Going against the grain

There are currently 229 clinical stage programmes in rheumatoid arthritis (RA) at Phase II and beyond. Using similar criteria, there are only 6 such programmes in sepsis. Yet sepsis is arguably as big a medical problem as RA, and the market size for a successful treatment would be large.

Clearly, past failures in sepsis weigh heavily on sentiment. Investors have long memories – particularly of things that went badly wrong. But as the imbalance favouring one indication over another grows, then other factors come into consideration. If everyone is trying to develop the same product, then two things happen: prices to acquire a promising candidate technology in the popular area increase dramatically due to the competition. And at the same time, the value of a successful programme in that area declines, as the success of the competition raises the bar.

In his latest blog article, David Grainger explores the forces that drive this marketplace away from equilibrium, underpinning such extreme 'asset favoritism', and asks at what point does the disadvantage of such abundant competition begin to outweigh the inherent attractiveness of a particular indication?

And if that tipping point is close at hand, what can investors, and other interested parties such as governments, doctors, patient groups and healthcare charities do to re-balance the marketplace? The fear of striking out alone might hamper a brave move into a new field by commercial investors, but charities and other groups with a vested interest in seeing improved treatments for particular medical problems have a real "window of opportunity" to influence future directions. And the evidence is that the most far-sighted of them are already beginning to grasp that opportunity.