symptoms and impairment of lung function.
treatment options with a variety of delivery mechanisms, each of which has drawbacks. Most notably,
safety concerns have arisen with inhaled long-acting beta-2 agonists, or LABAs, and the FDA has
required producers of LABAs to describe these concerns on their labels and to conduct further large-scale
randomized trials evaluating cardiac safety. These concerns impact the leading class of LABA/ICS, or
inhaled corticosteroid, combination therapies as well. The LABA/ICS combination is under further
pressure due to physician concerns about potential side effects and the long-term safety of ICS. The
safety concerns with existing therapies and the number of asthmatics with uncontrolled disease represent
a significant unmet medical need.
the seven major pharmaceutical markets forecasted to shrink annually by less than 1% from $14.6 billion
in 2010 to $14.1 billion in 2020. This outlook is based on the lack of any new blockbuster drug class
entering the market and a potential softening of the use of LABAs in the U.S. in the short term, and
ongoing price erosion due to generic entry and competitive pricing in current therapies. This will be offset
somewhat by an expected uptake of once-daily LABA/ICS combination agents, once approved, and likely
increased insurance coverage and expenditures due to healthcare policy changes likely to take place in
the U.S. from 2014 onward.
currently no approved drugs directly targeting PGD2 or CRTh2. Array is developing a novel oral drug,
ARRY-502, an antagonist of the CRTh2 receptor, which, if proven safe and effective, could allow for
targeted treatment for patients with the Th2 marker across the asthma severity spectrum, particularly
those with severe disease, who currently have few, if any, options for effective treatment.
research focuses on biologic functions, or pathways, that have been identified as important in the
treatment of human disease based on human clinical, genetic or preclinical data. Within these pathways,
we seek to create first-in-class drugs regulating important therapeutic targets to treat patients with serious
or life-threatening conditions, primarily in cancer and inflammatory disease. In addition, we seek to
identify opportunities to improve upon existing therapies or drugs in clinical development by creating
clinical candidates with superior, or best-in-class, drug characteristics, including efficacy, tolerability or
dosing to provide safer, more effective drugs. During fiscal years 2012, 2011 and 2010, we spent
$56.7 million, $63.5 million and $72.5 million, respectively, on research and development for proprietary
drug discovery, which consist of costs associated with our proprietary drug programs for, among other
things, salaries and benefits for scientific personnel, consulting and outsourced services, laboratory
supplies, allocated facilities costs and depreciation.
control and takes many years to complete. The following table outlines each phase in the drug
and indication. Therefore, the duration times shown in the table below are estimates only.
dose. The pharmacokinetics of the drug are
examined after single and multiple doses, the
effects of food on the pharmacokinetics may be
evaluated and drug metabolites may be
Proof-of concept for a drug candidate generally occurs during Phase 2, after initial safety and efficacy
data are established.
four integrated areas of expertise:
chemical compounds. We continue to add to our breadth of knowledge, refine our processes and hire key
scientists who enhance our current capabilities. We have expanded our translational medicine team,