The Development Speed Paradox – the greater the development speed, the longer the expected time to market.
The faster you go, the longer it takes.
· In the 1990s the pharmaceutical industry sought to increase R&D productivity by increasing development speed and reducing development cycle times.
· Such development speed initiatives shortened the development time of successful molecules.
· Unfortunately, in pharmaceuticals, most molecules are unsuccessful.
· When the risk is high and the probability of success is low, as in pharmaceuticals, such development speed initiatives: increasedevelopment costs; increase late-stage attrition; and increase the expected time to market.
· This is the Development Speed Paradox.
· This effect is large, robust and sufficient to have precipitated the current pharmaceutical innovation crisis.
Need Technical Detail?
Check out Lendrem DW, Lendrem BC The Development Speed Paradox: Can Increasing Development Speed Reduce R&D Productivity? Drug Discovery Today, In press.
Being the first to market carries a premium in pharmaceutical development.
Development speed initiatives in the 1990s sought to minimize time to market by placing development tasks in parallel wherever possible.
Unfortunately, minimizing time to market for successful molecules clogs the development pipeline with marginal or failing medicines.
By overlooking the fact that most molecules are unsuccessful, development speed initiatives inadvertently sub-optimized the pharmaceutical development process.
In the 1990s, a simple mathematical model demonstrated the Development Speed Paradox.
The full model is still the subject of a non-disclosure agreement but the original model is soon to be published in the journal Drug Discovery Today.
This model demonstrates that for high risk processes, like pharmaceuticals, where the probability of success is low, development speed initiatives will:
· increase development costs,
· increase late-stage attrition, and
· increase the expected time to market.
How does this happen?
By placing two tasks, A and B, in parallel we lose the option to terminate the development of a failing molecule after task A. Instead we commit to incurring the full time or development costs of task A + task B, even if the molecule is unsuccessful.
And most molecules are unsuccessful. So we end up incurring these costs most of the time.
By performing the tasks in series, the cost of task B will not be incurred unless we have a successful drug. Retaining the decision point at the end of task A has a value – the option value.
Performing the tasks in series saves money and time giving rise to the Development Speed Paradox.
Lendrem DW More Haste, Less Development Speed Scrip Magazine, April, 1995.
Lendrem DW, Lendrem BC The Development Speed Paradox: Can Increasing Development Speed Reduce R&D Productivity?Drug Discovery Today In press.