As the cost of drug discovery rises astronomically, companies need to shed ‘Go at it alone' model to pave the way for ‘wheel and spoke' model with partnerships and alliances to cut costs.

According to Mr Amar Kureishi, chief medical officer, head strategic drug development, Asia Quintiles, “Drug majors should fully capitalise on the research and development opportunities presenting themselves in growing markets such as India, the bio-pharma industry will need to relinquish its faltering ‘go-at it-alone' linear model of drug discovery and development.”

“Through go-at it-alone' model, firms control all the pieces and should shift towards a ‘wheel and spoke model' of multiple strategic partnerships with other bio-pharma and service provider companies,” he added

The ‘wheel and spoke' model provides companies with complementary strengths and capabilities and flexibility in allocating resources and offers shorter pay-back cycle.

R&D costs

Talking about research and development (R&D) costs in drug discovery, Mr Kureishi said “R&D costs have doubled over the past decade, while the new drug approvals have dropped down to a third. With the R&D costs now at more than $1.2 billion per drug approved, only one in five drugs approved is able to pay for the cost of its development.”

“In this increasing challenging landscape of rising costs and falling approval rates of new drugs, the pharma industry is rapidly moving towards an impending ‘patient cliff' with an estimated $128 billion of branded revenues losing patent protection between 2009-2014,” he explained.

As for the challenges of biotech, Mr Kureishi said for biotech companies, “the challenge is particularly acute. Once viewed as a source of fresh innovation, many biotech companies with a new molecules or technology platforms are struggling to access capital and are finding it increasingly difficult to find large pharma companies to partner in early stage development.”

Western drug companies should look at cost effective geographies in Asia such as India, Vietnam, Indonesia and Thailand for drug development.

According to Mr Kureishi, “Asia's fast paced growth, vast markets and access to fresh source of capital promises to herald in a new era of drug discovery, development and innovation and to provide a solution to the existential challenges facing the global bio-pharma industry.”

>anil.u@thehindu.co.in

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