Drug Repurposing The Most Affordable Relaunch Option For Pharma Companies

Armen Hareyan's picture

At an average cost of $8.4 million, drug repurposing has become an attractive option for pharmaceutical companies of all sizes to pursue.

Cutting Edge Information surveyed 30 pharmaceutical and biotechnology firms to determine the effectiveness of seven different relaunch strategies. The average implementation costs to repurpose a drug was the lowest among the seven profiled strategies. Relaunching a new formulation, for example, was among the most expensive strategies with an average implementation cost of $41.3 million.


"Drug repurposing is an option that any pharmaceutical company can consider, regardless of its size," said Elio Evangelista, research team leader at Cutting Edge Information. "Even small companies and biotechs can commit to a minimal investment and produce a multimillion dollar product."

Drug repurposing is a strategy that essentially revives compounds that were once thought dead. Compounds that never reach Phase 3 or those that failed to meet clinical study end points may be candidates for drug repurposing down the road. In many cases, companies purchase the rights to continue developing compounds that were once considered disappointments. The companies then discover new uses for the drugs and market them to new patient populations.

One repurposing case study profiled in the report describes how a company invested $31.5 million to repurpose its endocrinology drug. When the drug finally reached the market, the drug delivered between $300 million and $400 million in peak annual sales. While this success is not guaranteed for every repurposed drug, there are common principles behind that strategy that Cutting Edge Information discovered and discusses in its new study.

"Pharmaceutical Product Relaunch: Preserving Market Share through Line Extension and New Market Entry Strategies" examines drug repurposing, along with six other lifecycle management strategies, to understand the motivating factors driving relaunch decisions. Furthermore, Cutting Edge Information collected key benchmarks on the strategies' average implementation costs, average return on investment, effectiveness and timing.