As drug makers face an increasingly competitive landscape and development costs continue to rise, biopharmaceutical firms big and small are seeking every advantage to maximize the value of their R&D efforts. As a result, many companies have flocked to Asia-Pacific for better access to patients, lower costs, and operational efficiencies.
Beyond meeting the needs of global pharma in simply providing access to patient pools and lower operational costs, the region is also poised to realize the potential of a thriving biotechnology sector that is driving innovation on its own. From China to India, Singapore to Malaysia, to Sri Lanka and beyond, Asia is gaining the experience and infrastructure needed to support the global biotech industry by performing work and fostering innovation that moves higher and higher up the pharmaceutical value chain.
To be sure, Asia as a whole has yet to develop a completely outsourced drug discovery program that has progressed from inception to drug candidate, and such an event may well remain a few years or more away. Whether the opportunity for increased innovation will realize its full potential depends, in large part, on how well the region manages a host of challenges and hurdles standing in the way.
Factors Needed for Success
While a range of different dynamics that could ultimately change the drug development paradigm in the region and beyond are in play, to truly elevate Asia to a global innovation partner requires several key factors to become aligned. Among these, three threads stand out:
- Government, academic, and industry investment in innovation must be a high priority
- Biopharma companies big and small need to embrace a range of new development models including virtualization
- Regulatory changes need to be sped up, and increased cooperation between various agencies in the region must occur.
During the past few years these trends, which are already in motion, have accelerated. Investment dollars from academic centers and private firms are flowing to the region, attracted by an influx of new talent in the industry. Governments in the region are also continuing to invest significantly on the research side.
The Korean government, for example, is an active participant in the Korean National Enterprise for Clinical Trials (KoNECT), a public/private effort to advance the country’s infrastructure for conducting clinical trials. In Taiwan the proposed “Diamond Action Plan for Biotechnology Takeoff” will infuse NT$5 billion (around $155 million) into Taiwan’s biotechnology industry through the National Development Fund, venture capital sources, and other private investors. In addition to funding, the plan also includes resources for advancing preclinical drug development capabilities and establishing a network of biotech incubation centers.
For their part, biopharma companies big and small are investing or redirecting significant investment dollars from already existing R&D centers in the U.S. or Europe to new, emerging centers in Asia. This movement represents a potentially significant opportunity to jump-start innovation.
As the biopharmaceutical industry struggles with huge fixed costs and a sometimes inflexible business model, smaller and more nimble companies throughout the region are touting the benefits of virtualization in fostering development innovation. A virtual development model offers the opportunity to outsource operational tasks and infrastructure resources, a process by which Asia has proven a reliable and cost-effective partner in the past.
However, today Asian firms are growing the kind of capacity necessary to support a wider range of development needs, from analytical and bioanalytical chemistry to toxicology, clinical development, and regulatory affairs.
As a result Asian providers are taking advantage of new approaches to the development process. They are drawing on the expertise of a wider pool of talent and ideas to bring new targets to market more effectively—without the weight of legacy infrastructure burdens or outdated intellectual pathways. Whether it’s in discovery, clinical trials, commercialization, end licensing, or elsewhere, the opportunity exists for virtual development programs to create a region of true innovation and quite possibly help deliver next-generation therapies. Going forward the question becomes whether the industry can fully embrace virtualization as a development paradigm and leverage the growing capacity Asia already offers.
As Western companies begin to feel more confident about outsourcing discovery research projects to Asia—a vital step in creating the critical mass necessary to foster innovation—harmonization of government regulatory schemes becomes more and more a critical issue.
Some countries in the region, such as India, may fare better than China or those in Eastern Europe in terms of a regulatory environment. Other governments have placed regulatory reform high on their agendas. Yet, the situation is hardly uniform across the region. A more uniform, pan-Asian approach to regulation could help encourage a range of biopharma companies to chase development innovation without having to worry about regulatory risk in each new territory.
Asia’s rise as a potential development powerhouse further offers the opportunity to approach existing regulatory entities from a new perspective. One such example is New Drug Development Paradigms (NEWDIGS), an international consortium working to optimize biopharmaceutical R&D. Currently being field tested in Singapore and sponsored in part by Quintiles, NEWDIGS is focused on demonstrating the practicality and effectiveness of an alternative approach termed “progressive authorization.”
In place of the current high-cost, high-risk process based on randomized controlled trials and basic pharmacology, progressive authorization aims to ensure a more accurate benefit/risk profile, reduce late-stage attrition of compounds, and significantly minimize product withdrawals after market authorization. It enables a new product to enter the market with structured coverage progressively while further real-world evidence is still being obtained.
New Leadership, New Opportunity
For Asia-Pacific to adopt the mantle of true leadership in the global biopharma industry, these factors and more must be addressed before the region can meet its promise as an incubator for drug innovation and discovery. In addition, the region would clearly benefit from fostering an increased spirit of collaboration among industry, academia, and regulatory authorities. And perhaps most important, all stakeholders throughout the region must embrace the transition and be ready to align the region’s growing market power with ever-increasing internal and external demands.
Nevertheless, even as these and other factors continue their uneven march toward fruition, one outcome is certain: As the center of gravity for the industry shifts from developed to developing geographies, the balance of pharmaceutical investment and innovation will also shift toward a future where high-end drug discovery in Asia-Pacific will play an increasingly significant role.