Comment by arjie
2 days ago
Can’t agree with the premise. It seems that through changing regulatory regimes and technology a 1 in 10 chance is the economic optimum for this. Interesting stability, certainly, but I’d expect that as technology improves success rate, funding increases until the marginal project is unprofitable.
The better we get at doing things, the more ambitious we get. As an example, we can keep babies alive much earlier in gestation, so we try harder if they’re earlier than we would before. We should expect a homeostatic equilibrium between our skill and our ambition.
I 100% agree. the criteria for sucess is something that is missed by simplyifying things to a number.
Those failures can include drugs that would be considerer miraculous 10 or 20 years ago. You might have a drug that functionally cures HIV, but failed to outperform the standard of care in a RCT.
You have drugs like Lorbrena for non-small cell lung cancer where the median life extension is unknown because >50% of patients are alive 7 years out. Or Keytruda where 50% of advanced melenoma patients appear functionally cured 10 years post treatment.
This comment makes no sense.
Why would anyone make a drug if the current prevalent treatment was as good as a functional cure?
What do lorbrena and keytruda have to do with the rate of failures being constant?
"Why would anyone make a drug if the current prevalent treatment was as good as a functional cure?"
I am not sure whether you ask for economic why, or an overall why.
The overall why seems easier to explain:
a. The new drug may be cheaper.
b. The new drug may be safer. (e.g. no risk of anaphylaxis etc.)
c. The new drug may not need cold storage (huge problem outside the First World).
d. The new drug may have other properties that the original does not have (e.g. being taken once a day instead of four times a day, not requiring people to stay off specific food etc.)
e. The side effects (such as vomiting) may be lower.
In general, it is always better to have alternatives in medicine.
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Lots of reasons.
The new drug could be cheaper to manufacture, fewer side effects, a full cure in stead of a functional cure.
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These are examples of ambitious drugs that wouldn’t have been attempted even a few decades earlier. But technology improved and the money was there so they tried anyway, and found success. But for any 3 successes there are still 27 failures because those 27 were equally ambitious.
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Keytruda revenue is 30+ billion per year. If your new drug performs 1% better than Keytruda, that revenue becomes yours. If your drug perfroms 1% worse, you become a failure in the statistics.
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The economic calculus is ambivalent between a clinical trial with a 10% chance of a drug discovery worth a billion dollars, a 100% chance of a drug discovery worth a hundred million dollars, and a 1% chance of a drug discovery worth ten billion dollars. I'm not sure the economically marginal project is less likely to fail as much as it would simply target more niche markets.
Care to calculate the marginal utility of torching your credibility?
But technology isn't improving the success rate. And the marginal project is already expected to be unprofitable. Pharma is a hits driven business and the hits are getting simultaneously more expensive to produce, harder to find, and enter into a much more competitive market environment.