SOURCE: Cutting Edge Information

Cutting Edge Information

January 20, 2010 09:18 ET

Cutting Edge Information CEO Foresees Trends in Life Sciences Industry

RESEARCH TRIANGLE PARK, NC--(Marketwire - January 20, 2010) - Reaction to mega-mergers, tightened R&D budgets and market access challenges lie ahead for the drug industry in 2010, according to Cutting Edge Information ( CEO Jason Richardson. In fact, the decade will look much different than the one just ended.

Over the past several years, periods of industry consolidation drove different sets of multibillion dollar mergers -- but that model may prove unsustainable in the years ahead. According to Richardson, the most critical piece of news is that 2009 forced the industry to break out of its single-minded focus on the blockbuster model and to make some of the cuts and changes necessary to embrace that shift.

Recognizing that this business model is not as viable an option as it once was and fully accepting it are two entirely different things, in his opinion.

"It's funny, though, that the second most accepted fact, the drumbeat of conventional wisdom and the opinion of nearly every analyst out there -- that huge mergers are a waste of time and energy -- absolutely was not accepted by the industry," said Richardson. "We're all locked in a cycle of looking for what the next big merger will be, even though most of us think that they're generally not accomplishing their goals."

Richardson, who co-founded Cutting Edge Information in 2002, said continued tightening of R&D budgets is also to be expected in 2010.

"They're [clinical groups] hard at work trimming timelines and expenses, even at a time when they're being pressured to be more productive. Average per patient costs have leveled off, according to our longitudinal studies, which is one positive sign. At the same time, it's impossible to save your way to full pipelines," Richardson said.

While the CRO industry is expected to continue its growth, especially in new markets and in China, market access departments may experience some adjustments because of health care reform efforts, with the biggest impact coming on the payer side.

"We expect to hear a lot more talk about pharmacoeconomic data, health outcomes studies and comparative effectiveness in 2010," said Richardson.

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