The July approval of AstraZeneca’s blood-thinner Brilinta, a
potential blockbuster that will compete against Plavix, marks a milestone for the
U.S. Food and Drug Administration. It brings to 21 the total of new drugs
approved by the agency this year, a number that equals the total of all new
drug approvals in 2010, according Burrill & Company.

“We’re on our way to breaking the anemic pace of new
drug approvals of recent years, but the problems underlying the relatively low
rate of approvals since 2004 still need to be addressed,” says G. Steven Burrill,
CEO of the San Francisco-based Burrill & Company, a diversified global
financial services firm focused on the life sciences industry. “The
industry has to reverse a long-term decline in R&D productivity. And the
FDA has to find a way to ensure the safety of new drugs while not slowing the
introduction of new and needed therapies or creating undue burdens for
developers.” Already this year, the agency has approved several important
new drugs. This includes Vertex Pharmaceutical’s hepatitis C drug Incivek; Bristol-Myers
Squibb’s melanoma drug Yervoy, the first new melanoma drug in 13 years, and the
first to extend the lives of patients with late-stage disease; and Human Genome
Sciences’ lupus drug Benlysta, the first new lupus drug in 50 years. More than
a dozen other drug candidates are scheduled for review before year-end,
including Seattle Genetics’ Adcetris, a first-in-class cancer drug that uses an
antibody to target cancer cells with a cytotoxic payload. An FDA advisory panel
in July voted to recommend approval for that drug, with an agency decision due
before the end of the year.

Though it is unclear what has driven the burst of approvals,
an analysis by Burrill & Company found that a third of the drugs approved in
2011 had failed to pass muster with the agency on their first attempt. That
compares to about a fifth of the drugs approved in 2010.

“Seven months of data is not enough to suggest a
significant change in approach at the FDA or that strategies to alter the drug
development process to improve productivity are paying off,” says Burrill.
“It is encouraging. But improving the pace at which new drugs reach the public
will require much more work, both at the agency and in industry.” The
increase in drug approvals is part of a general improvement in the environment
for the biopharmaceutical sector. Through the first seven months of the year
the Burrill Select Index rose 13.7 percent, compared to a 4.9 percent advance
for the Dow Jones Industrial Average and a 3.9 percent increase for the Nasdaq
Composite Index.

At the same time, improvement in the sector is reflected in
the capital being raised by life sciences companies. Through July 31, 2011,
global public market financings for the sector rose to $49.6 billion compared
to $30.9 billion for the same period a year ago.

Major energy producers continued their push into the
renewable fuels and chemicals space, as five companies raised a record $319.3
million in venture financing during the month. Sundrop Biofuels, a Colorado-based
startup with a gasification technology that can turn any kind of cellulosic
material into a bio-based fuel that can be blended directly with fossil fuels,
received a $155 million equity investment from Chesapeake Energy, the second
largest producer of natural gas in the United States.