Solution Development: A Model For Structuring Biotechs And Developing Better Drugs

The drug companies that have the hardest time raising capital to fund proof-of-concept research are the ones developing drugs against new targets. The irony is that in an industry that ostensibly strives to be innovative, investors hate risk and would prefer to invest in a reformulated (e.g., Alkermes PLC), repositioned (e.g., Cypress Bioscience Inc.), geographically relocated (e.g., Amarin Corp. PLC), relaunched (e.g., ViroPharma Inc.) or repriced drug (e.g., Questcor Pharmaceuticals Inc.) or enzyme replacement therapy NCE (e.g., Synageva BioPharma Corp.). These companies and others are successes in their own right but too exceptional to serve as role models for how our industry can continue to tackle large unmet healthcare needs in the coming decades. Such companies can raise money for a single validated agent; in fact, investors typically prefer that they focus on advancing one drug through later-stage trials and not divert any cash to an early-stage pipeline. (See Also see "How To Create A Lasting Peace Between Biotech Management, Shareholders And Employees" - In Vivo, 1 July, 2011..)

Yet it is likely that only innovative but riskier approaches can lift industry out of its current doldrums, providing the necessary advantages over current standards that will convince payors to...