Invited Speaker

Drug Discovery Outsourcing: Experiences and Learnings
Jose Freire
USA

The pharmaceutical industry is facing a productivity crisis that is being aggravated by the patent term expiration of major blockbusters. The number of new chemical entities submitted to the FDA for approval has been declining since 2001 in parallel to the number of NDA approvals. As a result the cost associated with bringing one new drug to the market has escalated and is now estimated to be over $1 billion. This together with additional pressures to contain cost overall in the health care industry, is forcing the pharmaceutical companies to streamline expenditures. In this regard more and more pharmaceutical companies are looking to outsourcing as a way to reduce costs and increase flexibility.

While outsourcing is not new to the pharmaceutical industry, until recently it was limited to synthetic chemistry, medicinal chemistry, safety pharmacology profiling and toxicology, activities were generally considered outside of the core drug discovery research. Traditionally large pharmaceutical companies have seen their research/drug discovery organization as the key to innovation and future profits, and did not consider it appropriate to outsource this functions. With the surge of the Biotech industry and early success this mentality has started to change and with that, the Contract Research Organization (CRO) industry has seen a new opportunity to expand the variety of services to offer fully integrated drug discovery programs and not just portions or pieces of a general discipline. Collaborations between CRO and pharmaceutical industry could benefit both organizations. The pharmaceutical industry would benefit by increasing flexibility and productivity, while CRO industry would benefit from the increased business and associated growth opportunity. At the same time, one should not ignore the challenges associated with this type of collaboration, where the expectations and interests of each party are not necessarily perfectly aligned. For this to be successful both the pharmaceutical and CRO industries will need to change and adapt to form a greater alignment of the two industries.

Over the past three years our company has undertaken three integrated drug discovery collaborations with overseas companies resulting in two lead candidates and one optimized lead in separate disease areas. The knowledge and experience gained from our company and each CRO will lay the foundation for future successful programs utilizing this integrated approach.