0. Optimizing Pfizer Inc’s New Product Development Process
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Optimizing Pfizer Inc’s New Product Development Process
Transforming Molecules to Medicines AM
X : Mastering New Product & Service Development
Sunday, November 19, 2006

1. Key Questions WHO WHAT WHERE WHEN WHY HOW Pfizer Inc
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WHO
Pfizer Inc
WHAT
In Dire Need of a New Product Development Process
WHERE
Throughout the Entire Organization
WHEN
Within the Next 5 Years
WHY
Industry Challenges / Pipeline Concerns: PFE is struggling to maintain its growth in the face of increased competition and the expiration of key patents.
HOW
By Leveraging Internal Insights & Implementing a New Product Development Process Incorporating the Stage-Gate™ Process

2. An Introduction to Pfizer
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OUR MISSION
We will become the world's most valued company to patients, customers, colleagues, investors, business partners, and the communities where we work and live.
OUR PURPOSE
We dedicate ourselves to humanity's quest for longer, healthier, happier lives through innovation in pharmaceutical, consumer, and animal health products.

3. Pfizer Research and Development: Commitment
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DID YOU KNOW ?
Pfizer invests more in pharmaceutical research than any other private institution in the world. 1
This research is aimed at a single goal: to develop new medicines that will enable people to lead healthier, longer and more productive lives.
1 The Department of Trade and Industry (U.K.) The 2005 R&D Scoreboard. Page 96. Available at: Accessed on Oct. 26, 2005.

4. Pfizer Research and Development: Key Points
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The discovery of new drugs and their development into useful pharmaceuticals is central to the concept of medical progress.
The U.S. pharmaceutical and biotech industries invested nearly $39 billion in research and development in 2004, with Pfizer leading the way with $7.7 billion and 12,500 scientists. 2,3
Years to create a new drug: years
Probability of Success: <1%
Costs to create a new drug: Between $800 million and $1.7 billion
2 PhRMA. Press Release. Feb. 18, Available at: Accessed on Oct. 26, 2005.
3 Pfizer 2004 Annual Report. Available at: /pfizer/annualreport/2004/financial/p2004fin08.jsp. Accessed on Oct. 26, Also see Pfizer.com Research and Development website, available at: /pfizer/help/index.jsp.

5. Pfizer Research and Development: Risky Business
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Only one in five medicines that enter clinical trials testing in humans is eventually approved for patient use by the U.S Food and Drug Administration (FDA). 6 That's part of the risk involved in Pfizer's business of seeking out new and innovative health solutions.
6 Stanford Medical School's Academic Consortium for Clinical Excellence in Scientific Studies. Clinical Trials FAQ. Available at: Accessed on Oct. 26, 2005.

6. Seven Goals of a New Product Process
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Goal #1: Quality of Execution
Goal #2: Sharper Focus, Better Prioritization
Goal #3: Fast-Paced Parallel Processing
Goal #4: A True Cross-Functional Team Approach
Goal #5: A Strong Market Orientation with the Voice of the Customer Built In
Goal #6: Better Homework Up-Front
Goal #7: Products with Competitive Advantage
Source: Winning at New Products by Robert G. Cooper, p.115

7. Project enters the NP Process at Gates 1, 2, or 3
With Such High Risks and the Vital Importance of New Medicines - New Product Development Systems Must Be Optimized
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Robert G. Cooper’s Two-Stage Model
Research and Technical Development
Gate 1: Idea Screen
Stage 1: Technical Assessment
Gate 2: Second Screen
Stage 2: Detailed Investigation
Gate 3: Application Path Gate
New Product Development
Gate 1: Idea Screen
Stage 1: Scoping
Gate 2: Second Screen
Stage 2: Building Business Case
Gate 3: Go to Development
Stage 3: Development
Gate 4: Go to Testing
Stage 4: Testing and Validation
Gate 5: Go to Launch
Stage 5: Launch
Post-Launch Review
Project enters the NP Process at Gates 1, 2, or 3

8. Robert G. Cooper’s Two-Stage Model
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Research and Technical Development
GATE 1
GATE 2
GATE 3
STAGE 1
STAGE 2
Technical
Assessment
Detailed
Investigation
Application Path Gate
GATE 1
Project enters the NP Process at Gates 1, 2, or 3
New Product Development
GATE 2
GATE 3
GATE 4
GATE 5
STAGE 1
STAGE 2
STAGE 3
STAGE 4
Scoping
Build
Business Case
Testing &
Validation
Development
STAGE 5
Review probable execution
Revised financials
Quality = original def.
Work reviewed
Go to test
Decision to spend Confirm case
POST
LAUNCH
REVIEW
Legal
Technical
Sales Involved
Marketing Involved
Payback period
LAUNCH
Review costs
Review profits
Review strengths
Review weaknesses
Review what learned

9. Transforming Molecules to Medicine
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Finding the Right Lead Molecule
Preclinical CH 3 C 1 R
1-10 CH 3 C 1 R 4 + +
Establishing the Safety of a New Molecule for Human Testing
File
IND
Discovery
Research Team
Many
Compounds
In vitro & in vivo
Screening
Drug Candidate
Selection
Scale Up &
Animal Tox
Testing the Experimental Drug in People
Clinical
Establishing the Safety and Efficacy of a New Medicine for Patients
n =
n =
n = ,000
Phase I
Phase II
Phase III
From Laboratory to the Doctor
Regulatory Review
Phase IV
File
NDA
Regulatory Review & Commercialization
Regulatory
Approval & Launch
Research and Technical Development  New Product Development

10. Transforming Molecules to Medicine
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Average Years
Compound Success 2 4 6 8 10 12 14 16
Rates by Stage
Discovery
5,000 – 10,000
Screened
Preclinical
Phase I
Phase II
250
Enter Preclinical
Phase III
Registration
Postmarketing 5
Enter
Clinical
1 Approved Medicine
Research and Technical Development  New Product Development

11. Reasons Why Medicine Candidates Fail
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It takes 12 CANs to yield 1 marketed drug on average 2 4 6 8 10 12
animal toxicity, PK
chemical stability,
superior compound
human PK,
safety/toleration,
formulation
No. candidates
efficacy/safety,
differentiation,
dose/cost of goods
efficacy, long-term safety
non-approval 1 2 3 4 5 6 7 8 9
Years
Preclin. Phase I Phase II Phase III Registration
Research and Technical Development  New Product Development

12. The Drug Discovery and Development Process
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Registration
Full
Development
Exploratory Development
Discovery
Research and Technical Development  New Product Development

13. Drug Discovery: The Overarching Questions
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Voice of
Customer
Research
Is there a medical need?
What is prevalence of the disease?
What is the market potential?
Do we have a biochemical target?
Can we synthesis compounds that are target selective, potent in vivo, and bioavailable?
Are the compounds efficacious in disease models, show dose response, and are not toxic?
Building Business Case
Technical Assessment
Detailed Investigation
Research and Technical Development  New Product Development

14. Where Do Potential Leads Come From?
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Ideation
Acquisition Compounds
Natural Sources
GlaxoWellcome
AstraZeneca
Merck
Endogenous Ligand
Newly Synthesized
LEAD
e.g. Natural peptide, hormone, etc.
Random Screening
of Existing Compounds
Combinatorial Chemistry
Libraries
Research and Technical Development

15. Discovery (3–4 Years) Ideation, Gate 1, Stage 1 Gate 2 Go / Kill
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Ideation, Gate 1, Stage 1
Gate 2 No
Basic
Science
Go / Kill
Medical
Literature +
Activity +
Yes
Disease Intervention Hypothesis
Target
Characterization
Synthesis of Molecules
Screening
Medical
Need
Refinement
Voice of
Customer
Research
Improved
Activity
Nomination of Lead Molecule for Additional Investment
Initial Safety Testing of Lead Molecule
Detailed Investigation:
Stage 2
Research and Technical Development

16. Discovery (3–4 Years)
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Ideation, Gate 1, Stage 1, and Gate 2
Identify and Refine a Portfolio of Promising Molecules (“Candidates”) + 1
Thousands of Potential Disease Targets to Consider 3
Synthesis and Testing of Molecules to Bind to Target
Disease Intervention Hypothesis
Synthesis of Molecules
Ideation
Gate 1 2 4
Define Target and Structure at Molecular Level
Testing Against Target for Biological Effect +
Gate 2
Target
Characterization
Technical Assessment: Stage 1
Screening
Go / Kill
Research and Technical Development

17. Early Development (3–5 Years)
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Technical Assessment:
Ideation, Gate 1, Stage 1, Gate 2
Detailed Investigation: Stage 2
Safety Data
IND
Application
Lead Molecule Endorsed for Additional Investment
Manufacture Supplies
Required Animal Testing
Metabolism Data
Formulate Doses for Humans
Application Path Gate
Is it safe?
Is it safe?
Is it safe?
YES!
(Proof of
Concept)
Phase I:
Human Testing in Healthy Volunteers
Phase II:
Human Testing in Patients
Phase II:
Human Testing in Patients
Building
Business
Case:
Stage 2
How does it behave in the body?
Does the drug provide benefit?
What is the optimal dose?
Research and Technical Development  New Product Development

18. Early Development (3–5 Years)
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Detailed Investigation: Stage 2
Test Safety and Efficacy of “Candidates” Under Controlled Conditions 1
Preclinical Research Requires Testing Candidates in Animals 3
Dose Healthy Volunteers (Absorption, Distribution, Metabolization, and Elimination)
Required Animal Testing
Phase I
Gate 2 2
Determine Dosage Based on Safety and Metabolism Data 4
Dose Patients (Efficacy)
Formulate Doses for Humans
Phase II
Go / Kill
Research and Technical Development

19. Disciplines Involved in Drug Development Research
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Product Development
Pharmacology
Safety
Clinical Sciences
Clinical Development
Development Operations
Biostatistics
Medical
Clinical Pharmacy Operations
Library Sciences
Chemical Manufacturing
Regulatory Affairs
Project Management
Marketing
Biomarkers
Informatics
Etc …

20. Full Development (3–5 Years)
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Testing & Validation:
Stage 4
Full Team Involvement
Design Phase III
Studies
Carcino- genicity
Studies
Detailed Investigation:
Stage 2
Development:
Stage 3
Consult
FDA
Full Development Planning
File
NDA
Formulate,
Label, & Ship
Recruit 1000s of Patients
Conduct Phase III Testing
Collect, Verify, & Analyze Data
Gate 5
Manufacture
Drug Supply
Building Business Case:
Stage 2
Stability
Studies
Recruit
Investigators
Research and Technical Development  New Product Development

21. Full Development (3–5 Years)
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Demonstrate Efficacy and Safety of a Candidate in Patients 1 1
Plan Phase III Studies, Supply, as well as Investigator Recruitment and Education 3 3
Ensure Benefit of Candidate is Clearly Demonstrated in Patient Population
Full Development Planning
Collect, Verify, & Analyze Data
Plan Full Development Program
Testing & Validation:
Stage 4
Gate 2 2 2
Extensive Safety and Efficacy Testing with Patients under Real World Conditions 4 4
Documented Evidence Concerning the Safety and Efficacy of the new Molecule
File
NDA
Phase III
File New Drug Application
Gate 4
Gate 5
Research and Technical Development  New Product Development

22. Registration (1–2 Years)
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Gate 5
Other Regulatory
Filings
Approved New Medicine
File
NDA
Respond to Questions
Present to Advisory Committees
Regulatory
Approvals
Label Negotiations
POST
LAUNCH
REVIEW
Launch: Stage 5
Review costs
Review profits
Review strengths
Review weaknesses
Review what learned
New Product Development

23. Molecules to Medicine: Room for Improvement
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NDA/ MAA Approval
POC/ R2D2-1
NDA/ IRD Filing
Key Commercial Decision Points:
Idea
CAN
DIC-II
R2D2-2
Stage:
Discovery
Pre-
Clinical
Early Clinical
Clinical
Late
Clinical
Post Launch
Type of Testing:
Laboratory
Animals
Phase
I IIA IIB
Phase III
Phase IIIB
Phase IV
Accelerate candidate identification and screening
Accelerate development time
Improve labels and market access
Leverage depth of knowledge from exploratory through loss of exclusivity
Ensure global knowledge sharing and collaboration
Leverage Internal Resources and Stage-Gate™ Process to
Increase R&D Productivity and Maximize Commercial Success