For the last decade, as the biopharmaceutical industry has struggled — largely unsuccessfully — to live up to its anticipated potential, a litany of experts, analysts, participants, and commentators have offered up their diagnosis and treatment for pharma’s productivity problem.
The basic question they’re all trying to solve: how can it be that despite profound improvements in many aspects of drug discovery, actual productivity – measured by cost per new NME – seems to be declining?
That’s the problem that Jack Scannell (an industry analyst at Bernstein & Co.) and colleagues tackle in the latest issue of NRDD (here – abstract only), expanding upon a nice piece of work they did on this subject last year to now offer an even more comprehensive and thoughtful review of this important subject. While painfully depressing, the article is worth reading, as it cogently summarizes many years worth of hand-wringing and angst.
Having spent much of the last decade wrestling with many of the same issues (his topics will be familiar to regular readers of this column), I was perhaps most struck by the rather dismal take-away: there isn’t a clear unifying explanation for the R&D productivity problem; perhaps if each company examined its internal failures rigorously, new insight might emerge, but meanwhile, essentially, beatings will continue until morale improves.
More specifically: the payor environment is likely to make reimbursement increasingly difficult; regulators will always have an easier time tightening screws than loosening them; each success raises the bar higher; and the only immediate solution is likely to be continued R&D cuts.


Hospital leaders are busy trying to cope with the changes brought on by the Patient Protection and Affordable Care Act and the realization that the federal budget deficit translates into less money for all healthcare providers in the future. The seemingly inevitable transition from fee-for-service to global payments creates anxiety about how quickly the financial incentives will shift.
The going rate for a compromised medical record seems to be $1000 (well, at least that’s the asking price) as seen in papers filed in the eleven class action lawsuits against Sutter Health following the theft of a desktop computer last fall. The computer contained unencrypted protected health information on about 4.24 million members. The eleven class action suits are likely to be consolidated for ease of handling by the courts.
