Preclinical drug discovery has traditionally been the preserve of large fully integrated pharmaceutical companies (FIPCO’s) in established geographical centres in the UK, US and Europe. It relied on tight integration of laboratory facilities and drug design expertise within monolithic mega-research facilities. As laboratory science has become more industrialised and experimental data resources become more widely available through the internet, drug discovery is moving out from the mega-Pharma into thousands of small mid-size Biotech or Pharma research businesses.

These new “mini-Pharma” entrants usually focus on developing some biological insight emerging from academic research into potential drug development candidates and then license those to the mega-Pharmas that have the financial muscle to carry the costs of clinical development.

Although the mini-Pharma companies are smaller and operate more cost-effectively, they often operate as smaller versions of their larger role models. Their productivity may sometimes be higher, but they are not radically different. They remain expensive to set up, fixed costs are high and the majority fail commercially. Nevertheless, driven by unmet medical needs, growing populations and increasing wealth, there is a very large market for new clinical development candidates to fill the empty pipelines of the large FIPCO’s.

The revolution in information technology and emerging developments such as the semantic web, cloud computing as well as community data and software resources is now creating the right circumstances for a second wave of change. This change will be driven by solutions for managing information, extracting knowledge and making decisions in virtual organisations which will create opportunities for new entrants to this very valuable market, especially those with strong IT expertise. The new entrants will be “micro-Pharmas” that minimise fixed costs through accessing on demand, pay-as-you-go laboratory and computing services and exploit Web 2.0 technologies to access globally available services and expertise “on demand”. Driven by their expertise in Information systems, they will deliver new medicines at low unit cost and lower risk. These new micro-drug discovery companies will stimulate local markets for services and grow expertise core in biotechnology activities that create wealth for their investors and communities.

In this emerging landscape for Pharmaceutical research, the mega-Pharmas will increasingly focus on clinical development and commercialisation, in-licensing their products from high productivity mini- and micro-Pharmas. Services will be acquired from the best providers that operate globally and offer services on demand.

This emerging landscape creates new businesses opportunities in the provision of on demand services and in the formation of micro-Pharmas which may operate as businesses, charitable foundations or potentially as participants in open source drug discovery.

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