A myriad of uncertainties are present throughout the entire drug discovery, development, regulatory filing, and approval process, as well as in the eventual commercial success. “Big Pharma” companies like Sanofi, Roche, Bayer, and others have an in-depth awareness of this volatility and their research pipelines. Their diverse business models strategically capitalize on inherent uncertainty to prevent disproportionate losses due to missed regulatory milestones. It is clear that innovators engage in a flexible game of asymmetric bets.
Sanofi’s 2022 annual report addresses the risks associated with innovative drug discovery research (paraphrased): Failure to invest in the correct technology platforms, therapeutic areas, product classes, regional markets, and licensing opportunities could hurt pipeline productivity. During these research and development cycles, which usually last several years, there is a significant risk that we (Sanofi) will not meet our safety and efficacy goals and must abandon a product in which we have invested significant money and human resources. In 2022, the FDA halted Phase III tolebrutinib trials worldwide due to negative effects. In August 2022, the prespecified interim analysis of a Phase III trial ended the global clinical development program for amcenestrant (breast cancer). More trials have demonstrated superior clinical outcomes; failing to meet these could negatively impact the product’s outlook and our development program. Our launch plan (timing, pricing, market access, marketing, and dedicated sales forces) may fail or delay, preventing our products from delivering the intended benefits. Poor performance from our collaborative partners could potentially harm us during crucial tasks or operations, such as manufacturing. Failures in the development process or different goals may hurt our business, including our collaborations.
