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Why are clinical development success rates falling?

By Daniel Chancellor

VP Thought Leadership, Norstella

Citeline’s influential clinical development success rate analyses have been foundational for supporting investment decisions in biopharma R&D. The first paper in Nature Biotechnology in 2014 established a benchmark of 10% for the success of new drugs in Phase I trials, although this has steadily fallen over the last decade. This drop is both a concern and inevitable, as competition intensifies and the barriers to market entry become higher. Rather than becoming more risk averse, drug developers should seek to shift attrition to the earliest stages of development. Judicious go/no-go decisions allow the prioritization of the best assets that will have the greatest patient impact.

Likelihood of approval for new Phase I drugs is now just 6.7%

Phase transition data from Citeline for the 10-year period between 2014ؘ and 2023 show that the average likelihood of approval (LOA) for a new Phase I drug is now just 6.7%. This has steadily fallen in each analysis to an all-time low. The main cause of attrition remains the Phase II hurdle, which just 28% of programs successfully complete, while Phase I (47%) and Phase III (55%) are both close to a one-in-two rate. Once filed for regulatory approval, 92% of programs eventually reach the market.

As shown in the chart below, which further segments success rates into 3-year cohorts, phase transition rates have fallen consistently between the clinical stages. This is most notable at Phase I, where a success rate of over 75% during 2006–08 has now dropped to below 40%. This can be partly attributed to the increasing use of biomarkers as surrogate efficacy endpoints. This allows the early termination of drug programs that aren’t showing the desired biological effect, thus avoiding the expense of larger trials. However, Phase I remains largely a safety hurdle and so this doesn’t fully explain the drop.

Phase II and III success rates have also fallen, albeit not to the same extent. Phase II remains the toughest hurdle for drug development and it is often appropriate for this to be the stage when a program can be halted with confidence. It is worrying that Phase III success rates have dipped in tandem in the latest three-year window. Failures at this stage are the most expensive and catastrophic for R&D productivity measures.

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What does this mean?

Declining success rates are a function of the challenges posed by biological complexity and competitive intensity. As drug programs move into new diseases in search of unmet medical need, the scientific challenge to validate new drug targets – or improve upon older therapies – is greater. Furthermore, dramatic increases in funding, pipelines and clinical trial activity mean that drug development can quickly become crowded. Pipeline drugs that are not first-in-class or best-in-class may struggle to achieve a return on investment, and so many are discontinued.

The trend towards lower success rates shows that biopharmaceutical companies are continuing to push the boundaries of science, rather than rely on me-too therapies that offer little advance to patients. While it is a concern for those managing R&D budgets, it is also a positive indicator for innovation. Drug companies need to embrace risk as a prerequisite for scientific progress. Importantly, through designing clinical programs in a way that encourages effective attrition at the earliest stages of drug development, they can prioritize effectively. The companies that will best serve patients in the future will be those that take calculated risks, perhaps at the expense of overall clinical success rates.

This analysis was taken from a deeper analysis of clinical development success rates, first published by Citeline to accompany novel product enhancements within Biomedtracker. Download the full article Why Are Clinical Development Success Rates Falling? today.

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