The most important challenge facing the pharmaceutical industry in 2009 is the need to improve R&D productivity. Since the mid-1990s, the total number of novel drugs, including new chemical entities (NCEs) and biologic license applications (BLAs) approved per year, has generally declined.
At the same time, the cost of bringing a drug to market has risen precipitously. In 2001, the cost to discover and develop a drug that successfully reached the market was approximately $800 million; it had risen to approximately $900 million by 2004. Some R&D executives have predicted that the cost to develop a marketed drug will reach $2 billion by 2010.
Declines in the number of approved drugs in a given year are mainly the result of high rates of attrition of pipeline agents during the preceding 10–12 years.
This is all true, but the number of drugs failing spectacularly this year in Phase III after promising Phase II results seems to have gone up. With quite a few blockbuster cancer drugs going off patent this year and next, it does not auger well for the near future, unless some smart companies take advantage of the hiatus.