Lipophilic efficiency (LipE) is an important metric that has been increasingly applied in drug discovery medicinal chemistry lead optimization programs. In this Perspective, using literature drug discovery examples, we discuss the concept of rigorously applying LipE to guide medicinal chemistry lead optimization toward drug candidates with potential for superior in vivo efficacy and safety, especially when guided by physiochemical property-based optimization (PPBO). Also highlighted are examples of small structural modifications such as addition of single atoms, small functional groups, and cyclization that produce large increases in LipE. Understanding the factors that may contribute to LipE changes through analysis of ligand-protein crystal structures and using structure-based drug design (SBDD) to increase LipE by design is also discussed. Herein we advocate for use of LipE analysis coupled with PPBO and SBDD as an efficient mechanism for drug design.