Pharmaceuticals

A new report, “Pharma 2020: The Vision” from PWC finds that drug companies will change how they do R&D in the future. They will move from the current “linear” research process to “live licenses,” under which a drug is launched on a restricted basis as testing continues. Regulators worldwide will share data, resulting in a single system. The report suggests that the use of “risk sharing agreements” will also increase, creating variable pricing for manufacturers that depends on the drug’s efficacy. Patients will be monitored and prevention and disease management programs will become more prevalent. The report stresses that R&D is the biggest challenge facing drug companies, noting that R&D spending as a percentage of revenue by the largest drug companies increased to 17.1% from 15% between 1995 and 2005, but the sales and general administration expenses as a percentage of revenue grew from 28.7% to 33.1%.

Source: Financial Times

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