Focusing too many R&D resources on one drug: The hidden costs of clinical trial-level decision-making

Drug development is a high-stakes, high-cost endeavour. Every new drug entering clinical trials requires careful decision-making, particularly regarding trial design and resource allocation. However, when biopharmaceutical companies invest excessive resources into a single drug, they risk sidelining other potentially life-saving treatments. This short-sighted approach can result in missed opportunities for patients and significant financial loss for the companies themselves.

With resources often constrained, funnelling funds toward one drug can disrupt the broader development pipeline. Large-scale Phase III trials, for example, are notoriously expensive and time-consuming, sometimes absorbing tens of millions of dollars only for the lead candidate. When a drug shows overwhelmingly positive results, one may wonder if a smaller sample size would have been a more prudent choice from the company’s portfolio perspective.

Overpowering trials: A costly misstep

One common error in clinical trial design is the tendency to "overpower" trials by increasing sample sizes far beyond what is needed, under the assumption that more participants will yield better results. While large trials are often necessary for proving a drug's efficacy, there is a point at which increasing the sample size offers little additional benefit, but still dramatically increases costs. Additionally, overpowered trials can result in significant p-values, even if the treatment difference is not meaningful.

A solution to overpowering trials lies in smarter, more flexible decision-making. Instead of rigidly committing to an overly cautious approach, companies should take a portfolio-level view – analysing how resource allocation affects the entire pipeline, not just the drug at hand. Additionally, sponsors should consider the incorporation of interim analyses, which involve evaluating data at predefined points during the trial to assess the treatment's efficacy and safety. This allows companies to make informed decisions about continuing, modifying, or halting a trial based on early results, thereby enabling investments to be divided into smaller portions. Such a mindset would help avoid unnecessary costs, while maintaining momentum across the company's full range of development efforts.

The dangers of tunnel vision

Such a portfolio-wide perspective also helps prevent the tunnel vision that can occur when too much focus is placed on a single drug. Every time more dollars, staff, or resources are dedicated to a single candidate, other promising therapies are pushed aside. This not only delays or entirely stifles investment in other potentially beneficial products, but also leaves the clinical trial sponsor vulnerable should the lead candidate ultimately fail.

For example, AstraZeneca, as highlighted in the L.E.K. Consulting report, once placed significant focus on its cardiovascular and gastrointestinal drugs, allocating substantial resources to these areas. However, through an analytics-driven approach, AstraZeneca shifted its strategy to diversify and expand its oncology portfolio. By reallocating resources and prioritising a broader range of therapeutic areas, AstraZeneca increased its chances of success and reduced its dependency on any single drug. This portfolio-wide focus enabled the company to mitigate risks and optimise returns, rather than putting all its resources into one high-risk programme (L.E.K. Consulting, 2018).

Programme vs portfolio decisions

At the individual programme level, biopharmaceutical companies must weigh numerous factors when determining whether to continue investing in a drug. Considerations include patent expiration dates, competing products, and the overall cost of ongoing development. One of the most critical metrics for making such decisions is the risk-adjusted net present value (rNPV), which evaluates the balance between development time, cost, and the drug’s probability of success (PoS). Many larger pharmaceutical companies have already adopted formal optimisation strategies at the programme level to guide investment decisions and maximise the value of their portfolios.

On a larger scale, companies must also prioritise decisions at the portfolio level, ensuring they’re not just betting on one "blockbuster" drug. The focus should be on maximising the overall value of the portfolio, which benefits both sponsors and patients (Springer 2021). Programmes with the highest profitability indices, which account for both the cost and potential return, should receive priority in funding.

In many cases, a more sophisticated optimisation strategy is required, one that distributes resources to ensure the highest collective return across all projects, not just a single candidate. Failure to optimise at the portfolio level can lead to large financial losses for sponsors, because a large investment in one product can obstruct investments into other products. From a patient perspective, this means insufficient investments for many indications where there is a great need for better treatments.

Master protocols: A strategic way forward

One promising strategy for avoiding over-commitment to a single drug is the use of master protocols (NEJM, 2017). These innovative trial designs allow multiple therapies or disease indications to be tested simultaneously under a unified infrastructure. By using shared control arms and harmonised procedures, master protocols can reduce redundancies and streamline development. Master protocols also require broader, portfolio level decision making.

The I-SPY 2 trial is a prime example of how master protocols can lead to more efficient drug development. This trial, focused on breast cancer therapies, allows multiple drugs to be tested concurrently, with real-time adjustments made based on how well they are performing. This type of flexible structure enables companies to shift resources to more promising candidates quickly, accelerating development timelines and improving the odds of success for the entire pipeline.

A balanced approach for long-term success

In an industry where timing and resource management are crucial, overcommitting to a single drug jeopardises both the future of a company and the pace of medical innovation. A more balanced, strategic approach to decision-making – one that optimally spreads trial investments across multiple programmes – helps ensure that no single drug dominates the pipeline at the expense of others.

To accomplish this, companies should lean on statistical consultants not only for sample size calculations, but also for broader strategic insights. These experts can highlight inefficiencies and pinpoint where trial designs might be streamlined, preventing excessive investments that drain resources from other areas.

Companies that embrace this broader, long-term view will not only reduce their financial risks, but also advance efforts to bring more life-saving treatments to market, benefitting both their bottom lines and patients worldwide.

References

Antonijevic Z, Liu Y, Tang R, Huml J, Beckman RA, Mayer C, & McMillan G. Patient Benefits from Innovative Designs in Rare Diseases. Rare Disease Drug Development: Clinical, Scientific, Patient, and Caregiver Perspectives. Springer; 2021 pp 147-160.

Woodcock J & LaVange LM. Master Protocols to Study Multiple Therapies, Multiple Diseases, or Both. N Engl J Med 2017; 377:62-70 DOI: 10.1056/NEJMra1510062.