A Dangerous Trend?
The reverse merger between Pfizer and Allergan is the most recent chapter in a decades-long transformation of the pharma industry, but I believe it also represents a rapid acceleration of a troubling trend.
Michael Kinch |
Over the past few years, our work, first at Yale University and later at the Center for Research Innovation in Biotechnology at Washington University in St. Louis, has tracked sources of scientific and medical innovation in the pharmaceutical and biotechnology industries (1). As reported in a series of articles published in Drug Discovery, an obvious trend is a reduction in the breadth and depth of organizations participating in new drug research and development.
Over the past few decades, Pfizer has been a leader in a fundamental reshaping of how drugs are discovered and developed. Our data revealed that Pfizer leapfrogged from a middling company to become the dominant holder of new molecular entity (NME) approvals from the FDA. But this impressive climb arose not as a result of fundamental investment into research and development, but as a result of mergers and acquisitions. The present dominance of Pfizer thus represents the accumulation of many legacy companies over the past two decades. Indeed, an analysis of the league tables for NME holders over time reveals that Eli Lilly had consistently been the most prolific research and development organization in every decade from the 1940s through the 1990s. This dominance ended abruptly at the beginning of the new millennium when it was surpassed by Pfizer as a consequence of mergers and acquisitions. Moreover, Pfizer set a trend of aggregation that was matched by Merck, Novartis, Sanofi-Aventis and GlaxoSmithKline, such that Eli Lilly no longer ranks in the top tier in terms of new drug development leaders.
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