How are new drug developments getting better?

Release date: 2020-01-06 Views: 0

Source: WuXi AppTec  

The discussion about cost and value at one time became more complicated and even more commercial. The enthusiastic expectations of innovation from all walks of life, the impact of centralized procurement pricing, payers, patient rights groups, and regulators are challenging the front-runners of the pharmaceutical industry, asking the pharmaceutical industry to prove both the initial data related to the population and protect the value To make it last longer.

"Better than the Beatles?"

Talking about the value of drug research and development in 2020, it is inseparable from Eroom's law on drug research and development input-output ratio. Many new drugs have only small incremental benefits compared to existing treatments. Over time, drug development has become slower and more expensive. The smaller the incremental benefits of new drugs, the larger the scale of clinical trials required to prove the benefits of new drugs; at the same time, it becomes more difficult to maintain the commercial scale of new drug benefits. This paradigm has doubled the cost of developing new drugs every nine years (adjusted for inflation).

▲ Overall trends of R & D efficiency (Data source: Reference [1], mapping by WuXi AppTec content team)

Eroom's law is sometimes described as requiring "better than the Beatles." As you can imagine, if new bands are required to be better than The Beatles, then it will be more difficult to make new records.

As the category of innovative drugs becomes more and more crowded, generic drugs become more common, and the cost of incremental innovation increases. In 2019, oncology drugs have been criticized for following suit to detect "me-too" compounds. Dr. Richard Pazdur, director of the FDA Center for Excellence in Oncology, has criticized the industry for repeatedly testing very similar treatments, especially after witnessing multiple failures. The FDA has approved six checkpoint inhibitor immunotherapy drugs (targeting PD-1 / PD-L1 drugs) for 14 different types of cancer treatment. But the Cancer Research Institute estimates that there are more than 2,250 clinical trials underway, many of which are similar.

▲ The efficiency of some parts of the research and development process has been significantly improved, while the efficiency of other parts has been significantly reduced (data source: reference [1], cartographic by WuXi AppTec content team)

Many countries and regulators are struggling to set standards that are "better than the Beatles" and the diverse needs of rapid aging and demographic change. These countries will not accept the premium of "me-too" medicines. Therefore, the pharmaceutical industry must strike a balance between expectations and the uncertainties it faces in research, supply chain and costs.

Focusing on the reality of the world's fastest growing elderly population, Japan's regulators are planning. An aging population often means more will be spent and patient out-of-pocket costs will increase. In order to protect consumers and maintain the country's related resources at a normal level, we will abolish high prices for drugs with insufficient innovation technology. Such a tough stance will not compromise. On the other hand, the industry believes that Japan has a friendly environment for the latest compounds and needs to continue to maintain such a reputation.

Pharmaceutical companies caught in this dynamic must improve commercialization flexibility in accordance with relevant drug pricing schemes. In 2020, if these companies are committed to improving their position in local prescription concentration, it will be necessary to shift more and more from drug sales to solution sales.

Drug bidding, baht must compare

Tendering is a normal part of market access, but will bidding for drugs that must be compared to the asking price baht push the new competition to the bottom? Drug bidding is the process by which various countries, local governments, and medical systems negotiate drugs and sign purchase contracts. Buyers require that pharmaceutical companies bid on specific batch commitments and then choose based on the lowest cost or best perceived value.

Compared with the recommended method, the drug bidding method has greater influence; in most regions, relevant agencies require drug procurement bidding. For example, in Germany, pharmacists can only provide the preferred medicines specified by the patient care plan. In many growing healthcare systems around the world, drug bidding is getting more and more attention and localization. This development trend is more likely to exclude innovative drugs. Relevant plans are putting pressure on pharmaceutical manufacturers. If relevant pharmaceutical manufacturers want to participate in the competition, they need to cut prices significantly.

Sticky value framework

Third-party value frameworks are driving value conversations. Examples of these third-party value frameworks include institutions such as ICER (Institute for Clinical and Economic Review) and ASCO (American Society of Clinical Oncology) Refer to the end of this article for short names, English full names, and Chinese full names). Over the past two decades, these agencies have launched a variety of assessment tools to help evaluate the cost and impact of drugs in specific treatment categories.

Data source: Reference [9], mapping by WuXi AppTec content team

As time goes on, the price of related medicines will receive more and more attention from all walks of life. One reason is related to adoption and accessibility. ICER is making data more accessible to pharmaceutical and insurance companies through the use of new tools. At the same time, there are some compelling adoption cases, and even though the debate over the quality-adjusted life year (QALY) indicators is dazzling, the impact of these adoption cases is becoming a topic of heated discussion. Sanofi and Regeneron partnered with ICER to determine the net price of the cholesterol-lowering drug Praluent. Both the U.S. Department of Veterans Affairs and CVS Caremark, a prescription drug benefits management subsidiary of CVS, have used the ICER indicator to assess coverage exclusions.

▲ A glimpse of the five relevant value evaluation frameworks in the United States (Data source: Reference [10], cartography of WuXi AppTec content team)

The second driver of change is oncolytics and new frameworks created over the past five years to assess the cost of these oncolytics. In the relevant pipeline, there are 850 new tumor treatment drugs. Evaluation data show that the most recent median price was $ 160,000, and some exceeded $ 500,000. There is a general consensus that no framework is perfect, but these practices have been considered a good start in value dialogues.

Because these third-party frameworks are often used to evaluate value before release, the company is also focusing on communicating value earlier. In this regard, Europe has the earliest start, and relevant countries have readjusted their communication processes to support NICE (The National Institute for Health and Care Excellence) and other health technology assessment committees' evolving evaluation processes. . Now, other regions are following suit, and it is expected that in the next 18 months, important communication strategies will be re-developed. New approaches, including these frameworks, may be adopted earlier and more transparent. These initiatives will put new pressure on early data and integrated clinical and commercial development.

Communicate your values

In a world focused on creating value, the motivation for maintaining reputation comes from the company's emphasis on its own value. We have seen fulfilling price promises; signing value-based contracts. In the past five years, you have seen a significant shift between the number of companies that emphasize price commitments and the number of new value-based insurance coverage associations.

In 2020 and beyond, these contracts will focus more and more on the outcome, and will stick to vested interests to protect the integrity of the data between the partnership and the patient and healthcare provider. In such cases, pharmaceutical companies face two main challenges, including understanding exactly what needs to be measured and how to communicate. Medical service providers are no strangers to the challenges of measurement. The medical service provider was the first "crab eater" in the health policy review, but hesitated to enter value-based medical care.

In order to improve the outcome contract, the payer made it very clear which patients were being treated, and from the perspective of each of these patients, some expensive medicines were negotiated. They are working with research institutions to move from targeting the most likely to benefit to a key way to manage budgets and get membership results.

Communication is another key element of value. Companies should establish a value philosophy that aligns cross-functional systems with all price behavior. These value actions that ensure the value mix have the following characteristics: strategic, with clear goals; economical; politically feasible; accessible and testable; integrated into strategic plans across business units and franchises. Conversations about prices and whether drugs can deliver value against prices are accelerating. Facing this trend, the way the pharmaceutical industry speaks must change.

How to deal with value assessments in 2020

Be proactive

Work for the entire organization, starting from one place, determine in advance which areas will be the focus of investment, accurately estimate the negotiations that will be carried out and how much the price will be overwhelmed; understand the key countries where you can build value-driven relationships and maintain partnership .

Communicate in different ways

In terms of communication, especially risk and reputation teams, you need to work with clinical and business leaders to re-plan how and when to start communication and exchange in a price-sensitive, value-driven market. As pricing disputes continue, special communication channels are established to discuss price transparency in a way that resonates easily and strive to improve the availability of medicines.

Forging new partnerships

Work with insurance companies, policy makers, and the Medical Insurance and Medicaid Services (CMS) to participate in a conversation about drug reimbursement and payment strategies that are tuned to the new pace of innovation. In addition, before drug pricing, patients' voices should be fully considered, especially in the out-of-pocket market. Taking patient voices into account helps to identify price-sensitive patient segments and determine the optimal pricing strategy. .

Attachment: Relevant institutions, English abbreviations, full English names, Chinese translations:

Data source: References [9], [10], mapping by WuXi AppTec Content Team

Disclaimer: This article is for information exchange purposes only. The opinions expressed in this article do not represent Wuyi Kangde's position, nor do they imply that Wuxi Kangde supports or disagrees with the opinions in this article.


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[2] Susan E. Bates. PD-1 Pandemonium at the American Association for Cancer Research Annual Meeting. The Oncologist. May 2019, vol. 24, no. 5, 571-573. Doi: 10.1634 / theoncologist.2019-0281

[3] Karen Honey. AACR Annual Meeting 2019: PD-1 Pandemonium. April 12, 2019. Retrieved Dec 12, 2019 from

[4] Dana-Farber Cancer Institute. What is PD-1 and Immunotherapy? May 22, 2019. Retrieved Dec 12, 2019 from of-pd-1-and-immunotherapy /

[5] The CRI Anna-Maria Kellen Clinical Accelerator. PD-1 / PD-L1 Landscape. Retrieved Dec 26, 2019 from -l1-landscape

[6] Tang, J., Yu, J., Hubbard-Lucey, V. et al. The clinical trial landscape for PD1 / PDL1 immune checkpoint inhibitors. Nat Rev Drug Discov, 17, 854–855 (2018) doi: 10.1038 /nrd.2018.210

[7] Misato Adachi, Ryo Ishida, Genki Oka. Japan: Lessons from a hyperaging society. Mar, 2015. Retrieved Dec 12, 2019 from lessons-from-a-hyperaging-society

[7] Syneos Health® Insights Hub. 2020 Health Trends. Dec 6, 2019. Retrieved Dec 7, 2019 from 20Health% 20Trends% 20Report.pdf

[8] Japan Industrial Association. Japan Administration of Pharmaceutical Affairs. Pharmaceutical Administration and Regulations in Japan (2019). Retrieved Dec 22, 2019 from .pdf

[9] The Personalized Medicine Coalition (PMC). Personalized Medicine and Value Assessment Frameworks. Context, Considerations, and Next Steps. Retrieved Dec 24, 2019 from PM_and_VAFs.pdf

[10] Informa Pharma Intelligence. Market Access Article Pack Value Frameworks. Nov, 2016. Retrieved Dec 24, 2019 from -shop-window / pharma / files / reports / market-access-article-pack-value-frameworks.pdf

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