Innovation 'essential to future pharmaceutical sector success'

A new report has highlighted the growing need for innovative operating models in the clinical research sector in order to cope with the pressing challenges faced by the pharmaceutical industry.

Contract research organisation (CRO) Quintiles has published a new Economist Intelligence Unit survey that has highlighted an "urgent need" for new models of thinking, as the industry seeks to address waning productivity and potentially damaging medium-term market trends.

In the coming years, life science companies are likely to see their business models placed at risk by the so-called "patent cliff", a period in which a large number of blockbuster treatments will lose their exclusivity and become susceptible to competition from generic alternatives.

According to Quintiles' data, seven of the top-selling drugs in the world - which between them accounted for almost $50 billion (£30.4 billion) in sales in 2009 - will see their patents expire this year or next.

This trend is potentially hugely damaging for the bottom line of drugmakers and is likely to be compounded by a recent waning in the productivity of many companies' drug development pipelines.

A report published by CMR International last month showed that 2010 saw the lowest number of new molecular entities launched by major pharmaceutical companies in a decade, while the number of drugs entering phase I and II testing dropped compared to the previous year by 47 per cent and 53 per cent respectively.

Despite these concerning issues, Quintiles' survey - which involved 282 senior executives from the life sciences industry - demonstrated that a large number of businesses are taking an ambivalent view to bolstering innovation.

Of those consulted for the study, less than half believe their research and development model is capable of meeting the company's needs, yet only 54 per cent of respondents described making changes to innovation programmes as a leading priority.

Among the reasons behind this are concerns over cost, timescales and regulatory issues, while cultural attachment to existing practices was cited as the key contributing factor among the worst-performing businesses.

In the view of Quintiles, it is these non-committal attitudes to modernisation that are the key barriers to improvement.

The report said: "To meet the challenges mounting on every side, life sciences companies need to do far more than cut costs: they must reinvent how they innovate."

Indeed, the document indicated that many companies are taking steps to address this - one in five of the businesses surveyed described their innovation programmes as "very effective", with these organisations typically producing twice as many new products as others.

Among the measures these high-performing firms are implementing is a more open approach to collaboration and partnerships, in which traditionally defensive stances on intellectual property protection are relaxed, while others are seeking to undertake programmes to improve and maximise their use of clinical data.

Another key issue is the creation of the right working environment, with top businesses making sure that a management climate and reward structure are put in place to ensure clinical research staff are motivated to take risks and pursue creative strategies.

Recent trends in the wider pharmaceutical market show the ways in which these ideas are manifesting themselves in practice - for example, a recent Visiongain report noted a growth in the number of drugmakers moving to work in partnership with CROs, allowing them to increase their focus on near-registration products.

Among individual companies, Lilly last month spoke of its efforts to greatly expand its pipeline and innovation efforts to cope with the expiry of products such as Zyprexa and Cymbalta, while Pfizer recently agreed a new partnership with Hisun to create off-patent medicines in China, an emerging market with strong growth prospects.

According to Quintiles' president of clinical development Paula Brown Stafford, such efforts will be vital in a fast-changing healthcare environment.

"The best innovations will come from firms who look creatively at new technologies to turn their data and information into insight, pursue open partnerships to gain additional expertise and make better decisions, faster," she said.

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