What Does the US Federal Prescription Drug Bill Mean for Manufacturers?


Pressure to lower drug prices has been mounting for years and legislation is following suit.

In August 2022, the US Senate passed a prescription-drug-pricing bill aimed at reducing drug costs by allowing direct price negotiation between Medicare and manufacturers, limiting out-of-pocket expenses for patients, and reducing excessive cost spikes.

Increasing Scientific R&D Costs

Compounding this policy change is a steady increase in R&D costs that has been happening over the past decade. Data show that the cost to bring a small molecule drug from discovery through to commercialization now ranges from $1-3 billion dollars and takes around 12-18 years.

While manufacturers may feel an urgency to temper their R&D efforts in order to compensate for anticipated revenue losses due to rising costs and lowered prices, the ultimate goal of delivering novel treatments to patients remains. How do companies reconcile these competing pressures?

Of course, federal polices will continue to have a strong market impact, with demand influenced by government-based drug programs and subsidies, and supply affected by factors such as research grants, tax incentives, and market-exclusivity policies. But beyond this, manufacturers need to make internal adjustments to help keep investment in R&D not just feasible, but also attractive.

Optimizing Early Drug Discovery Efforts

One promising opportunity for many organizations is optimizing early discovery drug discovery efforts. The early drug discovery phase typically lasts 4-5 years and accounts for about 30-40% of total R&D costs. Over the past ten years, early discovery R&D costs have increased about 12% year-on-year. Moreover, the outcomes of early discovery can have a huge impact downstream, where the cost of candidate failure increases over time.

Finding better candidates faster is more important than ever. Unfortunately for many, it’s also more difficult than ever. Early discovery is often riddled with challenges that waste time, drive up costs, and, ultimately, stand in the way of innovation. Workflows are complicated and fragmented. Teams and tools are disconnected. Data are hard to find and use.

Many organizations know that addressing these challenges is not simply a matter of thriving, but rather surviving. Unfortunately, there is no quick fix. Even companies who have invested heavily in research technology still struggle to get all the pieces working together. They’re often operating with different architectures and data models, and as a result, researchers struggle to collect data, garner insights, and leverage their collective knowledge to guide better early-discovery decisions.

How Dotmatics Can Help

Dotmatics can help companies overcome these challenges by providing an end-to-end scientific R&D platform that connects best-of-breed applications that enable automation, analysis, and collaboration. We have wrapped the tools and solutions most needed for early drug discovery into the Dotmatics Small Molecule Drug Discovery Workflow.

The Dotmatics Small Molecule Drug Discovery Workflow:

  • supports discovery from hit and lead identification, through lead optimization, to candidate selection,

  • provides fully integrated laboratory informatics software to capture experiments, molecules, samples, and assays, and

  • supports better decision making with tools for gathering, analyzing, and visualizing project data.

On-Demand Webinar: Reduce Risk, Cost and Time in the New Era of Small Molecule Drug Discovery

To learn more about the ways Dotmatics can help companies streamline early drug discovery efforts to reduce downstream costs watch the on-demand webinar, Reduce Risk, Cost and Time in the New Era of Small Molecule Drug Discovery.

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