Alternative funding models for medical innovation: the role of product development partnerships in product innovation for infectious diseases

ABSTRACT

Over the past years, there has been an increasing trend in the number of product development partnerships (PDPs), primarily seeking to discover and produce new products in response to the global health threat posed by infectious diseases. This research exploits public and subscription-based databases to examine PDPs’ attributes and their impact on medical innovation in infectious diseases. We find that i) non-private funding is beneficial in the early stages of drug development by PDPs, ii) specific funder and product types are essential for the success of products developed by PDPs, iii) public sector funding is more common in products with lower chances of being approved, and iv) the lower the scientific advances in a sub-disease area are, the lower the likelihood of a product in that area of succeeding.

KEYWORDS:

• Product development partnerships
• innovation
• pharmaceuticals
• R&D

JEL CLASSIFICATION:

• O31
• O32
• I11

Acknowledgments

We thank conference participants at the International Health Economics Association (iHEA) 2021 Conference and the Professional Society for Health Economics and Outcomes Research (ISPOR) 2021 Europe Conference, for constructive comments and feedback.

Disclosure statement

DK, MB, MJB, and AT work at The Office of Health Economics, a registered charity and Independent Research Organization which receives funding from a variety of private and public sector sources.