In his heyday in the 1960s and 1970s, James Black demonstrated a Midas touch that turned base chemicals into pharmaceutical gold. An old-fashioned British pharmacologist who would think through his experiments for weeks before picking up a pipette, Black passionately believed in his duty to help cure disease―and in the capability of drug companies to help him do so. After leaving academia for ICI, he developed beta-blockers to treat hypertension. Later, working for Smith, Kline & French, his work on histamine H2-receptor blockers revolutionized the treatment of stomach ulcers. Black's contribution to medicine was honoured with a Nobel Prize in 1988, and these two classes of drug are still bestsellers. What wouldn't the world's pharmaceutical giants give for a return to the days when the steady arrival of new blockbuster drugs saw the industry riding high? Today it's a different story. The patents are running out on established earners and, despite the billions of dollars that the firms are pouring into research and development, the number of new drugs launched each year is falling. At the same time, the average cost of bringing a drug to market is rising, having doubled over the past 15 years; it now stands at as much as US$800 million, according to the Tufts Center for the Study of Drug Development in Boston. Put these two trends together, and it is easy to see why analysts are warning that historical patterns of profit growth are unlikely to continue. Factor in the threat of a big earner being blown away by a successful patent challenge―as happened to GlaxoSmithKline's antibiotic Augmentin earlier this year―and things look bleak indeed.
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