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The Great Rx Marketing-Science Divide

Executive Summary

Big Pharma must increasingly look to niche products, rather than blockbusters, to solve its growth problems. With a growing body of research demonstrating that major diseases like rheumatoid arthritis are, in fact multiple diseases requiring different therapeutic regiments, the once-size-fits-all paradigm will be superseded by one emphasizing more targeted drugs. This will require that drug companies look both internally and externally for a number of therapeutics, which individually will be relatively limited in market, but as a group could create a highly profitable business. Indeed, a key to success will be creating franchises of multiple products for symptomatically related conditions.

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Pharmacogenomics has disappointed advocates who saw the opportunity to apply a discovery tool to the near-term goal of increasing approval chances and marketability for late-stage and marketed compounds. In return, they hoped to take a percentage of the highest-cost segment of the pharmaceutical budget. But Big Pharma is by and large not using pharmacogenomics for late-stage and marketed compounds: senior executives don't believe there's enough evidence it works and are afraid of limiting the marketability of the products by segmenting broad target populations into niches. Some also worry about uncovering potential side-effects that non-pharmacogenomic trials wouldn't reveal. Nonetheless, pharmacogenomics has made it to Big Pharma: most companies, for example, are banking samples from clinical trials to be pharmacogenomically tested retrospectively, thereby informing future trials. Not that this means the pharmacogenomics specialists will be able to sign high-value deals with the commercial side of drug companies, who believe that pharmacogenomic analysis is available from a number of sources, including internal ones, and feel they own the key assets for creating meaningful programs: compounds and patient samples. Instead, pharmacogenomics will find its place first as a discovery technology, integrated with other methods for finding, validating and prioritizing targets. That means that to succeed selling pharmacogenomics, biotechs will have to combine their pharmacogenomic assets with other discovery technologies, perhaps through mergers. An alternative: use their technologies to find drug products that they can themselves develop, perhaps later out-licensing them.

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