ABSTRACT
The Dynamic Modeling methodology can be applied to pipeline portfolio issues in a way that integrates accepted financial portfolio concepts with the nuances specific to the development of pharmaceutical compounds. By combining the concept of defined phases through which an New Chemical Entity must pass with associated failure rates at those stages, Dynamic Modeling structure provides a consistent visual framework to depict a firm’s drug development pipeline. The ability to simulate this structure makes the Dynamic Modeling approach to pipeline portfolio management even more powerful. Pharmaceutical companies usually have multiple compounds in various stages of the pipeline with specific metrics around expected stage completion. One of the difficulties in pharmaceutical pipeline management lies in quantifying the impact of failure metrics of New Chemical Entities in various stages of development. Dynamic Modeling software has the capacity to simulate such a model and determine a range of possible outcomes, given the set of input parameters governing the behavior of the system.
