Highlights and Analysis from the AgbioInvestor Agrochemical Product Discovery, Development and Registration Report
Note: All screenshots of charts, unless otherwise cited, are from the AgbioInvestor Report linked above.
Going back to 1995, AgbioInvestor has been releasing a report overviewing the expenditures and timelines surrounding the largest agrochemical companies’ bringing new crop protection products to market. The survey work is done on behalf of Crop Life International.
As many would expect, the cost of bringing a new crop protection active ingredient to market continued to increase over the 5 year period:
Over the most recent quinquennium, 2014-2019, costs to bring a new active ingredient to market went above $300 million USD for the first time.
AgbioInvestor does a great job breaking out how those costs vary by segment of the product R&D and commercialization process:
The largest increases were in the “registration” process along with the “chemistry” and “field trials.”
Registration is indicative of the “preparation and submission of data dossiers to, and subsequent negotiations with, registration authorities to obtain approval to market a new product.”
Chemistry denotes the “scale-up of chemical synthesis to produce volumes required for product development and then for commercial introduction. Also the development of formulations suited to the target crop applications”.
The report highlights increased regulatory pressure as being a key driver of moving some of the testing and costs earlier:
The 2014-19 survey results indicate a migration of toxicological and environmental chemistry costs from the developmental phase to the research phase. This likely indicates the companies’ response to increased regulatory pressure within the major crop protection markets regarding AI fate and metabolites, meaning that toxicological and environmental chemistry profiling is a more significant factor in the decision to progress an AI from the research phase into development.
Not only did costs go up, but timelines to bring new active ingredients to market crossed the 12-year mark:
This increase is indicative of more complexity in the data requirements of regulatory bodies, along with the reality that regulatory bodies are more likely to refrain from granting conditional approvals.
Based on Eroom’s Law in Crop Protection, the concept from the pharmaceutical industry stated as:
The observation that drug discovery is becoming slower and more expensive over time, despite improvements in technology (such as high-throughput screening, biotechnology, combinatorial chemistry, and computational drug design), a trend first observed in the 1980s. The cost of developing a new drug roughly doubles every nine years (inflation-adjusted). In order to highlight the contrast with the exponential advancements of other forms of technology (such as transistors) over time, the law was deliberately spelled as Moore's law spelled backwards.
Albeit, in agrochemicals/crop protection it is occurring at a much slower rate.
Pharma development costs are doubling every nine years, whereas the Crop Protection doubling costs is illustrated as approximately every 20 years, according to the report.
Some of the reasons for Eroom’s Law in Crop Protection at a high level include similar reasons to the Pharma industry: