A “personal dose” model could be a blockbuster alternative
The business model of major pharma companies for recent times has been to develop and sell blockbuster drugs. With the expiration of about $100 billion in patents by 2011, major pharma companies have to look at other means to capture that revenue. This model is becoming uneconomical. In addition, generics pharma companies are also entering the ethical drug market. This is going to dilute the revenue and earnings of the big 10 pharma companies and add additional pressures to improve the business model.
Another avenue to capture revenue is to combine the existing drugs on the market so that their synergies can be used for cures. This hit-and-trial model’s success rate depends on identifying the drug combination values, business negotiation, and regulatory approval. We are seeing increasing use of this strategy. This drug combination model might extend the profits for a short time until the patents expire. Drug combination is an extension of the blockbuster model and can be considered a prelude to still another new model.
The “personal dose” model is based on genetics. Recent advances in genomics provide the necessary tools and will facilitate the drug development and commercialization for this business model. The personal dose model could be characterized as being in its test tube stage. Warfarin (Coumadin)1 is an example. Currently the proper dose has to be determined using genetic testing through repeated visits to a specialized clinic. This is expensive and a challenge for the physician and the patient—an aspect of the model that must be refined.
For the personal dose model to be used widely, the following challenges have to met:
- Genetic testing has to be simple, quick, and foolproof so that the test can be performed in physician’s office or a similar facility.
- Personnel in the physician’s office must be trained to correctly read and interpret the test results.
- Genetic harmonization is needed so that the testing process is easy and simple.
- Drug regulatory agencies must develop and implement methods that allow and approve dose variation and changes to suit individual needs.
- Social and privacy advocates will have to see the benefits, chime in, and let go of some of their inhibitions.
- The results of genetic testing must be handled carefully as the information could be used to deny employment or insurance coverage if the testing to cure an existing condition showed potential mutation leading to development of a disease that could be labeled “pre-existing”.
Once the pharmaceutical companies, regulatory agencies, and others have overcome the above, personalized dose could become the norm and a high-volume business.
Even with wide use of personalized dose, however, the drug efficacy and safety would always be under considerable scrutiny. There could be ongoing debates among the social and privacy pundits. For success, collaboration would be needed between the pharmaceutical companies, test developers, regulatory agencies, and social gatekeepers. Work on simplification and cost reduction of DNA coding is being driven by five companies.2 In the end, the personal dose model could be highly profitable and valuable if the social and ethical hurdles can be overcome and the drug dispensing process is simplified.
This opportunity is also being considered by companies in India. Companies in developed countries must keep an eye on these developments.3
1. PERSONAL DOSE: In Milestone, FDA Pushes Genetic Tests Tied to Drug, Wall Street Journal, August 16, 2007.
2. DNA Decoding Maps Mainstream Future, Wall Street Journal, October 4, 2007.
3. Coming soon: Drugs to suit your genetic profile, The Economic Times, October 3, 2007.
About the Author
Girish Malhotra, president of EPCOT International (Pepper Pike, Ohio) has 40 years of experience in Pharmaceutical, Specialty, Custom and Fine chemicals, in manufacturing, process and technology development, and business development.
Filed Under: Drug Discovery