4 ms·

> "A new study in 2020 estimated that the median cost of getting a new drug into the market was $985 million, and the average cost was $1.3 billion, which was m

> "A new study in 2020 estimated that the median cost of getting a new drug into the market was $985 million, and the average cost was $1.3 billion, which was much lower compared to previous studies, which have placed the average cost of drug development as $2.8 billion.[4]" PrEP repurposed Truvada, an existing blockbuster drug that had already reaped immense profit for Gilead for use in HIV treatment by the time the trials for PrEP began. The trials for PrEP were funded by the government, not Gilead. Gilead, however, got to retain all profits earned from PrEP.

HideousKojima 2y ago
Did Gilead fund the R&D? There's a lot more to developing a new drug than just trials (though I think Gilead should have foot the bill for the trials too).
- roughly 2y ago
  I don’t know if it’s the case here, but very, very, very often in biotech you’ve got the primary foundational research happening at university labs funded by grants, and it’s the productionization of the research (and then clinical trials, etc) that are what the biotech companies are doing. I’m not sure where that shifts the “who deserves what” conversation, but without university research labs, there’s no pharma industry.
  - pfdietz 2y ago
    If the university owned the IP, then its value should have been reflected in what was bid for it. If the knowledge was not restricted by IP law, then any drug company could use it, and compete for new drugs based on it. As such, it would not provide any of them with a competitive advantage, and so would not be reflected in what they could charge. What universities typically produce is not a chemical that can serve as an actual drug, but is only a starting point for a long and expensive process of producing such a chemical. And then, it's often found that the target of the class of potential drugs isn't actually a good one. One can't determine that until drug candidates are available to test on real patients.
    - Jensson 2y ago
      > What universities typically produce is not a chemical that can serve as an actual drug, but is only a starting point for a long and expensive process of producing such a chemical Remember you need to include all the failed attempts at finding useful things at university labs to see how much governments spend on research (just like you did failed pharma attempts), and if you add that up you see governments actually contribute a massive part of the cost to bring medicines to market. What they produce is necessary to even begin the work pharma does, currently it is basically a gift from the people to the pharma industry.
  - Nifty3929 2y ago
    "without university research labs, there’s no pharma industry." - I think you have it exactly backwards: Without the pharma industry, there's no medicine. Good research goes nowhere if you can't bring it to market. The pharma industry COULD do their own foundational research, but the university system cannot bring a drug to market.
    - Jensson 2y ago
      > The pharma industry COULD do their own foundational research, but the university system cannot bring a drug to market. You can't use an "in theory" argument for one side but not the other. In theory governments could bring medicine to market, in practice they don't/can't. In theory pharma industry could do foundational research, but in practice they don't/can't.
    - FireBeyond 2y ago
      If there’s no pharma industry? You act like the solution would be “oh well, no meds for anyone then!” and not “let’s expand university programs to meet that need”.
    - ClumsyPilot 2y ago
      > The pharma industry COULD do their own foundational research Citation neeeded - have they ever done so? Would the shareholders accept it? Would they be able to manage borderline autistic PHD types detached from reality, and would these scientists want to work there?
      - deleted 2y ago
        [deleted]
      - robotresearcher 2y ago
        Pharma companies are chock full of PhD types, as are the tech companies and Wall Street. What companies don’t have is PhD students. They are numerous, smart, very cheap, and work very hard.
        2y ago
  - a-dub 2y ago
    i've always viewed big pharma as like pre-internet record labels. they pick up talent (that often comes from bohemia aka government funded research), vet it, run the trials and put up the money, do the engineering to deliver it at scale and then market it.
    - mensetmanusman 2y ago
      That’s also like any endeavor with tech.
  - wdwvt1 2y ago
    The direct role that university research plays in drug development is overstated. The majority of cost and difficulty in pharma is _drug development_ not _drug discovery_. Pharma can do the discovery and the development, academics can only do the development. Absent academia, we'd have less drugs. Absent pharma we'd have no drugs. Academics focus on drug discovery because it's better aligned with academic incentives and timelines (see this commentary for a brief description [0]). Drug development costs (including clinical trials, extensive and repeated med chem, etc) are borne mostly by drug companies. Fair data on this is hard to come by because the two main sources have clear conflicts of interest (academics and pharma industry publications). One study Derek covered before (data from 1995-2007) shows only 24% of drug scaffolds were first found at a university and transferred to a biotech or pharma for development [1]. You can break this down further to highlight any story you want to support ('university ID'd drugs more innovative' vs. 'pharma ID'd drugs help more people') but they key point is that combining all the US research leads to only 24% of drug scaffolds that make it to market. I think everyone acknowledges that outside of finding the scaffolds and the basic biology, pharma is paying the vast majority of clinical trial costs. [2] gives a figure of total NIH funding of clinical trials at 10% of overall (e.g. pharma covers 90%). I think an argument could be made that the NIH training grants (which pay grad students in the biomedical sciences) subsidize the work force substantially, and might have a higher impact than direct research grants. I couldn't find quantitative data on this with a quick search, but I think this is often overlooked in the discussion. Finally, a less quantitative pieces make me think the impact of the NIH/government funding is overstated even given the above numbers. In my own field (microbiome), academic research has been almost inimical to the production of quality drugs. For every disease there exists a paper suggesting that a certain gut microbe changes the likelihood/severity/X about that disease. Academic labs have incentives to publish significant results fast, and in the microbiome this has led to a) abysmal signal to noise ratio with very high likelihood of failure to replicate, and b) an epistemic closure about what types of microbiome data matter and how they should be pursued as drugs that is totally divorced from the reality of how drugs are developed. Much of the knowledge base is polluted by low-quality research that has been done for the purpose of publishing. While the NIH spends ~40 billion a year on external research grants [3], I think you have to heavily discount this for the amount of just pure "grad student needs to graduate gotta publish" material that gets produced. [0] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10812233/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10812233/ [1] https://www.science.org/content/blog-post/where-drugs-come-numbers https://www.science.org/content/blog-post/where-drugs-come-n... [2] https://www.fiercebiotech.com/research/report-industry-not-nih-fronts-most-cash-clinical-trials https://www.fiercebiotech.com/research/report-industry-not-n... [3] https://www.nih.gov/about-nih/what-we-do/budget https://www.nih.gov/about-nih/what-we-do/budget
- Symmetry 2y ago
  The usual story is that academia finds an interesting mechanism to produce the desired effect. Though occasionally this is done by industry instead. Then industry turns that into a specific molecule that can enter the human body in a standard way and doesn't produce too many side effects. Then industry figures out how to produce that molecule at scale reliably in a sufficiently pure form. And at the same time industry is shepherding the drug through clinical trials.
ortusdux 2y ago
A significant portion of the cost is the drug trials. Excedrin Extra Strength and Excedrin Migraine have identical formulations, but IIRC Bayer spent $300m on FDA approval for migraine treatment, which is why the migraine variant continues to be more expensive.
- chimeracoder 2y ago
  > A significant portion of the cost is the drug trials. Excedrin Extra Strength and Excedrin Migraine have identical formulations, but IIRC Bayer spent $300m on FDA approval for migraine treatment, which is why the migraine variant continues to be more expensive. Your analogy would only be relevant if the US government paid $300M for the FDA approval and Bayer got to pocket 100% of the markup.

HideousKojima 2y ago

Did Gilead fund the R&D? There's a lot more to developing a new drug than just trials (though I think Gilead should have foot the bill for the trials too).

roughly 2y ago
I don’t know if it’s the case here, but very, very, very often in biotech you’ve got the primary foundational research happening at university labs funded by grants, and it’s the productionization of the research (and then clinical trials, etc) that are what the biotech companies are doing. I’m not sure where that shifts the “who deserves what” conversation, but without university research labs, there’s no pharma industry.
- pfdietz 2y ago
  If the university owned the IP, then its value should have been reflected in what was bid for it. If the knowledge was not restricted by IP law, then any drug company could use it, and compete for new drugs based on it. As such, it would not provide any of them with a competitive advantage, and so would not be reflected in what they could charge. What universities typically produce is not a chemical that can serve as an actual drug, but is only a starting point for a long and expensive process of producing such a chemical. And then, it's often found that the target of the class of potential drugs isn't actually a good one. One can't determine that until drug candidates are available to test on real patients.
  - Jensson 2y ago
    > What universities typically produce is not a chemical that can serve as an actual drug, but is only a starting point for a long and expensive process of producing such a chemical Remember you need to include all the failed attempts at finding useful things at university labs to see how much governments spend on research (just like you did failed pharma attempts), and if you add that up you see governments actually contribute a massive part of the cost to bring medicines to market. What they produce is necessary to even begin the work pharma does, currently it is basically a gift from the people to the pharma industry.
- Nifty3929 2y ago
  "without university research labs, there’s no pharma industry." - I think you have it exactly backwards: Without the pharma industry, there's no medicine. Good research goes nowhere if you can't bring it to market. The pharma industry COULD do their own foundational research, but the university system cannot bring a drug to market.
  - Jensson 2y ago
    > The pharma industry COULD do their own foundational research, but the university system cannot bring a drug to market. You can't use an "in theory" argument for one side but not the other. In theory governments could bring medicine to market, in practice they don't/can't. In theory pharma industry could do foundational research, but in practice they don't/can't.
  - FireBeyond 2y ago
    If there’s no pharma industry? You act like the solution would be “oh well, no meds for anyone then!” and not “let’s expand university programs to meet that need”.
  - ClumsyPilot 2y ago
    > The pharma industry COULD do their own foundational research Citation neeeded - have they ever done so? Would the shareholders accept it? Would they be able to manage borderline autistic PHD types detached from reality, and would these scientists want to work there?
    - deleted 2y ago
      [deleted]
    - robotresearcher 2y ago
      Pharma companies are chock full of PhD types, as are the tech companies and Wall Street. What companies don’t have is PhD students. They are numerous, smart, very cheap, and work very hard.
      - 2y ago
- a-dub 2y ago
  i've always viewed big pharma as like pre-internet record labels. they pick up talent (that often comes from bohemia aka government funded research), vet it, run the trials and put up the money, do the engineering to deliver it at scale and then market it.
  - mensetmanusman 2y ago
    That’s also like any endeavor with tech.
- wdwvt1 2y ago
  The direct role that university research plays in drug development is overstated. The majority of cost and difficulty in pharma is _drug development_ not _drug discovery_. Pharma can do the discovery and the development, academics can only do the development. Absent academia, we'd have less drugs. Absent pharma we'd have no drugs. Academics focus on drug discovery because it's better aligned with academic incentives and timelines (see this commentary for a brief description [0]). Drug development costs (including clinical trials, extensive and repeated med chem, etc) are borne mostly by drug companies. Fair data on this is hard to come by because the two main sources have clear conflicts of interest (academics and pharma industry publications). One study Derek covered before (data from 1995-2007) shows only 24% of drug scaffolds were first found at a university and transferred to a biotech or pharma for development [1]. You can break this down further to highlight any story you want to support ('university ID'd drugs more innovative' vs. 'pharma ID'd drugs help more people') but they key point is that combining all the US research leads to only 24% of drug scaffolds that make it to market. I think everyone acknowledges that outside of finding the scaffolds and the basic biology, pharma is paying the vast majority of clinical trial costs. [2] gives a figure of total NIH funding of clinical trials at 10% of overall (e.g. pharma covers 90%). I think an argument could be made that the NIH training grants (which pay grad students in the biomedical sciences) subsidize the work force substantially, and might have a higher impact than direct research grants. I couldn't find quantitative data on this with a quick search, but I think this is often overlooked in the discussion. Finally, a less quantitative pieces make me think the impact of the NIH/government funding is overstated even given the above numbers. In my own field (microbiome), academic research has been almost inimical to the production of quality drugs. For every disease there exists a paper suggesting that a certain gut microbe changes the likelihood/severity/X about that disease. Academic labs have incentives to publish significant results fast, and in the microbiome this has led to a) abysmal signal to noise ratio with very high likelihood of failure to replicate, and b) an epistemic closure about what types of microbiome data matter and how they should be pursued as drugs that is totally divorced from the reality of how drugs are developed. Much of the knowledge base is polluted by low-quality research that has been done for the purpose of publishing. While the NIH spends ~40 billion a year on external research grants [3], I think you have to heavily discount this for the amount of just pure "grad student needs to graduate gotta publish" material that gets produced. [0] https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10812233/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC10812233/ [1] https://www.science.org/content/blog-post/where-drugs-come-numbers https://www.science.org/content/blog-post/where-drugs-come-n... [2] https://www.fiercebiotech.com/research/report-industry-not-nih-fronts-most-cash-clinical-trials https://www.fiercebiotech.com/research/report-industry-not-n... [3] https://www.nih.gov/about-nih/what-we-do/budget https://www.nih.gov/about-nih/what-we-do/budget
Symmetry 2y ago
The usual story is that academia finds an interesting mechanism to produce the desired effect. Though occasionally this is done by industry instead. Then industry turns that into a specific molecule that can enter the human body in a standard way and doesn't produce too many side effects. Then industry figures out how to produce that molecule at scale reliably in a sufficiently pure form. And at the same time industry is shepherding the drug through clinical trials.

ortusdux 2y ago

A significant portion of the cost is the drug trials. Excedrin Extra Strength and Excedrin Migraine have identical formulations, but IIRC Bayer spent $300m on FDA approval for migraine treatment, which is why the migraine variant continues to be more expensive.

chimeracoder 2y ago
> A significant portion of the cost is the drug trials. Excedrin Extra Strength and Excedrin Migraine have identical formulations, but IIRC Bayer spent $300m on FDA approval for migraine treatment, which is why the migraine variant continues to be more expensive. Your analogy would only be relevant if the US government paid $300M for the FDA approval and Bayer got to pocket 100% of the markup.