Many opportunities should open in the next five years in the pharmaceutical market, and sales volumes might reach $1.18 trillion in 2024. The main drivers are the increasing convergence of technologies and health and new models for the treatment of many diseases based on advanced therapies. Pending issues pertains the revision of the current models for pricing and reimbursement to adapt to new generation technologies, says the EvaluatePharma report “World preview 2019. Outlook to 2024”.
The market for prescription medicines
Forecasted sales to 2024 are seeing the programmed cell death protein 1 antibody Keytruda (Merck and Otsuka, +15.4% CAGR (compounded average growth rate)) conquering the first place, leaving behind Humira (AbbVie and Eisai, -8.0%), an TNFa antibody. The analysts expect also a strong improvement in the sales of Bruton’s tyrosine kinase inhibitor Imbruvica (AbbVie and J&J, +13.5%) and the cyclin-dependent kinase 4 inhibitor Ibrance (Pfizer, + 14.2%). At the tenth position enters Gilead’s HIV-1 integrase inhibitor and nucleoside reverse transcriptase inhibitor Biktarvy, with projections of a +34.3% in sales.
The increasing number of regulatory approvals (62 by the FDA in 2018 vs 55 in 2017) are supporting a 6.9% CAGR expected growth of the prescription drugs market in the period 2019-2024. Orphan medicines and immuno-oncology should remain the favorite areas of innovation, in the second case seeing many line extensions for products already on the market. Oncology shall represent the 19.4% of the market in 2024 ($237 bln), while orphan drugs are expected to generate additional sales for $109 bln in 2024 vs 2018.
The report also indicates an increased competition in the anti-rheumatic field (-1,0% CAGR in the period 2018-24) and poses the question of the real interest in pursuing the development of new cardiovascular medicines, considering the risk of failure, the big dimensions of clinical studies and development costs in the order of a billion dollars. In comparison, the development cost for a new oncological product is “just” $0.7 billion.
Uncertainties linked to US’s president Trump intention to revise health policies on one side, and the launch of new products on the other are indicated by the analysts as possible factors that might influence the market. Among the more interesting and recently approved products, the report remembers Ultomiris-ravulizumab (Alexion Pharma) for adult patients living with paroxysmal nocturnal hemoglobinuria and Takhzyro-lanadelumab-flyo (Takeda) for routine prevention of recurrent attacks of hereditary angioedema in patients aged 12 years and older.
Pfizer, Novartis and Roche will remain the markets leaders, fighting for the first position; Takeda is expected to gain positions thanks to the acquisition of Shire, while BMS is suffering the competition of Keytruda (pembrolizumab) to its product Opdivo (nivolumab) to treat various types of cancers. The acquisition of Celgene may offer BMS an opportunity to access again the top 10 positions of the ranking. AstraZeneca is currently holding the 10th place, and its growth should be supported by the strong presence on the Chinese market and sales of the two oncological products Tagrisso (osimertinib) and Lynparza (olaparib).
The patent cliff and the new products from pipelines
According to the report, sales should decrease (-$198 billion) as the consequence of the expiration of many patents. One of the main products facing the patent cliff is Humira-adalimumab. On the other hand, analysts expect some 400 new products exiting the pipelines, even if R&D investments in proportion to sales of Rx medicines is due to diminish to 18% (from 21.6% in 2018). R&D expenditure reached $179 bln in 2018 (+6.5% vs 2017), and it is expected to increase 3% CAGR up to 2024.
According to the analysts, the forecasted reduction in R&D spend after 2019 may be an indication the investments to improve the future R&D efficiencies of the companies – i.e. real world data combined with machine learning techniques and collaborative R&D programs – might be well advanced. Another explanation is that less revenue is being reinvested in new R&D activities to enrich pipelines.
GlaxoSmithKline is expected to have the highest growth in pharma R&D spend (+5,3%), in a ranking seeing J&J and Roche as the leaders, with $9,9 bln R&D spend each. Johnson & Johnson and Merck should lead the investments ranking, before Novartis. Among promising products under development and that should reach approval in the next few years are the triple combination VX-659/VX-445+tezacaftor+ivacaftor for the treatment of cystic fibrosis, currently in phase 3 (Vertex), the Jak1 kinase inhibitor upadacitinib (Abbvie) to treat ulcerative colitis and rheumatoid arthritis (under approval) and the oncological anti-Her2 DS-8201 antibody currently in phase 3 (Daiichi Sankyo).
Biological medicines are the new king of the market
Small molecules are the past of the pharmaceutical industry, the present and the future being represented by biological medicines. This type on medicinal products currently represents 66% of the ten most sold drugs; if looking at the the top 100 ranking, says the report, biotech and conventional products should gain each 50% of the market in 2024.
Roche is maintaining its leading position, while Merck is rapidly growing (10.9% CAGR) and it is expected to reach the second position. Eli Lilly is also increasing its market shares thanks to its anti-diabetic product Trulicity (dulaglutide). The less performing company is expected to be AbbVie (-4.9%), suffering for the expiration of Humira’s patent.