Improvements in the efficiency of certain research and development (R&D) processes and the wider adoption of new technologies are cause for optimisim.
The biopharmaceutical industry continues to face a very challenging research and development (R&D) environment and has yet to turn a corner in terms of its value proposition and returns, according to a new report by the Deloitte Centre for Health Solutions on the return of investment for pharmaceutical innovation globally in 2017. However, the report sees room for optimism because of improvements in the efficiency of certain R&D processes and the wider adoption of new technologies.
The key findings include:
Pricing remains perhaps the most publicized challenge, especially in the context of escalating overall healthcare costs, and payers are increasingly demanding that biopharma demonstrate the value of its products. “It is no longer enough to show only product efficacy and safety at the point of registration; payers want to see improved outcomes, based on real-world evidence, as the foundation for a value-based pricing model,” the report states.
Other key findings include the following:
The focus of the report is on projected financial returns and the outlook for the future of biopharma R&D, Deloitte notes, but it would be a mistake to use these projected financial returns as the only measure of the industry’s ability to innovate. Despite the decrease in returns for the original cohort, Deloitte sees positives in the increase in forecast peak sales per asset, as companies target areas of unmet medical need and/or rare disorders. There has been an increase in the number of approvals of new molecular entities, orphan, breakthrough, or fast-track designations, and the approval of the first-ever CAR-T therapies in 2017 shows that innovation is contributing to an optimistic outlook for the future of the biopharma industry.
“This leads us to present an overall optimistic view of biopharma’s potential, although in our view, much improvement is still needed across R&D to balance revenues and costs,” the report concludes.
Drug development continues to be challenging, complex, costly, and time-consuming, which coincides with a growing tidal wave of confounding communicable and non-communicable diseases that threaten global public health. “Although there are promising platforms emerging to tackle these complex diseases, the challenge will be to develop these platforms in an accelerated, efficient way to create near-term value for all stakeholders,” the report concludes. “It will require a transformed model that involves new paradigms for drug development and emerging technologies.”