The State of Play

The medical world has come a long way since the genome mapping project wrapped up in 2003. In the two decades since, technological advances, investment from the venture capitalist world and changing regulatory environments have sparked significant changes in the life sciences industry.

At the same time, a sicker nation that pays the world’s highest health care costs has put some regulators, patient advocates and the public at loggerheads with the pharmaceutical industry.

In this segment, we explore the interplay of regulations, innovation, the drive for profit and how technological advancements are shaping the future of medicine.

Listen to the accompanying podcast here.

A protracted process: The medical world achieved one of its greatest feats during the early stages of the Covid-19 pandemic with the speedy development of mRNA vaccines. That was, however, a rare instance where the Food and Drug Administration quickly approved a drug for emergency public use.

Behind the advancements in treatments for diseases like cancer, Alzheimer’s or sickle cell anemia is a long and expensive drug development process. While the FDA’s oversight is necessary to ensure rigorous safety and efficacy standards, the regulatory hurdles add layers of costs and time to the drug discovery cycle.

It takes about eight years to bring a drug to the market and only about 10% get approved, according to Kenneth Getz, executive director at Tufts University’s Center for the Study of Drug Development.

Companies can fork out about $2.6 billion to take a single drug from its start to a patient’s bedside, according to Tufts, which has tracked the issue since as early as the 1970s.

“The cost of all drugs that fail have to be covered by the drugs that ultimately succeed,” Getz added.

In the meantime, the U.S. faces competition from other countries, including Switzerland, Germany, the U.K. and China. Japan, too, has stepped up its efforts to get more competitive in biopharmaceutical development. New technological advancements will nevertheless give an edge to whoever adapts fastest.

AI in medicine: As the life sciences evolve, AI has become an integral tool for turbocharging the health care and biotechnology sectors into the future.

Companies are using AI in different stages of the drug discovery cycle, including for the development of molecules, clinical trials and data analysis. AI has also been integrated into administrative tasks and doctor-patient interactions.

Jocelyn Ulrich, vice president of policy and research at PhRMA, which advocates on behalf of the leading biopharmaceutical research companies, said regulators are now also using machine learning and generative AI in the drug approval process.

Indeed, the FDA has said it “recognizes the increased use of AI throughout the drug product life cycle and across a range of therapeutic areas.”

The agency also has issued draft guidance for the industry on the use of AI in a way that would “support regulatory decision-making regarding the safety, effectiveness, or quality” for drug and biological products.

“If we can ensure that the regulatory and legislative framework continues to support the use of AI, there remains a lot of promise to optimize the use of AI in drug development,” Ulrich said.

Profit vs. product: The drug discovery process is still long, costly and FDA approval isn’t guaranteed.

Without the promise of profitability, some argue, there’s no incentive to dedicate years of time and research to developing a single drug.

Here’s where venture capitalists play a critical role in backing early-stage biotech companies. This kind of collaboration, though not entirely uncontroversial, allows small and emerging biotech startups to pursue breakthroughs in medicine often in partnership with larger pharmaceutical firms or before an acquisition.

“We need all of those players, including public funding and academic sites, all to be working together to generate innovation,” Ulrich said.

Rep. Greg Murphy (R-N.C.), one of the EPIC Act lead sponsors, said research and development for small molecule drugs have fallen and the bill would “restore” investments into those kinds of medicines.  

The ORPHAN Cures Act would expand incentives for the development of medicines that can cure more than one rare disease. Currently, incentives and exemptions from government price negotiations only apply to drugs approved for treating a single rare disease.

We’ll have more on these measures in our next segment exploring the regulatory landscape and how decisions made in Washington will shape the future of medicine and determine whether the U.S. remains the global leader in medical innovation.

— Elvina Nawaguna