Drug Development: First-to-market or best-in-class? Which would you rather be?

First mover advantage is a key success factor in many industries and this is certainly true of pharmaceuticals. VOI Consulting research has shown that, in cases where independent generics have a 6-month exclusivity period in which to establish first-mover advantage, the initial product will capture between one-third (with a concurrently-launched authorized generic) and one-half (with no authorized generic) of overall sales value for the molecule 30 months after other generics enter the market. In contrast, later-to-market independent generics capture only 15 to 25% and this is usually divided among multiple entrants.

But these are commodity markets. What about innovative pharmaceuticals? Surely, quality counts for more than timing when it comes to well-differentiated therapies with extensive clinical data. Research from Boston Consulting Group, reported in the June 2013 issue of Nature Reviews Drug Discovery finds that, despite high profile exceptions like Lipitor, this isn’t necessarily the case.

As would be expected, being first and best is the ideal position. The next most favorable position was first-to-market but clinically second best; sales for these drugs average 92% of the first and best product whereas sales of second-to-market but therapeutically superior competitors averaged 88%. Being first isn’t a guarantee of success, however: sales of products that were first-to-market but clinically third-in-class averaged only 40% of the first-and-best product’s while those that were third-to-market but therapeutically best captured 50%.

If you’re late and not-so-great, don’t bother showing up – products that were fourth-to-market and clinically inferior to competitors captured only 2% of the first-and-best drug’s sales.

Donald Clark
Donald Clark


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