About this Author
DBL%20Hendrix%20small.png College chemistry, 1983

Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: Twitter: Dereklowe

Chemistry and Drug Data: Drugbank
Chempedia Lab
Synthetic Pages
Organic Chemistry Portal
Not Voodoo

Chemistry and Pharma Blogs:
Org Prep Daily
The Haystack
A New Merck, Reviewed
Liberal Arts Chemistry
Electron Pusher
All Things Metathesis
C&E News Blogs
Chemiotics II
Chemical Space
Noel O'Blog
In Vivo Blog
Terra Sigilatta
BBSRC/Douglas Kell
Realizations in Biostatistics
ChemSpider Blog
Organic Chem - Education & Industry
Pharma Strategy Blog
No Name No Slogan
Practical Fragments
The Curious Wavefunction
Natural Product Man
Fragment Literature
Chemistry World Blog
Synthetic Nature
Chemistry Blog
Synthesizing Ideas
Eye on FDA
Chemical Forums
Symyx Blog
Sceptical Chymist
Lamentations on Chemistry
Computational Organic Chemistry
Mining Drugs
Henry Rzepa

Science Blogs and News:
Bad Science
The Loom
Uncertain Principles
Fierce Biotech
Blogs for Industry
Omics! Omics!
Young Female Scientist
Notional Slurry
Nobel Intent
SciTech Daily
Science Blog
Gene Expression (I)
Gene Expression (II)
Adventures in Ethics and Science
Transterrestrial Musings
Slashdot Science
Cosmic Variance
Biology News Net

Medical Blogs
DB's Medical Rants
Science-Based Medicine
Respectful Insolence
Diabetes Mine

Economics and Business
Marginal Revolution
The Volokh Conspiracy
Knowledge Problem

Politics / Current Events
Virginia Postrel
Belmont Club
Mickey Kaus

Belles Lettres
Uncouth Reflections
Arts and Letters Daily
In the Pipeline: Don't miss Derek Lowe's excellent commentary on drug discovery and the pharma industry in general at In the Pipeline

In the Pipeline

« Design Your Own Lab Course | Main | Resveratrol (SRT501): Development Halted »

November 30, 2010

More Advice From Andrew Witty

Email This Entry

Posted by Derek

Andrew Witty of GSK has a one-page essay in The Economist on the problems of the drug industry. None of the background he gives will be news to anyone who reads this site, as you'd imagine - lower rates of success in discovery, higher costs, patent expirations, etc.

Here's his take on research and development:

. . .it is clear that the size of the industry will continue to contract in the drive for efficiency. For some players, more mergers and acquisitions are likely, but others will plan to shrink, and all parts of the value chain from R&D through to production and sales and marketing will be affected. . .

. . .In the past the problem of R&D in big pharmaceutical companies has been “fixed” by spending more and by using scale to “industrialise” the research process. These are no longer solutions: shareholders are not prepared to see more money invested in R&D without tangible success. If anything, based on a rational allocation of capital, R&D should now be consuming less resource.

Yikes. I'm not sure where that last sentence comes from, to be honest with you. Does Witty think that we now know so much about what we're doing that it shouldn't cost so much for us to do it? Or that it shouldn't cost so much to comply with the regulatory authorities, for some reason? I'm a bit baffled, and if someone can explain that "rational allocation" that he speaks of, I'd be grateful.

And I'd like to say that the rest of the piece advances some useful ideas, but I can't do that with a straight face. (To be fair, if Andrew Witty has some great ideas for making GSK more productive, he's most certainly not going to lay them out for everyone in The Economist). So it's all innovative business models, dynamic partnerships, recapturing creative talent in the drug labs, and so on. That last line will no doubt inspire a lot of bitter comment, considering what things have been like at GSK in the last few years.

His main pitch seems to be that drug companies need a "fair reward for innovation", and that's one of those things that's hard to disagree with on the surface. But unpacking it, that's the tough part, because everyone involved will start disagreeing on what's innovative, what might constitute a reward, and (especially) what's fair. Witty has been giving speeches on this for a while now, and I'd say that this latest article is just the condensed version.

Comments (55) + TrackBacks (0) | Category: Business and Markets | Drug Development | Drug Industry History


1. Hap on November 30, 2010 10:43 AM writes...

I have to wonder where "fair reward" figures into the pay of pharma CEOs - given that while cutting the pay and benefits of their employees and getting rid of the ones they don't think they need, their pay seems to stay the same or improve.

There probably is reason to want more from R+D then what pharma has been getting, but Witty is probably one of the last people on earth to have standing to complain about it.

Permalink to Comment

2. Petros on November 30, 2010 10:51 AM writes...

I was also "amused" at this article given the prevailing paradigms at GSK and the endless slashing of R&D

But I note from Fierce Pharma that the knives are being sharpened for the soon to be superfluous marketers (the patent cliff effect), some of whose activities have incurred fines of a size that might have markedly enhanced R&D productivity

Permalink to Comment

3. RB Woodweird on November 30, 2010 10:53 AM writes...

Witty and his ilk are mice who write little mouse essays for the Journal of Mousy Thoughts about how the cat needs a bell.

Permalink to Comment

4. anchor on November 30, 2010 11:15 AM writes...

Noting insightful from Mr. Witty's comment, I say. Could not wait for what Mr. Ken Frazier has to say, now that he is taking over from Mr. Dick Clark as CEO of Merck (effective 01/01/2011). In appointing him, I suppose Merck is again following Pfizer's lead in appointing lawyer as CEO. To me it also foretells that Merck might face lot of litigation issue down the road and that means less science and scientists. He may need Kim, Hutchinson, Tillyer more than his predecessor and we all know where this is headed.

Permalink to Comment

5. Anonymous on November 30, 2010 11:21 AM writes...

How about transforming the funding of drug development within big pharma to a system where shares of a development candidate are sold to investors. The cost is shared with a large number of investors. The big pharma would of course retain a large number of shares. This would be more akind to treating a development candidate as a start up biotech. You could motivate researchers just like a small biotech with stock options of that development candidate.

This is merging the venture capital world with big pharma.

In the end, big pharma would be more like a holding company, with each product more or less its own daughter company.

My experience personally is going from a very large pharmaceutical company to a very small start up. It is VERY motivating to think of the possible rewards of stock options, it is also very motivating to know that success/failure depends on just a few people. It will drive people.

Permalink to Comment

6. Schlake on November 30, 2010 11:24 AM writes...

The Economist writers are concerned with one thing: making money. So, if R&D doesn't make money, then it is bad. They never consider the long term future, morality, or ethics in their opinions. Money made now is the only concern, and the future damage is never thought of.

Permalink to Comment

7. A nonie mouse on November 30, 2010 11:39 AM writes...

Rational allocation means that if you aren't getting a good enough return on your investment, maybe you shouldn't do that anymore. So not enough success argues for less investment until someone comes up with a new approach that is likely to yield better outcomes.

Permalink to Comment

8. emjeff on November 30, 2010 11:46 AM writes...

What do you expect from an economist? All Andy cares about is making money.

Permalink to Comment

9. Curt F. on November 30, 2010 11:51 AM writes...

@Hap #1: You don't think the CEO of a large pharmaceutical company has "standing" to want more out of pharmaceutical R&D?

@Anonymous #5: That is an interesting idea. To some extent I suppose it is already happening since the exit strategy for most VC-funded biopharmaceutical startups is acquisition by big pharma. But why not do it internally?

Permalink to Comment

11. David Formerly Known as a Chemist on November 30, 2010 12:23 PM writes...

I think he's merely positioning the topic from the viewpoint of an investor: more and more money has been plowed into R&D, and productivity has simultaneously decreased. Hence, the rational thing to do is stop plowing more money into R&D. That's a simplistic argument, but one that's hard to refute.

Realistically, we must continue to invest in R&D or else there will be no new products. But the nature of R&D needs to change, because the old way isn't working anymore.

Permalink to Comment

12. Virgil on November 30, 2010 12:35 PM writes...

@#22 David
I disagree that R&D "productivity" is down. It all depends on whether you count an approved drug as the end product of R&D. I would argue that an approved drug is not an R&D product, but instead it is the product of an R&D outcome plus a bunch of legalese, marketing, medicinal chemistry, SAR, and other magic performed on it.

The numbers of new candidates being generated by R&D is as strong as ever. What has changed is the FDA approval process and the heavy focus on side effects, which often leads to very promising and efficacious lead compounds never making it to the clinic. R&D is still pumping things into the pipeline, they just aren't coming out the other end so fast any more, and that is in large part due to the FDA.

Permalink to Comment

13. processchemist on November 30, 2010 12:41 PM writes...

The business model that produced big pharma companies with AAA rating and profits largely exceeding 10%/year was based on research. Every scientist in this line of work knows that research can't be industrialized: after 20 years of failed tests (combichem, armies of asians crunching molecules etc), it's clear that intensification does not produce more blockbusters.
But a plan to keep two digits profits and AAA rating with less research (that means lesser probabilities of future products) is pure nonsense.
By the way, have a look at the current GSK pipeline: it speaks by itself.
Everyone with friends in GSK knows how the company rewarded the groups that actually delivered new products (many others did the same, we know). And no CEO, as far as I know, ever talked about *motivation*.

Permalink to Comment

14. azetidine on November 30, 2010 12:48 PM writes...

If R&D funding went all the way done to zero, and we were stuck with the drugs that we currently have, would we really be so bad off, in the grand scheme of things?

Permalink to Comment

15. David Formerly Known as a Chemist on November 30, 2010 12:56 PM writes...

@#12 Virgil: I think all the steps you mentioned are part of the R&D process (a lot of it is the "D" part). Yes, the bar has gotten higher and more difficult to jump, but that's because our knowledge base has grown and we know how to predict potential side effect liabilities better. Medchem is still pumping leads into the pipeline, but the R&D process does a stricter job filtering those compounds than in the past. That in turn makes productivity go down (if you define productivity as approved drug per dollar spent, which is an appropriate measure, because approved drugs are the money-producing products that pay for all these activities).

The end conclusion reached is still the same. Pumping more money into R&D isn't resulting in more approved drugs, so why pump even MORE money into R&D? Even if the main culprit is the FDA as you stated, throwing more molecules into the pipeline won't solve that problem. They need to be smarter compounds. Or smarter targets. Or smarter clinical trial designs. And no, I don't have the answers on how to solve these problems.

Permalink to Comment

16. CR on November 30, 2010 1:03 PM writes...

@#12 Virgil...
"I disagree that R&D "productivity" is down. It all depends on whether you count an approved drug as the end product of R&D. I would argue that an approved drug is not an R&D product."

It absolutely has to be the end product of R&D. What you are saying is the end of the "R" in R&D; and one doesn't make too much money on that end of things. The only outcome that can be a measure of success is the approved drug. For example, one company has a single "new candidate" but that candidate makes it to the market, compared to another company that has 10 "new candidates" but none of them make it to the market. Which company is more successful? Clearly company #1, no argument.

My take on Witty's comments: Big Pharma is, in economists eyes, throwing good money after bad in R&D because there hasn't been an increase in approved drugs with the appropriate increase in budgets. So, instead of increasing and increasing budgets, what would happen if the R&D budget is cut to a scale that is appropriate for the number of drugs? Would it get worse? Can it get worse?

Permalink to Comment

17. Wagonwheel on November 30, 2010 1:05 PM writes...

@10, not to worry because according to the list there will be fewer Wittys too.

Agree with most of the posts, the cost of getting compounds to patients is just so high nowadays that we can't overcome the barrier. There are potentially good medications lost for ever in the vaults of big pharma because the forecasters say the market won't be big enough to cover costs and support the behemoth. Somethings gotta change...more drastically than at current...

Permalink to Comment

18. LNT on November 30, 2010 1:15 PM writes...

I think Witty's arguement about reduced funding of R&D is twofold:
1) As the profits of drug companies are shrinking, R&D budgets should be equally shrinking. (given the uncertain output of R&D it is only rational to "cap" the R&D costs at a certain percentage of sales)
2) The percentage of sales $ that goes into pharma R&D has been going up and up. (it was historically ~12-13% of sales in the 1970's, but it is now closer to 18%) I suspect that he wants the percentage to drop back to historical levels.

How can the industry shrink R&D while maintaining future profits? Simple. Just look at pharma portfolios and you'll get the answer: More profits coming from areas that are more "stable" than traditional small molecule drugs: Vaccines, biologic products, vetenary medicine, consumer healthcare products, diagnostics, and (yes) generics. All these areas less "rewarding" than the next blockbuster -- but they are far less risky (in terms of future profits).

Witty is essentially conseding defeat -- the current buisness model is fading fast. The new one is already emerging -- just look around you.

Permalink to Comment

19. Hap on November 30, 2010 1:36 PM writes...

#9: No, I think he in a position to want more from R+D, but since he's part of the reason it isn't producing, the complaints seem more than a little hypocritical. If you want to complain that R+D isn't productive enough while getting paid (in increasing amounts) for your part in making it less productive, then your standing to complain about it isn't very good.

Other than upper management, who has the "subsume and outsource yourself to greatness" benefited? Not employees, though that's sort of life. Not patients or consumers, because companies produce fewer drugs and (have to) charge more for those they do produce. Not stockholders, I don't think. Maybe the firms that engineer the purchases get rich too. I guess that's something.

Permalink to Comment

20. GSDecay on November 30, 2010 1:43 PM writes...

Witty also waxes that R&D is "more of an art than a process" which may be music to the ears of those SixSigma-hating readers of this blog but unfortunately to investors this reads "R&D is fundamentally unpredictable and you have no idea if you will make any money out of it" which when the bean counters are pulling all the strings is not music to the ears of the legions of passionate scientists who just want to use the available scientific knowledge to further human wellbeing. That bit got lost in the spreadsheets somewhere...
At a time of unprecedented scientific advances in understanding human health why do we so struggle to find a business model that can be easily used to apply it?

Permalink to Comment

21. HelicalZz on November 30, 2010 2:06 PM writes...

Perhaps part of the problem is that those in R&D are in so frequently 'baffled by rational allocations of capital'. Or at least fail to understand the role and responsibilities of a CEO as much as they accuse those same from failing to appreciate their role.

No, discovery will not get cheaper. But the efforts can be focused in areas that can most likely drive revenues and future profits, and/or areas of unmet need. Pushback from regulatory and reimbursing authorities means a diminished return on the spend for 'me too' types of products, the area where big pharma could in the past most predictably create a return on investment. The sentence before the one questioned was pretty explanatory. "shareholders are not prepared to see more money invested in R&D without tangible success." So 'rational expenditures' will likely be those pegged to certain metrics like % of revenues (as they always have been).

If a promising return on investment can not be generated in such a fashion, spending more won't improve things and could make it worse, such as by raising the hurdle rate for seed capital for startup 'pure' R&D operations.


Permalink to Comment

22. Curt F. on November 30, 2010 2:15 PM writes...

@Hap #19: If you want to complain that R+D isn't productive enough while getting paid (in increasing amounts) for your part in making it less productive, then your standing to complain about it isn't very good.

Do you think GSK shareholders share your apparent belief that their CEO is "getting paid" for making R+D "less productive"? It seems counterintuitive to me that shareholders would pay a CEO to lower their company's R+D productivity, but I am not an expert on GSK and have not been following them closely.

Permalink to Comment

23. alig on November 30, 2010 2:30 PM writes...

I wonder if R&D would seem as broken if GSK hadn't made so many mistakes outside of R&D. Such as management giving away Cialis for free (a few billion a year right now would be nice), paying billions in fines for illegal marketing, paying billions in fines for manufacturing issues, wasting $720 million on a company w/o real clinical assets. If Witty thinks the disfunctional pair at the top of R&D and Drug Discovery are the solution, he must not be the smartest guy in the room.

Permalink to Comment

24. ArtCase on November 30, 2010 2:45 PM writes...

This guy works on one principal:
Income - Expenses = Profit
Profit keeps shareholders happy and Witty in clover. R&D is an expense so slash and burn to keep profits up. He doesn't give a shit about patients or future viability as he'll be long gone. Don't know why all the navel gazing, it's pretty simple.

Permalink to Comment

25. Chemjobber on November 30, 2010 3:07 PM writes...

mad (#10):

A quick check of BLS reveals this number is just pure crap. According to BLS, there were (estimated) 79k chemists in the US.

I'm fairly sure this was a mistake; I'm putting in a e-mail to the author to be sure.

Permalink to Comment

26. Anonymous on November 30, 2010 3:49 PM writes...


Surely you jest. Not to distract the thread from GSK to MRK, but those buffoons have driven MRK into the ground. Starting with Kim, and continuing through "Hutchinson" (do you mean Ford-Hutchinson, Mr Vioxx???), and Tillyer - the six sigma process chemist. Perhaps you could specifically detail their accomplishments that distinguish them? Smarter money has Kim being given the heave-ho as soon as Frazier identifies a viable and palatable replacement.

Permalink to Comment

27. AnonChemX on November 30, 2010 4:32 PM writes...


If chemical employment is expected to grow by 2% according to BLS from the current situation, is that really growth? Put another way, say there are 100 chem jobs, the industry suffers a modest 5% reduction over the past decade (2000-2010) but grows 2% (2010-2018), that would still only give us 96-97 jobs in the end. A net decrease. I hope my math is wrong.

Permalink to Comment

28. MedChem on November 30, 2010 5:02 PM writes...

I actually agree with Witty. I like Motley Fool's comment on this interview:

"Coming up with novel drugs is easier said than done, but Witty thinks pharmaceutical companies need to get back to the basics. Rather than relying on brute-force screening techniques to plow through thousands of compounds, it makes more sense for companies to hire the brightest minds to design new drugs. As Witty puts it, drug development is often more art than science."

Couldn't be better said.

Permalink to Comment

29. dearieme on November 30, 2010 5:16 PM writes...

I suspect that he's saying "The game's up".

Permalink to Comment

30. Phil on November 30, 2010 6:00 PM writes...

@#28 MedChem

Do you really think companies don't already do all they can to attract the brightest minds? The brightest minds just don't cut it anymore, which is why drug development has turned to more brute force methods to try and find hits. We are way past the inflection point of the boom of drug discovery, and now are bound by the law of diminishing returns. There's no way around it, until we find a completely new paradigm that leads us to the next boom. So no, Witty's "back to the basics" approach will not work. The way out is a new "industrialized" research paradigm - something that gives us access to yet undiscovered insight or unprecedented access to new molecules.

Permalink to Comment

31. Med Chem is Dead on November 30, 2010 6:03 PM writes...

"it makes more sense for companies to hire the brightest minds to design new drugs. As Witty puts it, drug development is often more art than science."

Tell that to Mother Nature. Perhaps the problem is that the brightest minds aren't in chemistry to begin with.

Permalink to Comment

32. Anonymous on November 30, 2010 6:03 PM writes...

Dear Mr. Witty, if "shareholders are not prepared to see more money invested in R&D without tangible success", how did you guys get away with buying Sirtris, Praecis and Genelabs? Andrew, you silly little man, it is far better to appear an idiot (and trust me, you do) than to open ones mouth and relieve any tiny inkling of doubt. The next thing we'll hear from him is that he and Moncef have hired Jenny McCarthy to run their vaccine R&D effort. Imagine the cost savings!

And one other thing, pandering to the greed of shareholders as a rationale for slashing R&D is akin to slitting your wrist to cure your cancer. Let me dumb down the whole scenario to one that Witty, Slaoui, Vallance and their ilk can understand. If you're a Nascar driver and you always wind up last to cross the finish line; then slashing your tires and hiring a new pit crew from the guys hanging out in front of the Home Depot that morning probably isn't going to save the day. And that is exactly what these clowns have done.

Permalink to Comment

33. Hap on November 30, 2010 6:05 PM writes...

Yeah, but the brightest minds want to buy and sell your drug company, not actually make drugs, because that's where the money is. The outsourcing part of pharma's activities indicates that Witty (and lots of other pharma people) don't really think they need the brightest minds or that the brightest minds wouldn't find something useful if they had them, because they can be replaced easily.

Permalink to Comment

34. Hap on November 30, 2010 6:22 PM writes...

Investors don't want to throw good money after bad, but there's the problem that no one knows what to cut and still produce drugs. Cutting R+D works only if you cut more costs than income - if you don't know what to cut, then you have no idea if that's the case. (If you don't know what to cut, then you don't know whether you're cutting out fat, muscle, or brain. There are probably good reasons surgeons don't use blowtorches or chainsaws.) At that point, investors would be better off liquidating the company (at this point, the industry) and freeing up the resources for investment in a company that can produce drugs. Of course, if the knowledge that people have gained is actually useful, well, liquidation is probably suicidal, or highly counterproductive.

Unless divine intervention or a bolt of lightning is the next paradigm for drug discovery, nuking R+D without an understanding of what to cut is a recipe for disaster (unless you cash your options and paycheck before the industry goes under the waves). Investors in that case would be better off cashing out entirely rather than trying to cash out selectively while spending more money waiting for new drugs to appear from the ashes of R+D.

Permalink to Comment

35. MedChem on November 30, 2010 6:34 PM writes...

30 (Phil):

"Do you really think companies don't already do all they can to attract the brightest minds? The brightest minds just don't cut it anymore, which is why drug development has turned to more brute force methods to try and find hits. We are way past the inflection point of the boom of drug discovery, and now are bound by the law of diminishing returns. "

I don't disagree with you. It's just that I've seen too much stupid and wasteful big-pharma medchem that I think considerable savings can be realized by empowering the truly innovative and free minds. But who am I kidding? Fancy talk rules all day long in big pharma.

Permalink to Comment

36. Med Chem is Dead on November 30, 2010 7:50 PM writes...

The problem is that chemists are not successful at convincing the local community or the financiers that they belong on the asset side of the balance sheet.

Permalink to Comment

37. Anonymous on November 30, 2010 7:55 PM writes...

Let it burn let it burn let it burn.

Permalink to Comment

38. bbooooooya on November 30, 2010 9:52 PM writes...

thanks, this guy is pretty smart!

I think his comment "we need to reverse the decline in productivity, improve success rates for regulatory approval" is pretty insightful and should lead to greater profits for the whole industry. I can't believe no one has thought of this before: 'be more successful' brilliant! That's why this guy guy paid a minimum of $20/minute (before options, assuming 4 weeks vaca and 80 hrs/week). Outstanding.

Permalink to Comment

39. Cellbio on November 30, 2010 11:35 PM writes...

anon #5,

Take a look at Flexion and Chorus to see approximations of your suggestion. Here's a bnet article that quotes Derek.

http://www.bnet dot com/blog/pharma/biotech-startup-flexion-cuts-wasteful-big-pharma-r-d-why-didnt-we-think-of-that/6932

I like the model, but like all new fixes, I think problems will arise as the experience grows. First, even with cost savings, drug R&D remains capital intensive, and investors in these outfits will likely have the same profile as those Witty speaks of as he envisions reduced investment in-house. The shared risk part makes sense, but does not scale up to industry wide.

My second concern is that some of the savings in these models come from reducing investment in process development, stability and formulation work until clinical data support a rationale for that investment. So, you go through tox, PK and early human exposure without commercially viable processes and formulations. This means that after some magical early trial that "proves" the agent will work, then there is a pause in the timeline and significant investment, or a more costly parallel approach that advances the lead program while following with the refined process and formulation.

So, for every successful drug, the cost is actually higher, with the hope the aggregate costs will be lower when information returned from early trial allows for an early kill. Not so sure this will pan out, and if so not sure if it would be because the financial model is different, or just because it is run by people fed up with portals, review committees, performance reviews, six sigma etc.

Also, time to approval is likely longer, which may not matter if the investors make their money at the buy-back option, but with more risk ahead, the big return is likely to be at and after approval, so still a long horizon investor is needed. Turns out, these are likely the VC arms of pharma.

Lastly, I think the time delay opens the door to competition entering the market sooner. Say you are in charge of strategy at a place like Merck, why not wait until the underfunded test case reveals the opportunity before launching a fierce med chem effort and arrive close on the heels of the wonderdrug.

Permalink to Comment

40. Cal on December 1, 2010 4:22 AM writes...

Interesting piece from Witty. One thing to bear in mind is that Witty is directing his comments at certain groups and for the most part it's not directed at those of us at the coalface. I believe that he's trying to get governments to go easy on the industry and at investors, asking them to keep faith. However, I'm not convinced he actually understands what it takes to be a drug hunter and as commented above he doesn't know what to cut. I always come back to the Munos article
I think this is a pretty profound article. Rate of production of NDAs is constant for 60 years! Merged companies do not increase that rate (1+1=1) Number of NDAs is correlated with number of companies.
On this basis I think you can propose a sensible business model. Break your company down into smaller independent units (v important), ignore commercial analyses (80% wrong) and go for sensible patient populations. And lastly, do things quickly. With fixed costs, the rate at which you make decisons is important.

Permalink to Comment

41. processchemist on December 1, 2010 4:29 AM writes...


"My second concern is that some of the savings in these models come from reducing investment in process development, stability and formulation work until clinical data support a rationale for that investment"

This is already happening. Currently crystalline form/bioavailability studies are more frequent after few sets of clinical trials, and process validation is more and more a pre phase III activity. This behaviour has his amount of risks: I remember something about a Phase Ia study of PLX-4032 with poor results caused by bioavailability problems.

Permalink to Comment

42. BitterPill on December 1, 2010 4:30 AM writes...

Remember, Witty is a salesman first and foremost. He knows jackshit about R&D, all this talk of creativity and drug discovery being as much an art as a science is just hot air that he probably picked up from the comedy duo that is Slaoui & Vallence or their assorted lackeys. The real problem is that senior management regard all scientists as FTE head count, they don't appreciate the value of teams and the fact that it takes time to build good ones. Anyone who has worked in a good team can recognize it but would be hard-pressed to nail down the specifics of what makes the team tick. How many Nobel prizes have been won by groups run by Six Sigma Ninjas, Prince2-certified project managers, business analysts, or MBA-types? Yet, as has been pointed out on this forum before by others, these are exactly the sorts who run the R&D show @GSK!

Permalink to Comment

43. Thornbird on December 1, 2010 4:59 AM writes...

Au contraire, BitterPill, Andrew, Moncef, and Patrick understand very well the value of teams, hence the DPUs, etc. Andrew, with admirable modesty, never claims to be the brightest guy in the room but he recognizes the scientific brilliance of Patrick, and, if you don't believe me, just look at his publication record! It's very easy to airily dismiss whole skills sets as you've done above but GSK is about discovering drugs for patients not winning prizes! Some people can't see further than a test tube and completely miss the big picture, things like timelines, strategy, deliverables, etc are alien to them. Despite your crude caricature, those at GSK whose skills you decry, generally combine such skills with excellent scientific training. It's just that they've added new strings to their bows which you evidently haven't, hence the negative tone!

Permalink to Comment

44. processchemist on December 1, 2010 6:49 AM writes...


As far as I know, the Virtual CEDD leaded by Moncef delivered the absolute nothing. The current GSK pipeline demonstrates how a good job it's his executive direction of R&D. And he's still in his place. The same can't be said about the team that delivered Tykerb.

Permalink to Comment

45. Bigbird on December 1, 2010 8:05 AM writes...

Hey Thornbird, did they have to waterboard you to get you to write that or are you actually Andrew Witty?! It's not about drugs, it's about money. You'll get it one day but by then your idealistic, naive ass will be toast.

Permalink to Comment

46. Mariani on December 1, 2010 9:08 AM writes...

@32 Anonymous:

I would beg to differ on your lumping Praecis with Sirtris. Sitris cost GSK about 10 time more than Praecis did. The old Praecis site is still operating, and apparently doing well, they had the Nature Chem Biology paper last year. Derek had the pessimistic editorial in the UK , but I think these encoding techniques can be useful.

Permalink to Comment

47. BitterPill on December 1, 2010 9:56 AM writes...

Bigbird has replied for me, Thornbird. Good luck Thornbird, if you keep blowing ass gas like that, you'll have a bright future @GSK! Perhaps you forgot to add that "the vision is crystal clear and the focus is laser sharp" as a well known SVP likes to say!

Permalink to Comment

48. DrSnowboard on December 1, 2010 2:18 PM writes...

So Thornbird
Do the DPU's have budget autonomy, ie can they buy studies and services outside the GSK portfolio management prioritisation? Otherwise some of their biotech edge is blunt as toffee.
Has Patrick revisited his early failures in iNOS and septic shock to do something for those patients? Or was that just not high profile enough? To be honest, I don't know.
Does his impressive publication list and obvious scientific prowess really translate into GSK products? Or is it just shadowy interim deliverables?

I have some time for Witty, friends who work for and have worked for him suggest he leads - he has a point of view, he wants to put the company in a certain position, he has charisma, he seems earnest. The others need to start earning the same kind of loyalty.

Permalink to Comment

49. ex-Pfizerite on December 1, 2010 2:28 PM writes...

@14. azetidine, Unfortunately the answer is yes we would be in a world of hurt with Vancomycin resistant gram positives and the appearance of Zyvox resistant gram positives in Spain, USA and Asia knocking out the last good gram positive antibiotic. We would be in a world where the only treatment for MRSA would be amputation before MRSA got into the blood stream and where we could see the damage to a heart valve from a multi-drug resistant enterococcus but be unable to touch it with an antibiotic.

Permalink to Comment

50. Vacation on December 1, 2010 2:44 PM writes...

@34 thornbird

PV was a fair academic clinician (& I did just look at his publication record). To be appointed to his job without a track record of drug discovery just shows poor judgement by his seniors. Contacts at GSK suggest he never talks to scientists below SVP grade, who of course only say what he wants to hear. But why would a visionary such as you describe need to listen to someone who actually knows what they're talking about?

Permalink to Comment

51. MIMD on December 2, 2010 4:08 PM writes...

#3 "Witty and his ilk are mice who write little mouse essays for the Journal of Mousy Thoughts about how the cat needs a bell."

And for the Economist to boot. The Economist comes up with all sorts of great stuff from 'experts' about healthcare.

Permalink to Comment

52. Anonymous on December 2, 2010 9:49 PM writes...

The Wittmeister!! he's the man...hehhe

Permalink to Comment

53. Higvas on December 3, 2010 12:16 PM writes...

Why is everyone so angry at Witty? after all if anyone ghere followed the link to read the full article, you would have read his words actually say 'the pharmaceutical industry needs to recapture the ability to empower creative talent in the discovery phase of R&D, by creating an environment in the laboratories that reflects the fact that discovering a drug is not only a process but also an art.

and then he went on to say

'companies will need to put a premium on management and human capital, while operating in an increasingly complex scientific, social, legal and political environment.'

He has a valid point, which is constructive to R&D. he should not be misinterpreted.

Cutting R&D costs is not such a bad thing, 10 years ago big pharma thought if they scale up research they would get more R&D output, invested in HTS and so on. It is a good thing that Witty now realises that this approach is not the solution. Lets see what comes next.. new statistical models for clinical trials, regulatory overhaul. The answer os not down to Drug Discovery scientists, they are doing a great job, the problem is further down the line...

Permalink to Comment

54. Thornbird on December 5, 2010 10:05 AM writes...

Well said @Higvas, some welcome balance here. As for Bigbird, my point was just a recognition of outstanding leadership and, with all due respect to Derek and all who contribute to his generally excellent blog, I doubt it falls within Andrew's radar. Furthermore, delivering drugs to patients is not incompatible with delivering shareholder value, in fact these are mutually dependent processes. How many novel drugs did the former Soviet Union ever deliver?

Permalink to Comment

55. cisco wan optimization on March 10, 2012 6:33 AM writes...

You cant deal with a marginal curse word? Go to this is a discussion for adults. Dont bore me with you inanities so bloody early on Monday morning.Mon at 11:04am ·Tyrone KingTyrone KingOFF-TOPIC?!? Whats off-topic in regards to someone who wants to run for President of the United States?

Permalink to Comment


Remember Me?


Email this entry to:

Your email address:

Message (optional):

The Last Post
The GSK Layoffs Continue, By Proxy
The Move is Nigh
Another Alzheimer's IPO
Cutbacks at C&E News
Sanofi Pays to Get Back Into Oncology
An Irresponsible Statement About Curing Cancer
Oliver Sacks on Turning Back to Chemistry