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Identifying R&D outliers

Nature Reviews Drug Discovery volume 10, pages 653–654 (2011)Cite this article

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The market and institutional forces that underlie the decline in R&D productivity, and the consequent decrease in returns on investment, are familiar: more complex science, higher hurdles on unmet need, tougher competition, pricing and access pressures, and tighter regulation. Various solutions have been proposed, ranging from calls to re-engineer the R&D process to the radical suggestion that large pharmaceutical companies abandon internal R&D altogether1,2. However, although decades of improvements to the R&D process and the introduction of new technologies such as high-throughput screening have substantially improved the efficiency of discrete steps in the R&D process, they have not been able to counteract the forces above. And although many companies have increased the in-licensing of new compounds, abandoning R&D altogether would mean dismantling the in-house expertise that is crucial for determining the most promising drug candidates, what they are worth and how to develop them most effectively.

We have therefore focused on potential alternative solutions, driven by our observation that although the average ability of pharmaceutical R&D to create value has declined, there is in fact a large variation in R&D performance across the industry. In this article, we present an analysis identifying companies — which we term 'outliers' —that seem to have been more successful in counteracting the overall industry trend of declining R&D productivity, and provide our initial assessment of possible characteristics differentiating them from their less successful peers.

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Figure 1: Historical R&D productivity.
Figure 2: Future R&D productivity.

References

  1. Paul, S. M. et al. How to improve R&D productivity: the pharmaceutical industry's grand challenge. Nature Rev. Drug Discov. 9, 203–215 (2010).

    Article  CAS  Google Scholar 

  2. Morgan Stanley Research Europe. Pharmaceuticals: Exit Research and Create Value (29 Jan 2010).

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Authors and Affiliations

  1. Peter Tollman, Yves Morieux, Jeanine Kelly Murphy and Ulrik Schulze are at the Boston Consulting Group, Exchange Place, Boston, Massachusetts 02109, USA.,

    Peter Tollman, Yves Morieux, Jeanine Kelly Murphy & Ulrik Schulze

Authors
  1. Peter Tollman
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  2. Yves Morieux
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  3. Jeanine Kelly Murphy
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  4. Ulrik Schulze
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Corresponding author

Correspondence to Peter Tollman.

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Competing interests

The authors of this article are employees of The Boston Consulting Group (BCG), a management consultancy that works with the world's leading biopharmaceutical companies on R&D productivity issues. The research for this specific article was funded by BCG's Health Care practice.

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Tollman, P., Morieux, Y., Murphy, J. et al. Identifying R&D outliers. Nat Rev Drug Discov 10, 653–654 (2011). https://doi.org/10.1038/nrd3555

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