Live-Licensing and In-life testing: R and D Processes and Regulation for New Drugs, 2008-2020

1 Executive Summary: R&D Processes and Regulation for New Drugs, 2008-2020: 1.1 Aim of this Report; 1.2 Pharmaceutical Development and Regulation are Continually Evolving; 1.3 An Overview of the Report; 1.4 Economic Pressures and Regulatory Uncertainty
2 The Global Pharmaceutical Market Has Entered a Crucial Phase - Where Threats and Opportunities Meet: 2.1 The Pharmaceutical Sector is a Leading Technological Industry: However, It Faces Marked Economic Pressures

2.1.1 Number of Blockbusters Has Increased Along With Competition

2.1.2 Current Pressures on Industry - Blockbuster Business Model Under the Spotlight; 2.2 The World Pharmaceutical Market Continues to Grow, But Faces Mounting Challenges; 2.3 Pharmaceutical Development is a High Risk High Gain Business

2.3.1 R&D Strategy is Crucial to Success; 2.4 The Continuing Success of the Pharmaceutical Industry is Dependent upon Important Drivers and Restraints; 2.5 Companies Are Gradually Changing Their Strategic Focus to Overcome Challenges in the Worldwide Market; 2.6 Unmet Needs and Specialist Uses Will Continue To Drive Innovation; 2.7 Patent Protection Strategies Form a Cornerstone of Lifecycle Management

2.7.1 Falling Numbers of Drug Approvals are Accompanied by Fewer Patents Submitted

2.7.2 Life Cycle Management Requires a Combination of Strategies; 2.8 Drug Developers Face Increasingly Difficult Therapeutic Challenges; 2.9 Increasing Developmental Times is a Serious Problem; 2.10 Reducing Efficiencies in R&D Result in Concerns over Thinning Pipelines

2.10.1 Is Innovation Declining in the Pharmaceutical Industry?

2.10.2 Follow-on Products are Very Appealing to Companies

2.10.3 Calls for a More-Collaborative Approach to Pharmaceutical Regulation

2.10.4 Reform of Pharmaceutical Patenting Laws is Demanded; 2.11 Healthcare Stakeholders Can Benefit from Radical Changes to Regulatory Processes; 2.12 Greater Regulatory Co-operation; 2.13 Biomarkers and Theranostics

2.13.1 Pharmacogenomics is Increasingly Relevant to Pharmaceutical Development

2.13.2 Proteomics Constitutes the ``Next Step`` After Genomics

2.13.3 Personalised Medicine Will Rely Heavily Upon Theranostics

2.13.4 The Completion of the Human Genome Project Has Been a Major Driver of Molecular Diagnostics and Personalised Medicine

2.13.5 Personalised Medicine Supported by Theranostics Could Supersede the Existing Blockbuster Model, With Sustainable Revenue Flows Continuing; 2.14 Mandatory Price Reductions Continue to Beset the Pharmaceutical Industry

2.14.1 There Are Strong Downward Pressures on Pricing Strategies

2.14.2 Pricing is a Key Issue - One that is Often Contentious

2.14.3 In Europe Governments are Exerting a Growing Influence on Pharmaceutical Prices

2.14.4 It Is Possible That Mandatory Cost-Controls in Germany Will Serve As a Precedent for Wider Governmental Controlling of Prices

2.14.5 Governmental Price Controls Are an Established Part of the Japanese Pharmaceutical Market; 2.15 Is the Blockbuster Business Model Sustainable?
3 Clinical Development and Approval of Pharmaceuticals in 2007: 3.1 A Brief History of Clinical Trials

3.1.1 The Nuremberg Code and the Declaration of Helsinki

3.1.2 Establishing Standards for Good Clinical Practice and the International Conference on Harmonisation (ICH); 3.2 Stages of Clinical Testing

3.2.1 Clinical Testing Follows a Rigorous Internationally-Recognised Code

3.2.2 Phase I Trials

3.2.3 Phase II Trials

3.2.4 Phase III Trials

3.2.5 Phase IV Trials (Post-Marketing Surveillance)

3.2.6 Further Division of Clinical Trials; 3.3 Market Pressures are Driving the Need for Rationalisation of Clinical Testing; 3.4 The FDA - Gatekeepers to the Largest Pharmaceutical Market in the World

3.4.1 The FDA is the Most Important Pharmaceutical Regulatory Body in the World

3.4.2 The CDER Oversees Drug Safety in the US

3.4.3 The FDA Is Under Pressure to Tighten-Up Drug Approval Procedures

3.4.4 Changes to Regulation of Off-Label Prescribing; 3.5 The European Medicines Agency (EMEA) Controls a Diverse Range of Countries

3.5.1 The EMEA Combines and Harnesses National Medical Expertise

3.5.2 The EMEA Makes the European Market More Accessible to Companies - a Win-Win Situation

3.5.3 Structure of the EMEA

3.5.4 Approval Process of the EMEA and the EC

3.5.5 New Pharma Legislation in the EC

3.5.6 The EU Clinical Trials Directive

3.5.7 Provision for Joint Scientific Advice from the EMEA and FDA

3.5.8 Consultation Paper on Future of Healthcare in EU; 3.6 Japan Has a High Level of Regulation

3.6.1 Approval of Foreign Pharmaceuticals in Japan was Traditionally a Daunting Process

3.6.2 Japan has Rigorous Post-Marketing Drug Regulation

3.6.3 The Japanese System Accommodates Re-Evaluation of Drugs; 3.7 Safety and Speed Are Now Pressing Issues for Regulatory Authorities; 3.8 The Use of phase IV Clinical Trials Is Set to Increase Significantly

3.8.1 Post Marketing Surveillance is High on the Agenda Worldwide

3.8.2 Post Marketing Surveillance Can Benefit the Marketing of Products

3.8.3 Safety is Driving Phase IV Studies

3.8.4 Growth in Fast-Track Applications will also Stimulate Developments in Post Marketing Studies

3.8.5 Self-Monitoring of Patients Will Become More Established

3.8.6 The UK Yellow Card System Is a Long-Established Example of Post-Approval Monitoring; 3.9 Stringent Assessment of Risk Will Require More Patients and Better Indicators of Risk; 3.10 Education Is a Key Issue

3.10.1 Public Mistrust of the Pharmaceutical Industry is a Serious Problem

3.10.2 Problems with Vioxx and Other COX-2 Inhibitors Had a Major Impact

3.10.3 Open and Trustworthy Communication from both Companies and Regulators is Vital; 3.11 Changes in the Way Drugs Are Regulated Will Change the Nature of Clinical Trials; 3.12 Pharmacogenomics and Molecular Profiling Will Change Pharma

3.12.1 Pharmacogenomics Has the Potential to Revolutionise the Pharmaceutical Industry

3.12.2 The Progress of Pharmacogenomics Has Been Slow

3.12.3 Identification of Expression Profiles in Pre-Clinical Models

3.12.4 A More Iterative Approach will Result in Greater Synergies in R&D; 3.13 The Organisation of Clinical Testing is Changing

3.13.1 Phase I and II Clinical Trials Will Incorporate More Complex Screening Techniques

3.13.2 Post-Regulatory Approval will Become More Prominent; 3.14 Safety Concerns and Development Pressures Will Change the Structure of Clinical Trials
4 How Pharmaceutical Development and Supporting Regulation Will Evolve from 2008 to 2020: 4.1 Reducing Developmental Times and Late-Stage Failure are Crucial - Developments in Testing and Regulation Will Aid the Process

4.1.1 Drugs Ineffectiveness in Sub-Populations is a Significant Obstacle to Current Drug Development

4.1.2 There Are Steps that Can Reduce Developmental Times

4.1.3 R&D Will Change Due to New Developmental Models Supported by Regulatory Reforms

4.1.4 Leading Industry Figures Call for More Flexible Approach to Drug Approval

4.1.5 Regulators Acknowledge the Need for Stratification of Treatment Populations

4.1.6 Visiongain Predicts Stratification of Patient Populations Leading to Live-Licensing/In-Life Testing

4.1.7 There Will Be Greater Co-Operation between Regulators and Pharmaceutical Developers from Now Onwards

4.1.8 Uncertainties over Political and Legislative Will to Achieve Reform of Pharma Approval Processes; 4.2 A SWOT Analysis for New Developments in the Pharmaceutical Market Framework

4.2.1 SWOT Chart for Developmental and Regulatory Changes from 2008-2020

4.2.2 Efficient Use of Resources is Essential to R&D in the Years Ahead

4.2.3 Stratification of Patients is Key to More Personalised Medicine Sought by Developers and Increasingly Required by Regulators

4.2.4 Traditional Clinical Development has a Significant Disadvantage - Better-Targeted Studies will Take Precedence

4.2.5 Live Licensing/In-Life Testing is the Way Forward

4.2.6 Regulatory Systems are Already Becoming Closer Together - But Global Convergence is Still Far from Certain

4.2.7 Electronic Patient Records Will Be an Important Facilitating Tool of In-Life Testing

4.2.8 Evidence-Based Medicine will Become Increasingly Demanded by Pharma Stakeholders; 4.3 Adaptive Clinical Trial Design Will Facilitate Interaction with Regulators and Provide Increased Rationalisation of Drug Development

4.3.1 Adaptive Clinical Trial Design Uses Accumulating Data

4.3.2 Regulators Should be Involved in the Process

4.3.3 Adaptive Trial Design will Gain Acceptance by Early Next Decade; 4.4 Personalised Medicine Driven by Theranostics and Live Licensing/In-Life Testing Will Become Established by 2020

4.4.1 Drivers for Better-Targeted Medicine

4.4.2 The Prospects for More-Personalised Medicine and Related Diagnostics are Good

4.4.3 FDA Critical Path Initiative is a Progressive Move in the Right Direction; 4.5 Personalised Medicine Aided by Regulatory Reform will also Face Significant Obstacles

4.5.1 The Complex, Disparate Pharma Industry Will Prove Difficult to Reform, Especially in a Revolutionary Manner

4.5.2 It is Unclear How Extensively New Clinical Testing Models and Supporting Regulation will be Applied; 4.6 Calls for New Global Harmonization Effort from Influential Sources

4.6.1 Calls for Greater Regulatory Consensus

4.6.2 Agreements Between the FDA and EMEA are Already Taking Shape Encouragingly

4.6.3 FDA-EC Co-Operation in Pharmacogenomics, Vaccines, Paediatric Medicine, Oncology, Counterfeiting and Pharmacovigilance

4.6.4 Implementation Plan for Medicinal Products for Human Use and Other Transatlantic Developments

4.6.5 Globalisation Facilitates Harmonisation of Pharmaceutical Regulations

4.6.6 Design of a Supranational Regulatory Regime Should Protect National Interests

4.6.7 Developing Nations Adopting ICH Guidelines

4.6.8 Increasing Willingness for Regulators to Collaborate on a Global Scale - But No Sign of Global Regulatory Harmonisation; 4.7 While Personalised Medicine and Better Targeted Clinical Trials are Emerging, Such Developments are Welcomed by the FDA and EMEA

4.7.1 Emerging Developments are Welcomed by Pharma Stakeholders

4.7.2 Cancer Drug Development Leads the Way in its Merging of Drug Development and Treatment of the Disease

4.7.3 FDA's Critical Path Initiative and Personalised Medicine

4.7.4 Theranostic Solutions Will Aid the Development of Personalised Medicine and Improve Support from Regulators through Evidence-Based Medicine; 4.8 Pricing of Personalised Medicine

4.8.1 Personalised Medicine will Lead to Changes in Pricing and Reimbursement

4.8.2 Onus is on Companies to Prove Benefits of their Drugs Including Comparative Cost-Benefits

4.8.3 Biomarkers Can Create Value

4.8.4 Non-Compliance is a Major Problem that Can be Ameliorated via More-Personalised Medicine

4.8.5 The Developments are Complex and Systemic, Posing both Opportunities and Challenges for Healthcare Stakeholders; 4.9 Evidence-Based Medicine and Pharmacoeconomic Analyses

4.9.1 Comparative Testing is Prevalent

4.9.2 Electronic Medical Records are a Major Priority for Leading Nations

4.9.3 GSK Leads Way in Evidence-Based Medicine

4.9.4 Personalised and Evidence-Based Medicine Will Require Time for Acceptance; 4.10 Changes to Regulation Governing Paediatric Medicine; 4.11 Visiongain Believes that the New Developments Will Cut Developmental Time and Provide Better Healthcare

4.11.1 Shift from General to Personalised Healthcare is an Inevitable Trend with Significant Potential Gains for Industry and Society

4.11.2 Increased Use of Conditional Acceptance Based upon Live Licensing and In-Life Testing Constitute a Logical Progression

4.11.3 Pharmaceutical Developers Must Understand the Needs and Preferences of Other Healthcare Stakeholders
5 Emerging Technology Will Underpin Changes to Developmental Processes and Regulatory Policy: 5.1 Personalised Medicine is a Prime Aim for Healthcare

5.1.1 An Introduction to Pharmacogenomics

5.1.2 The Aim of Pharmacogenomics

5.1.3 Pharmacogenomic Drugs as Personalised Medicines

5.1.4 The Economic Potential of Pharmacogenomics; 5.2 The Advantages of Pharmacogenomics Drugs and Benefits to the Pharmaceutical Industry

5.2.1 Pharmacogenomics is Attracting a Great Deal of Interest from Pharma Stakeholders

5.2.2 Improved Drugs Through Better Targeting

5.2.3 Reduced Deaths from Adverse Drug Reactions

5.2.4 Personalised Drugs are More Likely to Work Safely and Efficaciously

5.2.5 Advanced Screening for Disease Leading to Quicker Diagnoses

5.2.6 Improved Vaccines

5.2.7 Improvements in Drug Discovery and Reduced Cost of Clinical Trials; 5.3 Adverse Drug Reactions are a Serious Problem

5.3.1 Economic and Other Consequences of ADRs

5.3.2 ADR and Genotype: Tacrine, a Case Study; 5.4 The Human Genome Project (HGP) and its Influence on Pharmacogenomics; 5.5 Barriers to the Growth of Pharmacogenomics

5.5.1 The Complexity of Finding SNP Gene Variations that Affect Drug Responses

5.5.2 Limited Therapeutic Alternatives

5.5.3 Disincentives for Drug Companies to Develop and Produce Multiple Treatments for a Disease

5.5.4 Educating Healthcare Providers; 5.6 Advances in Computing and Electronic Communications Will Benefit Pharmaceutical R&D

5.6.1 There are Prominent Examples of Electronic Solutions Benefiting Pharmaceutical Development

5.6.2 Electronic Data Capture (EDC) Promises to Streamline Clinical Trials

5.6.3 Training and Security are Barriers to EDC Conversion

5.6.4 The Clinical Trials Industry Must Take the Initiative on EDC Standards

5.6.5 Governments Working Hard to Establish e-Health Records; 5.7 Electronic Submission of Post-Marketing Safety Data is Another Important Development; 5.8 Proteomics Constitutes the ``Next Step`` After Genomics; 5.9 Advanced Diagnostics Will Aid Personalised Medicine and In-Life Testing

5.9.1 Theranostics - The Combination of Therapy and Diagnostics

5.9.2 Exciting Developments in Molecular Biology Can Bring Two Healthcare Industries Closer Together

5.9.3 Personalised Medicine Will Rely Heavily Upon Theranostics

5.9.4 Theranostic Applications Will Exhibit Rapid Market Growth from 2007-2012

5.9.5 Personalised Medicine Will Become More Prominent in Healthcare with Theranostics Benefiting as a Result

5.9.6 The Completion of the Human Genome Project Has Been a Major Driver of Molecular Diagnostics

5.9.7 Personalised Medicine Supported By Theranostics Could Supersede the Existing Blockbuster Model, With Sustainable Revenue Flows Continuing

5.9.8 Theranostics will Benefit from FDA�s Guidance on Pharmacogenomic Data Submission

5.9.9 Distinguishing Patients at a Greater Risk is Vital

5.9.10 In Future Parallel Use of Markers and Drugs Will Become Prevalent

5.9.11 The EDMA Cites Theranostics as a Medium-to-Long-Term Driver for Healthcare

5.9.12 Personalised Medicine is a Strong Driver of the Theranostics Sector

5.9.13 While Personalised Medicine Is Still a Goal for the Future, the Technology Is Already Emergent

5.9.14 Identifying Suitable Biomarkers Remains a Significant Challenge

5.9.15 Theranostics Bill Introduced in the US Senate During 2006

5.9.16 Funding for Theranostics R&D Efforts May Be Limited by Low Reimbursement Rates

5.9.17 Cancer Diagnostics is an Important Growth Area with Relevance to Theranostics

5.9.18 Collaboration among Stakeholders is Essential

5.9.19 Intra-Industry Collaboration is Important to Achievement of Innovation in the Years Ahead

5.9.20 Nucleic Acid Testing Will Be Decisive in the Development of the Theranostics Market

5.9.21 The Outlook for Theranostics
6 Interviews with Experts in Pharmaceutical Regulatory Affairs: Drug Development - Present and Future Trends: 6.1 Respondent 1: US-Based Academic Specialising in US Pharmaceutical Regulation

6.1.1 The Most Important Unmet Regulatory Needs

6.1.2 What Changes are Going to Occur?

6.1.3 Will the Changes Become Widespread, Geographically and in Disease Area?

6.1.4 Potential Resistance from Payers

6.1.5 How Will Pharma R&D Benefit?

6.1.6 The Obstacles to Regulatory Reform; 6.2 Respondent 2: US-Based Academic Specialising in International Pharmaceutical Regulation

6.2.1 The Most Important Unmet Regulatory Needs

6.2.2 What Changes are Going to Occur?

6.2.3 Will the Changes Become Widespread, Geographically and in Disease Area?

6.2.4 Potential Resistance from Payers

6.2.5 How Will Pharma R&D Benefit?

6.2.6 The Obstacles to Regulatory Reform; 6.3 Respondent 3: Analyst from a European Pharmaceutical Industry Representative Group

6.3.1 The Most Important Unmet Regulatory Needs

6.3.2 What Changes are Going to Occur?

6.3.3 Will the Changes Become Widespread, Geographically and in Disease Area?

6.3.4 Potential Resistance from Payers

6.3.5 How Will Pharma R&D Benefit?

6.3.6 The Obstacles to Regulatory Reform; 6.4 Respondent 4: US-Based Academic Specialising in US and European Pharmaceutical Regulation

6.4.1 The Most Important Unmet Regulatory Needs

6.4.2 What Changes are Going to Occur?

6.4.3 Will the Changes Become Widespread, Geographically and in Disease Area?

6.4.4 Potential Resistance from Payers

6.4.5 How Will Pharma R&D Benefit?

6.4.6 The Obstacles to Regulatory Reform; 6.5 Respondent 5: Regulatory Affairs Analyst from an International Business Consultancy Specialising in the Pharmaceutical Industry

6.5.1 The Most Important Unmet Regulatory Needs

6.5.2 What Changes are Going to Occur?

6.5.3 Will the Changes Become Widespread, Geographically and in Disease Area?

6.5.4 Potential Resistance from Payers

6.5.5 How Will Pharma R&D Benefit?

6.5.6 The Obstacles to Regulatory Reform; 6.6 Respondent 6: Representative from Regulatory Affairs in an International Pharmaceutical Company

6.6.1 The Most Important Unmet Regulatory Needs

6.6.2 What Changes are Going to Occur?

6.6.3 Will the Changes Become Widespread, Geographically and in Disease Area?

6.6.4 Potential Resistance from Payers

6.6.5 How Will Pharma R&D Benefit?

6.6.6 The Obstacles to Regulatory Reform; 6.7 Respondent 7: Head of Regulatory Affairs in a Top-10 Pharmaceutical Company

6.7.1 The Most Important Unmet Regulatory Needs

6.7.2 What Changes are Going to Occur?

6.7.3 Will the Changes Become Widespread, Geographically and in Disease Area?

6.7.4 Potential Resistance from Payers

6.7.5 How Will Pharma R&D Benefit?

6.7.6 The Obstacles to Regulatory Reform
7 Conclusions of this Study: 7.1 The Prevailing Development of Pharmaceuticals is Under Increasing Commercial and Regulatory Pressure; 7.2 Pharmaceutical Regulatory Authorities Play a Vital Role in Healthcare; 7.3 Personalised Medicine and Rationalisation of the Developmental Process; 7.4 Developmental Processes and Regulatory Policy Need to Accommodate Stratified Patient Populations; 7.5 Visiongain Predicts Stratification of Patient Populations Leading to Live-Licensing/In-Life Testing; 7.6 There Will Be Greater Co-Operation between Regulators and Pharmaceutical Developers; 7.7 Uncertainties over Political and Legislative Will to Achieve Reform of Pharma Approval Processes; 7.8 Greater Regulatory Co-Operation - However, No Sign of Global Harmonisation in Pharma in Sight; 7.9 Theranostic Solutions Will Aid the Development of Personalised Medicine and Improve Support from Regulators through Evidence-Based Medicine; 7.10 Increased Use of Conditional Acceptance Based upon Live Licensing and In-Life Testing Constitute a Logical Progression from 2008-2020
Appendix A: Glossary
Appendix B: About visiongain
Appendix C: visiongain report evaluation form
List of Tables: Table 2.1 Major Drugs Losing Patent Expiry in Near Future; Table 2.2 Revenue Generation ($bn) by the World Pharmaceutical Industry, 2000-2006; Table 2.3 Forecast Revenue Generation ($bn) by the World Pharmaceutical Market, 2006-2012; Table 3.1 Key Stages in the History of Clinical Trials; Table 3.2 Drug Approvals Agencies within the EU; Table 4.1 Greater Use of Disease Knowledge and Biomarkers Will Benefit Pharmaceutical Development; Table 4.2 SWOT Chart for Developmental and Regulatory Changes, 2008-2020; Table 4.3 Visiongain�s Predictions of How Changes to Pharma Development Will Benefit the Industry and Other Stakeholders, 2007-2020; Table 5.1 Assessment of EDC Solutions; Table 5.2 Share (%) of the World Molecular Diagnostics Market Held by Theranostics, 2006 & 2012
List of Figures: Figure 2.1 Revenue Generation ($bn) by the World Pharmaceutical Industry, 2000-2006; Figure 2.2 Forecast Revenue Generation ($bn) by the World Pharmaceutical Market, 2006-2012; Figure 2.3 The Drug Development Process is Long, Complex and Costly; Figure 2.4 Increasing Average Cost ($m) of NCE Development, 1976-2005; Figure 4.1 The Current Framework for Drug Development; Figure 4.2 How Pharmaceutical Development Will Evolve into a More Progressive System; Figure 4.3 The Dynamic Integrated Regulatory System of the Future; Figure 4.4 Systemic Changes to Pharmaceutical Regulation Involve all Healthcare Stakeholders; Figure 5.1 Progressive Technological Developments in Medicine; Figure 5.2 World Revenues ($m) for Theranostic Applications, 2006-2012