Monthly Vibe Bio Newsletter - March 2024
Every Cure for Every Community - The Role of PTRS in Biotech
Welcome to ’s Monthly Newsletter! Stay up-to-date with our latest updates and insights into biotech funding and ai integration.
In our March newsletter article, we dive deep into some of the history and value behind PTRS, its nuanced limitations, and the way it’s really used in the life sciences industry.
What is PTRS?
A widely recognized yet frequently scrutinized metric within the biotech and pharmaceutical industries is the Probability of Technical and Regulatory Success (PTRS).
This metric combines both the likelihood of a drug development program (or product) successfully passing through the necessary technical development phases (such as discovery, preclinical, and clinical testing) and the probability of it achieving regulatory approval (such as by the FDA in the United States, EMA in the European Union, or other regulatory bodies worldwide). Good PTRS scores are updated dynamically as new facts emerge which might impact the probabilities of success.
Oftentimes, these two metric variables are respectively called PTS and PRS. You may also see the combined metric simply labeled as the probability of Success (POS). As a side note, there’s also a related metric donned PPAS, the probability of pricing and access success, which is more focused on assessing market access risk.
Generating an accurate PTRS helps stakeholders make decisions about a program’s future. Patients, all the while, anticipate news that may provide them a life-saving therapy. Investors love to have an accurate PTRS metric available so they can generate more accurate valuations. It’s’ a touchy subject and varies across organizations.
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TL;DR The true value of conducting a Probability of Technical and Regulatory Success (PTRS) analysis lies more in the process itself—spurring meaningful discussions and thorough contemplation—rather than merely arriving at the final quantitative metric, which is still important for many key stakeholders.
Continue reading about PTRS after the Industry Updates and Resources section below.
Industry Updates and Resources 👀
Association for Computing Machinery: In 2022, Chirag Shah and Emily M. Bender authored an insightful research article on search systems ML technology and user interactions with search products and services - interesting read and can be applied to how biotech experts conduct research on drug markets and scientific due diligence.
BioPharmaDive: Jan. - March is looking to be the best biotech quarter in 3 years
Business Insider: Tourism, healthcare, and biotech are hot areas for investors as boomers drive the US economy.
End Point News: Biotech market’s key stock index, the $XBI, surpasses the $100 after two years of slow growth, bringing increased investor optimism for the industry.
Fierce Biotech: Big pharmas handing off “sweet spot” drug candidates to specialized drug dev shops and financial firms so they don’t need to sit on the shelf.
Fierce Biotech: Biggest biotech raises of 2023 - 1. ElevateBio $401M, 2. ReNAgade Tx $300M, 3. Generate Biomedicines $273M
Fierce Biotech: Biotech bankruptcies hit 10-year peak in 2023, with 18 filing Chapter 11s.
Fierce Biotech: The top 10 drugs losing US exclusivity in 2024
Where did PTRS come from?
Early Beginnings
Initially, drug development was largely guided by intuition, expert opinion, and a trial-and-error approach. The success rates of drug candidates moving from preclinical studies to approval were not systematically quantified. As the pharmaceutical industry grew in complexity and competitiveness, and as the costs of drug development soared, there emerged a critical need for more rigorous methods to evaluate and predict the success of drug development programs.
Quantitative Shift
The 1980s and 1990s marked a period of significant change, with the introduction of more structured project management and the adoption of quantitative risk assessment methods. Researchers began to compile and analyze historical data on drug development outcomes, seeking patterns and predictors of success. This era saw the genesis of PTRS as a formal concept, quantifying the likelihood of a drug candidate successfully passing through the technical milestones of development and achieving regulatory approval.
Refinement and Broad Adoption
By the early 2000s, the PTRS model had become more refined, incorporating not just historical benchmarks but also adjusting for disease-specific factors, the therapeutic mechanism of action, and the changing regulatory landscape. Advances in data analytics and the availability of more comprehensive datasets enabled more accurate and nuanced predictions. Regulatory agencies and major pharmaceutical companies started to embrace PTRS as a critical tool for portfolio management and strategic planning.
Current Landscape
Today, PTRS is integral to the drug development process, used by companies to make informed decisions about which drug candidates to advance, to allocate resources effectively, and to navigate the increasingly complex regulatory requirements. With drug development costs ranging from “$314 million to $2.8 billion”, the importance of PTRS accuracy is critical for drug pipeline forecasting.,
Machine learning is giving new life to PTRS estimates by leveraging big datasets to systematically approach clinical trial design, outcomes, regulatory data, drug biology, and sponsor characteristics.
The metric has also been adapted to incorporate the impact of regulatory pathways such as Fast Track, Breakthrough Therapy, and Priority Review designations, which can significantly affect the probability of success.
Defining PTRS: Probability of Technical and Regulatory Success
As aforementioned, PTRS is an estimate of a drug development program’s probability of technical and regulatory success. According to Vergetis et al., PTRS is based on three main inputs:
historical benchmarks driven by the current state/Phase of the program and the specific disease,
expert input from Key Opinion Leaders (KOLs), and
statistical analyses performed by the R&D analytics groups within pharma companies and biotechnology companies.
But what does that all mean?
Using Machine Learning to calculate PTRS
Vergetis et al. proposed a systematic approach that incorporates more than 100 different factors across five broad areas:
Clinical trial design: Choice of primary/secondary endpoints, number of arms, inclusion/exclusion criteria, type of comparator used, use of biomarkers, number of patients, number of sites, etc.
Clinical trial outcomes: The reported outcomes of the drug in previous studies. For example, the published phase II data for a drug that is currently transitioning to phase III, etc.
Regulatory data: Any signals/designations by regulatory agencies. For example, prior approvals in other indications/Therapeutic Areas, breakthrough therapy designation, accelerated approval pathway, etc.
Drug biology: Mechanism of action, modality, genetic and epigenetic alterations, target gene expression, tumor immunogenicity (for immuno-oncology drugs), molecular structure, etc.
Sponsor characteristics: Experience of the company running the development program in the specific disease area, etc.
PTS x PRS = PTRS
PTS
The Probability of Technical Success (PTS) metric is a cornerstone in the evaluation of bio ventures, providing a sophisticated, quantitative analysis rooted in statistical probability and scientific assessment. It calculates the likelihood that a therapeutic candidate will progress through successive stages of development, from preclinical trials to pivotal clinical evaluations.
This calculation is not merely an aggregate of past success rates; it's a nuanced estimation that incorporates the specificities of the drug's mechanism of action, the therapeutic area's historical data, and the complexity of the targeted disease pathology.
By integrating data from similar compounds and analogous pathways, and adjusting for the unique attributes of the current development program, PTS offers a refined, evidence-based forecast of a project's technical feasibility. This metric is pivotal for guiding R&D strategy, focusing resources on the most promising candidates, and making informed go/no-go decisions at critical development milestones. As such, PTS encapsulates the fusion of empirical rigor with the strategic imperatives of biotech innovation, serving as an indispensable tool in the arsenal of drug developers aiming to optimize their pipelines and achieve regulatory and commercial success.
PRS
PRS, or the Probability of Regulatory Success, shifts the focus from technical development milestones to the intricate nuances of regulatory navigation. This metric critically assesses how a drug's clinical profile, therapeutic impact, and safety data align with current health authority mandates and expectations. It factors in the dynamism of political trends, the receptivity to new scientific evidence, and the competitive landscape of similar therapeutic agents.
Sample PRS Assessment Sheet
In essence, PRS is the strategic gauge that forecasts the alignment between a drug's attributes and the ability to make claims safely in the market. It is this probability that often shapes the narrative of a drug's journey from the lab bench to the patient's bedside, reflecting the complex interplay between scientific innovation and regulatory approval pathways.
Quantitative
Quantitatively, PTRS is grounded in statistical rigor, leveraging historical data and empirical evidence to forecast the likelihood of a project’s advancement through clinical trials and regulatory milestones. This numerical aspect provides a tangible measure of risk and potential return, essential for financial modeling and investment analysis. Having a number to work with makes the metric useful and versatile. Public data
Qualitative
On the qualitative side, PTRS embodies the nuanced understanding of industry experts, encapsulating the subtleties of disease complexity, therapeutic innovation, and regulatory climate. This qualitative assessment enriches the metric with context and depth, enabling stakeholders to navigate the multifaceted challenges of biotech development. By working with different stakeholders to develop a PTRS, you are forced to have open dialogue about the many milestones a drug program needs to undergo to be marketed to the public.
Criticisms and Opinions
Although it’s incredibly useful, PTRS is not without it’s criticisms.
You’ll hear comments from pharma portfolio managers and pipeline BD executives such as:
"But people say it's just made up numbers"
"It's about the journey not the destination"
“Having the numbers to think about prioritization is helpful”
“Historical analogs are helpful for comparison”
“PTRS is good to help catalyze the conversation (qualitative)
“The quantitative part may be secondary”
“People in finance find the quantitative more useful than qualitative”
“It’s about understanding the nuances and connecting the dots”
“A team would make a TPP, create a plan, work on PTRS”
“Focus on uncovering blind spots in your PTRS journey “
Stakeholders
Patients: PTRS reflects the likelihood that a drug will successfully pass through the necessary technical development stages and regulatory approval processes. A higher PTRS means a greater chance that a drug will become available to patients. Ultimately, the most significant impact of PTRS on patients is on their health outcomes. Drugs that successfully navigate the development and approval process can offer better disease management, improved quality of life, and, in some cases, cures for diseases that were previously untreatable.
Pharmas: PTRS influences where companies allocate their R&D resources. Drugs with higher PTRS are more likely to progress to later stages of development and ultimately reach the market, encouraging companies to prioritize these projects. This strategic focus helps in optimizing resource allocation toward projects with the highest likelihood of success and market impact.
VC and Large Investors: The biotech and pharmaceutical sectors are known for their high failure rates and long development timelines. PTRS provides a quantifiable measure of success probability, aiding investors in assessing the risk profile of potential investments. A higher PTRS indicates a lower risk of failure due to technical or regulatory hurdles, making an investment more appealing. Financiers typically employ net present value (NPV) calculations while pharmaceutical companies more commonly use risk-adjusted net present value calculations (rNPV). The risk-adjusted value incorporates PTRS.
Remember: “Don’t let PTRS give you PTSD”
Future Directions
As we look to the future, PTRS models continue to evolve with the integration of advanced statistical methods, machine learning algorithms, and real-world data. These enhancements promise to improve the accuracy of PTRS calculations and extend their applicability across a broader range of therapeutic areas and development scenarios. Moreover, the growing emphasis on personalized medicine and the advent of novel therapeutic modalities, such as gene and cell therapies, present new challenges and opportunities for refining the PTRS framework.
The history of PTRS is a testament to the pharmaceutical industry's ongoing quest for greater efficiency, predictability, and success in bringing new therapies to patients. As the industry continues to evolve, PTRS will undoubtedly remain a key tool in the arsenal of drug developers, helping to illuminate the path from concept to cure.
Ultimately, PTRS drives conversations that help move drugs through the process of drug development. It’s these conversations that are at the heart of decision-making program managers and portfolio analysts.
Learn about Vibe’s AI-guided Insights and Analytics
🔬 Assess the likelihood of your drug candidate succeeding in clinical trials, based on its preclinical data and competitive landscape
📈 Make informed decisions about your drug pipeline
🧫 Elevate your drug asset’s scientific present value
🧪 Identify potential risks early in the development process
VibeCast Updates 🎙️
On VibeCast, our Industry Engagement Manager and show host Ray Dogum, interviews Vibe Bio community experts who come from diverse backgrounds and career paths. However, one commonality that all VibeCast guests have is a passion to improve society by encouraging research and educating others by sharing their own experiences.
Collectively we have the skills. We have the technology. We have the passion. We now need the community catalyst to bring it all together. That’s Vibe.
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We are always looking for interesting and knowledgeable people to interview on our show. If you know of a community member who would be a great guest, please let us know. You can suggest a guest by sending us an email, leaving a Substack comment below, or reaching out via social media.
Check out the latest episodes, 46 and 47 below
Rethinking Biotech's Operating Model with Rahul Chaturvedi | VibeCast Episode 46
In this episode, you will be able to:
Discover the benefits of the on-demand talent model for optimizing your workforce and projects.
Learn how AI integration is revolutionizing biotech innovation, leading to increased efficiency and breakthrough discoveries.
Explore the evolution of the Boston biotech scene and its impact on the industry as a whole.
Uncover the future impact of precision medicine and its potential to transform healthcare as we know it.
Rahul Chaturvedi is the Founder and CEO of Clora, the leading marketplace where people go to discover, build, and manage on-demand life science teams. Prior to founding Clora in 2017, Rahul was the head of clinical development at several biopharma companies, such as Kaleido Biosciences (NSDQ: KLDO) and Avedro (acquired by Glaukos). Rahul has successfully led the development activities for 20+ Phase II/III programs that have resulted in 6 product approvals to date. Rahul holds a bachelor of science degree from Brandeis University.
How Machine Learning Models Find Undruggable Targets with Alex Federation | VibeCast Episode 47
In this episode, you will be able to:
Unlocking the potential of the undruggable genome for groundbreaking therapies.
Overcoming challenges in targeting elusive disease-causing proteins.
Harnessing the power of transcription factor modulation for innovative disease treatment.
Maximizing the impact of data in biotech research for transformative discoveries.
Navigating effective funding strategies for driving biotech startup success.
Alex Federation, Ph.D. is the co-founder and CEO of Talus Bio. Dr. Federation invented the MARMOT platform during his postdoctoral fellowship at the Altius Institute for Biomedical Research in Seattle where he trained in computational epigenomics and cancer biology with John Stamatoyannopoulos and Fyodor Urnov. Prior to that, Dr. Federation received his Ph.D. in chemical biology from Harvard, training with Jay Bradner in drug development for genome regulators.
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The Vibe Bio Community Team
#EveryCureforEveryCommunity
Would have thought that estimating PTRS for emerging biotechs with little clinical history and developing a new modality , perhaps in a rare disease would be challenging. Surely many areas of uncertainty?