By Duff Wilson
At the end of November, Pfizer stands to lose a $10-billion-a-year revenue stream when the patent on its blockbuster cholesterol drug Lipitor expires and cheaper generics begin to cut into the company’s huge sales.
The loss poses a daunting challenge for Pfizer, one shared by nearly every major pharmaceutical company. This year alone, because of patent expirations, the drug industry will lose control over more than 10 megamedicines whose combined annual sales have neared $50 billion.
This is a sobering reversal for an industry that just a few years ago was the world’s most profitable business sector but is now under pressure to reinvent itself and shed its dependence on blockbuster drugs. And it casts a spotlight on the problems drug companies now face: a drought of big drug breakthroughs and research discoveries; pressure from insurers and the government to hold down prices; regulatory vigilance and government investigations; and thousands of layoffs in research and development.
My comments: The pharm-chem paradigm is running out of steam. The low hanging fruit has been picked, an the big, easy money made. Now its a declining number of new drugs. Same thing happened in an earlier era with vaccines.
But its not the en of the road for health technologies. Rejuvinative medicine; stem cells and related.. looks just huge in its potential, even bigger than the pharma-chem paradigm. There is also genetic engineering which is in its infancy. And there is nano-medicine which is also in its infancy.
Unfortunately I camee to realize the great names in Pharmacueticals will never make the jump to a new paradigm. They will stay making drugs, even as that business becomes about generics. New companies that don't even exist now will become ten billion dollar a year companies in the new fields.
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