As generics manufacturers grow more aggressive, will branded companies follow suit by deploying thorough patent strategies—and crack legal teams? Will government efforts in Japan finally bring cancer out of the shadows and spur oncology sales? Will the adoption of intellectual property rights drive pharma growth in India and help push the country to the top tier of global economic powers? These questions point to developments—some of them flying beneath the radar—that we expect to have major implications for pharmaceutical companies down the road. Each year, IMS identifies the key events that it believes will have a significant impact on the global pharmaceutical market. Here, we reveal those events—the harbingers of change—that will define and reshape the market through 2007 and for years to come.

1. Through the Golden Gates

The Harbinger In 2006, Warren Buffet pledged most of his fortune to charity, with the bulk of it—a record-breaking $30.7 billion—going to the Bill and Melinda Gates Foundation, more than doubling its endowment. Shortly thereafter, the Gates Foundation announced $287 million in grants to create 11 highly collaborative international discovery consortia that will create and evaluate novel HIV vaccine candidates. As a condition of funding, they will be required to share information and compare results using standardized benchmarks.

The Change With Buffet's generosity and the Gateses' own donations and direction, more private money than ever before is going toward world healthcare. At the same time, public–private partnerships (PPPs) have ratcheted up.

Under the Gateses' leadership, the consortia will operate without prejudice from the profit motive. They will have the benefit of clear-eyed business acumen in setting priorities, tracking progress, and delivering results. This combination gives the consortia an advantage over academia, international organizations, and the emerging countries themselves, which are too often hamstrung by bureaucracy, corruption, or both. The Collaboration for AIDS Vaccine Discovery is groundbreaking—the ultimate business model shaped by societal concerns.

The Implications The Collaboration's R&D model competes with both government institutions and the drug industry. Pharma companies can decide that this development allows them to focus less on the diseases of developing nations. Or they can see it as having the potential to push them out of the picture for entire classes of drugs. In still another view, they can be reenergized by the benefits of collaboration.

There are compelling reasons for pharma companies to watch the effort closely:

• $287 million is not a lot of money when applied to R&D. Should the Gates Foundation fail, pharma needs to be ready to pick up the pieces and further the cause.
• Discovering a drug from scratch is a 10-year undertaking: To get quick results, the Collaboration may need to build on intellectual property surrounding the 202 HIV medicines and vaccines in development at pharma and biotech companies. Will these companies participate in a global mobilization against a modern plague—at the risk of losing investor confidence and impacting the bottom line?
• Beyond vaccines, should the Foundation succeed in developing a "me-too" drug that is less costly than current options, there is no reason to think its impact will be limited to developing nations.
• While the Gates Foundation currently focuses on unmet needs of developing nations, its R&D could produce discoveries in other areas altogether. If pharma does not aggressively address the problems of developing nations, it risks shutting itself out of these broader therapeutic horizons.