The next 5 years: High­er R&D pro­duc­tiv­i­ty is here to stay, emerg­ing biotechs and new tech will have a big im­pact. But what about pric­ing?

Hind­sight is 20/20 vi­sion. But the drug mar­ket an­a­lysts at IQVIA be­lieve they can al­so paint a clear pic­ture of what lies ahead for all of bio­phar­ma in the next 5 years.

And it looks quite com­pelling — es­pe­cial­ly for the up-and-com­ing small­er com­pa­nies with a hard fo­cus on drug de­vel­op­ment and a taste for jump­ing in­to mar­ket­ing. Glob­al­ly, the in­dus­try can ex­pect to see over­all drug spend­ing rise from $1.2 tril­lion in 2018 to $1.5 tril­lion in 2023 — with the pres­sure on US pric­ing ris­ing.


IQVIA of­fered us a chance to get a pre­view of their new re­port, out on Tues­day. And with plen­ty of bold pre­dic­tions on of­fer for all as­pects of the in­dus­try, we’re go­ing to fo­cus on drug R&D trends, with a shot at clar­i­fy­ing the un­cer­tain pic­ture around drug pric­ing.

There’s a rel­a­tive­ly high and steady rate of new drug launch­es ex­pect­ed be­tween now and the end of 2023, says IQVIA in their new re­port on this top­sy turvy in­dus­try. Over the last 5 years, the in­dus­try av­er­aged 46 new drug launch­es per year. Over the next 5 years, that av­er­age will rise to 54. Spe­cial­ty drugs will ac­count for two thirds of those launch­es, com­pared to 61% in the last 5 years.


But R&D won’t be dom­i­nat­ed en­tire­ly by Big Phar­ma.

In­stead, the new re­port says up-and-com­ing small­er biotechs — de­fined as those with less than $500 mil­lion in rev­enue or R&D bud­gets un­der $200 mil­lion a year — have seen their per­cent­age of R&D ac­tiv­i­ty jump from 60% to 72% over the past 10 years. That’s led to 68 new drugs over the last 5 years, up from 47 from this group over the 5 years be­fore that.


The next 5 years? Look for these small­er com­pa­nies to pro­duce more than a third of the new drugs ap­proved, with a much greater like­li­hood that they’ll un­der­take the mar­ket­ing with­out a phar­ma part­ner.

As for phar­ma, the big com­pa­nies will pre­fer to do more part­ner­ing rather than shoul­der all of the com­mer­cial risk them­selves. In the near fu­ture, the em­pha­sis at the gi­ants will be on clar­i­ty and sol­id, re­li­able num­bers, and that means less like­li­hood of mak­ing ex­trav­a­gant bets on new drugs.

In this brave new world pic­tured by IQVIA, you can ex­pect play­ers to main­tain mar­gins in an un­cer­tain world or slash R&D spend­ing to com­pen­sate. Any­one who can’t ad­just will be sub­ject to a buy­out.

Here are some more snip­pets of what they’ve seen in the IQVIA crys­tal ball:

— Re­al world ev­i­dence gains trac­tion and devo­tees

The use of re­al world ev­i­dence is here to stay, with grow­ing so­phis­ti­ca­tion in gath­er RWE and us­ing it with reg­u­la­tors at the FDA — which have sig­naled their readi­ness for what lies ahead. Ran­dom­ized tri­als will re­main the gold stan­dard in R&D, but where they’re not vi­able, RWE can fill the gap. And where new tech­nol­o­gy can gen­er­ate da­ta at low­er costs, through site-less stud­ies for ex­am­ple, look for de­vel­op­ers to change as rapid­ly as pos­si­ble.

— AI is hap­pen­ing, and it’s get­ting big­ger

Ma­chine learn­ing and ar­ti­fi­cial in­tel­li­gence are gain­ing ground, and their use will grow sig­nif­i­cant­ly over the com­ing 5 years. AI and ML will have an im­pact on clin­i­cal as well as com­mer­cial set­tings, dri­ving drug man­age­ment and iden­ti­fy­ing pa­tients. And as da­ta sets con­tin­ue to grow in size, the in­for­ma­tion and analy­sis that they will pro­vide will grow in val­ue, fur­ther dri­ving adop­tion.

— Pre­scrip­tion dig­i­tal ther­a­peu­tics have a role to fill

The first pre­scrip­tion dig­i­tal ther­a­peu­tic was ap­proved last year. But look for lots more in the com­ing wave. What’s up first: “AD­HD, ma­jor de­pres­sive dis­or­der, and schiz­o­phre­nia apps are among late-stage pipelines and may be ear­ly en­trants.”

— That next-gen R&D rev­o­lu­tion? It could take awhile

You’ve like­ly read plen­ty about the next-gen cell and gene ther­a­pies that have been hit­ting the mar­ket. CRISPR-Cas9, stem cells and more gene mod­i­fi­ca­tion ap­proach­es are in the works. But the re­al­i­ty is that the first drugs of this new group — think CAR-T here — are ex­tra­or­di­nar­i­ly ex­pen­sive to make, dif­fi­cult to man­u­fac­ture and aren’t that wide­ly used. As a re­sult, IQVIA ex­pects on­ly 5 to 8 true, new next-gen ther­a­pies to make their way to an ap­proval in the next 5 years — few­er than we’ve seen in ear­li­er pre­dic­tions. The an­a­lysts ex­pect “on­ly a few com­pa­nies will end up dom­i­nat­ing here,” for all the above rea­sons.

— So what about pric­ing and mar­ket de­vel­op­ment?

Pub­lic per­cep­tion of the in­dus­try and drug pric­ing has been shaped by high­ly pub­li­cized in­ci­dents of price goug­ing — what I choose to call the Shkre­li Ef­fect. With drug pric­ing a hot po­lit­i­cal is­sue, there will be lots of ef­forts built around cap­ping prices. But the re­al­i­ty of the po­lit­i­cal sit­u­a­tion in DC will like­ly leave re­al change in the hands of the ex­ec­u­tive branch, says IQVIA, which can in­flu­ence pric­ing through new rules and reg­u­la­tions.

The shift in R&D in­no­va­tion over the last few years has tilt­ed the mar­ket to spe­cial­ty, or­phan and on­col­o­gy drugs, with new ther­a­pies of­ten win­ning 6-fig­ure list prices. That trend will con­tin­ue, says IQVIA, push­ing list prices on new drugs past the $200,000 mar­ket. But look for lots of pres­sure to rein in fu­ture price in­creas­es, with few­er re­al break­throughs like check­point in­hibitors, more back­lash from in­de­pen­dent pric­ing re­view or­ga­ni­za­tions like ICER and more com­pe­ti­tion in new class­es of drugs.

All of this will play out as some of the world’s biggest drug fran­chis­es are hit with biosim­i­lar ri­vals, capped by Hu­mi­ra, which los­es patent pro­tec­tion (most like­ly) in 2023, at the end of the 5-year win­dow. Biosim­i­lar de­vel­op­ment, which has lagged in the US, will ex­pand sig­nif­i­cant­ly over the next 5 years, with more com­peti­tors bring­ing more com­pet­i­tive pric­ing.


Fast growth through greater in­sur­ance ac­cess, mean­while, has made Chi­na the world’s sec­ond largest phar­ma mar­ket. Growth will con­tin­ue, but at a slow­er pace, de­clin­ing to 3-6% through 2023. That com­pares to an av­er­age of 11% per year for orig­i­nal brands over the past 5 years. Chi­na will re­main big, but the ex­plo­sive ex­pan­sion ap­pears to be be­hind us.

 

A new era of treat­ment: How bio­mark­ers are chang­ing the way we think about can­cer

AJ Patel was recovering from a complicated brain surgery when his oncologist burst into the hospital room yelling, “I’ve got some really great news for you!”

For two years, Patel had been going from doctor to doctor trying to diagnose his wheezing, only to be dealt the devastating news that he had stage IV lung cancer and only six months to live. And then they found the brain tumors.

“What are you talking about?” Patel asked. He had never seen an oncologist so happy.

Endpoints Premium

Premium subscription required

Unlock this article along with other benefits by subscribing to one of our paid plans.

David Ricks, Eli Lilly CEO (David Paul Morris/Bloomberg via Getty Images)

Eli Lil­ly set to in­vest $2.1B in home state man­u­fac­tur­ing boost

Eli Lilly is looking to expand its footprint in its home Hoosier State by making a major investment in manufacturing.

The pharma is investing $2.1 billion in two new manufacturing sites at Indiana’s LEAP Lebanon Innovation and Research District in Boone County, northwest of Lilly’s headquarters in Indianapolis.

The two new facilities will expand Lilly’s manufacturing network for active ingredients and new therapeutic modalities, including genetic medicines, according to a press release.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 142,700+ biopharma pros reading Endpoints daily — and it's free.

Pfiz­er and CD­MOs ramp up Paxlovid man­u­fac­tur­ing with Kala­ma­zoo plant ex­pan­sion lead­ing the way

As the Covid-19 pandemic continues to evolve, pharma companies and manufacturers are exploring how to step up production on antivirals.

Pfizer is planning to expand its Kalamazoo-area facility to increase manufacturing capabilities for the oral Covid-19 antiviral Paxlovid, according to a report from Michigan-based news site MLive. The expansion of the facility, which serves as Pfizer’s largest manufacturing location, is expected to create hundreds of “high-skilled” STEM jobs, MLive reported. No details about the project’s cost and timeline have been released, but according to MLive, Pfizer will announce the details of the expansion at some point in early June.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 142,700+ biopharma pros reading Endpoints daily — and it's free.

FDA spells out the rules and re­stric­tions for states seek­ing to im­port drugs from Cana­da

The FDA is offering more of an explanation of the guardrails around its program that may soon allow states to import prescription drugs in some select circumstances from Canada, but only if such imports will result in significant cost reductions for consumers.

While the agency has yet to sign off on any of the 5 state plans in the works so far, and PhRMA’s suit to block the Trump-era rule allowing such imports is stalled, the new Q&A guidance spells out the various restrictions that states will have to abide by, potentially signaling that a state approval is coming.

Pfizer CEO Albert Bourla at the World Economic Forum (Gian Ehrenzeller/Keystone via AP Images)

All about ac­cess: Pfiz­er moves to a non-prof­it mod­el for drug sales in 45 low­er-in­come coun­tries

Leading the way to increase access to cheaper drugs worldwide, Pfizer said Wednesday it will provide all current and future patent-protected medicines and vaccines available in the US or EU on a not-for-profit basis to about 1.2 billion people in 45 lower-income countries.

Rwanda, Ghana, Malawi, Senegal and Uganda are the first five countries to sign on to this accord, which will also seek to blaze new paths for quick and efficient regulatory and procurement processes to reduce the usual delays in making new medicines and vaccines available in these countries.

US sees spike in Paxlovid us­age as Mer­ck­'s mol­nupi­ravir and As­traZeneca's Evusheld are slow­er off the shelf

New data from HHS show that more than 162,000 courses of Pfizer’s Covid-19 antiviral Paxlovid were administered across the US over the past week, continuing a streak of increased usage of the pill, and signaling not only rising case numbers but more awareness of how to access it.

In comparison to this week, about 670,000 courses of the Pfizer pill have been administered across the first five months since Paxlovid has been on the US market, averaging about 33,000 courses administered per week in that time.

Almirall is tapping artificial intelligence on behalf of its sales force for insights and efficiencies. (via Shutterstock)

Almi­rall rolls out sales rep ar­ti­fi­cial in­tel­li­gence sys­tem, cut­ting pre-call prep and 'wind­shield time'

Dermatology specialty pharma Almirall is making its sales reps smarter. Not with extra training or educational courses, but instead with artificial intelligence tools.

It began a soft launch of a sales rep AI and machine learning platform it calls Polaris last August in one of its 7 US coverage regions. The platform from Aktana gathers information from across Almirall internal sources and external ones – such as claims and prescribing data – to generate insights for reps. Now, instead of spending hours prepping for a sales call, Polaris can generate details about a physician’s preferences, past behaviors and prescription habits for reps in minutes, said Almirall head of commercial operations Vincent Cerio.

Endpoints News

Keep reading Endpoints with a free subscription

Unlock this story instantly and join 142,700+ biopharma pros reading Endpoints daily — and it's free.

Te­va, Al­ler­gan reach yet an­oth­er opi­oid set­tle­ment — ef­fec­tive­ly end­ing WV tri­al

Teva and Allergan have reached settlements with multiple states over their involvement in the opioid crisis. Their latest is worth 9 figures.

West Virginia attorney general Patrick Morrisey announced the newest settlement, worth $161.5 million, at a press conference on Wednesday. The deal would resolve claims that the companies helped fuel the state’s opioid epidemic. If it goes through, it could become the largest state-negotiated settlement in West Virginia’s history, according to Reuters.

Roche un­veils three new mon­key­pox tests as cas­es rise

Health experts maintain that the current monkeypox situation is a stark contrast to Covid. Even so, a handful of biotechs have sprung to action, including Roche, who quickly developed a set of three tests to detect the virus.

Roche and subsidiary TIB Molbiol unveiled their Lightmix Modular Virus test kits on Wednesday — three unique test kits that can help track the spread of monkeypox.

The first kit detects orthopoxviruses, including all monkeypox viruses originating from the West African and Central African forms of the virus. The second kit is a specific test that detects monkeypox viruses only, while the third simultaneously tests for both orthopoxviruses and monkeypox viruses.