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Eckhard von Keutz - Articles and news items
Drug Discovery, Issue 6 2011 / 13 December 2011 / Andrew A. Parsons, Vice President Preclinical Drug Development, GlaxoSmithKline and Steve Street, Vice President, Head of Research Centres of Emphasis, Head of WRD Continuous Improvement, Pfizer and William Strohl, Vice President of Biologics Research, Centocor R&D, a division of Johnson & Johnson Pharmaceutical Research & Development and Eckhard von Keutz, Senior Vice President, Head Global Early Development, Bayer HealthCare
External economic pressures have been identified as the major driver for the pharmaceutical outsourcing market. Over and above the fiscal advantages of adopting this strategy, what other benefits and indeed risks do you see associated with this approach?
Steve Street: We definitely began our out – sourcing efforts based on economics and the fiscal benefits. Subsequently, we have realised that we gain benefits in terms of flexibility, diversity and opportunity. Flexibility in terms of where and when we scale up or down on investments, diversity in terms of access to outstanding and committed scientists across the world and opportunity in terms of more and different technologies, projects and markets.
Andrew Parsons: It really depends on the definition of outsourcing. In my opinion, there are a number of different activities that could be captured within a broad definition of outsourcing. These include outsourcing: the transfer of internal activities to an external vendor, off-shoring: the transfer of activities to a different location which is typically a lower cost country, which could be either an internal or external resource, and open sourcing or risk sharing: two or more individual companies sharing investment into one or more activities and sharing the reward.
Open Innovation (OI) is a paradigm originally presented by Henry Chesbrough in 2003. This concept allows development of both internal and external ideas using both internal and external development paths to the market place. The OI paradigm is a framework around building alliances with the mindset to develop win-win business models to identify and develop new products.
Clinical development costs are rising at an alarming rate. There is a decreasing success rate for new drug candidate approval and the duration of development is increasing. In other words, industry is spending more and getting less from current drug development efforts. In 2010, 21 new drugs were approved in the U.S., the fewest since 2007, as the Food and Drug Administration showed more willingness to delay or reject medicines with potential safety risks1. Along these lines and according to a study conducted by the Biotechnology Industry Organisation and BioMedTracker, the success rate in bringing new drugs to market has fallen. The study looked at drugs moving from early stage Phase I clinical trials to Food and Drug Administration approval between 2004 and 2010. The researchers found that the overall success rate is about one in 10, down from one in five to one in six, seen in reports involving earlier years2.
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