A Revolution in R&D

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Executive Summary
In the pharmaceutical industry’s struggle to reach
the levels of growth expected of it, one of its key
aims will be to increase R&D productivity. And a key
means of meeting this challenge is to adopt some of
the new technologies and approaches broadly
defined as genomics. 1 That is bound to be a complicated,
perilous, and often painful process, but if
companies get their strategy right and overcome
the obstacles, they could, in the best case, as much
as halve the cost of drug development.
The report is divided into three parts.
The Impact of Genomics
The first great advance of the genomics era is in
technology—above all, the integration of new highthroughput
techniques with powerful new computing
capabilities. The new technologies are active
throughout R&D, most immediately at the drug discovery
stage, and promise to enhance productivity
by boosting efficiency.
The staggering investment needed to develop a
drug—$880 million and 15 years is the pregenomics
average—could be reduced by as much as
$300 million and two years by applying genomics
technologies. Productivity gains would be realized
at every step in the value chain. Potential obstacles
abound, however. In particular, two broad challenges
must be met to realize the savings:
•Target quality must be maintained. Pursuing new
target classes could involve unfamiliar costs initially,
and these could delay the rewards—though
only temporarily. But to jeopardize target quality
by withholding that early investment would be to
risk higher failure rates downstream, and that
would involve far greater costs in the end.
• Bottlenecks must be eased. Owing to the unevenness
of the efficiency gains at different steps in
the value chain, the pipeline’s flow will be
impeded at various chokepoints. If the requisite
action is taken, an even flow should be restored
and the promised rewards should be safeguarded.
The Impact of Genetics
The second great advance of the genomics era is in
the quantity and quality of data. From the data,
invaluable information about individuals’ genetic
variation can be extracted and exploited. In pharmaceutical
R&D, genetics will be applied particularly
to two tasks: identifying genes whose carriers
are susceptible to specific diseases (disease genetics);
and subdividing patients in clinical trials
according to variations in drug response (pharma-
1. Genomics in its narrow sense contrasts with genetics. Roughly, the former concerns itself with the common “standard” genetic makeup, the latter with
the distinctive genetic makeup of individuals. But in its broader sense, genomics includes genetics. In this report, the context makes clear which sense is
intended.