Biopharmaceutical drugs’ affordability driven by R&D cost and production complexity: Dr Tumbagi
| Biopharmaceutical involves substantial investments in research, clinical trials, regulatory compliance, and manufacturing. Hence the affordability of these medicines are a complex issue, said Dr Amaresh Tumbagi, Karnataka additional drugs controller. Pricing of biopharmaceutical medicines are influenced by various factors, and the cost of research and development (R&D) plays a significant role in determining drug prices, he added. Other key factors influencing affordability of biopharmaceuticals are production complexity, regulatory compliance, intellectual property rights, limited competition and supply chain challenges. There is need for innovative pricing models. It should bring in value based pricing, outcome based agreements, subscription based model, tiered pricing, joint procurement and volume based discount, pooled purchase and benefit sharing. In addition to these are licensing and royalty agreement, patent pledges and access commitments. Then there is also the trade margin rationalization approach. Therefore each country has to develop pricing models by analysing strength, weakness, opportunity and threat situation in deciding the price of biopharmaceuticals, said Dr Tumbagi. Biopharmaceutical medicines form a critical component in patient care as global regulators have approved five gene therapies in addition to the 55 novel drugs, including a sickle disease treatment. The process of discovering and developing new biopharmaceuticals is resource-intensive. The cost of conducting preclinical and clinical trials, ensuring safety and efficacy, and navigating regulatory hurdles can be substantial. Companies often pass these costs onto consumers in the form of higher drug prices, Dr Tumbagi said at a panel discussion on Access to affordable Biopharmaceuticals at the Pharmexcil Capacity Building Programme on importance of quality compliance & patient safety which highlighted industry practices & regulatory expectations. Stating that developing a new drug involves inherent risks, and not all candidates make it through the entire development process, Dr Tumbagi said the high risk and uncertainty in the biopharmaceutical industry contribute to the need for higher prices for successful drugs. The development of biopharmaceuticals is a time-consuming process that can take many years. During this time, companies may face inflation, changes in market dynamics, and shifts in healthcare policies, all of which can impact the ultimate pricing of a drug. Further, the grant of patent exclusivity allows the biopharmaceutical companies to recover R&D costs. Once the patent expires, generic competition may enter the market, leading to lower prices. The level of competition in the market also influences drug prices. In cases where there are limited alternatives or a monopoly exists, prices may be higher, he said Efforts are being made to address the issue of biopharmaceutical affordability. These include advocating for more transparent pricing, encouraging competition, and exploring alternative reimbursement models. Additionally, advancements in technology and changes in regulatory frameworks may contribute to more efficient and cost-effective drug development in the future, said Dr Tumbagi. |
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