Risk Assessment of Curtailing Clinical Trial Saves Life Sciences Company $36 Million

Situation Analysis

A leading generics manufacturer was in the late stages of clinical development to bring one of the first biosimilars to market in the U.S.—ahead of other players racing to do the same. In discussions with the FDA, the necessity of one of the two arms in its Phase III study was questioned. Shortening the study would free up valuable resources and strengthen its competitive lead in getting the product to market. However, the company wanted to do a risk assessment before making a decision – would terminating the study or making changes to its design create more value?

Discovery & Solutions

Strategic Decisions Group helped the company evaluate the strategic alternatives to determine the best choice. It outlined a clear and structured understanding of the key risks and uncertainties facing the decision to either modify or terminate the Phase III study. The process explored how uncertainties might impact the future value derived from the product and how they were influenced by alternative strategies. The existing clinical development plan also received a thorough analysis to identify potential areas of cost and time savings.

After putting various choices through an assessment against each stage of the plan, we found that curtailing the study lowered the probability of technical and regulatory success by 12 percentage points and would ultimately delay market entry by three months rather than speeding it up.

Results & Impact

SDG advised the company that continuing with the second arm of the Phase III trial would ultimately save them $36 million when compared with the alternative. The process also identified two new creative modifications to the plan to lower development costs without diminishing the product’s commercial value:

• The first modification cut down the number of patients in the trial, saving several million dollars without any downside risk; and
• The second modification minimized the number of check-in points for the long-term safety study, saving $8 million without diminishing the value of the study.