Despite a history of new product launches, strong growth, and increased research spending, it is clear that the pharmaceutical industry is in a period of major transition. The challenge facing the industry is one of creating a sustainable pipeline that can generate the long-term growth needed to fuel the sector. This challenge faces both the established pharmaceutical industry as well as the younger biotechnology sector. In fact, I would go so far as to predict that those companies that successfully focus on addressing the need for a sustainable pipeline and enhanced productivity will define what the winners will look like in the new century —regardless of how they are defined today. These companies, equipped with the knowledge of the genome and of molecular pathways that define disease, will make a major difference in peoples’ lives through providing personalized medicines that increase drug efficacy and reduce adverse side effects for patients.
It has been estimated that for the top 10 pharmaceutical companies to maintain an 8% growth rate into the future, they will have to introduce three to four new chemical entities each year. This is a huge challenge to an industry that has seen declining productivity in spite of an increased commitment to research. While some companies have tried to address this challenge through mergers and acquisitions to fill their pipelines in the short term and rationalize overhead costs, the longer-term solution to creating a sustainable pipeline rests squarely on two fundamental building blocks, which are attainable through our understanding of molecular medicine. Companies must increase the number of hits, targets, and leads they can generate at scale, and they must improve the productivity of their discovery and development engines by removing bottlenecks at every stage in the process of…
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Kevin Starr is the chief operating officer of Millennium Pharmaceuticals Inc., a leading biopharmaceutical company located in Cambridge, Mass.