Clinical R&D in the US saw another record year in 2019. Fifty new active substances (NAS) reached patients, the late-stage active pipeline grew 10% and venture capital deals topped $20 billion.

These numbers reflect an evolution occurring across the industry. Sponsors are taking bigger risks on novel drugs, the US Food and Drug Administration is leveraging tools to safely accelerate the approval process, and sponsors are working more closely with government and academia to develop treatments that address unmet medical needs.

The disruption caused by COVID-19 in 2020 will likely only enhance these trends. While the pandemic has caused disruption of clinical trial activity with expected delays in trial programmes and subsequent filings and launches, it has simultaneously unleashed a flurry of new innovations and prompted unprecedented collaboration and decisions by regulatory authorities to adapt review and approval processes.

This swift and collaborative response will likely set the stage for a more innovative and adaptable drug development environment in the years to come.

The pipeline is full

The pipeline of new research saw continued record expansion in 2019. The late-stage active pipeline has grown 50% since 2014 and is strongly focused on oncology, infectious disease and neurology.

This steady growth is an important indicator of the strength of the biomedical innovation system in our country. Oncology now accounts for 30% of the late-stage pipeline, with a full 12% of late-stage trials developing cell, gene and nucleotide therapies.

Recent growth also demonstrates a willingness to take bigger risks developing new solutions. The crop of NAS launched in 2019 included breakthrough therapies, novel mechanisms of actions, precision and personalised medicines and orphan-designated treatments.

The focus on developing innovative treatments is being bolstered by several industry trends.

Sponsors have access to more healthcare data and advanced analytics tools than ever before. They are using these Human Data Science tools to model outcomes of new molecule development plans so that they can more accurately predict success and adapt their strategies to improve results. The adoption of technology coupled with our expanding understanding of biology is giving investors the confidence to commit billions of dollars to develop novel drugs and therapies that were previously seen as too high-risk.

Sponsors are also eager to take advantage of accelerated approval offered by FDA for breakthrough therapies that address unmet medical needs. Fully 74% of NAS launches in 2019 received at least one expedited review designation, and 40% were identified by FDA as first-in-class therapies – those with mechanisms of action different from existing therapies. That’s almost double the number from 2011.

One in four NAS in 2019 also relied on single-arm studies among their approval trials, which is up from 15% in 2018. Single-arm studies are useful in smaller target populations where there are challenges conducting randomised controlled trials, and this trend is mostly driven by the growing percentage of orphan NAS launching in the US.

The emphasis on breakthrough therapies resulted in slightly fewer Phase III trials initiated in 2019 over 2018, because many of these fast-tracked development efforts can now be submitted for FDA review based on Phase II trial results alone.

These programmes are reflective of FDA’s ongoing efforts to accelerating initial approval of drugs for life-threatening conditions. To ensure patient safety, regulators are balancing the accelerated approvals with more rigorous requirements for follow-up data around safety and efficacy. The eight NASs that received accelerated approval status in 2019 will have post-approval confirmatory trials with, on average, six times the number of subject-years than was included in their initial pivotal trials.

But the data shows that not all of this risk-taking is paying off. The composite success rate, which describes the likelihood of bringing a drug candidate through regulatory approval, fell from 11.1% in 2018 to 7.6% in 2019. That is well below the average of 12.9% for the past decade and reflects a drop in success across all development stages.

This lower rate of success reflects the pressure sponsors face to develop higher-risk, first-to-market molecules. They recognise that they have to develop treatments that offer significant clinical differentiation if they are going to secure reimbursement and uptake of their products in the current healthcare marketplace.

Despite the declining success rate, the increased number of investigational drugs in the pipeline suggests a sustained level of approvals and launches over the next five years of 50-55 per year on average.

COVID-19 and the future of R&D

While COVID-19 has caused delays and a lot of uncertainty in trials across the globe, pharma companies are not slowing down.

Prior to the pandemic, FDA approved 11 novel medicines through March, which is in line with expectations. Since the pandemic began, we have seen almost no cancellation of clinical trials. Instead, sponsors and sites are rapidly adapting their study methods and protocols in line with regulatory guidance to maintain trial progress while protecting the safety of patients and staff. Changes include the adoption of telemedicine, home health visits, remote monitoring and courier services to deliver drugs directly to patients.

But even with these efforts, we anticipate that the pandemic will have a ripple effect in the marketplace. As regulators shift priorities to COVID-19, it is likely that approval of some non-COVID-19 treatments will be delayed. Disruption to the initiation of pivotal trials may also delay the eventual filing and launch of new molecules in later years, though some of this will be mitigated by actions to accelerate development timelines.

At the same time, we are seeing rapid ramp-up of development for COVID-19 vaccines and therapeutics with active participation by FDA and industry. As of April 20, there were over 900 clinical trials planned or underway for COVID-19, many of which involve partnerships between pharma, government and public policymakers who are working collaboratively to eliminate barriers and accelerate results.

These efforts include FDA’s launch of the Coronavirus Treatment Acceleration Program (CTAP) in April to accommodate the surge of new studies and to move new treatments to patients as quickly as possible. The programme has announced plans to respond to all COVID-19-related requests and review protocols within 24 hours of receipt.

We also anticipate that FDA will be more likely to give accelerated approval or Emergency Use Authorisation to novel COVID-19 products, allowing manufacturers to collect the bulk of clinical evidence and safety in a post-marketing setting – similar to drugs receiving accelerated approvals. These programmes will likely rely on the use of real-world evidence studies and machine-learning-based analytics to closely monitor patient safety and efficacy in the years to come.

We are in this together

The collaboration and innovation occurring in response to COVID-19 has been remarkable to witness, and we believe the near-term impact of these efforts will be positive. We expect an uplift in discovery and R&D over the next several years leading to new breakthroughs in novel therapies and vaccines – particularly in infectious diseases, which are likely to remain an area of focus.

COVID-19 has forced us to re-examine our development strategies and to work together in new ways to solve this global healthcare crisis as quickly and safely as possible. When it’s over, we believe the lessons learned will continue to influence drug development and approval, causing a positive halo effect on pharmaceutical and regulatory innovation across critically important disease areas for years to come.

Murray Aitken is executive director at the IQVIA Institute for Human Data Science