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You could forgive drug and biotech executives for having a bad case of target fixation.
After all, they do work in a field that is filled with time-consuming and expensive headaches.
Consider that the Biotechnology Innovation Organization (BIO), the world's largest biotech trade organization, looked at 7,400 drug programs by 1,103 companies. They were investigating drug-approval rates.
The news was not good - just 9.6% of drugs scientists discover ever get approved for sale. That's a one-in-ten shot.
With such daunting data, it's no wonder that, even in a field already worth $1.2 trillion in global sales, industry leaders are on the lookout for ways to lower the cost of discovery and shorten time to market.
And with that goal in mind, I've uncovered a high-octane, large-cap firm that has become an essential ingredient in the drug sector's success.
It's a cloud-based leader in pharmaceutical efficiency that has a history of crushing the market by no small measure. It's been doubling its earnings, on average, every 18 months...
The Search for the Next Big "Blockbuster"
Now then, drug and biotech firms generally want to find as many so-called "blockbusters" as they can, and there's a good reason for that.
You see, a "blockbuster" drug is defined as one with sales of at least $1 billion annually. EvaluatePharma expects 10 will be launched this year alone. The research firm forecasts that combined sales for this particular group will hit $18.2 billion by 2024.
It's no doubt that numbers like that can certainly grab headlines, but there is a downside to all that press as well. To be candid, it's one of the reasons why so many people don't understand the complexity behind drug prices.
The fact that many people don't realize is that prescription drug prices aren't just based on the winners. They include the billions sunk into the 90.4% of drugs that, according to the BIO, are never released.
Consider that a few years ago, the Tufts Center for the Study of Drug Development found that it cost $1 billion to get a new drug to market.
Tufts has since updated that study to reveal that the field is only getting tougher. It now forecasts that, these days, the average drug takes 12 years to go from discovery to commercial launch.
When you factor in the impact of failed trials, Tufts further found that the average cost of getting a new drug to the public is a staggering $2.5 billion.
In other words, this is a sector that is badly in need of technology that can greatly flatten the R&D curve.
And that's just what we have with Veeva Systems Inc. (NYSE: VEEV). It offers a suite of cloud-based services for the life sciences industry.
Delivering its products as software as a service (SaaS), Veeva offers tools to help clients manage the entire clinical suite. It covers everything from collecting and verifying data to making sure clients are ready for any government inspections.
With drug safety, Veeva helps by using artificial intelligence to automate case intakes. The system can manage safety content and mitigate risks of something going wrong in a drug trial.
With R&D, Veeva also helps firms document and track all aspects of the process, from early stage research through clinical trials, all the way to FDA approval.
All the key documents are stored and shared in the Veeva Vault, which is designed to mimic the exact steps of the paperwork that the FDA will want to see during clinical phases.
Then there's Veeva Commercial Cloud. This is where clients can store all of their internal operational data, as well as their external interactions with the medical community.
No wonder Veeva's client list now totals some 600 firms and reads like a Who's Who of the field. We're talking leaders like AstraZeneca Plc. (NYSE: AZN), Biogen Inc. (NASDAQ: BIIB), GlaxoSmithKline Plc. (NYSE: GSK), and Eli Lilly and Co. (NYSE: LLY).
The Veeva Advantage
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About the Author
Michael A. Robinson is a 36-year Silicon Valley veteran and one of the top tech and biotech financial analysts working today. That's because, as a consultant, senior adviser, and board member for Silicon Valley venture capital firms, Michael enjoys privileged access to pioneering CEOs, scientists, and high-profile players. And he brings this entire world of Silicon Valley "insiders" right to you...
- He was one of five people involved in early meetings for the $160 billion "cloud" computing phenomenon.
- He was there as Lee Iacocca and Roger Smith, the CEOs of Chrysler and GM, led the robotics revolution that saved the U.S. automotive industry.
- As cyber-security was becoming a focus of national security, Michael was with Dave DeWalt, the CEO of McAfee, right before Intel acquired his company for $7.8 billion.
This all means the entire world is constantly seeking Michael's insight.
In addition to being a regular guest and panelist on CNBC and Fox Business, he is also a Pulitzer Prize-nominated writer and reporter. His first book Overdrawn: The Bailout of American Savings warned people about the coming financial collapse - years before the word "bailout" became a household word.
Silicon Valley defense publications vie for his analysis. He's worked for Defense Media Network and Signal Magazine, as well as The New York Times, American Enterprise, and The Wall Street Journal.
And even with decades of experience, Michael believes there has never been a moment in time quite like this.
Right now, medical breakthroughs that once took years to develop are moving at a record speed. And that means we are going to see highly lucrative biotech investment opportunities come in fast and furious.
To help you navigate the historic opportunity in biotech, Michael launched the Bio-Tech Profit Alliance.
His other publications include: Strategic Tech Investor, The Nova-X Report, Bio-Technology Profit Alliance and Nexus-9 Network.