Is the cited Deutsche Bank analyst report a company specific report? Like a Merck report, or a Pfizer report? Or was it just an outlook on the industry in general? I have access to her reports, but I haven’t been able to find it. Thanks for your help!

Are you saying that pharma researchers are overpayed? Or something else?

2) You write: “if you have a rich pipeline with multiple candidates for the same or overlapping indications, don’t…set up your resources to compete with one another.”

That’s easily said — but you know very well that the odds of success are so low that we MUST have multiple candidates for overlapping indications. Even a postitive phase III trial is far from a guarantee of approval these days….

Then, pray tell, where does Ms. Ryan expect companies to get drugs? No one seems to know how to optimize research,

Actually Robert, the reason R & D spending levels are not sustainable is due to poor management and lack of efficiency (and, to a lesser extent, unwillingness to limit pay to investigators to a fair rate). Those lame-ass reorganizations big pharma have all put their research staff through have not helped the bottom line, they’ve actually lead to unnecessary duplication of efforts, study teams that are at odds leading to poor operationalization of trials (which must negatively impact data), salary and title inflation and outrageously bloated study budgets.

Want to optimize (clinical) research? Go back to the traditional study team model - if necessary overlay an insourcing model to expand fluidity of teams (and, of course, pass personnel costs off as research costs). Also, if you have a rich pipeline with multiple candidates for the same or overlapping indications, don’t oversaturate the market and set up your resources to compete with one another.

In a nutshell, logic and common sense are sorely lacking in drug development. The sooner people start relying on these the sooner companies will be able to shed the bloat and run good, quality trials that kill of compounds or put them on NDA/BLA track in a timely and efficient manner.

The companies are now spending close to 20 percent of their revenue on research and development, Ryan wrote, but they’re getting less and less for their money and can’t sustain that level of spending through the patent cliff period even if they do develop novel and in-demand new drugs. Capacity is too high and many of the big pharma players are developing similar products, and Food and Drug Administration regulators are now demanding increased testing and are rejecting more drugs, she said.”

Link:
http://money.cnn.com/news/newsfeeds/articles/apwire/703dea4d80d40fc1237df957556f1ea0.htm

I love to invest!! Biotech and Pharma is not a place Id like to squander my money on. Wacky Deals dont sound very kosher

Big pharma can pump as much money as possible into mega deal but we haven’t seen many, if any, of these succeed - yet. BlockbusterDays are over: investors looking for those to come back are doomed to failure. What’s smarter is selective licensing, intelligent strategic investments, and fostering better alliances with mid-size companies, not the big guys. No secrets there.

With so many biotechs and small pharmas considered worth less than their cash holdings there are some wacky deals ahead. But mega mergers of the sort suggested in the article will happen no doubt, but in my opinion as a result of panic buying not smart medium to long term strategic planning.

Then, pray tell, where does Ms. Ryan expect companies to get drugs? No one seems to know how to optimize research, and littler companies are unlikely to afford the kind of studies needed to determine whether the candidates that bigger companies would like to purchase are actually good, or potential sinks for Phase III cash, so that buying drugs from smaller companies won’t keep the drugs from failing later and more expensively. Cutting research funding means that you should already have a blockbuster or two in the pipeline so that you can afford to cut research now and rebuild when your drugs reach market and generate money - otherwise, you’re dooming your company to starvation (everything goes off patent, after all) on a bigger scale than the smaller biotechs who go that route. Since they don’t, how does cutting research help them?

Merging gives companies a bigger pool of cash, but it hasn’t seemed effective at making them more efficient - if they’re not more efficient, then you haven’t solved your problem (not enough drugs, too much spending) that you had before. Mergers aren’t going to solve problems - if the purchased company is badly enough off, a merger won’t even help its stockholders (and if they were efficient, they probably wouldn’t be in that position), let alone the purchased company. It may help executives (by giving them a bigger company and thus a potentially larger salary), but I didn’t think that was the point of a merger.

The reports are for big clients, such as institutional investors, which are funds of various sorts - pension funds, mutual funds, hedge funds. If you have the money, they will sell you the research. That’s why the reports are proprietary, but some firms still provide them to the media, provided they are not circulated. However, we are free to quote from them. Deutsche Bank is one of several firms that makes reports available. Merrill used to distribute its report and so you would see David Risinger quoted often, but Merrill stopped doing so and Risinger disappeared from sight - at least to the general public.

Regards
ed