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Companion Diagnostics Budgets Exceed $1 Million as Companies Build Personalized Medicine into Drug Development Strategy

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As the drug discovery paradigm shifts away from mass-marketed products toward targeted treatments and the life sciences industry adjusts to an increasingly payer-driven environment, precision medicine is emerging as a critical asset in the clinical development strategy. Biomarkers and companion diagnostics offer companies the ability to target a specific patient population with increased efficacy, accelerated regulatory approval and better reimbursement. Consulting firm Cutting Edge Information reports that almost 50% of drug discovery companies spend between $1 and $5 million to develop targeted therapeutic technologies that increase the effectiveness of drugs in development. Another 33% of companies invest half to a fifth as much ($500,000 to $1 million), and only a few report companion diagnostics budgets under $500,000.

Ryan McGuire, senior analyst at Cutting Edge Information, says that understanding companion diagnostics is important to create an effective strategic plan for drug commercialization:

These figures are small, compared to overall drug development costs, but it’s clear that companion diagnostics are fast becoming a fundamental building block of drug commercialization strategy. While they don’t fit with every drug, companion diagnostics can produce far better efficacy and health outcomes, which in turn leads to better market access and reimbursement.

The recently published report “Companion Diagnostics and Biomarker Development: Partnership Strategies and Benchmarks” covers strategy, timing and resources, and describes real-company perspectives on companion diagnostics benefits, uses and limitations. Five key criteria that influence go/no-go decisions are analyzed, and factors companies use to select tests, based on specific criteria (e.g., speed, reliability, cost), are discussed. The report details what is usually done in-house versus with a partner’s capabilities and how to better align drug and companion diagnostic development timing with regulatory approval processes.

Companion diagnostics partnerships are described with a focus on partner selection, involvement and leadership. The report outlines who should be involved in companion diagnostic program due diligence and explores leading partnerships. In addition, the report provides an overview of companion diagnostics activity in five major therapeutic areas: oncology, central nervous system, cardiovascular, inflammation and virology.

Industry executives interviewed for the study believe ‘personalized medicine’ will be key to the success of many compounds now in development, which pharmaceutical and biotechnology companies are depending on to refill product pipelines. The 113 page report includes over 400 metrics and 90 charts and diagrams.

Report: Companion Diagnostics and Biomarker Development: Partnership Strategies and Benchmarks

Source: Business Wire