Ele­phants can't jump? IDEA's Mike Rea says some Big Phar­ma play­ers are crush­ing old be­liefs

This is an in­dus­try that typ­i­cal­ly says ‘in­no­va­tion’ when what it means is ‘in­ven­tion.’ In­no­va­tion, as most purists will ar­gue, is about re­turn on in­ven­tion, an abil­i­ty to de­rive val­ue from pipeline. That is what our Phar­ma­ceu­ti­cal In­no­va­tion In­dex mea­sures — a com­pa­ny’s abil­i­ty to launch suc­cess­ful­ly, to add more val­ue to pipeline mol­e­cules than an­oth­er com­pa­ny would. It is ob­jec­tive, and about how well the past 5 years have gone, re­gard­less of how well the sto­ry has been spun.

This year took us by sur­prise. The idea that ‘ele­phants can’t jump’ may well be true bi­o­log­i­cal­ly, but it has been mis­ap­plied to large phar­ma, it seems. Where the trend had been to­wards small­er, more ‘ag­ile’ com­pa­nies in pre­vi­ous in­dices, this year the three fastest ris­ers were As­traZeneca, No­var­tis and Pfiz­er. This should give us all pause — if the nat­ur­al dis­rup­tion’ of the di­nosaurs was self-ev­i­dent, we’d be see­ing it. In­stead, they are fight­ing back, us­ing their scale, com­bined with wit, to take on the more buzz­wor­thy new guys.

The PII ranks com­pa­nies by their abil­i­ty to bring prod­ucts from Phase I/II to mar­ket and com­mer­cial­ize them suc­cess­ful­ly, and uti­lizes a range of clin­i­cal, reg­u­la­to­ry and com­mer­cial met­rics to do this, rang­ing from the cor­po­rate lev­el down to in­di­vid­ual prod­ucts.

The Pro­duc­tive In­no­va­tion In­dex (PII), now in its eighth year, pro­vides a sys­tem­at­ic and ob­jec­tive as­sess­ment of how well the top 30 com­pa­nies per­form in suc­cess­ful­ly bring­ing new med­i­cines to mar­ket and com­mer­cial­is­ing them.

The biggest shak­er this year is As­traZeneca, com­ing from the mid­dle of the pack in 2017 to take the 2018 PII Crown. Gilead al­so con­tin­ued their PII as­cent, be­com­ing the run­ner-up in 2018, ad­vanc­ing from 2017’s 3rd. John­son and John­son, hav­ing ced­ed the top spot last year af­ter a 4 year run on top, was able to re­gain some of the lost ground in 2018, land­ing in a joint 3rd spot with a rapid­ly-im­prov­ing No­var­tis.

1 As­traZeneca

How does a com­pa­ny cat­a­pult from the 15th spot in 2017 all the way to the top seat on the Phar­ma­ceu­ti­cal In­no­va­tion In­dex? A se­ries of strate­gic and suc­cess­ful de­ci­sions that helped gen­er­ate a sub­stan­tial amount of ro­bust pos­i­tive da­ta for their pipeline and be­gan to stem the com­pa­ny’s down­ward trend since the loss of sev­er­al prod­uct ex­clu­siv­i­ties be­tween 2011 and 2017. As­traZeneca man­aged to launch five sig­nif­i­cant new med­i­cines in 2017, across their pri­ma­ry ther­a­py ar­eas, in­clud­ing Imfinzi in ad­vanced blad­der can­cer, Calquence for r/r MCL, Qtern in T2D, Bevespi Aeros­phere in COPD, and fi­nal­ly Fasen­ra for se­vere asth­ma. Sig­nif­i­cant­ly, 2 of these 5 launch­es re­ceived ac­cel­er­at­ed ap­proval. In ad­di­tion to these new drug ap­provals, As­traZeneca ac­cu­mu­lat­ed 14 oth­er reg­u­la­to­ry ap­provals across in­di­ca­tion ex­pan­sion and LCM projects in ma­jor mar­kets. Over the past year AZ has al­so racked up 3 Break­through Ther­a­py Des­ig­na­tions (in­clud­ing 2 Or­phan Drug Des­ig­na­tions) and 6 ad­di­tion­al Pri­or­i­ty Re­view Des­ig­na­tions.

These reg­u­la­to­ry suc­cess­es are mir­rored strong­ly with a myr­i­ad of clin­i­cal tri­al suc­cess and ad­vance­ment. Based on key in­ter­nal guid­ance, the com­pa­ny has nar­rowed their R&D fo­cus to pro­vide deep­er re­sults from their pri­or­i­tized ther­a­peu­tic ar­eas, most no­tably on­col­o­gy. Short­ly af­ter Imfinzi re­ceived ac­cel­er­at­ed ap­proval in ad­vanced blad­der can­cer, AZ an­nounced pos­i­tive top-line re­sults for the Phase III PA­CIF­IC tri­al with Imfinzi demon­strat­ing su­pe­ri­or PFS in pa­tients with lo­cal­ly-ad­vanced, un­re­sectable NSCLC. In ad­di­tion to these ma­jor da­ta read­outs, AZ was able to bol­ster their pipeline with the ad­vance­ment of 14 phase II tri­als in 2017.

2017 wasn’t with­out its chal­lenges how­ev­er, as the MYS­TIC tri­al did not meet its pri­ma­ry end­point of im­prov­ing PFS com­pared to stan­dard of care (SoC) in PD-L1 >25% in pa­tients with 1st line NSCLC. How­ev­er, the MYS­TIC tri­al con­tin­ues as planned to as­sess the ad­di­tion­al pri­ma­ry end­point of over­all sur­vival – a da­ta read­out that is ac­cu­mu­lat­ed sig­nif­i­cant in­vestor in­ter­est. In fact, by the end of year EP Van­tage re­port­ed a 27% in­crease in AZ share price- demon­strat­ing both con­fi­dence in MYS­TIC’s OS out­comes and the bright fu­ture of As­traZeneca’s pipeline.


2 Gilead

Gilead saw an ex­cit­ing con­tin­u­a­tion of last years in­no­v­a­tive suc­cess, climb­ing to the 2nd spot on the PII for 2018. De­spite crum­bling rev­enues from block­buster Har­voni (a drop off of more than half, from $9.08 bil­lion in 2016 to $4.37 bil­lion in 2017) Gilead is re­port­ing net prod­uct sales be­tween $24.5 bil­lion and 25.5 bil­lion in 2017, up from a range of $22.5 bil­lion to $24.5 bil­lion. This in­crease in rev­enue comes from new prod­ucts, such as Vo­se­vi, as well as ex­ter­nal ac­qui­si­tions which drove in­creas­ing mar­ket share from their core strate­gic ther­a­peu­tic ar­eas.

Gilead has made a habit of en­ter­ing mar­kets with the goal of gen­er­at­ing step-wise change, ex­em­pli­fied by both Tru­va­da in HIV  and So­val­di in he­pati­tis C. When Gilead pur­chased Kite to join the CAR-T race, it’s clear their as­pi­ra­tion for game-chang­ing ther­a­peu­tics was a key dri­ver. In Oc­to­ber, Gilead was re­ward­ed for their jump in­to the cell ther­a­py mar­ket with the ap­proval of Yescar­ta for 3rd line treat­ment in large B-cell lym­phoma. Gilead has al­so con­tin­ued to back their CAR-T bet with ad­di­tion­al da­ta read­outs fea­tur­ing com­pelling long term da­ta in non-Hodgkin’s Lym­phoma and ag­gres­sive ex­pan­sion of treat­ment cen­ter ed­u­ca­tion and fa­cil­i­ta­tion, hop­ing to reach 80% of cen­ters over the next few years.

The huge in­vest­ment in Kite’s CAR-T was a bold and am­bi­tious move by Gilead. Some crit­ics ar­gue that the po­ten­tial is­sues with safe­ty, man­u­fac­tur­ing and oth­er re­al world ob­sta­cles to treat­ment made the $11 bil­lion dol­lar price tag too steep. Gilead hopes to over­come these crit­i­cisms by ex­pand­ing the la­bel through a wide breadth of hema­to­log­i­cal in­di­ca­tions and be­com­ing the hema­tol­o­gist’s first choice in CAR-T tech­nol­o­gy.

In 2017, Gilead’s Selon­sert­ib al­so con­tin­ued to ad­vance, ini­ti­at­ing a pair of phase III tri­als. Non-al­co­holic steato­hep­ati­tis (NASH) could rep­re­sent an enor­mous op­por­tu­ni­ty by 2020, with an ex­pect­ed an­nu­al mar­ket size pro­ject­ed be­tween $20 and $35 bil­lion. Da­ta from the late phase tri­als should be avail­able ear­ly in 2019.

Gilead’s de­ci­sion to con­tin­ue build­ing and de­vel­op­ing their HIV port­fo­lio af­ter the ac­qui­si­tion of Tri­an­gle Phar­ma­ceu­ti­cals (and Tru­va­da) led to con­tin­ued suc­cess when they could have oth­er­wise rest­ed on the lau­rels of their ini­tial suc­cess. Af­ter watch­ing its U.S. HIV mar­ket share grad­u­al­ly de­cline to just over 70% in Q3 2015, Gilead has seen a resur­gence to 78% mar­ket share in Q3 2017. These im­pact­ful strate­gic de­ci­sions have paved the way for Gilead’s suc­cess in 2017.

3 John­son & John­son

Al­so notch­ing a sin­gle rung high­er for the 2018 PII is John­son & John­son. Over the course of 2017, J&J had a strong show­ing of reg­u­la­to­ry mile­stones, clin­i­cal da­ta read outs and drug spe­cif­ic rev­enues. Strong growth in new prod­ucts in­clude Darza­lex, for the treat­ment of pa­tients with mul­ti­ple myelo­ma, Im­bru­vi­ca, for use in treat­ing cer­tain B-cell ma­lig­nan­cies, and Trem­fya, for the treat­ment of adults liv­ing with mod­er­ate to se­vere plaque pso­ri­a­sis.

Among the biggest stars of 2017 for John­son & John­son was Im­bru­vi­ca, which notched an enor­mous win with the first ever ap­proval in graft-ver­sus-host by the FDA. The suc­cess­es con­tin­ued to mount as suc­cess­ful long term phase 3 da­ta read­outs helped so­lid­i­fy the Im­bru­vi­ca mar­ket po­si­tion in Man­tle Cell Lym­phoma (MCL). Short­ly af­ter the da­ta was an­nounced in De­cem­ber, J&J re­ceived fur­ther good news when NICE re­versed their pre­vi­ous neg­a­tive opin­ion of Im­bru­vi­ca in MCL.

Ad­di­tion­al­ly, Darza­lex scored mas­sive phase 3 da­ta in front line myelo­ma, demon­strat­ing a 50% re­duc­tion in dis­ease pro­gres­sion or death in new­ly di­ag­nosed myelo­ma pa­tients. This mon­u­men­tal read­out, cou­pled with the ap­proval of Darza­lex (in com­bi­na­tion with dex­am­etha­sone and Cel­gene’s Po­m­a­lyst) for late line mul­ti­ple myelo­ma pa­tients, high­light a suc­cess­ful year for the ther­a­py, de­spite re­ceiv­ing a neg­a­tive opin­ion from NICE in March. 2017 end­ed – and 2018 be­gan – pos­i­tive­ly for the Darzelex brand team how­ev­er, with the FDA ac­cept­ing J&J’s sub­mis­sion and sub­se­quent­ly pri­or­i­tiz­ing the sBLA for their ther­a­peu­tic (in com­bo) for the treat­ment of new­ly di­ag­nosed mul­ti­ple myelo­ma pa­tients.

In ad­di­tion to growth from new prod­ucts, J&J man­aged to pre­serve Rem­i­cade rev­enues, no easy feat in a ever-ris­ing tide of biosim­i­lars. Over the last year, rev­enues de­clined to $6.32 bil­lion, a 9.3% de­cline from the pre­vi­ous year, but fared be­yond ex­pec­ta­tions with the launch of in­flix­imab biosim­i­lars en­ter­ing the US mar­ket. Ex-US has been a dif­fer­ent tale al­to­geth­er, with Rem­i­cade’s mar­ket share falling to 50% in the Eu­ro­pean mar­ket, which rais­es the ques­tion: how will the ad­vance of biosim­i­lars in the US in 2018 and be­yond af­fect rev­enues?

Al­though 2017 demon­strat­ed some ter­rif­ic suc­cess, the year was marred by the IL-6/IL-3 pro­gram fail­ures. The FDA re­jec­tion and fail­ure of the once-hope­ful block­buster can­di­date sirukum­ab and the dis­con­tin­u­a­tion of the phase 3 tri­al of ta­la­co­tuzum­ab were a low point of the 2017 year for John­son and John­son. To com­bat this pair of fail­ures, John­son & John­son need­ed a con­sid­er­able amount of help from the re­main­der of their es­tab­lished brands and pipeline to dig out – luck­i­ly for the big Phar­ma, many of their oth­er ther­a­peu­tic ar­eas were able to de­liv­er. Sales from John­son & John­son’s ‘World­wide Phar­ma­ceu­ti­cal’ unit tal­lied $36.3 bil­lion for the full-year 2017 – an in­crease of 8.3% ver­sus the pri­or year.


3 No­var­tis

Dur­ing the last year, No­var­tis jumped a con­sid­er­able 9 places and holds the third spot, ty­ing with John­son & John­son in the 2018 PII. Ma­jor dri­vers for this up­ward move­ment in­clude im­por­tant new prod­uct launch­es and ground­break­ing ad­vance­ments in per­son­al­ized can­cer ther­a­py.

No­var­tis reached three sig­nif­i­cant on­col­o­gy mile­stones in 2017, per­haps the most im­por­tant the sig­nif­i­cant mile­stone of achiev­ing the first FDA ap­proved chimeric anti­gen re­cep­tor T-cell (CAR-T) ther­a­py. Kym­ri­ah, an in­no­v­a­tive CAR-T ther­a­py was ap­proved in Au­gust of last year to treat chil­dren and young adults up to 25 years of age with acute lym­phoblas­tic leukemia (ALL). The com­pa­ny is now in the process of seek­ing ap­proval to ex­tend the im­muno­cel­lu­lar ther­a­py to treat adults with non-Hodgkin’s lym­phoma. CAR-T ther­a­py is an in­no­v­a­tive ap­proach which uti­lizes a pa­tient’s en­gi­neered healthy T-cells to tar­get and kill can­cer cells. Ad­di­tion­al­ly, Kisqali re­ceived FDA ap­proval as first-line treat­ment for (HR+/HER2-) ad­vanced or metasta­t­ic breast can­cer, and Ry­dapt was ap­proved in the US for treat­ment of FLT3- mu­tat­ed acute myeloid leukemia and three types of sys­temic mas­to­cy­to­sis.

Al­though No­var­tis faced gener­ic com­pe­ti­tion from patent ex­pi­ra­tion of its can­cer drug Gleevec/Glivec, the com­pa­ny’s com­mit­ment to strength­en­ing its on­col­o­gy port­fo­lio is ev­i­dent with their re­cent de­vel­op­ments and launch­es in this space. Ad­di­tion­al­ly, in an ef­fort to de­fend its pso­ri­a­sis drug Cosen­tryx from new en­trants, No­var­tis pub­lished phase 3 da­ta in­di­cat­ing that 44% of pa­tients had com­plete­ly clear skin af­ter one year of treat­ment and 41% main­tained clear skin in­to the 5th year. No­var­tis de­liv­ered a sol­id fi­nan­cial per­for­mance in 2017 with net sales of $49.1 bil­lion (up 2% in con­stant cur­ren­cies (cc)) and pro­gressed its pipeline by de­liv­er­ing 16 ma­jor ap­provals, 6 FDA break­through ther­a­py des­ig­na­tions, and 16 ma­jor sub­mis­sions.


5 Ab­b­Vie

Ab­b­Vie, mak­er of 2017’s glob­al top sell­er Hu­mi­ra, holds 5th place on the 2018 PII. In 2017, Ab­b­Vie’s de­liv­ered an ad­mirable fi­nan­cial per­for­mance with net rev­enues of $28.2 bil­lion, a jump from $25.6 in 2016. Hu­mi­ra brought in $18.4 Bil­lion in sales, an in­crease of 14.4 % on an op­er­a­tional ba­sis from 2016. Its run­ner up, Im­bru­vi­ca, for which Ab­b­Vie shares rights with J&J, brought in net rev­enues of $2.5 bil­lion, an in­crease of 40.5% from the pri­or year.

Ab­b­Vie’s mega block­buster Hu­mi­ra is ex­pect­ed to hold on to the num­ber one spot in sales for 2018 and is on track for reach­ing fore­cast­ed peak sales fig­ures of $21 bil­lion in 2020. This is large­ly thanks to last year’s set­tle­ment that was reached to stave off com­pe­ti­tion in the US from Am­gen’s FDA ap­proved Am­je­vi­ta un­til Jan 31st 2023. How­ev­er, Am­gen is ex­pect­ed to launch its biosim­i­lar in Eu­rope lat­er in 2018, where it may be­gin to steal away mar­ket share from Hu­mi­ra. Fol­low­ing its set­tle­ment with Am­gen, Ab­b­Vie filled a suit for patent in­fringe­ment against Boehringer In­gel­heim for its FDA ap­proved biosim­i­lar.

The com­pa­ny is ag­gres­sive­ly work­ing to­wards grow­ing its an­ti-in­flam­ma­to­ry port­fo­lio in prepa­ra­tion for fu­ture com­pe­ti­tion to Hu­mi­ra, which los­es ex­clu­siv­i­ty in 2023. They an­nounced top-line re­sults from a phase 3 study in­ves­ti­gat­ing a JAK1 se­lec­tive in­hibitor upadac­i­tinib (ABT-494) as a monother­a­py for the treat­ment of pa­tients with mod­er­ate to se­vere RA. In the study, 45% of pa­tients in the 15 mg and 53% in the 30 mg group had low dis­ease ac­tiv­i­ty by week 14 of treat­ment. Ad­di­tion­al­ly, the com­pa­ny re­port­ed pos­i­tive re­sults from a phase 3 study eval­u­at­ing IL-23 in­hibitor Risankizum­ab for treat­ment of pa­tients with mod­er­ate to se­vere plaque pso­ri­a­sis. Risankizum­ab achieved 84 to 88 per­cent re­spose rates of clear to al­most clear skin in pa­tients at week 16; a re­sponse rate sig­nif­i­cant­ly greater com­pared to STE­LARA (ustek­inum­ab) and HU­MI­RA (adal­i­mum­ab).

In par­al­lel, Ab­b­Vie is so­lid­i­fy­ing its pres­ence in on­col­o­gy with Im­bru­vi­ca, a drug orig­i­nal­ly de­vel­oped by Phar­ma­cyclics, which was bought by Ab­b­Vie in 2015 for $21 bil­lion. The drug re­ceived ex­pand­ed in­di­ca­tion out­side blood can­cer in 2017, when it land­ed FDA ap­proval for chron­ic graft-ver­sus-host dis­ease (cGVHD). This nov­el ap­proval made Im­bru­vi­ca the first drug to ever be in­di­cat­ed in this space. Ad­di­tion­al­ly, in on­col­o­gy, Ab­b­Vie’s phase 3 MU­RA­NO study eval­u­at­ing Ven­clex­ta/Ven­clyx­to (vene­to­clax) in com­bi­na­tion with Roche’s Rit­ux­an in pa­tients with re­lapsed or re­frac­to­ry chron­ic lym­pho­cyt­ic leukemia (CLL) met its pri­ma­ry end­point. Ven­clex­ta is FDA ap­proved for pa­tients with CLL with 17p dele­tion. How­ev­er, Ab­b­Vie has com­mit­ted ef­forts to­wards ex­pand­ing the role of Ven­clex­ta, seek­ing to be­come the go to ther­a­py  for pa­tients who de­vel­op re­sis­tance to first line treat­ment with Im­bru­vi­ca.


6 BMS

BMS holds the 6th place in the 2018 Phar­ma­ceu­ti­cal In­no­va­tion In­dex (PII). The com­pa­ny had a 7% growth in rev­enues from 2016, bring­ing in a to­tal of $20.8 bil­lion in 2017. Sales for Op­di­vo, its star im­muno-on­col­o­gy drug, in­creased by 31% with sales of $4.9 bil­lion in 2017. A flur­ry of ac­tiv­i­ty sur­round­ed Op­di­vo in 2017 as BMS tried to max­i­mize reach across glob­al mar­kets and ex­pand use of the ther­a­py across mul­ti­ple can­cer in­di­ca­tions, both as a monother­a­py and in com­bi­na­tion with Yer­voy.

Cur­rent­ly, Op­di­vo is ap­proved for treat­ment in 9 tu­mor types and 15 in­di­ca­tions. In ad­di­tion to this im­pres­sive la­bel, Bris­tol-My­ers Squibb has re­cent­ly re­leased da­ta that could lead to yet an­oth­er ap­proval in kid­ney can­cer, demon­strat­ing a 37% re­duc­tion in risk of death in pa­tients treat­ed with com­bi­na­tion of Op­di­vo plus Yer­voy. How­ev­er, the biggest win for Op­di­vo alone or in com­bi­na­tion (with Yer­voy) would be the high­ly sought FDA ap­proval in front-line treat­ment in non-small cell lung can­cer. In in­ter­na­tion­al mar­kets, the com­pa­ny filed a BLA for Op­di­vo to the Chi­na Food and Drug Ad­min­is­tra­tion and hopes to achieve this ap­proval in the Chi­nese mar­ket where lung can­cer is the most com­mon­ly di­ag­nosed can­cer.

In the car­dio­vas­cu­lar space, Eliquis (the an­ti­co­ag­u­lant drug that BMS shares rights to with Pfiz­er) has seen tremen­dous growth in 2017. Sales of the drug in­creased by 46%, reach­ing $4.9 bil­lion in 2017. The next gen­er­a­tion an­ti­co­ag­u­lant is on the way to dom­i­nat­ing this mar­ket by steadi­ly steal­ing away share from com­pe­ti­tion. Their rheuma­toid arthri­tis drug, Oren­cia, had the third high­est sales in 2017, fol­lowed by on­col­o­gy drug Spry­cel.

There is a lot to look for­ward to in 2018 for BMS. In on­col­o­gy, BMS con­tin­ues to ad­vance its port­fo­lio with nu­mer­ous stud­ies in phase 3. In im­muno­science, the com­pa­ny is quick­ly ad­vanc­ing its TYK2 in­hibitor in pso­ri­a­sis. Fi­nal­ly, in fi­brot­ic dis­ease their FGF21 for the po­ten­tial treat­ment of non-al­co­holic steato­hep­ti­tis (NASH).


7 Mer­ck

For Mer­ck, Keytru­da un­doubt­ed­ly has stolen the spot­light in 2017. Hav­ing land­ed three ap­provals last May, for use in front-line com­bi­na­tion ther­a­py with chemo for pa­tients with non-small cell lung can­cer (NSCLC), first and sec­ond-line ther­a­py in blad­der can­cer, as well as treat­ment of chil­dren and adults with mi­crosatel­lite in­sta­bil­i­ty-high (MSI-H) or a mis­match re­pair de­fi­cient (dMMR) sol­id tu­mors, Keytru­da’s sales re­flect­ed its ma­jor reg­u­la­to­ry suc­cess­es. In 2017 the PD-L1’s sales grew an im­pres­sive 172% from the pre­vi­ous year, bring­ing in $3.8 bil­lion in sales in 2017. Mer­ck re­port­ed end year sales of $40.1 bil­lion, over­all on­ly a 1% change from pri­or year.

Not all news was good news for Keytru­da in 2017 how­ev­er, in Ju­ly, Mer­ck an­nounced the Im­muno-On­col­o­gy drug fell short of de­liv­er­ing a sta­tis­ti­cal­ly sig­nif­i­cant ad­van­tage in over­all sur­vival over the cur­rent stan­dard treat­ment in a phase 3 study in head and neck can­cer. Lat­er in the year, the com­pa­ny’s am­bi­tious at­tempt to move Keytru­da in­to sec­ond line treat­ment for stom­ach-can­cer was shot down by the FDA af­ter the drug failed to meet its pri­ma­ry end­point in a phase 3 tri­al. In ad­di­tion, pa­tient deaths in two Keytru­da + chemo myelo­ma tri­als led the com­pa­ny to halt the tri­als and raised con­cerns in the med­ical and reg­u­la­to­ry com­mu­ni­ty.

In the vac­cines space Mer­ck con­tin­ues to strength­en its Gar­dasil fran­chise; a Mer­ck-fund­ed study found that the Quadri­va­lent HPV vac­cine Gar­dasil could pro­vide pro­tec­tion against vac­cine spe­cif­ic HPV types 6, 11, 16, and 18 for 10 years. Ad­di­tion­al­ly, in a large phase 3 tri­al the new­er vac­cine Gar­dasil 9 de­liv­ered pro­tec­tion in sub­jects for at least 6 years. On the oth­er hand, Mer­ck’s Zoster­vax was not viewed fa­vor­ably by a CDC ad­vi­so­ry com­mit­tee on im­mu­niza­tion prac­tices. The group vot­ed 8 to 7 in fa­vor of GSK’s Shin­grix over Zoster­vax, and fur­ther ex­pand­ed the rec­om­men­da­tion in peo­ple 50 years and old­er. In 2018, the com­pa­ny is ex­pect­ed to file for ap­proval for its Ebo­la vac­cine. Last Sep­tem­ber, the com­pa­ny an­nounced the ter­mi­na­tion of their He­pati­tis C treat­ment de­vel­op­ment ef­forts, but with nu­mer­ous pro­grams in phase 3, we’ll con­tin­ue to watch close­ly as they progress in 2018.


8 Roche

Roche had a steady flow of pos­i­tive news in 2017, dri­ving the Swiss drug­mak­er up 3 spots in this years PII rank­ings, to num­ber 8. Their up­ward trend can be at­trib­uted to a com­bi­na­tion of fac­tors, in­clud­ing: a sig­nif­i­cant num­ber of pos­i­tive tri­al read­outs, an im­pres­sive reg­u­la­to­ry per­for­mance and sol­id rev­enue growth.

Roche’s to­tal sales rose 5% in 2017 to $56.32 bil­lion. Both the phar­ma­ceu­ti­cal and di­ag­nos­tics di­vi­sions in­creased rev­enue by 5% from 2016. Key dri­vers of the phar­ma­ceu­ti­cal di­vi­sons growth came from new­er drugs, main­ly Ocre­vus, Tecen­triq, Per­je­ta and Ale­cen­sa, con­tribut­ing $1.48 bil­lion in new sales.

In 2017 Roche re­ceived a num­ber of key ap­provals, in­clud­ing two new med­i­cines, name­ly Ocre­vus for the treat­ment of re­laps­ing and pri­ma­ry pro­gres­sive mul­ti­ple scle­ro­sis, and Hem­li­bra for haemophlia A.  Roche al­so re­ceived a num­ber of ad­di­tion­al ap­provals for ex­ist­ing prod­ucts. These ad­di­tion­al ap­provals in­clude: Per­je­ta for ad­ju­vant, as well as for neoad­ju­vant, use in HER2-pos­i­tive breast can­cer, Ale­cen­sa for 1st line treat­ment in ALK-pos­i­tive NSCLC, Zelb­o­raf in Erd­heim-Chester dis­ease, Gazy­va for un­treat­ed ad­vanced fol­lic­u­lar lym­phoma, Lu­cen­tis for the treat­ment of all forms of di­a­bet­ic retinopa­thy, and Avastin for Glioblas­toma in adult pa­tients whose can­cer has pro­gressed.

Roche al­so re­ceived ap­proval in 1st line metasta­t­ic bad­der can­cer for its IO ther­a­py, Tecen­triq. How­ev­er, in a twist of fate, it lat­er went on to fail a Phase III tri­al in its 2nd line tri­al in UC.  Al­though the fail­ure has yet to re­sult in the re­moval of Tecen­triq, it did have dra­mat­ic neg­a­tive im­pacts on Tecen­triq’s UC mar­ket share. Some fear could this de­vel­op­men­tal mis­step could lead to fu­ture neg­a­tive im­pacts on the as­sets per­for­mance in oth­er large in­di­ca­tions, such as NSCLC, where there is lit­tle to clear­ly dif­fer­en­ti­ate Tecen­triq from the oth­er IO ther­a­pies.

Roche al­so had a num­ber of pos­i­tive clin­i­cal read outs in key ar­eas in 2017. Of par­tic­u­lar note were Roche’s pos­i­tive phase III IM­pow­er150 and IM­mo­tion151 stud­ies, which both met their pri­ma­ry end­point of PFS. The IM­pow­er150 study demon­strat­ed that the com­bi­na­tion of Tecen­triq and Avastin plus chemother­a­py sig­nif­i­cant­ly im­proved PFS com­pared to Avastin plus chemother­a­py in the first-line treat­ment of peo­ple with ad­vanced non-squa­mous non-small cell lung can­cer. The IM­mo­tion151 study demon­strat­ed that the com­bi­na­tion of Tecen­triq and Avastin pro­vid­ed a sig­nif­i­cant im­prove­ment in PFS in peo­ple who ex­pressed PD-L1 com­pared with suni­tinib for first-line metasta­t­ic re­nal cell car­ci­no­ma.  Both were sig­nif­i­cant as they help to bol­ster Roche’s newest po­ten­tial block­buster, Tecen­triq, while re­new­ing the util­i­ty of one of its his­tor­i­cal block­busters, Avastin, cre­at­ing a very val­u­ble can­cer-fight­ing dy­nam­ic duo. Oth­er pos­i­tive da­ta read outs for Roche in­clud­ed: pos­tive da­ta for Hem­li­bra, which de­liv­ered “clin­i­cal­ly mean­ing­ful” re­duc­tions in the num­ber of bleeds for he­mo­phil­ia A pa­tients, pos­i­tive da­ta for po­latuzum­ab ve­dotin in com­bi­na­tion with ben­damus­tine plus Rit­ux­an (BR) in r/r dif­fuse large B-cell lym­phoma and pos­titve da­ta for Ven­clex­ta plus Rit­ux­an for r/r chron­ic lym­pho­cyt­ic leukaemia (CLL).

De­spite a sol­id year of pos­i­tive news, Roche did face some chal­lenges in 2017. One such con­cern came from de­clin­ing sales of Tarce­va and Avastin. Avastin sales de­clined for the first time in the US, large­ly due to in­creas­ing use of new­er im­munother­a­py agents. Rit­ux­an/MabThera al­so suf­fered a 11% rev­enue de­crease in the EU in 2017, due pri­mar­i­ly to the en­try of biosim­i­lars.

Over­all, Roche de­liv­ered an im­pres­sive 2017 per­for­mance, with a re­mark­able set of new med­i­cines and exa­pan­sions in­to new in­di­ca­tions where true un­met needs ex­ist. As Roche looks to the fu­ture, they will con­tin­ue to try and re­ju­ve­nate their on­col­o­gy port­fo­lio with new, in­no­v­a­tive med­i­cines that can help take the place of for­mer block­busters.  Their cur­rent pipeline of on­col­o­gy prod­ucts is di­verse and should help in their ef­forts to dri­ve their con­tin­ued suc­cess in the com­ing years.


9 Pfiz­er

Pfiz­er had quite a pro­duc­tive 2017, jump­ing up 10 spots from their 2017 rank­ing (19), land­ing at num­ber 9 on this years PII. Their sol­id per­for­mance was the re­sult of sev­er­al fac­tors, in­clud­ing: sig­nif­i­cant progress on sev­er­al pipeline pro­grams, a decades best, ten ap­provals from the FDA, and con­tin­ued strength from sev­er­al core brands, in­clud­ing Ibrance, Eliquis and Xel­janz. No­tably, glob­al rev­enue for Eliquis in­creased by 43%, while glob­al Xel­janz rev­enue grew by 47% from 2016. Against these must be bal­anced in­creased com­pe­ti­tion for the im­munol­o­gy block­buster En­brel and a luke­warm per­for­mance by the com­pa­ny’s best-sell­ing prod­uct, pneu­mo­coc­cal vac­cine Pre­vnar 13. Over­all, to­tal rev­enue for Pfiz­er in­creased by 1%, with rev­enue from their In­no­v­a­tive Health Busi­ness up by 5% from 2016.

2017 was a par­tic­u­lar­ly strong reg­u­la­to­ry year for Pfiz­er, with a to­tal of 10 new ap­provals. Par­tic­u­lar­ly note­wor­thy was the ap­proval of their an­ti- PD-L1 im­muo-on­col­o­gy agent, avelum­ab, re­ceiv­ing ap­proval for the treat­ment of urotheial car­ci­no­ma (UC) and Merkel cell car­ci­no­ma (MCC), both com­ing with­in a span of two months. While Pfiz­er will face stiff com­pe­ti­tion as the 5th IO to mar­ket in UC, avelum­ab is the first and on­ly IO in MCC, mak­ing it a tru­ly in­no­v­a­tive ap­proval. Some of Pfiz­er’s oth­er key ap­proval this year in­clud­ed: Bo­sulif (bo­su­tinib), Steglatro (er­tugliflozin), a new in­di­ca­tion for Xel­janz (to­fac­i­tinib) in PsA, and a new in­di­ca­tion for Su­tent (suni­tinib malate) as an ad­ju­vant treat­ment in RCC.

Al­so of note, was Pfiz­er’s growth in emerg­ing mar­kets, with to­tal rev­enue growth at $1.1 bil­lion, or 11% from 2016. Pfiz­er showed a con­tin­ued com­mit­ment to emerg­ing growth mar­kets with deals like the one it made with Basilea Phar­ma­ceu­ti­cals. In the agree­ment, Pfiz­er was giv­en ex­clu­sive de­vel­op­ment and com­mer­cial­iza­tion rights for Cre­sem­ba (isavu­cona­zole), a nov­el an­ti­fun­gal med­i­cine in Chi­na and sev­er­al coun­tries in the Asia Pa­cif­ic re­gion.

Some of Pfiz­er’s biggest set­backs in 2017 came from loss­es of ex­clu­siv­i­ty, which neg­a­tive­ly im­pact­ed 2017 rev­enues by $2.1 bil­lion. This in­clud­ed loss of ex­clu­siv­i­ty for En­brel in Eu­rope, Pris­tiq and Vi­a­gra in the U.S., and Lyri­ca and Vfend in Eu­rope. A sec­ond note­wor­thy set­back came with Pfiz­er’s failed at­tempt to bol­ster the Lyri­ca fran­chise, when the FDA re­ject­ed Lyri­ca CR in the treat­ment of fi­bromyal­gia.

Pfiz­er’s biggest clin­i­cal set­back came with the fail­ure of avelum­ab in its phase 3 tri­al in ad­vanced stom­ach can­cer. Two of its reg­u­la­to­ry fail­ures in 2017 in­clud­ed the re­jec­tion of its Epogen biosim­i­lar and Xtan­di in breast can­cer.

Al­so of note in late 2017 was Pfiz­er’s de­ci­sion to end its in­ter­nal neu­ro­science dis­cov­ery and ear­ly de­vel­op­ment pro­gram. Like­ly a re­sult of decades of fail­ures, Pfiz­er de­cid­ed to shut down the pro­gram in or­der to re-al­lo­cate fund­ing to oth­er ar­eas where the com­pa­ny has stronger sci­en­tif­ic lead­er­ship.

Over­all, Pfiz­er had a pro­duc­tive 2017, with a decades-high 10 new ap­provals that should pro­vide sol­id ad­di­tion­al rev­enue for years to come. Look­ing ahead to 2018, Pfiz­er is hop­ing for more pos­i­tive out­comes in a se­ries of up­com­ing reg­u­la­to­ry de­ci­sions and clin­i­cal da­ta read­outs across their pipeline as they con­tin­ue to builds to­ward its next wave of in­no­v­a­tive treat­ments.


10 Bio­gen

De­spite an ap­pre­cia­ble year of rev­enue growth (up 7% from 2016), Bio­gen dropped from 1st in 2017, to 10th on this years PII. While still 2nd on the fresh­ness in­dex (per­cent of sales from drugs launched in the pre­vi­ous 5 years), a reg­u­la­to­ry set back in their core ther­a­peu­tic area (MS), a lack of pos­i­tive news, and strong per­for­mances from oth­er com­pa­nies led to Bio­gen’s drop on this year’s in­dex.

Bio­gen achieved 4% rev­enue growth in 2017, with over 90% of its rev­enue com­ing from its core MS busi­ness, de­spite an in­creas­ing­ly com­pet­i­tive en­vi­ron­ment in MS, lead pri­mar­i­ly by Tec­fidera.

A sig­nif­i­cant por­tion of this year’s growth al­so came from Bio­gen’s new­ly launched Spin­raza (ap­proved in De­cem­ber, 2016), which gen­er­at­ed over $880 mil­lion in rev­enue. The launch rep­re­sents one of the most suc­cess­ful rare dis­ease launch­es of all time, for which Bio­gen re­ceived the 2017 Prix Galien USA Award for Best Biotech­nol­o­gy Prod­uct.

2017 was al­so a year of re­new­ing fo­cus for Bio­gen. In Feb­ru­ary, Bio­gen com­plet­ed the spin-off of its he­mo­phil­ia busi­ness, Biover­a­tiv Inc., as an in­de­pen­dent com­pa­ny. In Oc­to­ber, Bio­gen ap­proved a cor­po­rate re­struc­tur­ing, in­tend­ed to cre­ate a lean­er and sim­pler op­er­at­ing mod­el. Both ef­forts were in­tend­ed to al­low Bio­gen to strate­gi­cal­ly re­al­lo­cate re­sources to­wards it’s core com­pe­ten­cies and emerg­ing growth ar­eas (all in neu­ro­science).

Bio­gen al­so made sig­nif­i­cant progress with its emerg­ing biosim­i­lar busi­ness in 2017. Benepali, an etan­er­cept biosim­i­lar, and Flix­abi, an in­flix­imab biosim­i­lar, both showed wide ac­cep­tance and adop­tion in the EU. In Au­gust, 2017 the EC al­so grant­ed mar­ket­ing au­tho­riza­tion for Im­ral­di, an adal­i­mum­ab biosim­i­lar.

Un­for­tu­nate­ly Bio­gen’s lat­est MS as­set, Zin­bry­ta (da­clizum­ab), failed to live up to its ex­pec­ta­tion of be­com­ing the next best fol­low-up ther­a­py for pa­tients who stop Tysabri (na­tal­izum­ab). The EMA de­cid­ed to sig­nif­i­cant­ly re­strict its use in pa­tients just one year af­ter its ap­proval due to safe­ty con­cerns (in March, 2018,  Bio­gen an­nounced a vol­un­tary world­wide with­draw­al of the prod­uct, though this was not fac­tored in­to this years PII). Though the as­set was not ex­pect­ed to be a ma­jor block­buster, this rep­re­sents a sig­nif­i­cant set­back for Bio­gen in it’s core ther­a­peu­tic area (MS).

Al­though Bio­gen faced some stag­na­tion in 2017, it is still well placed for fu­ture per­for­mance in the com­ing years. In 2017, Bio­gen added sev­en clin­i­cal pro­grams to its neu­ro­science pipeline, in­di­cat­ing con­tin­ued com­mit­ment to the fu­ture of its core busi­ness. Bio­gen’s most promis­ing pipeline as­set, ad­u­canum­ab, is cur­rent­ly in phase 3 clin­i­cal tri­als for pro­dro­mal AD. A pos­i­tive read­out as a DMT in AD would pro­pel Bio­gen clos­er to its stat­ed goal of be­com­ing the fastest grow­ing large cap biotech. Thus­ly, the next 12-18 months will see piv­otal da­ta read­outs that will have ma­jor im­pli­ca­tions on Bio­gen’s fu­ture suc­cess.


Fi­nal thoughts on PII per­for­mance…

Of the com­pa­nies out­side this year’s top 10 rank­ings, most had rel­a­tive­ly mod­est move­ments be­tween 2017 and 2018’s PII (with the ex­cep­tion of one). This like­ly speaks to the in­dus­try’s lack of dy­nam­ic risk tak­ing as a whole in 2017, with lit­tle in terms of dra­mat­ic cat­a­stro­phes or ma­jor par­a­digm shifts.

Take­da is the ex­cep­tion to this, hav­ing a pre­cip­i­tous fall from 5th in 2017 to 31st in this year’s PII. CEO Christophe We­ber warned of this po­ten­tial de­cline in the com­pa­ny’s mid-year state­ment when he stat­ed “we ex­pect head­winds in the sec­ond half of the year”. While a cou­ple of break­through des­ig­na­tions were seen, Take­da scored near the bot­tom on all key PII met­rics, in­clud­ing a dis­ap­point­ing year in terms of R&D, reg­u­la­to­ry ap­provals, key da­ta read­outs, HTA fail­ures and key fi­nan­cial mea­sures. Over­all, Take­da is one of the least ‘fresh’ com­pa­nies in terms of rev­enue from re­cent­ly launched drugs.

Al­ler­gan and Valeant were no­table new en­trants to this years PII, com­ing in at 16 and 18, re­spec­tive­ly. Al­ler­gan had a sol­id and steady year, with mid­dle-of-the-pack per­for­mances across all key PII met­rics. Valeant had a more mixed set of PII met­rics, with a very strong reg­u­la­to­ry per­for­mance (in the top 5), but a poor fresh­ness in­dex (one of the worst), which tak­en in com­bi­na­tion, pre­vent­ed it from mov­ing any high­er than 18th in its de­but on the PII.

The largest movers out­side the top 10 were Te­va, up 7 spots to 23rd, and Eli Lil­ly, up 8 places to 13th. Lil­ly was punch­ing above its weight in terms of ap­provals, R&D and reg­u­la­to­ry but with a low Fresh­ness In­dex and poor key fi­nan­cial met­rics. Te­va, by con­trast punched slight­ly above its weight in all met­rics bar NME ap­provals, where it was in the top 10.

In terms of the over­all PII, a key shift from 2016 to 2017 was the re­claimed su­prema­cy of big phar­ma in the top 10 rank­ings, push­ing out small­er com­pa­nies.

An­oth­er key trend of 2017 was the near record num­ber of NMEs ap­proved by the FDA in rare dis­eases and on­col­o­gy. While these in­no­v­a­tive med­i­cines are pro­vid­ing true clin­i­cal val­ue to pa­tients, they al­so come with an ex­or­bi­tant price tag and con­tin­ue to put ex­treme pres­sure on pay­er or­ga­ni­za­tions. A key ex­am­ple of this came in 2017 with the launch of Lux­tur­na, a sin­gle in­jec­tion for a rare oph­thalmic con­di­tion at the price of $425,000. While some can ar­gue that the price is jus­ti­fi­able giv­en that the in­ter­ven­tion quite lit­er­al­ly can cure blind­ness, it could be the next source of back­lash from both com­mer­cial pay­ers, gov­ern­men­tal sys­tems and the gen­er­al pub­lic. On­ly time will tell.


For more de­tails, vis­it http://ideaphar­ma.com/pii. Im­age: SHUT­TER­STOCK

Brent Saunders [Getty Photos]

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