Health, Medical, News, Science

4 Challenges Pharmaceutical Companies Are Facing Today

Challenges Pharmaceutical Companies Are Facing, streamline costs without sacrificing quality, pharmaceutical patents, alternative generic drugs, FDA approval

As is the case within most industries, pharmaceutical companies are under constant pressure to streamline costs without sacrificing quality. They’re also facing ever-increasing competition, as well as intervention from regulators. As troubling as those can be, here are another four challenges modern pharmaceutical companies are facing today.

Balancing R&D with Liability

Operating in today’s market is a balancing act between streamlining the research and development process and ensuring product quality. On one hand, companies want to optimize consumer outcomes and minimize liability risks. But, on the other, they are feeling pressure from the FDA to keep drug prices low by expediting R&D — taking measures to make the process less costly and more efficient.

As Risk & Insurance notes, while these efforts make costs lower on the consumer end, pharmaceutical companies must be very careful not to sacrifice quality or oversight. If medications spend less time in R&D for the sake of cost — only to end up adversely affecting patients — firms could be on the hook for liability and regulatory failures.

High Cost & Timeframes for Bringing Drugs to Market

The Johns Hopkins Bloomberg School of Public Health notes previous median cost estimates of $19 million to bring a product to market only tell part of the story. Comprehensive costs are likely to range somewhere between $2 and $3 billion.

Getting a drug through multiple phases of FDA testing is neither inexpensive nor easy to do in a timely manner. This is especially true for large drug trials involving thousands of patients, which can easily take more than 10 years to complete successfully.

One silver lining is the impact medical data analytics can have on bringing drugs to market in an efficient manner. For instance, one Fortune 500 Company has deployed the ThoughtSpot analytics platform to give its scientists the ability to speedily analyze trials results and identify side effects. In doing so, this company has reduced the time to gather insights from three months to about three minutes. This enables them to make adjustments with less wait time for critical insights.

Increased Presence of Generic Drugs

Opting for generic drugs allows consumers to get the medications they need at a lower price point.  While this is indeed advantageous for patients, the increased presence of generic drugs presents a hurdle for firms producing brand-name medications.

While pharmaceutical companies have to fund and pass clinical studies to bring their medications to market, multiple generic alternatives are often approved without the same degree of trials because they contain the same active ingredients at the same strength and are administered in the same way. So, when patents end, pharma companies can experience a major uptick in competition at lower prices.

Rising Patent Cliffs

The pharmaceutical industry has weathered several major waves of patent cliffs over the course of the last decade, causing companies to experience losses due to the expiration of previously protected patents. As The Motley Fool cites, more than $250 billion in sales could be at risk between 2018 and 2024 due to drugs losing patent exclusivity. As an example: Humira, historically the world’s top-selling drug with sales of $18.4 billion in 2017, will lose its exclusivity in 2023 and will face stiff competition from a biosimilar called Amjevita.

Losing exclusive rights means they’ll face increased competition and lose market share. As a result, companies operating in the pharmaceutical space today must figure out how to streamline their operations while upholding high product quality —while competing with other major firms and generic equivalent drugs. The good news is data analytics capabilities have advanced, too, and can help enterprises make data-driven decisions to optimize various aspects of performance. 


More on this topic:

The Advantages of Medicare

Previous ArticleNext Article