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Unformatted text preview: Overview of the U.S. Drug Approval Process and the Pharmaceutical Industry
Marv Shepherd, Ph.D. Director Center for Pharmacoeconomics University of Texas Email: email@example.com
Presented for BIO 307D, February 26, 2009 The pharmaceutical industry is a mega The business enterprise. The research intensive pharmaceutical industry, along with all the tangential firms, employs hundreds of thousands of people. It has enormous political power. Its research machine is unmatched in the world. It brings a lot of good to society, but it has tremendous cost. tremendous Four Sectors of the Pharmaceutical Industry Industry Research Intensive Pharmaceutical Research Firms Firms Generic Drug Manufacturing Firms Biotechnology Firms Drug Delivery Firms Research Intensive Pharmaceutical Manufacturers
v First, is the Research Intensive First, Pharmaceutical Manufacturers. These firms are very research intensive; these firms produce the majority of new pharmaceutical entities. There are less than 100 firms in the category and the top five firms by sales volume in 2007 were: volume J&J……………………….$61.095 billion Pfizer……………….…..$48.371billion GlaxoSmithKline……$45.432 billion Novartis……………..…$39.800 billion Roche…………………….$38.447billion Generic Drug Manufacturers Generic Second are the generic drug product Second manufacturers. These firms are NOT research intensive, but they do bioavailabilty research to get their products FDA approved and on the market. Some top generic drug manufacturers are: Teva Pharmaceuticals Alpharma Mylan Laboratories Watson Pharmaceuticals Ivax Sandoz Biotechnology Sector Biotechnology Third are the biotechnology companies. These Third companies are research intensive but in the biological areas. They are relatively small compared to the research intensive industry. How many of these firms are being purchased by the research intensive firms. Examples of biotech firms include: firms Amgen Genetech Genzyme Serono Biogen Drug Delivery Sector Fourth are the drug delivery companies. Fourth These firms do research on developing innovative mechanisms for getting the product to the desired site in the body. These firms are research oriented, but relatively small. Examples include: relatively Alza Elan Inhale Dura Bioavail Bioavail The focus of this presentation will be primarily on the research intensive pharmaceutical manufacturing firms. Perhaps I’ll get to a couple slides on generic drugs and the approval process for generic drugs. The research intensive pharmaceutical The industry firms invest a very high percentage of sales in R&D. In fact, these firms invest more in R&D than other major manufacturing industries in the U.S. This includes the computers, automobiles, aerospace and electronics. In 2005, the industry invested $39.4 billion in research. $31.4 billion was spent within the U.S. $31.4 Another $11.9 billion was invested by Another biotech firms. Thus, a total of $51.3 billion was spent on drug research in 2005. was Top Five Pharmaceutical Firms by R&D Investment for 2007 Investment Pfizer…………………….$ 8.089 Billion J&J…………………………$7.680 Billion Roche…………………….$6.988 Billion GSK……………………….$6.654 Billion Novartis……………….$ 6.456 Billion As a percent of total sales, the industry As invested 19.2% in R&D in 2005. invested National Institutes of Health’s (NIH) National total budget was $28.6 billion and only a part of this goes to pharmaceutical research. Comparison of U.S. Research Expenditures for PHRMA Research Intensive Firms and NIH for Source: Pharmaceutical Industry Profile, 2006, PhRMA For the industry, approximately 80% For of the R&D is spent on the development of new products, 20 percent goes to improvement of older products. Approximately 92% of all drug products are developed by the pharmaceutical industry. R&D Domestic Expenditures by Research Intensive 1980-2008 Research
(Billions) Trend in Cost of Drug Development Trend $ Million 1976-2006 Sources: R. Hansen, Ph.D., University of Rochester; S.N. Wiggins, Ph.D., Texas A&M University; J.A. DiMasi, Tufts Center for the Study of Drug Development (2002); Office of Technology Assessment (1993). The 2006 data came from PHRMA Industry Profile 2009. It is important to remember, that these costs are average development costs; they include drugs which failed along with drugs that were approved. Also, development cost vary by therapeutic category. Drugs in some therapeutic categories take longer to develop and cost more than others. Recent PHRMA reports state it cost on average over a billion dollars to develop an new drug entity. Mean Costs for “Clinical Testing” per Approved Drug by Therapeutic Category, 2003 2003 Millions of Dollars R&D Expenditures as a Percent of Domestic Sales of 1980-2008 Source: PHRMA Industry Profile 2009 There has been an increasing trend in expenditures for new drug development, however, what is the output produced from this increasing cost? Look at the next slide. Number of New Chemical Entities Number Approved by FDA 1985-2008 Pre-Clinical Development Pre-Clinical
• Lab and animal tests to establish Lab pharmacology and toxicology in animal models models
– Pharmacokinetics—absorption, distribution, Pharmacokinetics—absorption, metabolism and excretion metabolism
• Provides data for dosing, drug formulation – – – Pharmacodynamics—drugs positive and adverse Pharmacodynamics—drugs effects in animals effects Toxicology—collect data on drug’s safety in both Toxicology—collect high and low doses, including 24-month carcinogenicity of the product, impact on reproductive health reproductive Human tissue cultures are sometimes used W hat’s the GOAL of Pr e-Clinical W or k ? T he goal of pr e-clinical d evelopment is to pr ovide data t o suppor t an I nvestigational N ew D r ug Application (I N D ). I N D ’s pr ovide evidence that h uman testing of the dr ug p r oduct should be allow ed. F D A has 30 days fr om r eceipt of t he I N D to r equest mor e i nfor mation, deny or appr oved t he I N D . Contents of an IND Contents
• • • • • Results of the pre-clinical studies The drugs chemical structure and how it The is thought to work or its mechanism of action. action. Listing of adverse effects The manufacturing information A detailed clinical testing plan which list detailed how the drug will be tested, patient types and where the testing will take place and by whom. A n I N D must be submitted to F D A a nd appr oved by F D A befor e human t esting is conducted. Also, all clinical studies must be appr oved f or human use thr ough an I nstitutional Review Boar d. Clinical Development Clinical
• • • Clinical development is the process of Clinical testing the drug in humans. testing Goal is to show the drug is safe and Goal effective in treating specific conditions in certain patients. in Prior to 1962 all you needed to do was Prior show that the drug was safe, but with the passage of 1962 FDA amendments EFFECTIVENESS is required. EFFECTIVENESS Four Phases of Clinical Development Development Phase 1 Trials establishes safety of administration to humans and a range of safe doses. Trials are conducted on normal humans— are healthy volunteers in a carefully controlled healthy environment. Subjects are under observation for hours or days. observation Number of subjects 20 to 100 Number volunteers who are young, healthy, and male. male. Phase 2 Phase
• • • Phase 2 First clinical test of the drug on people First with the disease. It is small scale trial of 100 to 500 patients who have the targeted condition or disease. It is determine if the drug actually works. The phrase used during this phase is “proof of concept.” Helps establish dosing (minimum and Helps maximum), safety (adverse effects), and efficacy testing, or endpoints. efficacy Phase 3 Phase
• • • • Large scale randomized, blinded, placebo controlled trail. Large Some times a comparative product is used instead of a placebo. It is the largest investment by the company in both money and time. both Approximately 1,000 to 5,000 patients with the targeted Approximately disease or condition. Normally it is a multi-center trial or a trial using multiple research investigators and clinics using the similar or the same protocol. There could be global sites. global Goal is to collect efficacy information about the product Goal to support the New Drug Application to FDA. The goal is to collect end point effectiveness data. Phase 3 trials can take three to six years and cost Phase millions. millions. Phase 3 Clinical trials Phase Many time Phase 3 clinical trials are Many conducted by contract research organizations (CROs). The pharmaceutical company works very closely with CROs to make sure the trials are conducted and documented correctly. Good Clinical Practice (GCP) guidelines are required. Definition of Terms Definition
• • • • Placebo group is the group of patients who are Placebo receiving the inactive, fake or “sugar pill,” but they do not know it. Randomization means that subjects are randomly Randomization assigned to either the placebo or test group. Being assigned to the test group is by chance. assigned Single blinded is when the subjects do not know if Single they are receiving the placebo or the test drug, however the investigator knows. however Double blinded is when the subjects and the Double caregiver or investigator do not know who is receiving the test drug. This is most common study. Phase 3b Trials Phase Phase 3b trial often begin before the Phase drug is approved but after filing the NDA application. NDA The goal is to collect supplement The information, primarily safety data or to test the drug for other conditions other than what it was originally intended. than 3b Trials are optional and are 3b conducted while FDA reviews the NDA application. Following completion of Phase 3, the data of all Following three phases are aggregated and analyzed by the company. When the company believes that sufficient efficacy and safety data were collected, and NDA will be submitted to FDA for review. be For non-biological agents, companies submit the For NDA to FDA’s Center for Drug Evaluation and Research (CDER). For biologicals a BLA (Biological Application) is submitted to FDA’s Center for Biological Evaluation and Research (CBER). Biological Draft Package Insert Included in NDA Draft
• • NDA applications are huge electronic files NDA containing thousands of pages of data and results. Also included in the file is the proposed package insert. The insert specifies
– – – – – – indications, explains dosages and dosing and administration includes key statement as to safety risks risks mechanism of action mechanism adverse effects • Importance of the package insert cannot be over Importance emphasized. emphasized. Package Insert Package During the FDA approval process FDA During dictates the contents of the package insert and the drugs labeling. insert Pharmaceutical promotion claims Pharmaceutical MUST follow the insert. In other words, the insert is the foundation of the products marketing strategy. FDA Classifies NDAs FDA
• FDA puts NDA into two categories based on:
– – Novelty of the active ingredient Clinical improvement • • If the product satisfies an unmet need or If represents a significant advanced therapeutic advancement, FDA may grant a priority review which takes six months or less. or If it doesn’t fit the above, then the drug fits If the normal time frame of about 12 to 15 months for FDA review. months FDA Priority Review Drugs FDA Potentially a breakthrough new drug. Potentially First treatment of a condition. New chemical entity or new molecular entity. entity. Represents a significant advance in Represents efficacy, safety, limiting side effects. efficacy, Non-Priority FDA Review Non-Priority New salt form of the drug New formulation but nothing advanced Already marketed drug with no Already previous NDA approved previous New indication for an already New marketing drug in which there is already many competing products already Trend in Average FDA Approval Times (Months) for New Chemical Entities (Months) 1985-2007 Trend in FDA Approval Times: 1999-2007 Trend Phase 4 Phase
• • • • Phase 4 Studies are commonly referred to as “PostMarketing Surveillance” or “post-approval” studies. Phase 4 studies are done after the drug has been Phase approved and the product is on the market. NOT all products undergo Phase 4 studies. Sometimes FDA makes Phase 4 studies as a condition for approval. Basically, FDA wants more outcomes data on a larger population. population. Typically Phase 4 studies are not randomized or placebo Typically controlled. These are “open label” studies; all subjects and their caregivers know what they are taking. and Today, Phase 4 studies are used to monitor adverse Today, effects, and to check on the safety of the drug product. effects, New Product Development - A Risky and Expensive Proposition Expensive
Discovery (2–6 Years) 0 2 4 Phase I 20–100 Healthy Volunteers Used to Determine Safety and Dosage Phase III 1,000–5,000 Patient Volunteers Used to measure efficacy and safety. Additional Post-marketing Surveillance 6 8 10 12 NDA Submitted 14 16 FDA Review Approval Preclinical Testing Laboratory and Animal Testing IND Submitted Phase II 100–500 Patient Volunteers “Proof of concept” research, does the agent work? Also used to collect dosing and safety data. Compound Success Rates by Stage 5,000–10,000 Screened 250 Enter Preclinical Enter Testing Testing 5 Enter Enter Clinical Testing Testing 1 Approved by the FDA Net Cost: $500 million to $1.3 billion invested 10 to 15 years The reality is that drug molecules which are being developed today in the laboratory, will not reach the market until 2021-2024. Next question: how much “real” patent life does a drug product have?
In the U.S., patent life is 20 years after the patent is filed and approved. Pharmaceutical companies file for the drug patent once they think they have a innovative molecule. Normally, this occurs during the molecule lab-development period---in other words patents are filed before the preclinical studies. Depending on the time it takes for drug development, clinical testing and approval by FDA, the time “left on the patent” is critical. This time is known as “product exclusivity” time On average, a drug product’s “exclusivity” is about 6 to 8 years. In other words, the company has 6 to 8 years to recoup their research investment before generic products can enter the market. Trend in Generic Drug Share of the U.S. Prescription Drug Market Prescription 1984-2007 Percentage Patent Expiration Cliff Patent In 2010, $30 billion brand name sales will In become generic. In 2011, it is $28 billion. Look at the following list of product Look expirations in the next three years: expirations
-Avandia-2009 -Lipitor-2010 -Singular-2012 -Seroquel-2011 -Zyprexa-2011 -Actos-2011 -Plavix-2011 By 2016, $140 billions of brand name drugs will be generic. Loss of Market Exclusivity Loss Once the brand name drug’s patent has Once expired, generic competition becomes very fierce. Within 60 days after patent expiration the brand name product loses over half its market. Within 90 days over 80 percent of the market is lost. This was stimulated by managed care formularies to move to the generic product and consumers wanting a d cheaper drug. New products within a therapeutic class New can also cause market share erosion. can It has been fun-time for me to be with you today. Its time for me to ride on out of here. Y’all take care. Thanks, Marv Shepherd ...
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This note was uploaded on 01/23/2010 for the course BIO 307D taught by Professor Moore during the Fall '09 term at University of Texas at Austin.
- Fall '09