The Global Pharmaceutical Industry is at the Cross Roads due to Low Productivity And High And Unaffordable Costs of R&D with few products in the pipeline and expiry of Patent protection for many Blockbusters.
Needs new approaches to New Drug Discovery necessitated by :- High Costs Of Research & Development
- Low Success Rates
- Rapid Obsolescence Of Drugs
- Evolution Of Drug Resistance
- Emergence Of New Diseases
- Poor Understanding Of Disease Processes
There are Three Approaches possible:
1.Growth of the companies to reach critical Mass to afford the currently unaffordable R&D.
2. Find Innovative ways to make R&D more productive.
3. Net work And Collaborate with others to synergise efforts and optimise outputs.
Since vertical growth has limitations, the Strategy has been to merge with and acquire other companies
Ciba-Geigy-Sandoz (Novartis)
Marion-Merrill-Dow-Hoechst Roussel-Rhone Poulenc-
Rorer (Aventis)
Aventis-Sanofi
Richardson-Merrell-Proctor & Gamble
Kabi-Pharmacia-Upjohn
Bristol-Myers-Squibb
AHP-American Cynamide
Astra-Zeneca
Bayer-Sterling
Glaxo-Burroughs Wellcome- SKB
BASF-Knoll-Boots
Roche-Syntex
Pfizer - AHP-Pharmacia-Upjohn
Strategic Alliances Between Big Pharma & Little Biotech
Wyeth signed licensing agreement with Exelixis for drugs for metabolic disorders.
GSK works closely with Exelixis for pipeline cancer drug candidates.
Roche signed agreement with Maxygen to develop
r Factor VII a for intracerebral haemorrhage & trauma.
TERMS Of THE DEALSUpfront Payments of $ 10 to $ 30 mio , milestone payments and royalties which could be as high as $ 100 mio to $ 500 mio. depending on successful developmental outcomes & blockbuster sales.
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