Threading the Needle: How Biotech and Pharma Can Flourish in a Post-Reform Environment

The past year has seen the ravaging debates of health care, with both sides making attacks and counter attacks. However, one thing has remained abundantly clear. A form of health reform will pass sometime soon, either late this year or early next year.

So how could this reform affect drug companies? In the short term, it is guaranteed to either reduce their revenues through collective bargaining for drug prices, or through head to head competition for FDA approvals. While the list of hazardous diseases is still long, the resources to fight these diseases with new drug development are decreasing. Drug companies already have a difficult enough time as it is to pay off current research costs. Also, there is a dearth in the number of market viable drugs in the research pipeline. This all adds up to squeezed profits, and further endangers many companies who are already on thin ice.

Companies have a couple of options to stave of bankruptcy. They can dilute the reform package through an army of lobbyists, slowly chipping away at the core guidelines to ensure that bill won’t affect them badly. However, only the large companies can afford to do this, and it won’t guarantee you protection for long.

Companies can merge with or acquire competitors to ensure collective survival with pooled resources. However, this also only gives temporary protection, and doesn’t guarantee the most efficient use of resources.

The root of the problems stems from research costs. Currently, the process takes nearly ten years and two billion dollars per drug. Even then, it doesn’t guarantee that the drug will sell, and most times, most drugs that make it through the FDA regulations don’t recuperate their research costs. Thus, the few blockbuster drugs pay off the myriad of other drugs that fail to sell to ensure the company does not go under.

The ideal situation would be quick, inexpensive research that yields higher quantities of market ready drugs. This way a company can spread out their risk, and ensure that at least one drug would work. The question is, Can this be done now?

Surprisingly, the answer is yes. The microgravity environment of space yields higher volumes of useful data on a myriad of diseases and disabilities ranging from osteoporosis to E-Coli to cancer. The environment accelerates muscle and bone loss, while at the same time elevating stress levels in living organisms. This offers a perfect environment to study atrophy diseases like osteoporosis and stroke and stress related diseases like high blood pressure and cardiovascular disease. Also due to the low gravity environment, X-ray crystallography to yield exact geometries of complex proteins can be done with high accuracy due to perfect crystal growth. This can all be done autonomously for little added cost from current ground based research. The only added cost would be the supply and the cost of putting a lab into orbit. Even with today’s astronomical launch costs, companies can still recover their investments through shorter research time lines. Since organic compound geometries can be determined with high accuracy quickly in space, research can be targeted instead of trial and error as it is now. This can potentially save companies billions, and give them a safety net for both the long and short terms, allowing them to weather any change in market conditions or regulations. More detail on what specific advantages that space based life sciences research can give will be on following posts.