Knowledge Synergies Between Small Innovators Can Accelerate Drug Development, Experts Speak Out

SINGAPORE - It may sound too idealistic but Israel Makov, Teva's former chief executive, believes the present drought of late-stage pipeline drugs can be filled if smaller companies doing research in "silos" share their specialized insights and form single entities to develop future drugs.

Speaking to PharmAsia News along the sidelines of the BioPharma Asia conference in Singapore March 17, Makov expressed skepticism over the success of recent Big Pharma mergers and said some part of the government's expenditure on healthcare can be saved if future drugs are developed more cost effectively. He predicted that the U.S. healthcare costs could go up to $13 trillion by 2050.

Makov, presently the chairman of diagnostics firm Given Imaging and credited to have built Teva into a formidable pharmaceutical generic and brand company, suggested that developing a comprehensive knowledge base that spans from biotherapeutic devices to molecular models and biomarkers could help in making cost-effective preventive remedies. He visualized that big pharmaceutical companies will deploy enough cash into such research work and spin them off in coming years.

In 1996, 388 compounds were in Phase III trials, but that increased to 550 in 2008. Makov said that the products approved by U.S. FDA have significantly dropped since then. He also highlighted that the leading drugs in the market in key therapies like cancer and Alzheimer's disease were only 25 to 35 percent effective in many patients and represented a dire need for collaborative research. "To pay $80,000 for a cancer treatment cannot be acceptable," Makov said, stressing the need to develop cheaper alternatives.

Villoo Morawala-Patell, founder of Avesthagen, a small Indian biotech spoke on developing expertise in systems biology for targeting diseases early but pointed to the lack of funding for basic innovations primarily due to the lack of bandwidth of private equity investors in understanding the pharma and biotech business model. She was optimistic that newer grounds could be broken by smaller Indian companies in areas like personalized medicine due to the advantages of biodiversity, trained manpower and a condusive regulatory and political scenario.

Avesthagen has spread into diverse areas from developing functional foods to biosimilar therapeutics and agriculture biotech and is looking at raising capital in India through the public listing route. As part of its research drive, Avesthagen has undertaken a much-awaited study of the genetic samples of the closely held 67,000 Parsi Zoroastrian community in India, which may provide leads into disease prediction and help in accelerating development of drugs.

Peter Kash, President of U.S.-based Riverbank Capital Securities agreed about the shortage of funding for new experimental drugs but noted that a large part of future funds may flow from family-owned non-traditional businesses. "Of the 500 publicly listed biotechs in U.S., almost half are going bankrupt and there are 1,200 that are privately held. These setbacks have made investors risk-averse and they are not sure about the return on investments," Kash told the audience.

Smaller companies working on a single therapy area could pool a common equity base that could then share the success of leads or divide the risks by keeping a separate escrow account, Kash suggested; however, he agreed that egos can often get in the way of fruitful partnerships.

Makov concurred that his endeavor two decades ago to bring together scientists from Harvard, Stanford and two other universities from Holland and Israel failed because the scientists and stakeholders could not agree on the terms of forming a single research entity.

- Vikas Dandekar ([email protected])