Are biopharmas pulling the plug fast enough on drug projects?

Moren Lévesque Professor of Operations Management and Information Systems; CPA Ontario Chair in International Entrepreneurship; Co-director of Entrepreneurial Studies
Moren Lévesque

A new study published in the journal Production and Operations Management shows that scientific teams in biopharma companies might allocate too much time to early-stage drug discovery projects that are doomed to fail.

“A central feature of drug discovery projects is whether the drug is more of a follower- type or first of its kind,” says co-author Moren Lévesque, Schulich Professor of Operations Management and Information Systems and CPA Ontario Chair in International Entrepreneurship. By nature, first-in-class drugs face significantly more risk during their development since they have no predecessors to learn from.

“Whether a drug is a follower or first-in-class is not a binary measure, but more like a continuum because it is captured by the number of competitors that engage in the discovery of similar drugs,” remarks Lévesque. “To balance risk and return, biopharmas should favour delaying pulling the plug on those projects in the middle of this continuum.”

But there is a caveat to this recommendation, she adds: “Highly-risky, first-in-class drug projects targeted at rare diseases—aka orphan drugs—might never see the light of day, so third-party intervention is required.”

“AstraZeneca, Eli Lilly, and Pfizer were part of an NIH program where scientific teams at the biopharmas received the help of university researchers to develop new drugs,” notes Lévesque. “Today, Oxford University and AstraZeneca are working together on the ‘Oxford Vaccine’ for COVID-19. Such programs that combine expertise and efforts will undoubtedly remain needed in the new normal ahead of us.”