Kenneth A. Getz
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Drug development companies face one of the toughest operating environments: Clinical research costs continue to rise steadily
at a rate of 12%–14% annually; average development and regulatory cycle times are worsening; the volume and scope of clinical
research activity is increasing while the volume of approved new drug applications and drug development success rates remain
low.
Development resources in the current climate will be further constrained by market conditions for prescription pharmaceuticals:
Public trust in industry integrity has eroded sharply; drug detailing and advertising practices face increasing scrutiny;
charges against FDA effectiveness loom as potential openings to overhaul the agency; and the changing of the guard in both
houses of Congress threatens to intensify branded drug pricing practices and the use of generic drugs.
Today's operating realities underscore the importance of speed and efficiency as central to all viable drug development strategies.
In doing so, companies optimize product revenue while minimizing development costs. The rewards for speed and efficiency can
be great with an average of $30 million in out-of-pocket development costs saved and $1.1 billion in incremental prescription
revenue gained for each product. A company's aggressive and ongoing pursuit of speed and efficiency also delivers other benefits,
including streamlined and continuously improved development operations and coordinated organizational support.
The speed demons
Speed Study Methodology
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A select group of companies stand apart as the fastest drug developers—"Speed Demons"—during 2000 to 2005. Bayer, Astra-Zeneca,
Allergan, Boehringer-Ingelheim, and Merck are the five fastest, and they appear resistant to some of the challenges that plague
most biopharmaceutical companies at this time. Speed Demon companies are almost always the fastest among those with which
they compete. They exhibit far less cycle-time variability while maintaining levels of development spending comparable to
industry benchmarks.
Whereas most biopharmaceutical companies saw their development and regulatory cycle times increase between 2000 and 2005,
for example, Speed Demons defied convention and shortened their development and regulatory timelines. During that six-year
period, the fastest 10 companies reduced their median development speed by 20% (from 66.5 to 53 months) and held regulatory
cycle times flat. Between 2000 and 2005, the typical company saw median development cycle times increase by 3% and regulatory
cycle times increase by nearly 11%.
In each therapeutic area where they compete, the fastest development companies beat median development and regulatory cycle
times more than 83% of the time, demonstrating that speed and efficiency are not chance or haphazard events. In addition,
the fastest drug developers managed to minimize development and regulatory cycle-time variability, suggesting that they are
implementing speed and efficiency strategies across their portfolios.
In comparison, the slowest companies display high levels of variability, suggesting that examples of efficient drug development
practices may be found and applied within their own organizations.
Speed-delivering practices
Between 2000 and 2005 the fastest development companies delivered as much as a 17-month development speed advantage over average
performers and as much as a three-month regulatory speed advantage. So what are the fastest companies doing? Interviews with
executives from the fastest companies suggest a number of common practices centered around leveraging resources and collaborations:
- They terminate projects sooner.
- They collaborate more actively with global regulatory agencies.
- They use eClinical data management technologies consistently and widely.
- They report higher usage of CROs.
Fastest companies, for example, terminate 56% of their discontinued projects in Phase I, whereas slowest companies terminate
only one-third of discontinued projects in that time frame. And drug companies that have higher relative CRO usage report
completing their projects closer to projected time frames and submitting their projects more than one month closer to projected
submission dates.
