice. Wirehang testing revealed that salmeterol and the AAV vector significantly increased performance, in comparison with the AAV vector alone (p<0.001). Similarly, salmeterol with the vector increased performance significantly more than any of the other drugs. The most effective individual drugs had no significant effect in absence of vector, in comparison with untreated mice. Thus, salmeterol should be further developed as adjunctive therapy in combination with either ERT or gene therapy for Pompe disease.

Development and Characterization of Monovalent and Bivalent RNA Aptamers Targeting the Common Pathway of Coagulation

Anticoagulant agents are commonly used drugs to reduce blood coagulation in acute and chronic clinical settings. Many of these drugs target the common pathway of coagulation because it is critical for thrombin generation and disruption of this portion of the pathway has profound effects on the hemostatic process. Currently available drugs for these indications struggle with balancing desired activity with immunogenicity and poor reversibility or irreversibility in the event of hemorrhage. While improvements are being made with the current drugs, new drugs with better therapeutic indices are needed for surgical intervention and chronic indications to prevent thrombosis from occurring.

A class of therapeutics known as aptamers may be able to meet the need for safer anticoagulant agents. Aptamer are short single-stranded RNA oligonucleotides that adopt specific secondary and tertiary structures based upon their sequence. They can be generated to both enzymes and cofactors because they derive their inhibitory activity by blocking protein-protein interactions, rather than active site inhibition. They inhibit their target proteins with a high level of specificity and bind with high affinity to their target. Additionally, they can be reversed using two different antidote approaches, specific oligonucleotide antidotes, or with cationic, “universal” antidotes. The reversal of their activity is both rapid and durable.

The ability of aptamers to be generated to cofactors has been conclusively proven by generating an aptamer targeting the common pathway coagulation cofactor, Factor V (FV). We developed two aptamers with anticoagulant ability that bind to both FV and FVa, the active cofactor. Both aptamers were truncated to smaller functional sizes and had specific point mutant aptamers developed for use as controls. The anticoagulant activity of both aptamer-mutant pairs was characterized using plasma-based clotting assays and whole blood assays. The mechanism of action resulting in anticoagulant activity was assessed for one aptamer. The aptamer was found to block FVa docking to membrane surfaces, a mechanism not previously observed in any of our other anticoagulant aptamers.

To explore development of aptamers as anticoagulant agents targeting the common pathway for surgical interventions, we fused two anticoagulant aptamers targeting Factor X and prothrombin into a single molecule. The bivalent aptamer was truncated to a minimal size while maintaining robust anticoagulant activity. Characterization of the bivalent aptamer in plasma-based clotting assays indicated we had generated a very robust anticoagulant therapeutic. Furthermore, we were able to simultaneously reverse the activity of both aptamers with a single oligonucleotide antidote. This rapid and complete reversal of anticoagulant activity is not available in the antithrombotic agents currently used in surgery.

Economics of new oncology drug development.

PURPOSE: Review existing studies and provide new results on the development, regulatory, and market aspects of new oncology drug development. METHODS: We utilized data from the US Food and Drug Administration (FDA), company surveys, and publicly available commercial business intelligence databases on new oncology drugs approved in the United States and on investigational oncology drugs to estimate average development and regulatory approval times, clinical approval success rates, first-in-class status, and global market diffusion. RESULTS: We found that approved new oncology drugs to have a disproportionately high share of FDA priority review ratings, of orphan drug designations at approval, and of drugs that were granted inclusion in at least one of the FDA's expedited access programs. US regulatory approval times were shorter, on average, for oncology drugs (0.5 years), but US clinical development times were longer on average (1.5 years). Clinical approval success rates were similar for oncology and other drugs, but proportionately more of the oncology failures reached expensive late-stage clinical testing before being abandoned. In relation to other drugs, new oncology drug approvals were more often first-in-class and diffused more widely across important international markets. CONCLUSION: The market success of oncology drugs has induced a substantial amount of investment in oncology drug development in the last decade or so. However, given the great need for further progress, the extent to which efforts to develop new oncology drugs will grow depends on future public-sector investment in basic research, developments in translational medicine, and regulatory reforms that advance drug-development science.

Returns to R&D on new drug introductions in the 1980s.

This study finds that the mean IRR for 1980-84 U.S. new drug introductions is 11.1%, and the mean NPV is 22 million (1990 dollars). The distribution of returns is highly skewed. The results are robust to plausible changes in the baseline assumptions. Our work is also compared with a 1993 study by the OTA. Despite some important differences in assumptions, both studies imply that returns for the average NCE are within one percentage point of the industry's cost of capital. This is much less than what is typically observed in analyses based on accounting data.

The quantity and quality of worldwide new drug introductions, 1982-2003.

We examined trends in the introduction of new chemical entities (NCEs) worldwide from 1982 through 2003. Although annual introductions of NCEs decreased over time, introductions of high-quality NCEs (that is, global and first-in-class NCEs) increased moderately. Both biotech and orphan products enjoyed tremendous growth, especially for cancer treatment. Country-level analyses for 1993-2003 indicate that U.S. firms overtook their European counterparts in innovative performance or the introduction of first-in-class, biotech, and orphan products. The United States also became the leading market for first launch.

New business models for antibiotic innovation.

The increase in antibiotic resistance and the dearth of novel antibiotics have become a growing concern among policy-makers. A combination of financial, scientific, and regulatory challenges poses barriers to antibiotic innovation. However, each of these three challenges provides an opportunity to develop pathways for new business models to bring novel antibiotics to market. Pull-incentives that pay for the outputs of research and development (R&D) and push-incentives that pay for the inputs of R&D can be used to increase innovation for antibiotics. Financial incentives might be structured to promote delinkage of a company's return on investment from revenues of antibiotics. This delinkage strategy might not only increase innovation, but also reinforce rational use of antibiotics. Regulatory approval, however, should not and need not compromise safety and efficacy standards to bring antibiotics with novel mechanisms of action to market. Instead regulatory agencies could encourage development of companion diagnostics, test antibiotic combinations in parallel, and pool and make transparent clinical trial data to lower R&D costs. A tax on non-human use of antibiotics might also create a disincentive for non-therapeutic use of these drugs. Finally, the new business model for antibiotic innovation should apply the 3Rs strategy for encouraging collaborative approaches to R&D in innovating novel antibiotics: sharing resources, risks, and rewards.

Drug-drug interaction studies of cardiovascular drugs involving P-glycoprotein, an efflux transporter, on the pharmacokinetics of edoxaban, an oral factor Xa inhibitor.

BACKGROUND: Edoxaban, an oral direct factor Xa inhibitor, is in development for thromboprophylaxis, including prevention of stroke and systemic embolism in patients with atrial fibrillation (AF). P-glycoprotein (P-gp), an efflux transporter, modulates absorption and excretion of xenobiotics. Edoxaban is a P-gp substrate, and several cardiovascular (CV) drugs have the potential to inhibit P-gp and increase drug exposure. OBJECTIVE: To assess the potential pharmacokinetic interactions of edoxaban and 6 cardiovascular drugs used in the management of AF and known P-gp substrates/inhibitors. METHODS: Drug-drug interaction studies with edoxaban and CV drugs with known P-gp substrate/inhibitor potential were conducted in healthy subjects. In 4 crossover, 2-period, 2-treatment studies, subjects received edoxaban 60 mg alone and coadministered with quinidine 300 mg (n = 42), verapamil 240 mg (n = 34), atorvastatin 80 mg (n = 32), or dronedarone 400 mg (n = 34). Additionally, edoxaban 60 mg alone and coadministered with amiodarone 400 mg (n = 30) or digoxin 0.25 mg (n = 48) was evaluated in a single-sequence study and 2-cohort study, respectively. RESULTS: Edoxaban exposure measured as area under the curve increased for concomitant administration of edoxaban with quinidine (76.7 %), verapamil (52.7 %), amiodarone (39.8 %), and dronedarone (84.5 %), and exposure measured as 24-h concentrations for quinidine (11.8 %), verapamil (29.1 %), and dronedarone (157.6 %) also increased. Administration of edoxaban with amiodarone decreased the 24-h concentration for edoxaban by 25.7 %. Concomitant administration with digoxin or atorvastatin had minimal effects on edoxaban exposure. CONCLUSION: Coadministration of the P-gp inhibitors quinidine, verapamil, and dronedarone increased edoxaban exposure. Modest/minimal effects were observed for amiodarone, atorvastatin, and digoxin.