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Group aims to cut costs of late-stage drugs

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You know things are bad in the fiercely competitive pharma industry when drugmakers start turning to each other for help.

But that’s exactly what happened last week when 10 major drug companies—including Indianapolis-based Eli Lilly and Co.—joined forces to cut costs out of clinical trials.

The 10 companies formed a not-for-profit organization called TransCelerate BioPharma Inc. Each company is contributing roughly a dozen employees to the project, as well as an undisclosed amount of money.

TransCelerate has a list of about 50 projects to work on to cut unnecessary costs from Phase 2 and Phase 3 clinical trials. Those two stages of human testing cost nearly $150 million per drug, according to studies by the Tufts Center for the Study of Drug Development.

“It’s significant,” said Jeff Kasher, vice president of Lilly’s Development Center of Excellence in Indianapolis, of the potential cost savings of the effort. He declined to quantify the expected savings, but he added, “I’m really, really confident that we’re going to deliver the goods from this group.”

TransCelerate has an initial three-year goal to show time and dollar savings in five areas. They include establishing a common supply model for comparison drugs—the existing medicines that experimental drugs are often tested against.

Also, TransCelerate plans to develop a common computer interface for physicians and their staffs conducting drug trials, which would recognize which companies and which drugs that particular medical center is doing work for and grant computer access to only those trials.

TransCelerate also intends to develop a new approach to monitoring the various sites that conduct clinical trials. Currently, some drug companies require extensive paper documentation of every aspect of a clinical trial while others do random sampling to generate statistics, which they use to monitor the clinical trial sites.

But TransCelterate will try to unite all 10 drug companies under a “risk-based monitoring approach” that documents aspects of drug trials that will be key in the regulatory review of the drug and pays less attention to less-critical areas.

“Everybody does it differently. Nobody really does it all that better than anybody else. But because we do it differently, we create confusion for a lot of the research sites,” Kasher said.

The 10 companies participating in TransCelerate are Lilly; Illinois-based Abbott Laboratories; United Kingdom-based AstraZeneca plc; Germany-based Boehringer Ingelheim GmbH; New York-based Bristol-Myers Squibb Co.; United Kingdom-based GlaxoSmithKline plc; New Jersey-based Johnson & Johnson; New York-based Pfizer Inc.; Genentech Inc.; which is a subsidiary of the Switzerland-based Roche Group; and France-based Sanofi-Aventis SA.

Many of them have struggled recently to launch enough new drugs to offset declining sales after their older blockbusters' patents expire. Lilly is in the midst of a four-year run in which it will see patents on five blockbusters expire, sapping as much as $10 billion in annual revenue.

Lilly has pushed more than 60 new drugs into experimental trials, but the cost of testing all of those in humans is pinching the company’s profits. A similar story is playing out at many of its competitors’.

“Even five years ago, this wouldn’t have happened,” Kasher said. “I’d say there’s frustration across the industry and pressure across the industry to accelerate the development of innovative medicines.”

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