It’s axiomatic that most new drug development efforts fail. Only a handful of the compounds a preclinical researcher works on throughout a 30-year career will ever become marketed pharmaceutical products. The odds of success may be higher for those who toil in the clinical research field, but every clinical specialist also knows an extremely high degree of failure. Of course, drug development professionals are not the only type of workers who live with a high rate of failure.

The accumulated evidence from a variety of studies conducted over time by academics and consultants suggests that most mergers and acquisitions do not meet expectations; indeed, on average, about 70% of them can be considered failures.

Professional athletes live with a range of failure; my favorites are the major leaguers who can fail to hit the ball safely 7 out of every 10 times at bat and still enjoy respectable careers.

For every aspiring actor who seeks to become the next Clooney, De Niro, Sarandon, or Streep, there are thousands of others who lose far more parts than they win.

People who view electoral politics as a noble calling must prepare themselves to lose as many elections as they win.

Thousands of medical students, law students, and service academy cadets fail to complete the academic course of study that would enable them to enter the profession of their choice.

We remember the names of the entrepreneurs behind successful companies as Amazon, eBay, Google and Microsoft; but we forget the much longer list of names of people whose ideas did not result in a company that could provide them with a decent living.

Why, you may ask, am I using this column to dwell on failure? Because I think there are useful lessons in failure that enough of us don’t learn.

Drug development is not a continuous process; it is a series of discrete experiments in laboratories, animals, and man.It is quite acceptable to have numerous failures at every stage of development; indeed, sometimes it is just as important to rule out potential drug candidates as it is to find those that are worthy of further development.

If I were the King of the World, I would make it mandatory for every drug discovery and development team to document and communicate the reasons for the failures they see in every step of the development process. Knowing as much as possible about the nature of those issues should prevent another team of researchers in another country and at a later time from experimenting with similarly-structured compounds.

• Does every researcher in your firm have complete transparency of the toxicity problems that were discovered in every first-in-man study conducted for the past several years?
• Do all the members of all your clinical trial research teams know which positive animal results were not useful in predicting the results of large-scale human trials?
• Are the results from failures in every clinical trial fed back into the corporate database and made accessible to anyone attempting to develop similarly acting compounds in the future?
• In short, does this type of rigorous after-action analysis occur at your company?

Michael A. Martorelli is a Director at the investment banking firm Fairmount Partners. For additional commentary on the topics covered in this column, please contact him at Tel: (610) 260-6232; Fax (610) 260-6285.