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February 13, 2008
Pharma Companies Reexamine R&D Processes
The pharmaceutical industry is fully aware that not as many drugs are making it to market and product pipelines are not as robust as they once were. To respond to this challenge many pharmaceutical companies have reexamined their market strategies and taken a long hard look at their R&D processes. Among these is AstraZeneca. The December 2007 issue of PharmaExec includes an interview with AZ's head of Global Marketing, John Patterson, who explained some of the changes the company has made to adapt to the new R&D frontier. As Patterson pointed out, there are many factors behind trend of fewer drug approvals in recent years, including a different acceptance of what is a reasonable risk/benefit ratio for a treatment.
In the article, "R&D Innovation: Climbing Out", Patterson explained a new R&D regimen that he has implemented at AZ - Quality on Time. The core basis of this outlook is to take a hard look at each molecule and be more honest and upfront from the earliest stages of development about potential risks and benefits. The goal is to raise the quality of the molecules the company pursues which in the long run will help AZ avoid spend much less time and money on poor molecules.
The second main factor to the Quality on Time regimen is saving time - not in a way that would put patient safety at risk - but in making better go/no-go decisions early on so that the company can move forward more quickly and make investments with more calculated risks. In fact, the goal of the new R&D process is to get drugs developed and approved within eight years - a radical improvement from AZ's historic average timeline of 11 years (currently the company estimates it is running at about nine years).
AstraZeneca appears to be taking large steps in the right direction. Instead of putting more and more molecules into the development pipeline for the sake of volume, the company is concentrating on the ones that are most likely to come to fruition and provide valuable revenue streams for the company. This school of thought appears to be the right way of looking at developing new pharmaceutical treatments going forward - focus on quality not volume.
Another trend Patterson pointed out is that pharmaceutical companies are going to become more flexible in seeking new ways to acquire quality molecules - either through partnerships or buyouts. This trend is evident; Pfizer's purchase of biotech CovX underscores this strategy in play. Pharmaceutical companies have been clever enough to discover amazing, life-saving treatments so it is not surprising that companies are now adapting their organizations and processes to overcome market factors. AstraZeneca is on the right track - quality will be the key to success.
Posted by Amanda Zuniga at February 13, 2008 02:12 PM