A Fresh Look at Big Pharma
- June 28, 2018
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So who is Big Pharma, really?
Big Pharma is a term used to refer collectively to the global pharmaceutical industry, which includes pharmaceutical (innovators and generic), biotech, and medical device companies involved in the discovery, development, manufacturing, sales, and distribution of medicines and devices.
Little known facts:
- Invest heavily researching the causes of human diseases and illnesses
- Develop and test products to treat symptoms or cure diseases and illnesses.
- Comply with broad range of regulations to assure quality and safety throughout the discovery, development, clinical evaluation, commercialize manufacture, and distribution of their products.
- Conduct years of clinical studies followed government approved protocols the results of which are then by review by independent medical review boards and government regulators for safety and effectiveness before products can be and marketed.
- After launch, they fund and report to the government continuous clinical studies and post-launch surveillance to ensure the safety and effectiveness of their products
- Employ many of the world’s greatest scientific, medical, and engineer professionals
- Work in partnership with physicians, pharmacies, hospitals, universities, benefit providers, and other healthcare companies as part of the larger healthcare ecosystem.
What’s it really take to bring new treatments to patients?
A typical pharma product or medical device requires 10 or more years to research and develop before gaining approval to market. However, it is not just a huge investment of time. According to a recent Forbes analysis, the average costs is $4 B, but can be as much $ 18 B for the “big pharma” companies. Not only do they drive fundamental discovery science, each of these companies will maintain product pipelines involving about 200 projects and thousands of clinical trials at any given time. It is a necessary investment since the attrition rate is about 20 product failures for every 1-2 successes. In fact, the real costs are much higher when you consider that the majority fail. Those products that do succeed must make up their own cost plus the cost of those that failed plus create the funding for the next generation of medical discoveries. Few industry sectors involve such a high level of investment, high risk, and degree of uncertainty of success over such a long time horizon.
Simple facts regarding the costs of medicines
Let’s set aside negative stories by the news media and politicians and look at the facts.
According to the U.S. Health and Human Services, Center for Medicare and Medicaid Services, 2016 statistics, prescription drugs represent only 10% of the overall U.S. health care costs.
Of this, about 1/3 of the cost is the result of pharmacy and hospital mark-ups, charges by wholesalers, and government fees https://www.letstalkaboutcost.org/
What really matters?
What is the value of medicines and are they cost effective? Of course none of us can place a value on preventing an illness or saving a human life. However, it is well known that medicines reduce overall medical costs. For instance, just one dollar spent on medicines for patients with congestive heart failure, high blood pressure, diabetes and high cholesterol can generate $3 to $10 in savings on emergency room visits, inpatient hospitalizations, and other complications due to disease. You know, “An ounce of prevention is worth a pound of cure.” -Benjamin Franklin
The Truth Is
Pharmaceutical innovation has led to some of the greatest achievements in modern medicine.
Entire diseases have be eradicated; millions of children’s lives are saved through vaccinations; patients live full lives with were once progressive deadly diseases like diabetes and HIV/Aids, and cancer is no longer a death sentence. Globally people live longer and healthier lives than previous generations. Medical advances allow people to enjoy a better quality of life and increase their productivity, contributing to the overall prosperity of society. Pharmaceutical innovation also creates jobs, spurs technology, and represents an important source of income. For an in-depth look at the numbers, Read On: The Pharmaceutical Industry and Global Health: Facts and Figures 2017.
What’s Next for Big Pharma Scientifically?
The industry has demonstrated tremendous agility by in adopting the latest in science and technology to advance medical knowledge and treatments for several hundred years. Today pharma companies are pushing fast into the future and they share the vision of moving beyond hope to actual cures for disease. The treatments and technologies they are pursuing go well beyond a pill. If you would like to read about some of the new discoveries and treatments, Read On: From Hope to Cure.
Teaming up with Pharma?
At BP3, we believe that the mission of pharma is noble and instrumental to the success of the broader life sciences/health care industry that we serve. For this reason we have added pharmaceutical experts to our team and we are inviting pharmaceutical, biotech, and medical device pharmaceutical companies to partner with us as we embark on a journey in the application of digital technologies to increase sped, reduce complexity, and provide new medical treatments to patients.