Monday, September 25, 2023

Measuring the newness of latest medication – Healthcare Economist


All folks need new, advanced drugs. Medication that offer incremental advantages (incessantly referred to as “me too” medication) are just right, however actually innovative treatments are even higher. Alternatively, how does one separate how “novel” a remedy is? Is there a strategy to quantify this?

Actually there’s. A technique to do that is in accordance with the remedy’s molecular construction. For example, the Tanimoto distance measures the the fraction of chemical options which might be shared by way of the 2 chemical substances. Nikolova et al. 2004 summarizes this method which is calculated as follows:

Krieger, Li and Papanikolau 2022 use this strategy to quantify how drug building for novel medication has a lot more sure informational spillovers at the drug building than incremental medication. This paper supplies an instance of an software of Tanimoto distance beneath.

The use of the Tanimoto distance as a measure of novelty, the authors in finding the next:

…novel drug applicants are much less more likely to download FDA approval however are in accordance with extra precious patents. In line with a easy type of pricey exterior finance, we display {that a} sure surprise to companies’ internet price leads companies to broaden extra novel medication. This means that even huge companies might behave as despite the fact that they’re chance averse, decreasing their willingness to funding in probably precious radical innovation.

You’ll learn the whole paper right here.


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