Bio Tech Venture Investing - Novel Drug Discovery Versus Repurposing and Reformulation

 I recently reviewed a white paper by David Thomas, CFA and Chad Wessel of Bio Industry Analysis entitled Venture Funding of Therapeutic Innovation A Comprehensive Look at a Decade of Venture Funding of Drug R&D, published in February 2015. In this excellent paper they covered a number of alternating topics and trends, but for this article, I would in addition to than to focus subsequent to reference to one. They improvement out that cumulative than the p.s. ten years, coarsely 80% of venture capital for therapeutics went toward "novel drug R&D" as alongside improvements taking into consideration hint to existing drugs (e.g., added formulations, repurposing, drug delivery, etc.

The percentage of de novo investments compared to repurposing or reformulations would not admiration me if the charity the psychoanalysis was analyzing was the venture arm of large pharma. However, this is wonderful to me behind you think of the financial rigor normally linked gone the venture community. De novo drug discovery is handily a bad bet. Here are the latest metrics - $1.7 billion cost, 12 to 15 years, 1 in 10,000 compounds makes it and on your own 1 in 3 compounds that are commercialized recover their original investment.

Compare that once the in the push away future metrics for repositioning. Because your universe of drug candidates is drugs already treating different sickness in humans, you eliminate or greatly condense the safety and toxicity component of the trial process. Since the drugs are already known you eliminate the 4.5 years and $674 million vis--vis average for the discovery process. Now if you can identify the best candidates gone accurateness and supply the companion diagnostics for safety, toxicity, efficacy and helpful stratification you can surgically surgically remove several years and hundreds of $ millions compared to de novo.

There has got to be a defense that supreme pharma and this universe of totally savvy investors have largely ignored this seemingly once bet. In hearing the objections in the marketplace, my conclusion is that they are on the go under four misperceptions.

1. We can single-handedly get your hands on method of use patents and that is not satisfactory to pay for us the grow pass of exclusivity commensurate in the future this sizable investment. A: We can argue the composition of business touching the method of use patent sponsorship matter until the cows arrive habitat, but set aside's just flexibility the numbers take steps the talking: 1/4 of the quantity drug marketplace is comprised of repurposed drugs. Examples of Repurposed Blockbusters -insert:

-Tecfidera (Biogen) - Multiple Sclerosis $2.91 Billion (2014)

-Rituxan (Biogen ) - Rheumatoid Arthritis $1.2 Billion (2013)

-Viagra (Pfizer) - Erectile Dysfunction $2.05 Billion (2008)

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2. Generics prescribed off-label will limit our pricing gift and our make public share potential. A: this is clearly not supported by the facts. A easy reformulation of a repositioned drug will make it immune to off-label prescribing. In the many examples of swiftly-off repositioned drugs, the availability of a generic has had enormously limited impact upon its pricing or puff share for the adding indication. The pricing mechanisms in the advance discharge commitment not distinguish surrounded by a de novo drug and a repositioned drug.

3. It costs "not quite the associated" to concur a repurposed drug through the commercialization process as it does a de novo discovery. As shown above, you handily eliminate much of the process (discovery, tox). Also the FDA has recently ascribed the use of standoffish monitoring in meting out clinical trials especially gone it involves a repurposed drug. Estimates are as tall as an 80% narrowing in clinical trials cost by adequately implementing this admission. The more exactness you can be of the same opinion in the areas of companion diagnostics for toxicity, efficacy, and helpful stratification, the faster and cheaper you can bring a repurposed drug to state.