The content of this report will be updated with the latest scenarios based on the global COVID-19 Pandemic
Innovation is a crucial element of the pharmaceutical industry. The market is highly research-intensive, being deeply reliant on a high level of R&D investment and a strong product pipeline to maintain growth and ensure long-term revenue generation. Without successful innovation, which can be broadly defined as the market launch of novel therapeutic molecules that cost-effectively treat or cure diseases, the industry would face a substantial long-term decline in revenue.
Manufacturing processes of existing active pharmaceutical ingredients are inexpensive compared with the development of novel drugs, with the manufacture of small molecules being particularly low-cost. As such, once a pharmaceutical product loses patent protection and market exclusivity, the revenue any individual company can generate from that chemical is drastically decreased, as the exact same compound can be readily copied and synthesized by generics companies. Barring generics manufacturers, the pharmaceutical industry relies on innovation to bring new products to market and generate a profit (Gupta et al., 2010).
While nutrition, sanitation and other public health measures, such as effective diagnosis and non-pharmaceutical interventions, have been pivotal to the general upwards trend in life expectancy since the 1950s, the development of new medicines has played an essential role in facilitating these improvements in life expectancy (PHRMA, 2013a). Across both developing and high-income countries, the uptake of medicines launched after 1990 is estimated to have contributed to 73% of the 1.74-year increase in life expectancy at birth between 2000 and 2009 (Lichtenberg, 2012).
Mortality rates due to heart disease have also decreased dramatically since the introduction of new drugs such as angiotensin II receptor inhibitors and calcium channel blockers and, more recently, statins such as Lipitor (atorvastatin). The US age-adjusted annual death rate per 100,000 people decreased from 401.6 to 173.7 between 1979 and 2011. Even in cancer, in which there is still much progress to be made, the mortality rate declined by 7.6% between 1990 and 2000 and by 15.5% between 2001 and 2011 (PHRMA, 2013a).
Cost-effective, innovative drugs that advance the standard of healthcare are more likely than cost-ineffective drugs to get payer support and achieve market access, owing to healthcare budgetary constraints worldwide. They are therefore more likely to be listed in formularies or insurance plans, which results in increased patient access to the drug and reduced expenditure for healthcare agencies, governments and insurance companies.
In 2013, following a 15-year high in 2012, the number of new drug approvals declined from 39 to 27. The number of new drug applications from big pharma companies remained constant, while in spite of the creation of a breakthrough designation by the FDA in 2012 (a designation that expedites the review process and guarantees a 60-day turnover for approval requests for drugs treating life-threatening conditions that, based on preliminary evidence, offer a substantial benefit above the existing standard of care), the contribution of new drug applications from smaller companies declined substantially, accounting for this drop. The number of new drug approvals recovered to levels exceeding those of 2012 in the following two years.
The report “Innovation and Clinical Trial Tracking Factbook 2017: An Assessment of the Pharmaceutical Pipeline” is a comprehensive, granular analysis of the 25,522 products currently in the pharmaceutical industry pipeline, from the Discovery stage through to Pre-registration and split into therapy areas and key indications. This pipeline is also benchmarked against its size across each segment compared to 2015 and 2016, and an assessment of the level of first-in-class innovation is provided. In addition, a detailed contextual analysis of the key drivers of this pipeline is provided, in addition to an assessment of companies present in the pipeline and historical deal value and volume.
- What is the current size and composition of the pharmaceutical industry pipeline and how has it changed in the last two years? What can we learn from this?
- The largest therapy area, by a substantial margin, is oncology, and, with growth in the pipeline sizes for all major oncology indications since Q1 2015, this trend appears set to continue. Why is this the case?
- What is the overall advantage for companies including first-in-class product developments in their pipeline portfolio, rather than opting for better-characterized established molecular targets?
- What factors have been driving the increasing number of first-in-class product approvals over recent decades?
- Historically, what has the risk of clinical trial attrition been across each therapy area and molecule type in the pharmaceutical industry?
- How long have their associated clinical trials been and how many patients, on average, were recruited?
Key Reasons to Purchase
- Achieve an up-to-date understanding of the landscape of the overall pharmaceutical pipeline, on both a broad and granular level; this also provides a highly accessible reference which is useful in any pharmaceutical strategic decision making process
- Benchmark key therapy areas and indications in terms of the number of pipeline products and level of innovation, and assess one’s own strategic positioning against this backdrop
- Understand the contemporary role and importance of radical and incremental innovation within the various disease areas and indications
- Make key decisions about the role of innovation within one’s own pipeline portfolio
- Understand and benchmark the risk of attrition, clinical trial duration and size across the pharmaceutical industry