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Trends of Business-to-Business Transactions to Develop Innovative Cancer Drugs

Author

Listed:
  • Arisa Djurian

    (Graduate School of Technology Management, Ritsumeikan University, Osaka 567-8570, Japan)

  • Tomohiro Makino

    (Graduate School of Technology Management, Ritsumeikan University, Osaka 567-8570, Japan)

  • Yeongjoo Lim

    (Faculty of Business Administration, Ritsumeikan University, Osaka 567-8570, Japan)

  • Shintaro Sengoku

    (School of Environment and Society, Tokyo Institute of Technology, Tokyo 152-8550, Japan)

  • Kota Kodama

    (Graduate School of Technology Management, Ritsumeikan University, Osaka 567-8570, Japan
    Center for Research and Education on Drug Discovery, The Graduate School of Pharmaceutical Sciences in Hokkaido University, Sapporo 060-0812, Japan)

Abstract

A key concept in the pharmaceutical industry is open innovation, in which pharmaceutical companies contribute to human health and adapt to a changing business environment by acquiring external knowledge. As successful drug discoveries and developments have become challenging, pharmaceutical companies must proactively pursue the open innovation of new drugs through various inter-firm partnerships to be more sustainable. This study aims to interpret the trend of inter-firm partnerships in the development of cancer drugs and to evaluate their effectiveness by examining inter-firm transactions related to cancer drugs approved by the US Food and Drug Administration (FDA). It is a novel approach to exercise this on each product instead of at the company level. The findings revealed that the number of inter-firm transactions in the oncology field has increased over the past 20 years. Furthermore, the annual number of transactions related to biologics has surpassed that of small molecules since 2015 and has been primarily driven by three PD-(L)1 inhibitors: Keytruda, Opdivo, and Tecentriq. Moreover, the average number of inter-firm transactions related to biologics is significantly higher than that of small molecules in total, in alliances, and in financing, suggesting that inter-firm transactions for biologic cancer drugs actively occur through various means. Additionally, a positive and significant correlation exists between the number of transactions and the average number of approved indications for biologics, but not for small molecules. These results suggest that the observed trend of active inter-firm transactions is key in increasing the probability of success in cancer drug research and development. This could provide a potential breakthrough in this industry for the successful development of innovative drug candidates to address unmet medical needs. Further study is necessary to confirm the applicability of this paradigm in broader drug discoveries and development.

Suggested Citation

  • Arisa Djurian & Tomohiro Makino & Yeongjoo Lim & Shintaro Sengoku & Kota Kodama, 2020. "Trends of Business-to-Business Transactions to Develop Innovative Cancer Drugs," Sustainability, MDPI, vol. 12(14), pages 1-14, July.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:14:p:5535-:d:382188
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    References listed on IDEAS

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    1. DiMasi, Joseph A. & Grabowski, Henry G. & Hansen, Ronald W., 2016. "Innovation in the pharmaceutical industry: New estimates of R&D costs," Journal of Health Economics, Elsevier, vol. 47(C), pages 20-33.
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    6. DiMasi, Joseph A. & Hansen, Ronald W. & Grabowski, Henry G., 2003. "The price of innovation: new estimates of drug development costs," Journal of Health Economics, Elsevier, vol. 22(2), pages 151-185, March.
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