How to Lower the Cost of New Medicines (Hint: coordination is the key)

The development of new medicines in a free market economy presents a dilemma. On the one hand, the motivation for profit helps drive the innovation needed for development of new medicines. On the other hand, earning a profit often means pricing new medicines at a level that is out of reach for many people.

A breast cancer drug called Kadcyla, for instance, came on the market in 2015 at $100,000 per patient per year. Then there’s Sofosbuvir, a cure for hepatitis C in 98% of cases, that was priced at $84,000 for the treatment course.

Insurance companies and national health care programs of course step in to cover these high costs, but increasingly, that too is becoming untenable. In the UK, for instance, the NHS’s annual drug bill is rising at an unsustainable 7% per year. In the US, spending on prescription drugs rose from 5% of total healthcare costs in 1980 to 10% in 2016, and that ratio is expected to continue to increase over the next decade.

Can’t we just regulate prices?

With rising medicines costs and high-profile cases like “pharma bro” Martin Shkreli — who infamously raised the price of antiparasitic drug Daraprim from $13.5 to $750 per pill after obtaining the manufacturing license for it — it’s not surprising that there have been rising calls for stricter rules on drug pricing.

Unfortunately, in the globalized market for medicines development, price regulation comes with long-tail economic and political consequences. A nation openly flaunting internationally-set pricing, risks the imposition of trade penalties through the WTO and other pacts that could have a bigger negative impact overall.

If the free market economy for medicines development can’t be abandoned, it stands to reason that working within it to improve its efficiency (and lower the costs) is the best path forward — but where can efficiency improvements be made?

The Cause

Why is medicines development so expensive anyway?

When it comes to medicines development, promising treatments start at a pure research level, often at nationally funded universities, but also within the research labs of corporate pharmaceutical giants. The journey from promising treatment to generally available medicine, however, is — for a multitude of good reasons — a long and costly process. The efficacy and safety of potential medicines must be clearly and ethically established before approval is granted; and the bar for approval has, correctly, been steadily raised since the post-war era. Nobody wants, for example, another disaster like the approval of Thalidomide for morning sickness, which resulted in at least 100,000 mutations.

The Tufts Center for the Study of Drug Development’s latest figure for the cost of developing a prescription drug that gets marketing approval is a colossal $2.558 billion, a number that has risen steadily, especially over the last two decades. The time needed from conception of a drug to its approval has also increased, with 10 years now considered realistic for many types of medicines.

At the heart of the approval process is the extremely costly and time consuming four-stage clinical trial regime, where the average cost to conduct a single phase now exceeds $15 million, and where entire trials regularly fail. Proving the efficacy of a drug through clinical trials while ensuring the safety of the patients trialing it is a daunting challenge. It involves coordination amongst a wide variety of disparate parties — from the pharmas sponsoring the trials, to the doctors conducting them and the multiple vendors providing support, all the way to the regulators overseeing the process. Any small mistake, including a minor breach in protocol like giving a single patient the wrong meal during testing, could jeopardize an entire trial’s legitimacy. When that happens, it’s back to the drawing board.

How can clinical trials efficiency be improved?

Improving the efficiency of clinical trials has long been identified as a promising way to reduce the costs and time of approval for new medicines. It was thought that the move towards digital record keeping would result in efficiencies improvements, but that simply hasn’t been the case. Given the large number of parties that must coordinate through the process, the challenge of protecting data privacy for test subjects, and protecting IP for the pharmas conducting the trials while simultaneously ensuring for regulators that the results are legitimate, is immense.

In fact, research has shown that the inability to integrate data across disparate stakeholders in a medical trial is a major factor holding back efficiencies improvements. Nearly all (98%) clinical data management professionals report challenges with their clinical data management systems according to the eClinical Landscape Study, which was conducted by the Tufts Center and published in November 2017.

The Solution

Data coordination and security is the answer

At last, a tenable solution to the long-standing inefficiencies in conducting medical trials has emerged from the tech sector. Colloquially known as “blockchain,” this solution is, at its core, really just a new type of database — but make no mistake, since gathering and sharing data is critical to the clinical trials process, improved database technology really is transformative.

At a first principles level, this new database technology allows the disparate parties involved in clinical trials to coordinate like never before. It does this by decentralizing the storage of clinical trials data, thereby making it possible for all stakeholders — from pharmas, to the doctors conducting the trials and the multiple vendors supporting them, all the way to the regulators overseeing the process — to rest assured that data hasn’t been tampered with. At the same time, all parties with permissioned access can see the data as it is updated in real time, vastly improving the speed at which a trial can be conducted. Further, since all data gathered through the trial process is securely aggregated, it can be analysed like never before. This means correlations that were previously impossible to draw, can be clearly established just by crunching the data in real-time, while the trial is still ongoing. The result should be vast improvements in clinical trials efficiencies. For example, pharmas conducting the trials will be able to predict when a participant is at risk of dropping out of the trial — currently a major factor in the extremely costly failure of a trial — and take the necessary steps to prevent that.

Industry experts have identified blockchain as the solution clinical trials stakeholders have been looking for. A paper entitled “How Blockchain Can Transform the Pharmaceutical and Healthcare Industries” and published back in 2018 by England based pharma-tech think tank PhUSE, for instance, clearly outlined the potential for the technology and the way forward for adopting it.

The critical infrastructure

ClinTex is building the platform on which clinical trials data can be aggregated and shared amongst stakeholders. Built on a blockchain foundation, this platform finally enables all parties to coordinate. Further, ClinTex’s solution provides the tools to allow gathered data to be processed, visualized, and acted upon — in real time. This will enable researchers to determine exactly what needs to be improved or changed with the trial while it’s still ongoing, a revolutionary improvement over the status quo. For the first time, clinical trials researchers will be able to predict the probability of key events that impact the ability of a trial to deliver the clinical data that regulators accept as proof of efficacy and safety of the drug being tested.