• Log InLog In
  • Register
Liquid`
Team Liquid Liquipedia
EST 06:07
CET 12:07
KST 20:07
  • Home
  • Forum
  • Calendar
  • Streams
  • Liquipedia
  • Features
  • Store
  • EPT
  • TL+
  • StarCraft 2
  • Brood War
  • Smash
  • Heroes
  • Counter-Strike
  • Overwatch
  • Liquibet
  • Fantasy StarCraft
  • TLPD
  • StarCraft 2
  • Brood War
  • Blogs
Forum Sidebar
Events/Features
News
Featured News
RSL Revival - 2025 Season Finals Preview8RSL Season 3 - Playoffs Preview0RSL Season 3 - RO16 Groups C & D Preview0RSL Season 3 - RO16 Groups A & B Preview2TL.net Map Contest #21: Winners12
Community News
Weekly Cups (Jan 5-11): Clem wins big offline, Trigger upsets3$21,000 Rongyi Cup Season 3 announced (Jan 22-Feb 7)15Weekly Cups (Dec 29-Jan 4): Protoss rolls, 2v2 returns7[BSL21] Non-Korean Championship - Starts Jan 103SC2 All-Star Invitational: Jan 17-1824
StarCraft 2
General
SC2 All-Star Invitational: Jan 17-18 Weekly Cups (Jan 5-11): Clem wins big offline, Trigger upsets When will we find out if there are more tournament SC2 Spotted on the EWC 2026 list? Weekly Cups (Dec 29-Jan 4): Protoss rolls, 2v2 returns
Tourneys
SC2 AI Tournament 2026 $21,000 Rongyi Cup Season 3 announced (Jan 22-Feb 7) $25,000 Streamerzone StarCraft Pro Series announced WardiTV Winter Cup WardiTV Mondays
Strategy
Simple Questions Simple Answers
Custom Maps
Map Editor closed ?
External Content
Mutation # 508 Violent Night Mutation # 507 Well Trained Mutation # 506 Warp Zone Mutation # 505 Rise From Ashes
Brood War
General
[ASL21] Potential Map Candidates A cwal.gg Extension - Easily keep track of anyone Potential ASL qualifier breakthroughs? BGH Auto Balance -> http://bghmmr.eu/ BW General Discussion
Tourneys
[Megathread] Daily Proleagues [BSL21] Grand Finals - Sunday 21:00 CET [BSL21] Non-Korean Championship - Starts Jan 10 SLON Grand Finals – Season 2
Strategy
Game Theory for Starcraft Simple Questions, Simple Answers Current Meta [G] How to get started on ladder as a new Z player
Other Games
General Games
Beyond All Reason Nintendo Switch Thread Awesome Games Done Quick 2026! Mechabellum Stormgate/Frost Giant Megathread
Dota 2
Official 'what is Dota anymore' discussion
League of Legends
Heroes of the Storm
Simple Questions, Simple Answers Heroes of the Storm 2.0
Hearthstone
Deck construction bug Heroes of StarCraft mini-set
TL Mafia
Vanilla Mini Mafia Mafia Game Mode Feedback/Ideas
Community
General
US Politics Mega-thread Russo-Ukrainian War Thread Things Aren’t Peaceful in Palestine European Politico-economics QA Mega-thread Trading/Investing Thread
Fan Clubs
White-Ra Fan Club
Media & Entertainment
Anime Discussion Thread
Sports
2024 - 2026 Football Thread
World Cup 2022
Tech Support
Computer Build, Upgrade & Buying Resource Thread
TL Community
The Automated Ban List TL+ Announced
Blogs
My 2025 Magic: The Gathering…
DARKING
Physical Exercise (HIIT) Bef…
TrAiDoS
Life Update and thoughts.
FuDDx
How do archons sleep?
8882
James Bond movies ranking - pa…
Topin
Customize Sidebar...

Website Feedback

Closed Threads



Active: 1765 users

Overview Of The Pharmaceutical Industry, Part I

Blogs > AUGcodon
Post a Reply
AUGcodon
Profile Blog Joined February 2011
Canada536 Posts
Last Edited: 2013-12-05 20:35:36
December 05 2013 05:56 GMT
#1
Hello Teamliquid, I decided to start a blog and I wanted to share something new with you guys. I do not believe I have seen an extensive discussion of the pharmaceutical industry on this forum before. I would like to take this opportunity to share some of my knowledge on the pharma and biotech industry in general. Now I am a relatively new comer to the pharma industry itself but I do have a decent grasp of the industry in general. I will also try to make this accessible to the non-science audience as well. So without further ado, let us begin.

What is the modern process of drug development? Broadly speaking it can be divided into 6 stages.

1) Establishing a target and find something that can bind to the target.

2) Preclinical

3) Phase I

4) Phase II

5) Phase III

6) Post-Market or Phase IV


1) Establishing a target and find something that can bind to the target.

The first two stages is pretty much the R of R&D. during this stage, researchers from academia or the pharma company itself finds a druggable target. For the sake of simplification, this target is essentially a particular protein. Proteins are molecular machinery in cells that is responsible for everything from transportation to signaling. For this theoretical case, the researchers found that a gene is linked to the expression of a particular protein. When there is a mutation in this gene, the protein is implicated in cancer. Through some more molecular bio experiments, we find that the mutated protein has a new shape. This new shape allows it to bind and activate proteins that is responsible for cell division[1].

So once a target is found, how do we shut off this protein that is associated with the mutant gene? I have to go through the concept of rational design first. We can elucidate the structure of the protein via x-ray crystallography or NMR. Once we have the structure of the protein, medicinal chemist can design chemical compounds that interfere the binding between the mutated protein and the protein responsible for cell division[2]. So they play around with the chemistry until they find something that binds to the mutated protein strongly enough to prevent binding with the cell division protein. Then it is time to test these compounds in cancer cells that have the mutated gene in question[3]. Further chemical tinkering occurs with our small molecule as our medicinal chemist weigh the benefits/risk between increasing specificity of the compound and potential for side effects and delivery issues. The head scientist(actual title in pharma) for that group submit this compound to above and they decide if this compound is worth pursuing. Luckily for this group, this compound is deemed to have potential and moved to the preclincal phase, or the animal trials as it is more commonly known.

footnotes

[1]- To be more precise, this protein is part of the signalling pathway for cell division.
[2] - I did not mention protein based drugs, or biologic. This will definitely show up sometime in the future.
[3] - I decided to forgo mentioning synthetic compound library tested against protein targets or cancer cell line.

I was originally going to write about all 6 stages today, but then it hit me how long all this is. Looking back, I think I manage to hit the sweet spot where it is too basic for anyone with a biology or chemistry background and still a little too technical for the average person. Oh well, I would definitely like feedback on this point.

To be honest, I really want to discuss drug pricing and the economics behind the pharma industry. But I feel it is important to set the background first. Looks like it is going to be a little while before I get there.

Thank you guys for reading through this and all questions/feedbacks are welcome.

Cheers



*****
2809-8732-2116/ Fighting/ Mienfoo, Tyrogue, Sawk
Kingsky
Profile Blog Joined October 2010
Singapore298 Posts
December 05 2013 06:42 GMT
#2
Hi, may i ask what role do you play in the industry?

researcher? investor? accounts? sales? marketing?
Why do people hate the Colossus? Because the Colossus is like banksters from Wall Street: “too big to fail”. - TheDwF
AUGcodon
Profile Blog Joined February 2011
Canada536 Posts
Last Edited: 2013-12-05 07:13:10
December 05 2013 06:55 GMT
#3
Sure, I play a QC role on the post-production side. Tracking safety issues once the products are on the shelves. I do want to get into health economics eventually though.
2809-8732-2116/ Fighting/ Mienfoo, Tyrogue, Sawk
FryBender
Profile Joined January 2011
United States290 Posts
Last Edited: 2013-12-05 15:39:47
December 05 2013 15:39 GMT
#4
I'm not sure that you need to go through all the steps in that much detail in order to explain why drugs are so expensive. The research and development of drugs is complex and requires different experts in different fields. As you mention you need biologists, biochemists, crystolagrophers, organic chemists, medicinal chemists, and analytical chemists just to come up with a couple of potential molecules. You then need to scale up the process so you need process and chemical engineers as well as formulators to actually create the tables. All of this expertise is not cheap and they all require expensive resources and equipment.

On the other side, the government will not let you sell anything to the public that isn't both effictive and safe. Human beings are funny in that we're all different and so something that is harmless to one person can kill someone else (like peanuts). So the drug manufacturer has to spend a lot of money in order to prove to the FDA (and other government's drug agencies) that the drug does exactly what you say it does and nothing else. This costs A LOT! And on top of it all it's often that the drug will fail while going through these clinical trials so all that money you spent on developing a molecule goes down the drain which means that the price of successful drugs has to include costs to recoup the failed drugs as well. This whole process takes a long time (5-10 years from beginning to end) The way that patent law works you have a very limited amount of time on the market to actually make money since you have to patent the molecule when you first dicover it (so about 4-8 years before it will reach market and start selling) so when it actually does release the drug companies have to raise the price in order to make the money back in a short amount of time (and obviously make a profit) before the generic manufacturers can start making the same drugs and sell them for much cheaper since they have virtually no R&D invested in the drug. On top of it all drug manufacturers have to invest millions in order to protect their IP since other drug manufacturers (and generics as well) are always trying to break each others patents because the chemistry behind drug effectivness is extrememly comlicated and different configurations of the same molecule can have very different effects. And that is why a tablet that might cost less then a cent to make actually costs hundreds of dollars to buy.

P.S. all of this only applies to small molecules. Biotech companies work differently in that it's both much harder to develop and much harder to break the pattents on large molecules.
catplanetcatplanet
Profile Blog Joined March 2012
3830 Posts
December 05 2013 15:56 GMT
#5
why the AUG codon?
I think it's finally time to admit it might not be the year of Pet
Awesomedrifter
Profile Blog Joined May 2009
Canada62 Posts
December 05 2013 17:45 GMT
#6
How does it feel to work in a stagnated industry that refuses to change its methodology?

This look like a pretty good write up, I'll be looking forward to the future parts. Perhaps you might want to go to the topic of interest and just cite resources to find the background if they so chose.
http://awesomedrifter.com/
FryBender
Profile Joined January 2011
United States290 Posts
December 05 2013 19:00 GMT
#7
On December 06 2013 02:45 Awesomedrifter wrote:
How does it feel to work in a stagnated industry that refuses to change its methodology?

This look like a pretty good write up, I'll be looking forward to the future parts. Perhaps you might want to go to the topic of interest and just cite resources to find the background if they so chose.


How is it stagnated and how do you propose it change its methadology?
AUGcodon
Profile Blog Joined February 2011
Canada536 Posts
Last Edited: 2013-12-05 21:54:42
December 05 2013 21:34 GMT
#8
On December 06 2013 00:39 FryBender wrote:
I'm not sure that you need to go through all the steps in that much detail in order to explain why drugs are so expensive. The research and development of drugs is complex and requires different experts in different fields. As you mention you need biologists, biochemists, crystolagrophers, organic chemists, medicinal chemists, and analytical chemists just to come up with a couple of potential molecules. You then need to scale up the process so you need process and chemical engineers as well as formulators to actually create the tables. All of this expertise is not cheap and they all require expensive resources and equipment.

On the other side, the government will not let you sell anything to the public that isn't both effictive and safe. Human beings are funny in that we're all different and so something that is harmless to one person can kill someone else (like peanuts). So the drug manufacturer has to spend a lot of money in order to prove to the FDA (and other government's drug agencies) that the drug does exactly what you say it does and nothing else. This costs A LOT! And on top of it all it's often that the drug will fail while going through these clinical trials so all that money you spent on developing a molecule goes down the drain which means that the price of successful drugs has to include costs to recoup the failed drugs as well. This whole process takes a long time (5-10 years from beginning to end) The way that patent law works you have a very limited amount of time on the market to actually make money since you have to patent the molecule when you first dicover it (so about 4-8 years before it will reach market and start selling) so when it actually does release the drug companies have to raise the price in order to make the money back in a short amount of time (and obviously make a profit) before the generic manufacturers can start making the same drugs and sell them for much cheaper since they have virtually no R&D invested in the drug. On top of it all drug manufacturers have to invest millions in order to protect their IP since other drug manufacturers (and generics as well) are always trying to break each others patents because the chemistry behind drug effectivness is extrememly comlicated and different configurations of the same molecule can have very different effects. And that is why a tablet that might cost less then a cent to make actually costs hundreds of dollars to buy.

P.S. all of this only applies to small molecules. Biotech companies work differently in that it's both much harder to develop and much harder to break the pattents on large molecules.


The primary reason I went relatively in depth is because I believe the devil is in the details. That was a good overview of the R/D expenditure for a pharma company. It actually leads to the point Awesomedrifter is pointing to, the stagnation of the pharmaceutical industry. A good majority of the pharma companies are in the midst of a patent cliff currently. This means patents on their blockbuster drugs are expired or about to be retired and they don't have the new drugs in the pipeline that can replace the lost revenue. This has led to many cutbacks at pharma companies although some of them are still doing pretty well at the moment. There is quite the doom and gloom in this industry and the future is rather uncertain. The industry is heading toward consolidation and acquisition of small biotech firms for their IP. (Although acquiring successful IP is very much hit and miss as well). I will politely ignore the question of how to change the methodology of pharma company at this moment. It is a difficult question and we can have a ten page discussion about it. It is something that will be coming forward in future blogs.

I want to capture some of the subtler points regarding research and clinical trials in my upcoming blog posts. As I believe topics such as clinical trial designs, negotiation process between pharma companies and the FDA, the role of marketing are integral for getting a picture of why there is a innovation crisis in the pharma industry right now. The devil is in the details and there will be a payoff once I finish the world building process.
2809-8732-2116/ Fighting/ Mienfoo, Tyrogue, Sawk
Awesomedrifter
Profile Blog Joined May 2009
Canada62 Posts
December 05 2013 21:46 GMT
#9
On December 06 2013 04:00 FryBender wrote:
Show nested quote +
On December 06 2013 02:45 Awesomedrifter wrote:
How does it feel to work in a stagnated industry that refuses to change its methodology?

This look like a pretty good write up, I'll be looking forward to the future parts. Perhaps you might want to go to the topic of interest and just cite resources to find the background if they so chose.


How is it stagnated and how do you propose it change its methadology?



Profit margins on drug development have almost vanished, its a horribly inefficient process, yet they will neglect alternative therapy and insist drugs and drugs alone will solve all health problems. If you suggest something against the established model it will be hard to obtain even modest research funds. Research institutions are typically very conservative.

I have not heard promising things for those pursuing this field at this current time, its more profitable to get into industries that are beginning to grow imo.
http://awesomedrifter.com/
FryBender
Profile Joined January 2011
United States290 Posts
December 05 2013 21:59 GMT
#10
On December 06 2013 06:46 Awesomedrifter wrote:
Show nested quote +
On December 06 2013 04:00 FryBender wrote:
On December 06 2013 02:45 Awesomedrifter wrote:
How does it feel to work in a stagnated industry that refuses to change its methodology?

This look like a pretty good write up, I'll be looking forward to the future parts. Perhaps you might want to go to the topic of interest and just cite resources to find the background if they so chose.


How is it stagnated and how do you propose it change its methadology?



Profit margins on drug development have almost vanished, its a horribly inefficient process, yet they will neglect alternative therapy and insist drugs and drugs alone will solve all health problems. If you suggest something against the established model it will be hard to obtain even modest research funds. Research institutions are typically very conservative.

I have not heard promising things for those pursuing this field at this current time, its more profitable to get into industries that are beginning to grow imo.


Well besides surgical intervention, modern healthcare pretty much relies on drugs and drugs alone to solve all health problems. What else is there that the drug companies are neglecting? Homeopathy? Accupuncture? Shaman rituals?
BigFan
Profile Blog Joined December 2010
TLADT24920 Posts
December 06 2013 07:55 GMT
#11
On December 06 2013 06:46 Awesomedrifter wrote:
Show nested quote +
On December 06 2013 04:00 FryBender wrote:
On December 06 2013 02:45 Awesomedrifter wrote:
How does it feel to work in a stagnated industry that refuses to change its methodology?

This look like a pretty good write up, I'll be looking forward to the future parts. Perhaps you might want to go to the topic of interest and just cite resources to find the background if they so chose.


How is it stagnated and how do you propose it change its methadology?



Profit margins on drug development have almost vanished, its a horribly inefficient process, yet they will neglect alternative therapy and insist drugs and drugs alone will solve all health problems. If you suggest something against the established model it will be hard to obtain even modest research funds. Research institutions are typically very conservative.

I have not heard promising things for those pursuing this field at this current time, its more profitable to get into industries that are beginning to grow imo.

alternative therapies? CAM?
Former BW EiC"Watch Bakemonogatari or I will kill you." -Toad, April 18th, 2017
renoB
Profile Joined June 2012
United States170 Posts
December 07 2013 03:39 GMT
#12
On December 06 2013 06:46 Awesomedrifter wrote:
Show nested quote +
On December 06 2013 04:00 FryBender wrote:
On December 06 2013 02:45 Awesomedrifter wrote:
How does it feel to work in a stagnated industry that refuses to change its methodology?

This look like a pretty good write up, I'll be looking forward to the future parts. Perhaps you might want to go to the topic of interest and just cite resources to find the background if they so chose.


How is it stagnated and how do you propose it change its methadology?



Profit margins on drug development have almost vanished, its a horribly inefficient process, yet they will neglect alternative therapy and insist drugs and drugs alone will solve all health problems. If you suggest something against the established model it will be hard to obtain even modest research funds. Research institutions are typically very conservative.

I have not heard promising things for those pursuing this field at this current time, its more profitable to get into industries that are beginning to grow imo.

Alternative therapy is just therapy that hasn't been scientifically proven, or has been scientifically proven... not to work. Why would any healthcare professional recommend something not evidence based?
Kingsky
Profile Blog Joined October 2010
Singapore298 Posts
December 07 2013 21:24 GMT
#13
Hi, please continue with this blog and provide even deeper insights into the industry! This is something relevant to my interests and the more detail the better!
Why do people hate the Colossus? Because the Colossus is like banksters from Wall Street: “too big to fail”. - TheDwF
Please log in or register to reply.
Live Events Refresh
Next event in 53m
[ Submit Event ]
Live Streams
Refresh
StarCraft 2
BRAT_OK 102
StarCraft: Brood War
Soma 485
BeSt 330
Hyun 273
Hyuk 234
Mong 193
Mini 191
Shuttle 181
Last 179
Rush 144
Light 142
[ Show more ]
ZerO 114
Zeus 102
Pusan 102
Dewaltoss 85
Snow 79
Mind 57
Aegong 54
hero 51
Barracks 45
EffOrt 44
JulyZerg 37
GoRush 36
Free 30
JYJ 26
soO 22
Bale 21
Sacsri 19
HiyA 15
Noble 13
Icarus 11
Sea.KH 4
Dota 2
XcaliburYe93
ODPixel70
League of Legends
JimRising 449
C9.Mang0389
Counter-Strike
olofmeister1594
shoxiejesuss858
allub248
fl0m2
Super Smash Bros
Mew2King119
Other Games
summit1g7503
singsing1426
ceh9740
XaKoH 198
crisheroes170
Pyrionflax158
Sick95
B2W.Neo91
ZerO(Twitch)12
Organizations
StarCraft 2
Blizzard YouTube
StarCraft: Brood War
BSLTrovo
sctven
[ Show 18 non-featured ]
StarCraft 2
• Berry_CruncH216
• LUISG 31
• iHatsuTV 13
• LaughNgamezSOOP
• sooper7s
• AfreecaTV YouTube
• Migwel
• intothetv
• Kozan
• IndyKCrew
StarCraft: Brood War
• iopq 7
• STPLYoutube
• ZZZeroYoutube
• BSLYoutube
Dota 2
• WagamamaTV152
League of Legends
• Jankos1368
• Stunt757
• TFBlade538
Upcoming Events
WardiTV Invitational
53m
Creator vs Shameless
Shameless vs GuMiho
Shameless vs YoungYakov
Creator vs YoungYakov
Creator vs GuMiho
GuMiho vs YoungYakov
The PondCast
22h 53m
OSC
1d
Jumy vs sebesdes
Nicoract vs GgMaChine
ReBellioN vs MaNa
Lemon vs TriGGeR
Gerald vs Cure
Creator vs SHIN
OSC
2 days
All Star Teams
2 days
INnoVation vs soO
Serral vs herO
Cure vs Solar
sOs vs Scarlett
Classic vs Clem
Reynor vs Maru
uThermal 2v2 Circuit
3 days
All Star Teams
3 days
MMA vs DongRaeGu
Rogue vs Oliveira
Sparkling Tuna Cup
3 days
OSC
4 days
Replay Cast
4 days
[ Show More ]
Wardi Open
5 days
The PondCast
6 days
Liquipedia Results

Completed

Proleague 2026-01-13
Big Gabe Cup #3
NA Kuram Kup

Ongoing

C-Race Season 1
IPSL Winter 2025-26
BSL 21 Non-Korean Championship
CSL 2025 WINTER (S19)
OSC Championship Season 13
Underdog Cup #3
BLAST Bounty Winter Qual
eXTREMESLAND 2025
SL Budapest Major 2025
ESL Impact League Season 8
BLAST Rivals Fall 2025
IEM Chengdu 2025
PGL Masters Bucharest 2025

Upcoming

Escore Tournament S1: W4
Acropolis #4
IPSL Spring 2026
Bellum Gens Elite Stara Zagora 2026
HSC XXVIII
Rongyi Cup S3
SC2 All-Star Inv. 2025
Nations Cup 2026
BLAST Open Spring 2026
ESL Pro League Season 23
ESL Pro League Season 23
PGL Cluj-Napoca 2026
IEM Kraków 2026
BLAST Bounty Winter 2026
TLPD

1. ByuN
2. TY
3. Dark
4. Solar
5. Stats
6. Nerchio
7. sOs
8. soO
9. INnoVation
10. Elazer
1. Rain
2. Flash
3. EffOrt
4. Last
5. Bisu
6. Soulkey
7. Mini
8. Sharp
Sidebar Settings...

Advertising | Privacy Policy | Terms Of Use | Contact Us

Original banner artwork: Jim Warren
The contents of this webpage are copyright © 2026 TLnet. All Rights Reserved.