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Rethinking Innovation in
Pharmaceutical R&D

Health & Life Sciences
The pharmaceutical industry is facing a challenge to be productive. One of thesolutions to this problem is for the industry to better harness innovation todeliver more and better drugs through the pipeline.
But what is innovation and how can it deliver higher performance throughmore valuable drugs? Historically, pharmaceutical innovation has been seen to be firmly rooted in Discovery. The focus has been on the pursuit of first-in-class products based on new targets1. However, new research by CMR International and Accenture challenges the view that investment in thistype of innovation alone will solve the productivity gap. The research showsthat projects based on new targets are slower and less likely to get to marketthan those based on established targets2. Hence, they substantially increasethe risk in pharmaceutical research. In addition, there is evidence that laterentrants based on known mechanisms and designed specifically to be best inclass often displace first-in-class products in the marketplace. Based on these findings and on wider research into what makes high-performing businesses tick, Accenture believes that companies pursuing highperformance need to rethink their innovation strategies. Companies must takea broader view of how and where they innovate. Applying novel approachesthroughout the organization and across the entire R&D process may be thetrue key to higher levels of productivity. Innovation in Discovery is clearlyimportant and the portfolio needs to be carefully balanced to maintain riskwithin acceptable limits and to deliver expected levels of output. But it is not in itself sufficient. Figure 1: The top 10 selling pharmaceutical products in 2003 include just one first-in-class product
Manufacturer
First-in-class
2003 sales $ billion
Procrit / Eprex (epoetin alpha)
Johnson & Johnson
Figure 2:
Scientific innovation
Implications of investment
Success rate by Discovery phase for
in scientific innovation
new and established target projects
deliver a successful product to market.
Established
shows that to deliver one submissionper year, a company focusing Figure 3:
Median duration by Discovery
phase for new and established
target projects
in lead optimization, which is 17months longer for new target products.
established target projects also havehigher requirements for demonstrating hits in lead discovery.
Established
Focus on scientific
innovation does not mean
greater commercial success
Re-thinking innovation for
high performance
creating commercially viable products.
“Innovation is not about
new targets, it is about
successfully bringing
to market a product
that meets an unmet
medical need .”
Dr. Jan-Anders Kaarlson
transition through the R&D pipeline.
project rather than keeping it going.
and providing incentives, as well asrewarding innovation more broadly. What to do tomorrow
Managing risk, holistic
innovation
drive productivity through innovation:1. Assess the risk associated with the risk, timelines and resourcerequirements in pharmaceutical R&D.
1. Assess the risk associated with
However, it does not necessarily increase scientific innovation
Scientific innovation can create asignificant amount of risk in R&D Figure 4:
The number of new Discovery
projects that must start each year to
different levels of risk in the pipeline.
consistently deliver one submission
to make more informed decisionsabout the level of risk resulting from scientific innovation that isacceptable and appropriate for 2. Innovate all the way to market
Companies need to assess how well
they currently use innovation to add
Established New
target

1 No public data is available on the target and no drugshave been developed for it.
of Discovery, Development andCommercial. In doing so, they may 2 Either some public data is available but the company hasnot previously worked on the target, or the company has previously worked on and has experience with the target.
Accenture in Europe / Middle East /
Africa / India
Accenture in the Americas / Asia /
Pacific

CMR International
Copyright 2005 AccentureAll rights reserved.
Accenture, its logo, and High Performance Deliveredare trademarks of Accenture.

Source: http://images.accenture.ca/Microsites/rdtransformation/Documents/PDFs/Accenture_Rethinking_Innovation_in_Pharmaceutical.pdf

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