Drug Discovery

When a patient has a bacterial infection, doctors must prescribe antibiotics immediately without knowing which antibiotic will work. Traditional culture-based susceptibility testing takes 2-3 days. This forces broad-spectrum empiric prescribing that drives antibiotic resistance.

Gene therapies are the most expensive drugs ever approved — Hemgenix costs $3.5M, Elevidys $3.2M, Zolgensma $2.25M per patient. Manufacturing relies on artisanal processes (transient transfection of adherent cells) that cannot scale. Global AAV production can serve only ~5,000-10,000 patients per year.

Despite $50B+ invested in AI drug discovery companies, not a single AI-designed drug has been approved by the FDA. Several AI-discovered candidates are in Phase II, but none have completed Phase III. The validation gap between computational predictions and clinical outcomes remains wide.

Biologic drugs (antibodies, peptides, proteins) represent ~40% of pharma revenue but almost all require injection because stomach acid and enzymes destroy them. Oral semaglutide (Ozempic) is a rare exception but requires a special absorption enhancer and achieves only ~1% bioavailability.

More than 90% of drugs that work in animals fail in human trials. Mouse models of cancer, Alzheimer's, and inflammation are notoriously poor predictors. This is the fundamental reason clinical trials fail at such high rates and cost billions.

Of approximately 10,000 known rare diseases, only 5% have any treatment. Healthcare expenses for Americans with rare diseases are 3-5x greater than for those without. The total economic burden approaches $1 trillion annually. Small patient populations make traditional drug development ROI calculations impossible.

Unlike other drugs, new antibiotics are deliberately used sparingly to prevent resistance, which destroys the economic incentive to develop them. Multiple antibiotic startups have gone bankrupt despite FDA approval. The PASTEUR Act proposes $6B in subscription-style payments to fix this, but hasn't passed yet.

The blood-brain barrier prevents most drugs from reaching brain cells. Treating neurological diseases requires invasive brain surgery for direct injection, which is risky and cannot treat the whole brain uniformly. Focused ultrasound with microbubbles is emerging but remains early-stage.

More than 30% of drugs fail in Phase II and 58%+ fail in Phase III. CNS drugs fail at ~85%. The average Phase III trial costs $36.58M (2024), 30% higher than 2018. The overall success rate from Phase I to approval is approximately 8-11%, meaning 9 out of 10 compounds fail.