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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: derekb.lowe@gmail.com Twitter: Dereklowe

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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

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September 20, 2012

Various Links Of Stuff

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Posted by Derek

Swamped with all sorts of stuff today - when science marches on, you have to make sure that it's not leaving its bootprints on your back. But I do have some interesting links:

The bluest of blue-sky brain research, funded by Paul Allen. Fascinating stuff, on several levels - here's a big publication that came out this week. I find the phenomenon of tech-billionaire funding for things like this, asteroid mining, low-cost orbital access and the like very encouraging. (And of course, the Gates Foundation is doing a lot in more earthbound pursuits).

The Wall Street Journal reveals what is apparently a rather ill-kept secret: most firms funded by venture capital fail. "Most", as in about 3 out of 4. That's a loose definition, though - as the article says, if you're talking total wipeout of capital, then that's about one third of them. If you're talking about failing to see the projected return in the projected time, well, that's over 90%. But it's all about the ones that succeed, just like the drug business.

The Royal Society of Chemistry, in a rather self-congratulatory press release, pledges money to help authors publish their work open-access in RSC journals. The UK government is putting money into this, but no one's sure if it'll be enough.

Do you want to make this compound? No? Neither do I. Especially not when they turn around and stick three more nitro groups onto it.

Comments (12) + TrackBacks (0) | Category: Business and Markets | The Central Nervous System | The Scientific Literature


COMMENTS

1. Vader on September 20, 2012 10:57 AM writes...

Even with the three nitros, that's going to be an underoxidized explosive. Probably better blended with ammonium nitrate. Not sure I want to be the one to see if it will sit still for that.

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2. milkshaken on September 20, 2012 11:31 AM writes...

someone better make HOBt-like coupling reagent from that monster

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3. opsomath on September 20, 2012 12:01 PM writes...

Your insightful and concise discussion of the state of chemistry in general and industrial med-chem in particular is what makes your blog famous, Dr. Lowe, but the chemists are here to talk about stuff blowing up. MOAR BLOWING UP PLEASE.

Permalink to Comment

4. Anonymous on September 20, 2012 12:23 PM writes...

One of the rules I continue live by (and thereby continue living) is: avoid working with anything where the first keyword is "detonation".

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5. Frank Adrian on September 20, 2012 12:35 PM writes...

That is one seriously "interesting" compound. And, no, I wouldn't want to be anywhere within a mile or two of its manufacture.

As for the start-up numbers, that sounds about right. I've been involved in a couple of start-ups and the VC's have told me that about 40% of funded firms just die and about 40% sputter along, becoming small firms, always on the edge, struggling to find capital to stay afloat, burning out after a handful of years, and though the VC's can eventually get their money back, there's no real return. Out of the remaining 20%, 15% become moderately successful, staying afloat as small companies with a relatively steady rate of return (but nothing exciting, maybe returning 3x-10x of the money invested over a ten-year period). Of the 5% remaining, 5-epsilon% make a go of it with substantial returns in the range of 10x-100x over a ten-year period. Then you have the epsilon% that become monsters (e.g., Google) where the VC's make insane amounts of money. You can't count on the monsters and you have to recoup the costs of the 80% of the losers out of the 20% of the winners.

Drug discovery sounds a lot like that. The interesting thing is that most VC firms don't trade on the NYSE. I'd say that maybe drug companies shouldn't either, but unlike VC firms, you're not just putting in money and building a new company for each new product, you're having to build and/or maintain a testing and manufacturing infrastructure that is a major barrier to entry for new firms. As opposed to most VC-funded firms, where both R&D are relatively cheap and production is initially cheap and scales linearly with the volume of units shipped, you have a realm where the research is (relatively) cheap, the development costs are brutal, and the production (due to government oversight - which I wouldn't want to skip) has a high initial cost.

The conundrum is that, if I were an investor, I could see a lot easier places to put my money to make a buck. The risk-reward ratios just don't seem to pencil out. Where does that leaves the industry? Who knows. It's a knotty issue.

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6. anon on September 20, 2012 2:33 PM writes...

My nomination for the best line from the linked Angewandte Chemie article:
"In a continuing effort to seek more powerful, less sensitive, eco-friendly energetic materials, we are interested in fused heterocyclic compounds that contain a high percentage of both nitrogen and oxygen."
Don't want to harm the environment when you're blowin' sh*t up.

Permalink to Comment

7. Cris on September 20, 2012 6:26 PM writes...

I'm a biologist, and my first reaction on seeing the chemical structure load was "Oh hell no!" (for full Southern effect, it is pronounced "oh HAY-el nawh.") I don't usually have a drawl, but that structure really calls for something stronger than "oh no."

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8. newnickname on September 20, 2012 6:32 PM writes...

Old, but useful, Venture Cap story: Wall Street Journal, May 20, 2004, page A1: "Biotech's Dismal Bottom Line: More Than $40 Billion in Losses."
As Scientists Search for Cures, They Gobble Investor Cash; A Handful Hit the Jackpot. 'The Ultimate Roulette Game'. By DAVID P. HAMILTON, Staff Reporter.

It was something like $120 BB of VC money invested over 12 years and around $80 BB recouped in successful exits. Read the whole article for details.

close the spaces around the /s:

online.wsj.com / article / 0,,SB108499868760716023,00.html

Permalink to Comment

9. metaphysician on September 20, 2012 7:27 PM writes...

#1- With that much nitrogen, do you really even need much oxygen? I'd expect it to want to turn straight into N2 readily enough, and with all those double bonded nitrogens, there's going to be plenty of energy to go around. . .

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10. BS on September 20, 2012 7:32 PM writes...

Did anybody catch that the standard impact sensitivity measurement used in the explosives paper is the, "BAM Fallhammer Technique"?

Side note, "The BAM Fallhammer Technique," is what I should have named my experimental metal band in college.

Permalink to Comment

11. Ed on September 20, 2012 7:57 PM writes...

That's an astoundingly bad Photoshop of Paul Allen in the first link. He may actually be sitting in a chair, but there's no way his face and his suit are in that room.

Permalink to Comment

12. matt on September 21, 2012 9:37 PM writes...

I propose a category/keyword of Things That Go Boom.

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