Gurpreet Singh, VP & MD - Integrated Safety, IQVIA, 0
The overall revenue of the global pharma market stood at $1.6 trillion in 2023, with the expenses on R&D alone accounting to around $250 billion. This signifies the humongous extent of the sector emphasizing on its R&D efforts. As a result, the number of pharma companies with active R&D pipelines which stood at 1200 in 2001, has increased significantly over the past few years, with over 5,500 companies having active R&D pipeline. To note that 55 novel drugs were approved by CDER in 2023.
On the other hand, the total cost of introducing a new drug into the market has immensely increased over the last two decades, with the average cost standing at $1.2-1.3 billion and average time taken being 12-18 years. Thus, pharma companies are now increasingly focusing on getting their drugs into the market with the best-in-class Clinical Research, at the shortest time frame and most affordable cost. We are now seeing multiple partnerships happening with the clinical research organizations that are assisting pharma organizations in their drug development efforts. Hence, the CRO market which stood at $82.6 billion in 2023 is forecast to reach $188.5 billion by the end of this year with a CAGR of 12.5 percent.
Of late, there has been a heightened focus by the pharma industry around quality and compliance in their drug development process. Also, the health authorities too have become stringent in conducting inspections and audits to ensure that the companies are fully compliant with the necessary regulatory policies and frameworks. Additionally, pharmaceuticals are now making significant investments in process excellence initiatives to enhance the overall efficiency of their processes.
Emerging Trends & Tech Disruptions
While the pharma sector had been comparatively slow in adopting new technologies due to stringent regulations and concerns pertaining patient safety, we are
witnessing widespread adoption of RPA, AI/ML, data analytics and other digital technologies in the industry for the past few years. Also, simulation tools are now being increasingly utilized to predict the results in the drug development process. Furthermore, the number of M&A that are happening within the pharma and clinical research industries has been at an all-time high over the last few years. Unlike earlier when outsourcing was only transactional, today most of the outsourcing strategic and partnership oriented, wherein pharma companies are in search of companies that can not only offer services, but also bring-in process excellence, technology and innovation. Lastly, with a significant increase in the availability of skilled pharma talent in India lately, companies are now making it a priority to hire the right talent, develop them internally and ensure that they stay with the organization.
Government’s Role in Facilitating Drug Development
Drug development has always been an ecosystem as it cannot be done in silos. Pharma companies are currently leading the drug development space since they own the required molecules. However, they work closely with CROs, IT companies and other service providers who specialize in specific areas. Also, pharma companies have realized the key role academia will play in the drug development process going forward and are thus collaborating with numerous academic institutions; the COVID vaccine that was developed by AstraZeneca in collaboration with one of the universities in UK being a recent example. The government has been playing a pivotal role in providing a platform that facilitates such collaborations. Additionally, the government has also been very proactive in supporting drug development across the country by not only providing various benefits to the companies, but also creating the right academic environment to support the industry going forward.
Future Prospects
The next few years will be crucial for the drug development industry, with digital transformation expected to completely disrupt the way various processes are carried-out. While the pharma and clinical research industries continue to exhibit significant growth, going forward, there will be a heightened demand for talent with highly specialized skill-sets. Thus, it is paramount for individuals wanting to enter this industry to not only possess the required subject matter expertise, but also be capable of using technology effectively to derive optimum results.
With a significant increase in the availability of skilled pharma talent in India lately, companies are now making it a priority to hire, develop and retain the right talent.
Government’s Role in Facilitating Drug Development
Drug development has always been an ecosystem as it cannot be done in silos. Pharma companies are currently leading the drug development space since they own the required molecules. However, they work closely with CROs, IT companies and other service providers who specialize in specific areas. Also, pharma companies have realized the key role academia will play in the drug development process going forward and are thus collaborating with numerous academic institutions; the COVID vaccine that was developed by AstraZeneca in collaboration with one of the universities in UK being a recent example. The government has been playing a pivotal role in providing a platform that facilitates such collaborations. Additionally, the government has also been very proactive in supporting drug development across the country by not only providing various benefits to the companies, but also creating the right academic environment to support the industry going forward.
Future Prospects
The next few years will be crucial for the drug development industry, with digital transformation expected to completely disrupt the way various processes are carried-out. While the pharma and clinical research industries continue to exhibit significant growth, going forward, there will be a heightened demand for talent with highly specialized skill-sets. Thus, it is paramount for individuals wanting to enter this industry to not only possess the required subject matter expertise, but also be capable of using technology effectively to derive optimum results.