Tufts CSDD| White Papers Quantifying the Value of a Dayof Delay in Drug Development Zachary Smith MA, Joseph DiMasi PhD, Kenneth Getz MBA Quantifying the Value of a Day of Delay in Drug Development The financial value of time is an essential measure used by drug development profession-als to inform budget and resource planning as well as investment decisions. Two figures— the value of a day in delayed or lost prescription sales, and the direct daily costs to con-duct a clinical trial — are frequently and widely cited. However, they often rely on antiquat-ed and inaccurate estimates that were introduced more than 30 years ago. The value of unrealized drug sales — at $4 – 5 million-per-delay-day for a given drug— isbased on estimates calculated in 1993 from two separate sources: the Office of Technol-ogy Assessment and the Boston Consulting Group. These estimates were based on theexpected annual revenue from prescription sales of a typical 1990s-era blockbuster drugdivided by 365 days in a year. In October 2023, the Tufts Center for the Study of Drug Development (Tufts CSDD) re-search team conducted a robust study to provide more accurate measures of the out-of-pocket cost of a missed day of prescription drug or biologic sales and of the cost of a dayconducting a clinical trial. Tufts CSDD also conducted this analysis to test the hypothesisthat average prescription drug sales per day have been decreasing over time. Recentlylaunched drugs and biologics are targeting ever more narrowly defined patient popula-tions including those living with rare and ultra-rare diseases. The Value of a Day of Lost or Delayed Prescription Sales Tufts CSDD created a dataset drawn from commercially available data, supplemented byprimary research. Specifically, we gathered pharmaceutical sales data in US dollars ($s) fordrugs and biologics launched anywhere around the world since January 1st, 2000. Drugsfor which there was no 2022 sales data and those approved as treatments for COVID-19were removed from the dataset. All sales data was converted to 2023 $US dollars using theGross Domestic Product (GDP) Implicit Price Deflator published by the Federal ReserveBank. The average value of a sales day was calculated by dividing total aggregate sales of a givendrug or biologic by the number of days for which generated sales estimates were available,beginning with the day the drug was first launched.We analyzed a number of subgroupsincluding therapeutic area and launch year. Correlations and the Kruskal-Wallis test wereconducted to test for significant differences. In all, 645 drugs were analyzed, the majority (61%) included the US among countries wherethe biologic or drug was first launched. The two largest therapeutic areas were oncologywhich represented 28% of the total products analyzed and CNS which represented 27% ofthe total. In all, 645 drugs were analyzed, the majority (61%) included the US among countrieswhere the biologic or drug was first launched. The two largest therapeutic areaswere oncology which represented 28% of the total products analyzed and CNS whichrepresented 27% of the total. At the present time a single day of delay is worth approximately $800,000 inlost prescription drug or biologic sales. The $4 - 5 million figure has been a grossmisestimation for more than 25 years. Therapeutic areas with the highest relative averageprescription drug sales — in 2023 $US dollars — included cardiovascular, hematology,and oncology drugs and biologics at a median of $1.4 million, $1.3 million, $840,000respectively. The Tufts CSDD study also found — as we hypothesized — that average prescriptiondrug and biologic sales per day have been steadily declining over time —decreasingby approximately $80,000 to $100,000 each year. A negative correlation was observedbetween average sales per day and the year the product was first launched. The Value of a Day of Delay in Clinical Trials The value of a day of direct costs to run a clinical trial comes from Medidata Solutions.Estimated to be approximately $35,000, the figure is based on a robust analysis that wasconducted more than three decades ago (1990s). Tufts CSDD’s updated analysis is based on proprietary budget data gathered duringour protocol design benchmark studies conducted between 2016 and 2021. Protocolsfor COVID-19 drugs were not included in this analysis. Actual clinical trial budgets wereinflated to 2023 $US dollars using the GDP Implicit Price Deflator. Total clinical trialdurations were calculated as the number of days from protocol approval to database lock(or primary completion date if database lock date was not available). Average cost perday was calculated by dividing the total budget for each protocol, expressed in 2023 $USdollars, by the total reported duration of the clinical trial. Total budgets for 447 protocols were analyzed. The results indicate that, across alltherapeutic areas, the mean direct cost to conduct a clinical trial per day is approximatel