Novartis and the Innovator's Dilemma
Novartis' most important new drug candidate, the innovative irritable bowel syndrome drug tegaserod, has been rejected by both European and US regulatory agencies. But while it and other drug firms may blame regulatory groups for becoming too risk averse, or for worrying about the costs of drug treatment, it's just as likely a problem of innovation. The agencies know how to deal with me-too drugs--it's the breakthroughs that are problematic.
You may also be interested in...
Alizyme's GBP16.1 million, barely discounted placing and open offer illustrates its investors' faith in its low-risk business model and maturing pipeline. It also provides leverage for negotiating the out-licensing deals those investors now expect.
Benefiting from lessons learned during the more than two decades of futile efforts to develop a sepsis treatment, Lilly is primed to launch the first sepsis therapeutic. Lilly's apparent success reflects a revised view of the disease as multi-factorial in nature, involving not only the body's inflammatory processes--long thought to be at the heart of the disease--but also its interlocking coagulation and clot-busting systems. Zovant's development is also marked by a series of business decisions that could have long-term implications for the company, including a renewed commitment to large molecule drugs and the creation of a critical care business. Critical care pharmaceuticals and protein therapeutics are, in many ways, complementary pursuits for Lilly that could help the company maintain its independence by generating big money products that won't require the huge commercialization costs associated with mass-marketed drugs.
Novartis has unexpectedly re-created itself with a back-to-basics, centrally-driven marketing effort accomplished by an almost entirely new senior marketing group. The transformation has been expensive and the company used a significant portion of the cost savings from the Ciba/Sandoz merger which created Novartis to finance increased marketing and Phase IV clinical development of key current products, as well as larger and more numerous trials for major development candidates, rather than simply to drive short-term earnings increases. The company is now attempting to take the centralization still further into global management. By creating global brands, it feels it can more efficiently capture leading share of voice and thus, at lower cost and with a smaller total sales force, create worldwide brand leaders.