Market Place
Acquisitions and spin-offs dominated headlines in 2019 and the tone was set very early with Bristol-Myers Squibb acquiring
New Jersey-based cancer drug company Celgene in a US$ 74 billion deal announced on
January 3, 2019. After factoring
in debt, the deal value ballooned to about US$ 95 billion, which according
to data compiled by Refinitiv, made it the largest healthcare deal on
record.
In the summer, AbbVie Inc,
which sells the world’s best-selling drug Humira, announced its acquisition of Allergan Plc, known for Botox and other cosmetic
treatments, for US$ 63 billion. While the companies are still awaiting
regulatory approval for their deal, with US$ 49 billion in combined 2019
revenues, the merged entity would rank amongst the biggest in the industry.
View Our Interactive Dashboard on Top drugs by sales in 2019 (Free Excel Available)
The big five by pharmaceutical sales — Pfizer,
Roche, J&J, Novartis and Merck
Pfizer
continued
to lead companies by pharmaceutical sales by reporting annual 2019 revenues of
US$ 51.8 billion, a decrease of US$ 1.9 billion, or 4 percent, compared to
2018. The decline was primarily attributed to the loss of exclusivity of Lyrica in 2019,
which witnessed its sales drop from US$ 5 billion in 2018 to US$ 3.3 billion in
2019.
In 2018, Pfizer’s then incoming CEO Albert Bourla had mentioned that the company did not see the need for any large-scale M&A activity as Pfizer had “the best pipeline” in its history, which needed the company to focus on deploying its capital to keep its pipeline flowing and execute on its drug launches.
Bourla stayed true to his word and barring the acquisition of Array Biopharma for US$ 11.4 billion and a spin-off to merge Upjohn, Pfizer’s off-patent branded and generic established medicines business with
Mylan, there weren’t any other big ticket deals which were announced.
The
Upjohn-Mylan merged entity will be called Viatris and is expected to have 2020
revenues between US$ 19 and US$ 20 billion
and could outpace Teva to
become the largest generic company in the world, in term of revenues.
Novartis, which had
followed Pfizer with the second largest revenues in the pharmaceutical industry
in 2018, reported its first full year earnings after spinning off its Alcon eye
care devices business division that
had US$ 7.15 billion in 2018 sales.
In 2019,
Novartis slipped two spots in the ranking after reporting total sales of US$
47.4 billion and its CEO Vas Narasimhan continued his deal-making spree by buying New
Jersey-headquartered The Medicines Company (MedCo) for US$ 9.7
billion to acquire a late-stage cholesterol-lowering
therapy named inclisiran.
As Takeda Pharmaceutical Co was
busy in 2019 on working to reduce its debt burden incurred due to its US$ 62
billion purchase of Shire Plc, which was announced in 2018, Novartis also purchased
the eye-disease medicine, Xiidra, from the Japanese drugmaker for US$ 5.3 billion.
Novartis’ management also spent a considerable part of 2019 dealing with data-integrity concerns which emerged from its 2018 buyout of AveXis, the
gene-therapy maker Novartis had acquired for US$ 8.7 billion.
The deal gave Novartis rights to Zolgensma,
a novel treatment intended for children less than two years of age with the
most severe form of spinal muscular atrophy (SMA). Priced at US$ 2.1 million,
Zolgensma is currently the world’s most expensive drug.
However,
in a shocking announcement, a month after approving the drug, the US Food and
Drug Administration (FDA) issued a press release on
data accuracy issues as the agency was informed by AveXis that
its personnel had manipulated data which
the FDA used to evaluate product comparability and nonclinical (animal)
pharmacology as part of the biologics license application (BLA), which was
submitted and reviewed by the FDA.
With US$
50.0 billion (CHF 48.5 billion) in annual pharmaceutical sales, Swiss drugmaker
Roche came in at number two position in 2019
as its sales grew 11 percent driven by
its multiple sclerosis medicine Ocrevus, haemophilia drug Hemlibra and cancer medicines Tecentriq and Perjeta.
Roche’s newly introduced medicines generated US$ 5.53 billion (CHF 5.4 billion) in growth, helping offset the impact of the competition from biosimilars for its three best-selling drugs MabThera/Rituxan, Herceptin and Avastin.
In late 2019, after months of increased
antitrust scrutiny, Roche completed
its US$ 5.1 billion acquisition of Spark Therapeutics to strengthen its presence in
gene therapy.
Last year, J&J reported almost flat worldwide sales of US$ 82.1 billion. J&J’s pharmaceutical division generated US$ 42.20 billion and its medical devices and consumer health divisions brought in US$ 25.96 billion and US$ 13.89 billion respectively.
Since J&J’s consumer health division sells analgesics, digestive health along with beauty and oral care products, the US$ 5.43 billion in consumer health sales from over-the-counter drugs and women’s health products was only used in our assessment of J&J’s total pharmaceutical revenues. With combined pharmaceutical sales of US$ 47.63 billion, J&J made it to number three on our list.
While the sales of products like Stelara, Darzalex, Imbruvica, Invega Sustenna drove J&J’s pharmaceutical business to grow by 4 percent over 2018, the firm had to contend with generic competition against key revenue contributors Remicade and Zytiga.
US-headquartered Merck, which is known as
MSD (short for Merck Sharp & Dohme) outside the United States and
Canada, is set to significantly move up the rankings next year fueled by its
cancer drug Keytruda, which witnessed a 55
percent increase in sales to US$ 11.1 billion.
Merck reported total revenues of US$ 41.75 billion and also
announced it will spin off its women’s health drugs,
biosimilar drugs and older products to create a new pharmaceutical
company with US$ 6.5 billion in annual revenues.
The firm had anticipated 2020 sales between US$ 48.8 billion and US$ 50.3 billion however this week it announced that the coronavirus pandemic will reduce 2020 sales by more than $2 billion.
View Our Interactive Dashboard on Top drugs by sales in 2019 (Free Excel Available)
Humira holds on to remain world’s best-selling drug
AbbVie’s acquisition of Allergan comes as the firm faces the expiration of patent protection for Humira, which brought in a staggering US$ 19.2 billion in sales last year for
the company. AbbVie has failed to successfully acquire or develop a major new
product to replace the sales generated by its flagship drug.
In 2019, Humira’s US revenues increased 8.6 percent to US$ 14.86 billion while internationally, due
to biosimilar competition, the sales dropped 31.1 percent to US$ 4.30 billion.
Bristol Myers Squibb’s Eliquis, which is also marketed by Pfizer, maintained its number two position
and posted total sales of US$ 12.1 billion, a 23 percent increase over 2018.
While Bristol Myers Squibb’s immunotherapy treatment Opdivo, sold in partnership with Ono in Japan, saw sales increase from US$ 7.57 billion to US$ 8.0 billion, the growth paled in comparison to the US$ 3.9
billion revenue increase of Opdivo’s key immunotherapy competitor Merck’s Keytruda.
Keytruda took the number three spot in drug sales that
previously belonged to Celgene’s Revlimid, which witnessed a sales decline from US$ 9.69 billion to US$ 9.4 billion.
Cancer treatment Imbruvica, which is marketed
by J&J and AbbVie, witnessed a 30 percent increase in sales. With US$ 8.1
billion in 2019 revenues, it took the number five position.
View Our Interactive Dashboard on Top drugs by sales in 2019 (Free Excel Available)
Vaccines – Covid-19 turns competitors into partners
This year has been dominated by the single biggest health emergency in years — the novel coronavirus (Covid-19) pandemic. As drugs continue to fail to meet expectations, vaccine development has received a lot of attention.
GSK reported the highest vaccine sales of all drugmakers with
total sales of US$ 8.4 billion (GBP 7.16 billion), a significant portion of its
total sales of US$ 41.8 billion (GBP 33.754 billion).
US-based Merck’s vaccine division also reported a significant increase in sales to US$ 8.0 billion and in 2019 received FDA and EU approval to market its Ebola vaccine Ervebo.
This is the first FDA-authorized vaccine against the deadly virus which causes
hemorrhagic fever and spreads from person to person through direct contact with
body fluids.
Pfizer and Sanofi also reported an increase in their vaccine sales to US$ 6.4
billion and US$ 6.2 billion respectively and the Covid-19 pandemic has recently
pushed drugmakers to move faster than ever before and has also converted
competitors into partners.
In a rare move, drug behemoths — Sanofi and GlaxoSmithKline (GSK) —joined hands to develop a vaccine for the novel coronavirus.
The two companies plan to start human trials
in the second half of this year, and if things go right, they will file
for potential approvals by the second half of 2021.
View Our Interactive Dashboard on Top drugs by sales in 2019 (Free Excel Available)
Our view
Covid-19 has brought the world economy to a grinding halt and shifted the global attention to the pharmaceutical industry’s capability to deliver solutions to address this pandemic.
Our compilation shows that vaccines and drugs
for infectious diseases currently form a tiny fraction of the total sales of
pharmaceutical companies and few drugs against infectious diseases rank high on
the sales list.
This could well explain the limited range of
options currently available to fight Covid-19. With the pandemic currently infecting
over 3 million people spread across more than 200 countries, we can safely
conclude that the scenario in 2020 will change substantially. And so should our
compilation of top drugs for the year.
View Our Interactive Dashboard on Top drugs by sales in 2019 (Free Excel Available)
Impressions: 54752
https://www.pharmacompass.com/radio-compass-blog/top-drugs-and-pharmaceutical-companies-of-2019-by-revenues
#PharmaFlow by PHARMACOMPASS
29 Apr 2020
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In April last year, PharmaCompass
had shared a list of over 300
different dosage forms of drugs which had no patents and no competition.
These drugs were ripe for ‘price-gouging’ — a hot industry topic that became synonymous with activities of many major pharmaceutical companies, after Martin Shkreli (former CEO of Turing Pharmaceuticals) increased the price of Daraprim (Pyrimethamine) from US$ 13.50 per tablet to US$ 750 overnight in the US. Similarly, Valeant Pharmaceuticals
adopted a strategy of buying up companies and dramatically increasing the price
of the acquired drugs.
Although it has been a while
since Hillary Clinton tweeted angrily: “Price gouging like this in the specialty drug market is outrageous”; last week newly appointed US Food Drug Administration (FDA) Commissioner Scott Gottlieb, indicated that the topic is still very much on top of his agenda.
Access the 2017 Compilation of Drugs with No Patents & No Competition (Excel version available) for FREE!
FDA to play a more active
role in drug pricing
On May 25, Gottlieb told a congressional panel that the FDA is developing a “drug competition action plan” aimed at expediting approval of generic versions of brand-name medications that lack competition.
“While FDA does not play a direct role in drug pricing, we can take steps to facilitate entry of lower-cost alternatives to the market and increase competition,” Gottlieb said in his testimony before a House Appropriations subcommittee. “This is especially true when it comes to safe and effective generic medicines.”
In his testimony,
Gottlieb highlighted that he would like the FDA to take a more active role
in pricing and would publish a list of drugs that are off-patent and lack
generic competition.
Access the 2017 Compilation of Drugs with No Patents & No Competition (Excel version available) for FREE!
Our compilation — Drugs with No Patents and No Competition
500 dosage forms this year, where oral drugs (tablets, capsules etc.) had the least competition followed by drugs administered as injections.
The list has over 400
different active pharmaceutical ingredients (APIs) that are used in
manufacturing these dosage forms.
While there are
almost 70 drugs which were approved recently (since 2015), the majority of
products on the list are those that have been on the market for years.
Some of the products that made
it to our list last year continue to enjoy monopolies, such as Pfizer's Premarin, isolated from pregnant mares’ urine,
which brings in over US$ 1 billion in sales to Emcure’s BICNU (carmustine or BICNU is an anti-cancer, chemotherapy
drug).
While Emcure is still banned from exporting products
to the United States, due to compliance problems found in its manufacturing
operations, BICNU remains exempted since there is no other alternative
available in the market.
While an estimated 13 million
people in the United States have latent tuberculosis infection (LTBI), Sanofi’s Priftin (rifapentine) still has no generic competition.
Access the 2017 Compilation of Drugs with No Patents & No Competition (Excel version available) for FREE!
Our view
Our list provides
tremendous opportunities for generic companies in the short-term. In many
cases, to capitalize on the opportunities, generic drug companies will need to
partner with API manufacturers as the lack of sustained, quality API supply is
a major reason that there are no competitors on the market.
However, it is important for generic companies to remember that the FDA’s continued focus on accelerating review of these drugs will require companies to rely on strategies less opportunistic than price-gouging, to drive their future business growth.
Access the 2017 Compilation of Drugs with No Patents & No Competition (Excel version available) for FREE!
Impressions: 6730
https://www.pharmacompass.com/radio-compass-blog/pharmacompass-finds-500-drugs-with-no-patents-and-no-competition-in-the-fda-orange-book
#PharmaFlow by PHARMACOMPASS
01 Jun 2017
Drug price increases have emerged as a core strategy for generic pharmaceutical companies in the recent past. In September last year, Martin Shkreli’s decision to increase the price of Daraprim (Pyrimethamine)
from US $ 13.50 per tablet to US $ 750 overnight, received an angry tweet from Hillary Clinton. “Price gouging like this in the specialty drug market is outrageous,” she had tweeted. Shkreli of Turing Pharmaceuticals wasn’t the only one hiking prices of drugs. ‘Price gouging’ has become a hot topic, and synonymous with the activities of many major pharmaceutical companies. Price increase due
to ownership, not improved scienceValeant
Pharmaceuticals, a stock market darling until
recently, developed a strategy of buying up companies and dramatically
increasing the price of the acquired drugs. In February 2015, Valeant purchased two life-saving heart drugs – Isuprel
and Nitropress.
And the same day, Valeant increased the prices of these drugs by 525 percent and 212 percent
respectively. The increase was not an outcome of improved science but simply a
change of ownership. Similarly, on January 1, 2016, Pfizer raised
prices of more than 100 of its drugs. According to global information
services company Wolters Kluwer the price increase was as much as 20 percent in
the case of some medicines.
Another recent study on US drug prices uncovered that “prices for four of the nation's top 10 drugs increased more than 100 percent since 2011, Reuters found. Six others went up more than 50 percent.” “It’s not funny, Mr. Shkreli. People are dying”Scrutiny on drug price increases and its accounting
practices has made Valeant Pharmaceuticals, which not so long ago was
the biggest company on the Toronto Stock Exchange (TSX), lose 90 per cent
of its market value in less than a year.
“Pharma Bro” Shkreli was arrested
in December for allegedly bilking tens of millions of dollars from his former biotech venture, Retrophin. And
while he smirked
his way through the Senate hearing on drug price increases, he was rebuked by Representative Elijah Cummings. “It’s not funny, Mr. Shkreli. People are dying, and they are getting sicker and sicker,” he told Shkreli, as the latter grinned during the Congressman’s opening statement. The appearance by Shkreli was the highlight of this
congressional hearing, which explored the complicated reality of drug pricing
in the US. Bernie Sanders, a US presidential candidate, has long been protesting “skyrocketing
drug prices” and has also proposed a new bill last year – The Prescription Drug Affordability Act of 2015. FDA’s accelerated review planIn this backdrop, the US Food and Drug Administration (FDA) announced a small regulatory change – it will prioritize review of new applications for generic drugs “that would compete with treatments made by only one company.”The policy mentions that “potential first generic products for which there are no blocking patents or exclusivities on the reference listed drug may receive expedited review”. In an email to Bloomberg, the FDA estimates the change in prioritization could expedite review of as many as 125 generic drug applications. The next ‘price-gouging’ targetsPharmaCompass has
found over 300 different dosage forms of drugs which currently have no patents
and no competition. Click
here to access the compilation (Excel version available) for FREE!Our compilation covers a broad range of products from Pfizer's Premarin, isolated from pregnant mares’ urine, which brings in over
US $ 1 billion in sales to Emcure’s
BICNU (carmustine
or BICNU is an anti-cancer, chemotherapy drug).While Emcure was banned from exporting products to the United
States, due to compliance problems found in their manufacturing operations,
BICNU was exempted since there was no other alternative available in the
market. While an estimated 13 million people in the United States
have latent tuberculosis infection (LTBI), Sanofi’s Priftin
(rifapentine),
launched last year in
a new packaging, still has no generic competition. Click
here to access the compilation (Excel version available) for FREE! Our viewWhile our list provides tremendous opportunities for generic
companies in the short-term, the FDA’s accelerated review program will require
companies to rely on strategies less opportunistic than price-gouging to drive
their future business growth.
Impressions: 7836
https://www.pharmacompass.com/radio-compass-blog/drugs-with-no-patents-and-no-competition-here-s-our-list-of-new-price-gouging-targets
#PharmaFlow by PHARMACOMPASS
07 Apr 2016
The
importance of taking the right decision in product selection, by the senior
management at pharmaceutical companies, can never be emphasized enough. A
correct call can lead to windfall gains and if companies are fortunate enough,
a monopolistic market position. This
week, to assist the senior executives, we compiled a list of products that have
existed for decades without any competition. A
billion dollar opportunityCanadian company, Concordia’s acquisition of Covis Pharmaceuticals, for US $ 1.2 billion in March this
year, was yet another affirmation of the opportunity that lies in 18
high-margin, branded generic pharmaceutical products. Covis Pharma’s 2014
revenues were around US $ 140-US $ 145 million. However, their gross margin was
a whopping 90 percent! Wouldn’t it be wonderful if there were more such opportunities?This week we used the PharmaCompass
database to generate a list of products (email
us for your copy) which were approved in the United States before 1982 and are currently enjoying monopolistic positions and don’t have any patent protection. Our focus (for this list) is on approved, prescription drugs. We
removed biologics, over-the-counter medicines, devices and unapproved drugs
from the list. For generic firms ‘old is gold’ While old products stop serving the strategic growth objectives of
larger pharmaceutical companies, smaller generic companies with ambitious
growth plans frequently buy these branded products. Sales of ‘pharmaceutical assets’ is quite common and boutique financial advisory companies, like Torreya Partners, have developed a special focus on providing these services. Since 2010, Torreya has been “involved
in the acquisition or sale of 23 separate pharmaceutical products”. For both large pharmaceutical companies and generic firms, old
products can generate substantial cash. The deal between GlaxoSmithKline
(GSK) and Aspen Pharmacare Holdings is
a case in point. Six years ago, GSK off-loaded
a portfolio of products to South African, Aspen Pharmacare in
exchange for a 16 percent shareholding in Aspen. The strategic agreement also
combined commercial activities in Sub-Saharan Africa of the two organizations.
In May 2015, GSK sold
half its stake in Aspen for US $841 million as the share
prices of Aspen had surged eight folds since the original agreement was struck.On the one hand, the old products generate cash for the large
pharmaceutical firms and generics players, on the other hand their niche market
positions sometimes let them earn exemptions in the event of US Food and Drug
administration (USFDA) regulatory action. Take the case of India’s Emcure Pharmaceuticals, which purchased
the rights of BiCNU (Carmustine
for injection) from Bristol-Myers Squibb in
2012. Last month, when Emcure
was banned
from exporting products to the United States, due to compliance
problems found in their manufacturing operations, BiCNU was exempted since
there was no other alternative in the market. The
price hike potentialThe drugs that make our
list have not been subject to competition for years because usually their sales are relatively small, in comparison to the blockbuster drugs. Moreover, these drugs serve niche market segments. Since they don’t qualify as ‘budget-breakers’, companies can take risks by increasing prices without fearing a drop in sales volumes. This invariably results in outrageous profits, leading to a raging debate across the US and Europe.Earlier this year, Valeant Pharmaceuticals
purchased the rights to Isuprel (isoproterenol hydrochloride), another drug on our list. The very
day they acquired the rights from Hospira, Valeant raised
the price of Isuprel by more than six-fold. The
curious case of Premarin Another old product which has a unique story is Premarin. It was introduced in the United States in the 1940s. However, when Premarin’s patents expired in 1971, the sales had declined to a point where generic companies were not motivated enough to develop an equivalent drug. But things changed dramatically when new data appeared in 1986
demonstrating its efficacy in minimizing bone loss associated with osteoporosis.
The sales of Premarin sky-rocketed and now the drug generates over
US $ 1 billion annually for Pfizer. The drug’s protection from generics has been an outcome of the fact that Premarin is isolated from pregnant mares’ urine. The complex mixture, now known to contain more than 50 estrogens, has made
it difficult for a generic to replicate the composition and Premarin’s slow release bio-availability mechanism. Generics which were in the market in the late 1980s were removed in 1991. “We had certified that the generics were interchangeable with Premarin, but when we looked at it from the point of view of the science, that was not the case,” said Janet Woodcock, director of the FDA’s Center for Drug Evaluation and Research (CDER). Our
viewProduct selection continues to be one of the most challenging
decisions taken by the senior management at pharmaceutical companies. In our
previous reviews, we have seen many companies targeting the same business
opportunity, which in turn leads to unprofitable operations due to poor
development decisions.Could our
list of these golden old drug monopolies provide ideas to companies on
their strategy going forward? Watch this space for more.
Impressions: 4333
https://www.pharmacompass.com/radio-compass-blog/making-a-fortune-out-of-decades-old-prescription-drugs
#PharmaFlow by PHARMACOMPASS
20 Aug 2015
