In the new report from EvaluatePharma®, World Preview 2013, Outlook to 2018, the analysis is already done, so no magical accessory is required.
In this sixth edition of the World Preview, a vast amount of data and analyses have been brought together to provide the 20,000-foot view of what the pharmaceutical future will look like over the next 5 years.
There is both good news and not-so-good news to report. Let’s get the bad news out of the way first. For the first time since 2004, pharmaceutical sales actually declined in 2012 in terms of worldwide prescription drug sales. In dollars, this amounted to a 1.6% decrease.
Causes for decline
- Loss of patent protection for a number of blockbusters ($38 billion in sales were lost due to patent expiry)
- Fiscal austerity throughout Europe
- Worldwide financial recession
Reasons for hope
Sales increasing: The good news is that sales are expected to increase throughout 2013, albeit at a slow rate of +0.4%. Even better news is that sustained growth should be evident by late 2013/early 2014, averaging 3.8% per year from 2012 through 2018.
New drug approvals: Despite the sales decrease, 2012 saw more FDA approvals of NDAs and BLAs than have been seen since 1997.
- 45 agents were approved in 2012, compared to 35 in 2011
- Analysts were impressed with the high quality of the new therapies
- Sales of these drugs are expected to reach $15.8 billion in the US alone
- The expectation is that 2013 will also be a good year for approvals
|Agents Approved in 2012 Forecast to be Possible Blockbusters by 2017|
|Stribild™ (elvitegravir, cobicistat, emtricitabine, tenofovir disoproxil fumarate)|
|Xeljanz® (tofacitinib citrate)|
This increase in approvals is consistent with an earlier posting here entitled New Drug Approvals in the United States on the Downslope? Let’s Take a Closer Look.
The orphan drug model—how is it changing the face of pharma?
In 2018, it is estimated that orphan drugs will account for almost 16% of the worldwide prescription market, amounting to $127 billion in sales (excluding generics). A number of factors are in play here:
- Lower development costs
- Higher prices
- Government incentives
- Accelerated approval
Even “non-rare” diseases can benefit from lessons learned through the orphan drug experience:
- Patient subgroups can be identified within more common diseases
- Clinical trials in these subgroups will involve fewer subjects and cost less to run
- Subgroup targeting may increase likelihood of clinical success and approval
Is the “patent cliff” more of a patent hill?
EvaluatePharma states that between 2013 and 2018, $230 billion in worldwide drug sales will be at risk for generic erosion. However, due to the large number of biologic drugs, their contribution to overall sales, and the perceived difficulty in gaining approval for biosimilars, EvaluatePharma estimates that only $114 billion of the total amount at risk is actually in jeopardy. In 2018, about half of sales of the top 100 products in the world are forecast to be generated by biologics.
One word of caution: biologics may not be as “erosion-proof” as once thought. On June 28, 2013, the European Medicines Agency (EMA) announced that the Committee for Medicinal Products for Human Use (CHMP) has recommended marketing authorizations for the first 2 monoclonal antibody biosimilars—Remsima™ and Inflectra™, both containing infliximab (branded agent is Remicade®, approved in the EU in 1999).
Pharma future—the optimism is contagious
Financial analysts have their own crystal ball. And they too are seeing sustained growth in drug sales, especially in 2014 and later. They share the feeling that biosimilars will be harder to approve, thus avoiding some patent cliff problems. Plus, analysts were happy with the number and quality of the agents approved in 2012 and are hopeful for 2013 drug approvals.
Contributing to the optimistic view of pharma, the top 20 pharma companies’ share prices outperformed the S&P 500 in 2012, signaling a growth period for the industry.
The future does, in fact, look bright
From Wall Street to the halls of pharma companies great and small, it appears that pharma will resist the negative halo of lackluster sales in 2012 and enjoy a healthy future of continued growth—fueled in large part by smaller disease communities and the targeted biologic innovations that serve them.
What are your impressions of the decline in 2012 and the biotech-laden pharma of the future?
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