New Molecule Entity Research - Summary of Findings

Anthony Woodhead 2/12/2010

Rather than spend the time putting stuff into my own words, I’m just gonna cut and paste a lot and
give you the reference’s!

1.0 Relevant Definitions

First the Process:

“First, a manufacturer (sometimes referred to as the sponsor) submits to FDA an

Investigational New Drug (IND) application for permission to conduct clinical studies in
humans. Second, the manufacturer completes Phase I, II, and III clinical trials to establish
that a product is safe and effective for a specific purpose and population. Third, the
manufacturer submits to FDA a New Drug Application or a Biologics Licensing Application”
(Saul, 2008 p.1)

Yes your right, the FDA does then differentiate between standard and priority molecules. However
from what I found out you can’t say that because a drug is given priority it always means it is
innovative, it usually does though. There are possibly 5 important groups you can break the
molecules down into. I didn’t look too closely at what the EMA does though I gather they have a
similar system. Also as they both look at mostly the same molecules sooner or later it doesn’t
particularly matter (especially in terms of pNME’s where there less differentiation, see Jenkins, 2009
slide.46):

Priority New Molecular Entities pNME’s

“Priority Review involves no discussions of study design or procedure; it relates only to an

application’s place in the review queue.” (Saul, 2008 p.1)

“Unlike Fast Track or Accelerated Approval, the Priority Review process begins only when a
manufacturer officially submits an NDA/BLA. Priority Review, therefore, does not alter the
timing or content of steps taken in a drug’s development or testing for safety and
effectiveness. For products believed to address unmet needs, however, it shortens the
average amount of time from completed application until approval decision from 10 months
to 6 months.” (Saul, 2008 p.3)

Standard New Molecular Entities sNME’s

I’m presuming obviously this it’s for products believed to address met needs. I didn’t find a specific
FDA definition.

Stats I’ll highlight in more detail later put the ratio of sNME’s : pNME’s at 1.2 : 1, between 1998-
2007. I.e. 55% of all New Molecules are not really new. (Kneller, 2010)
Accelerated Approval and Fast Tracked FDA Molecules

There are two other relevant types of FDA approval:

“Accelerated Approval. For the treatment of a serious or life-threatening illness, FDA

regulations, promulgated in 1992, allow “accelerated approval” of a drug or biologic product
that provides a “meaningful therapeutic benefit ... over existing treatments.” The rule covers
two situations. The first allows approval to be based on clinical trials that, rather than using
standard outcome measures such as survival or disease progression, use “a surrogate
endpoint that is reasonably likely ... to predict clinical benefit.” The second situation
addresses drugs whose use could be deemed safe and effective only under set restrictions
that could include limited prescribing or dispensing.” (Saul, 2008 p.2)

“Fast-Track Mechanism. The Food and Drug Administration Modernization Act of 1997
(FDAMA, P.L. 105-115) directed the Secretary to create a mechanism whereby FDA could
designate as “Fast Track” certain products that met two criteria. First, the product must
concern a serious or life-threatening condition; second, it has to have the potential to
address an unmet medical need. Once FDA grants a Fast Track designation, it encourages
the manufacturer to meet with the agency to discuss development plans and strategies
before the formal submission of an NDA/BLA. The early interaction can help clarify elements
of clinical study design and presentation whose absence at NDA/BLA submission could delay
approval decisions.” (Saul, 2008 p.2)

“For what percentage of products with Fast Track designation do sponsors submit
NDA/BLAs? How many NDA/BLAs submitted each year are for Fast Track products? With
only the numerator (approved products), one cannot calculate the percentage of NDA/BLA
submissions that are approved among Fast Track products.” (Saul, 2008 p.6)

Big Pharma and Biotec’s seem understandably cagy about releasing any information about their
fancy new stuff. However:

“Sponsors are suspected of announcing Fast Track designations to facilitate an increase,

albeit a temporary one, in company stock prices, and the FDA has been criticized for its lack
of transparency concerning the programme” (Reichert et al., 2008 p.885)

Orphan Drugs.

This isn’t a category the FDA typically assigns molecules to and requires secondary assignment; this
has been done in some studies. I assume that all Orphan Drug in FDA terms would all fall into the
pNME’s category by definition. There are however difference in Classification between the FDA and
the EMA and no international standard.
For the FDA:

“Defined as conditions that affect fewer than 200,000 US citizens a year or conditions for
which the cost of developing treatments cannot be covered by subsequent sales of these
treatments in the United States. The key incentives are 7 years’ exclusivity for the orphan
indication in the US market (that is, the FDA will not approve an application by a different
company to market the same drug for the same disease — an important protection because
many orphan drugs are not covered by patents) and tax credits for up to 50% of the cost of
clinical trials.” (Kneller, 2010)

For the EMA the definition see: http://www.ema.europa.eu/ema/index.jsp?

curl=pages/regulation/general/general_content_000029.jsp&murl=menus/regulations/regulations.js
p&mid=WC0b01ac05800240ce

They also do a monthly report of all new approvals which has the running totals of all new Orphan
Drugs from 2000 in the appendix (see References: EMA, 2010):

Again there are financial incentives given for companies to develop them. I think they all catered
towards the needs of orphan drugs in western medicine though. From memory, a statistic often
cited in global public health is that 90% of all drugs are designed for 10% of the population - more a
rule of thumb than hard stats.

Innovative Molecules.

Again I’m assuming all would be pNME’s by definition. Kneller (2010) makes this distinction based
partially on pNME status in a cohort study of all new drugs released between 1998-2007:

“Two key characteristics of the 252 drugs were also analysed: the extent to which they
addressed unmet medical needs and their scientific innovativeness. The assignment of
priority review status by the FDA, which is granted to drugs that are anticipated to provide
substantial benefit over currently marketed drugs, was used as an indicator for the first
characteristic. Considerations related to the novelty of the mechanism of action and/or the
chemical structure of the drug were used for the second characteristic” (p. 869)

“With regard to addressing unmet medical needs, of the 123 drugs in the priority review
category, 56.6 WDEs (46%) were attributed to pharmaceutical companies, and 66.4 WDEs
(54%) were attributed either to biotechnology companies (29.0 WDEs; 23%) or universities
(37.5WDEs; 30%) (TABLE 1). In addition to the important finding that biotechnology
companies or universities provided more than half of the overall discovery contribution for
drugs in this category, it is also noteworthy that a substantially greater proportion of the
total number of WDEs attributed to biotechnology companies and universities are in this
category, rather than the standard review category. For example, 65% of the WDEs
attributed to biotechnology companies are for the 123 drugs in the priority review category,
with 35% in the standard review category, whereas the corresponding figures for
pharmaceutical companies are 38% in the priority review category and 62% in the standard
review category.
In the assessment of scientific innovativeness, of the 118 drugs considered to be scientifically
novel, 51.5 WDEs (44%) were attributed to pharmaceutical companies, and 66.5 WDEs (56%)
were attributed either to biotechnology companies (29.9 WDEs; 25%) or universities (36.6
WDEs; 31%) (TABLE 1). Thus, biotechnology companies and universities provided more than
half of the discovery contribution to scientifically innovative drugs. Similarly, a substantially
greater proportion of the WDEs attributed to biotechnology companies and universities
transferring to biotechnology companies are scientifically novel (68% and 69%, respectively)
rather than follow on products. The opposite is true for the WDEs attributed to
pharmaceutical companies, with 65% of these WDEs corresponding to follow on products
(TABLE 1).” (p.869-879)
2.0 Some Questions and Answers

I decided the best way of presenting what I found out was to try and briefly answer a set of research
questions.

2.1 Is there a decline in pNMEs v’s sNMEs?

“declining clinical transition probabilities between Phase I and Phase II, and between Phase II
and Phase III, suggest that drug sponsors are becoming more aggressive about terminating
unpromising candidates, enabling them to re-direct increasingly scarce R&D resources to
more promising drug development programs.” (Tufts, 2010 p.4)

“Although developers are terminating more unpromising drugs earlier and teaming with
outside service providers to streamline development, new product approvals are not keeping
pace with patent expirations.” (Tufts, 2010 p.3)

As the below graph shows (Jenkins, 2009 slide.27) both filings and approvals of all drugs are in
decline.

Since the figures fluctuate quite a bit so you’d have to compare cohorts. Group stuff in 3 or possibly
5 year intervals and look for the trends over time. Then there’s the added problem of do you assess
applications or approvals. Jenkins (2010) says submission cohorts are the best comparator but
obviously take time to mature. He’s done some slides on this in 5 year groupings, (see Jenkins, 2010
slide 31-34).
I’ve copied the slides below as I wanted to look at the data all together:

Usually more sNME than pNME applications are filed each year.

% approvals seem to be falling with time, certainly for the sNME’s

I stuck the data for first action approval rates into SPSS, this graphs came out:

I gave up looking for trends then.

2.2 What about in relative v’s absolute terms?

“global spending on new drug development has been growing at an annual rate of 9.1%
during this past decade, spending on contract clinical services has been growing nearly 50%
faster—at an annual rate of 13.4%.” (Tufts, 2010 p.8)

There’s definitely an argument that in relative terms w.r.t. R.O.I. that less value for money in being
achieved in terms of all new molecules being released. No great revelation though and I didn’t look
for any papers. Tuft’s (2010) discuss how current economic pressures might mean that Big Pharma
is being quicker to drop riskier molecules it doesn’t want to take a chance with. Executives might
well be scared of an expensive Phase III going belly up. I would suspect if prospects look boarder line
it’s easier not to approve further work. Kneller (2010) also discusses how Big Pharma is more risk
averse with respect to investments than Biotech companies.

2.3 Is there a decline v’s innovative molecules?

From the Kneller (2010) paper, in his cohort 123/252 (48%) are pNME’s. Of these he classes 118 to
be scientifically novel. So if a drug is a pNME it would be reasonable to assume that it is usually going
to be innovative also. Therefore the Jenkins’ cohort graphs are a reasonable proxy of this. However,
as discussed, the trends are not really clear.

2.4 What about the Accelerated Approval / Fast Track Schemes?

Typically, Big Pharma seems to be getting the best of both worlds here. Releasing info for a spike in
their share price when it suits them, then hiding behind not unreasonable claims of intellectual
property protection and not allowing the FDA to divulge how many Fast Track Molecules are being
studied. Also, because there’s a long time lag, it’s difficult to spot the trends when it comes to the
really fancy stuff coming to market.

A recent JAMA article (Mitka, 2010) made some interesting points:

“once a drug was on the market, it became difficult to spur pharmaceutical companies—who
were already earning revenues from sales of the drug—to conduct follow-up studies showing
efficacy on hard clinical end points, in part because patients may be reluctant to join a trial in
which they may receive a placebo or alternative medication instead of the drug that they
presume works. Midodrine has been on the market for 14 years without a single rigorous
study to show its efficacy.” p.1774

John K. Jenkins, MD, director of the FDA’s Office of New Drugs, said the accelerated approval
process puts the agency in a tough spot, forcing it to balance between getting a drug with a
promise of efficacy quickly to a population in dire need and then ensuring that that promise
is fulfilled. “These are very complex cases,” Jenkins said. “If this is the only available therapy,
it is a very complex decision to remove that from physicians and patients as an option unless
you identify a real safety concern, or if the drugs have not shown benefit but harm, or
something else comes along to replace it.” p.1774
2.5 Are we seeing much substitution of Chemical to Biological Molecules? Is the game
changing?

The IMS report you sent me indicates there’s some substitution going on in the market place. With
new types of product shifting toward Biotech stuff, recombinant DNA technology, vaccines produced
in living organisms etc. The decent research includes all types of molecule as both need approval
through the same process. However I couldn’t say if the newer type of research is less efficient,
taking longer to achieve results compared with older chemistry based techniques. My hypothesis
would be that it took longer at first and then the processes improved and the pull through speeded
up. I didn’t look for any papers on this.

I didn’t think the IMS analysis was particular good though. Paraphrasing from p.8-9: The number of
new product launched in 2007 (27) is significantly lower than the average of 44 per years 1995-2000
and 33 per years 2001-2006.

So what, they don’t do a statistical test (t-test) and as the FDA shows there’s probably too much
fluctuation year by year to say one year’s result can indicate much.

IMS data is however necessary to tell the other side of the story though. Namely how much money
do all these products make and in what markets. I didn’t look into this in much detail.

2.6 What about the increase in efficacy supplements? Are the goalposts being shifted?

I though Slide 23 in Jenkins 2010 was interesting.

There appears to be an increasing backlog in terms of companies adding efficiency supplements.
What this really means is not totally clear.

“Following the withdrawal of Vioxx from the market in 2004 and increasing FDA oversight,
RiskMAP submissions surged by 75%” (Tufts, 2010 p.5)

 Are these included into the figures above, and therefore Pharma is being good (or watched)?
Not sure, probably.
 Is it because the FDA had to cut back on staff because of the recession, and concentrate on
new stuff as a priority, leading to a backlog? Again a reasonable assumption
 It could of course also be hypothesised that Big Pharma is adding supplementary data to
increase line extensions. This also wouldn’t surprise me one bit either.

In reality I suspect the backlog is being caused by all three of these things at once. I have not looked
for a study that broke it down further.

2.7 Where are the New Molecules coming from? Big Pharma, Biotecs or Universities?

I’ll refer you to the Kneller (2010) for this one, from the Abstract:

“By identifying the inventors of 252 new drugs approved by the US Food and Drug
Administration from 1998 to 2007 and their places of work, and also classifying these drugs
according to innovativeness, this study investigates the contribution of different types of
organizations and regions to drug innovation during this period. The data indicate that drugs
initially discovered in biotechnology companies or universities accounted for approximately
half of the scientifically innovative drugs approved, as well as half of those that responded to
unmet medical needs, although their contribution to the total number of new drugs was
proportionately lower.” (p.867)
3.0 Possible relevance to Bad Science, and society in general.

You didn’t say what the ultimate aim for this research was going to be, possible as you didn’t know
of course. If you do end up taking on more interns in the future telling them this might help them
tailor their work, if possible. Not that I minded one bit to be honest. Was nice to do something with
my brain and apply some of what learnt on my MSc, the Pharma interviews I’ve had recently have
been boring! For the record I probably spent a couple of easy days putting this together. I’m sure
others would be willing to devote that sort of time to the cause. From my point of view it will give
me a good answer for PhD interviews if I’m asked what I’ve been doing since graduating.

Anyway…

In terms of Data Sources: The FDA and EMA seem open and reliable; you could pull raw numbers
from them. Tufts also do pretty good analysis. If you want to relate it to market share etc. the only
way to go then is IMS though. A quick skim of the business literature led me to believe there’s some
of this type of analysis out there.

I definitely think there’s a story here. However to quote your good self, it’s a little more complicated
than Big Pharma isn’t inventing anything new and useful. (I’m sure you knew it was going to be).

I could be said that, unlike the banks, Big Pharma are too risk averse. It certainly seems they prefer
to bet on sure things. This is evidenced in the Kneller Paper (2010) and also by Tuft’s (2010)
indicating they’d rather pull the plug and put money elsewhere rather than risk going down a blind
alley. I’m sure they’d probably argue this is because of too much regulation. (Of course companies
like Goldman Saks also only bet on sure things also, so in reality they’re probably not that different).

I know there’s a long running argument made by researchers in York Health Sciences that they
should be broken up in order to help foster greater innovation. Karen Bloor likes to call Big Pharma
‘The Borg’, as they assimilate anything in their path. (She works with Prof. Alan Maynard a lot. If you
don’t already read his Blog it’s always worth checking out for comedy value). Obviously that’s never
going to happen at the moment. Personally I’d want to delve more into the business literature
before deciding if there’s good the evidence for such a policy. On the face of it I’d probably agree
though.

There’s definitely an argument for merging the FDA with the EMA, certainly when it comes to
assessing pNME’s. The evidence shows this would be more efficient. (Jenkins, slide 46 - Concordance
of action for ~ 80% of NMEs submitted within 12 months to both agencies with little divergence on
priority NMEs, greater divergence on standard NMEs). I think the way Pharma exploits approval to
the Accelerated Approval and Fast Tracked FDA Molecules process is par for the course and would
be hard to deal with. A little naughty, not particularly surprising; in sales we’d call this a quick win!
There’s no excuse for them being let off from doing the after-studies though.

I personally I think the ‘damming evidence’ all comes from the Kneller Paper (2010) which clearly
shows when compared with Universities and Biotechs, Big Pharma just isn’t that innovative. This
argument is probably the most accessible as well. My instinct would be to find something stupid that
the Con-Dem’s said about Universities being worthless at coming up with new stuff and big business
being amazing, then debunk the myth. I’m sure there’s plenty of government rubbish / ideology /
bad science which takes that line.
References, including notes on the sources.
There all attached, but I’ve done the references for you as well. The numbers correspond to the
attached pdf’s. It’s Harvard style in the document as that’s what I’m used to.

1. Jenkins, J. (2009). New Drug Review: 2009 Update. Available at

http://www.fda.gov/downloads/AboutFDA/CentersOffices/CDER/UCM192786.pdf [Accessed
Dec 1st, 2010]

A slide show by the Director, Office of New Drugs Center for Drug Evaluation and Research.
Always nice when someone like that put out something like this!

2. EMA. (2010) Committee for Orphan Medicinal Products (COMP). November Monthly Report
Available at. http://www.ema.europa.eu/ema/index.jsp?
curl=pages/news_and_events/document_listing/document_listing_000201.jsp&murl=menu
s/about_us/about_us.jsp&mid=WC0b01ac0580028e78&jsenabled=true [Accessed 1st Dec,
2010]

Contains running totals of Orphan Drug numbers.

3. Taul, S. (2008) CRS Report for Congress: FDA Fast Track and Priority Review Programs
Available at http://www.nationalaglawcenter.org/assets/crs/RS22814.pdf [Accessed 1st Dec,
2010]

4. Tufts. (2010). Tufts Center for the Study of Drug Development: Outlook 2010. Available at
http://csdd.tufts.edu/_documents/www/Outlook2010.pdf [Accessed 1st Dec, 2010]

A lot of good research by this group, The Tufts Center for the Study of Drug Development
(Tufts CSDD), http://csdd.tufts.edu/research

5. Reichert, J. Rochon, S. and Zhang, B. (2007) A decade of the Fast Track programme. Nature
Reviews. Drug Discovery. (7):886-887

A paper written by people at Tufts. The Nature Journal seems to be a good source also.

6. Mitka, M. (2010) Oversight of Fast-Track Drug Approval by FDA Stuck in Low Gear, Critics Say
JAMA. 2010; 304(16):1773-1775.

Contains quotes from an interview with J Jenkins from the FDA.

7. Kneller, R. (2010) The Importance of new companies for drug discovery: origins of a decade
of new drugs. Nature Reviews. Drug Discovery. (9):867-882

A very thorough paper, definitely worth reading.

Also, Prof Maynard’s Hilarious Blog... http://www.healthpolicyinsight.com/?q=TMDMonth