A new report suggests that pharmaceutical companies should be paid by the NHS depending on how effectively their products ultimately treat patients.
This approach is advocated by the Social Market Foundation, with the organisation asserting that drugs which satisfy a particular criteria should be made eligible to pass through a new purchasing scheme.
The Social Market Foundation believes that this would make medicines available for patients more rapidly.
Based on this new suggestion, the NHS would collaborate with the pharma company in question to jointly agreed on health outcomes to be achieved.
Other issues to discuss could include the basis on which manufacturers of the drugs will be paid, against certain performance yardsticks.
However, the Social Market Foundation also acknowledges that it is essential for safeguards to be built into the process, in order to protect smaller pharmaceutical and biotechnology companies.
With the financial climate of the NHS likely to be increasingly challenging in the coming years, such innovative attempts to make drug purchasing more efficient are almost requisite.
Yet Mike Thompson, chief executive of the Association of the British Pharmaceutical Industry, commented at an event earlier this year that patients in territories search as Germany and France are approximately 700% more likely to obtain a newly-launched medicinal product.
Clinical trials in the UK are already under threat, and this is only likely to be exacerbated by the Brexit process.
Meanwhile, policies intended to achieve outcome-based pricing are being increasingly embraced by both the pharmaceutical industry and the NHS.
Manchester health authorities have mooted paying companies for drugs based on how well they work, with several major players in the pharmaceutical industry having expressed support for the notion.
The Social Market Foundation has particularly cited Italy as a country implementing the approach suggested with considerable success.
And researchers, Nigel Keohane and Kathryn Petrie, said that as the NHS pursued efficiency savings of £22bn over five years, “how we procure medicines is too often left out of the equation”, despite the fact that £16.8bn was spent each year on treatments.
A shift to outcomes-based reimbursement would allow the purchase of medicines to be refocused on “value for money over the longer-term,” they argued.
Any model adopted “should be designed with simplicity in mind — to send clear signals to investors and to retain diversity in the market where small providers can participate fully,” according to the foundation.
The report, funded by Novartis, also included suggestions on how to protect smaller drug companies from competition difficulties.
The cost to the NHS of prescribing drugs for diabetes has soared to almost £1 billion annually, as the number of people diagnosed with the disease has risen sharply alongside the surge in obesity.
£956.7m was spent by NHS England on prescribed diabetes drugs last year; representing 10.6% of the cost of all prescriptions issued by NHS primary care services in 2015/16.
More is now spent on medication for type 1 and type 2 diabetes than for any other ailment.
The number of diabetics across the UK as a whole has recently risen to more than four million and has increased by 65% over the last 10 years.
Diabetes is thought to cost the NHS about £10 billion, once the cost of treatment is included.
Last year a total of 49.7m items were prescribed for diabetes, compared to 27.1m a decade years earlier.
90% of diabetics have been diagnosed with type 2 diabetes, with lifestyle factors clearly playing a massive role in this epidemic.
90% of adults with type 2 diabetes aged 16-54 years are either overweight or obese.
Helen Donovan, the Royal College of Nursing’s health professional lead, stated that cuts to nursing support for diabetics meant that some patients were not getting the help they needed to manage their illness.
“These stark figures show the need for a greater focus on preventing type 2 diabetes. Encouraging healthier lifestyles would not only save the NHS money, it would improve countless lives. This is bad for the health service’s finances but more importantly it can be devastating for patients.”
NHS Digital’s findings show that the West Midlands is the region of England with the highest proportion of people over the age of 17 who are diabetic.
The south central area has the lowest prevalence rate, at 5.6%.
And the east London borough of Newham spends proportionately more of its drugs budget than anywhere else in England on diabetes medication, at 17.9%.
North Tyneside spends the lowest, at 7.4%.
Meanwhile, the spend on medication differed widely in different parts of England.
The cost per patient treated was highest in Warwickshire North, at £415 a head, and lowest in Northumberland (£239).
62% of adults were overweight or obese in England in 2012, while 6% of people aged 17 years or older had diagnosed diabetes in England in 2013.
In England, 12.4% of people aged 18 years and over with obesity have diagnosed diabetes; five times that of people with a healthy weight.
Men with a raised waist circumference are five times more likely to have been diagnosed diabetes than those without a raised waist circumference; women are over three times more likely.
Clearly tackling obesity can play a massive role in the fight against diabetes, yet results for 2014 showed that 61.7% of adults were overweight or obese (65.3% of men and 58.1% of women).
A major health leader believes that a cure for dementia will be found by the end of the decade.
Dr Dennis Gillings, outgoing chairman of the World Dementia Council, suggested that recent scientific research had surpassed his expectations, and that a major breakthrough is now on the horizon.
Gillings had previously been appointed by David Cameron back in 2013 to create the Global Council.
And the doctor believes that great strides have been made in the scientific understanding of dementia, with gaps in research being filled on a regular basis now.
“The original goal [of the council] was disease modification by 2025,” Gillings commented. “I feel a lot more optimistic now: I wouldn’t be surprised if we get there by 2020 or 2021.”
Gillings believes that understanding of the way to treat dementia has taken quantum leaps over the last few years.
In particular, Gillings opined that treating dementia as a singular condition had been mistaken, and breakthroughs would ultimately result from developing treatments targeted at varying subsets of the condition.
“We may need more customised diagnoses. We used to just think cancer now we know there are many different types, with different treatments. We need to approach dementia similarly.”
Pharmaceutical products available to treat conditions such as Alzheimer’s presently mask symptoms, but it is impossible to prevent the onset of disease.
Yet treatments are now being developed which have the potential to remove the plaques in the brain that are synonymous with dementia.
It may also be possible in the future to instigate a form of brain training in order to help repair lost neural pathways.
Gillings was also positive about the recent creation of a £150 million Dementia Research Institute.
On the other hand, the doctor did express the opinion that funding for research on dementia could scupper efforts to solve problems in the UK.
The United States invests significantly more money into both researching and developing techniques related to dementia, and Gillings believes that this will ultimately result in more major breakthroughs in America.
Gillings also expressed fear about whether treatments will be properly funded in this country.
“We need sensible partnerships here. What we need to avoid is making a breakthrough such a drug that can destroy plaque but is then refused by the NHS. I do have fears about that.”
The Health Secretary Jeremy Hunt believes that remarkable process has been made in treating dementia.
“While we are seeing progress in drug development and greater understanding of this disease, there can be no cause for complacency and I look to the World Dementia Council to use their expertise and global reach to drive governments, industry and regulators to further action.”
There are currently approximately 850,000 people in the UK with dementia, underlining the significance of this issue.
Ovarian cancer patients have been giving new hope of recovering from their condition, after a new drug was approved for NHS availability.
Health officials approved the potentially life-saving Lynparza with the hope of seriously impacting upon ovarian cancer in the UK.
Yet despite the potential of Lynparza, its approval for NHS prescription was far from certain.
Indeed, it took months of negotiation with the manufacturers of the drug in order for officials to make the approval decision.
It had been thought at one time that cost issues would override the possibility of the drug being made available on the National Health Service.
But it seems that a solution has been found, which will enable the drug, which goes by the name of olaparib, to be made available.
Lynparza will be made available for women who have BRCA1 or BRCA2 mutations of ovarian cancer whose disease has responded to a certain type of chemotherapy, according to the National Institute for Health and Care Excellence (Nice).
In addition, Nice also stated that the drug should be made available to sufferers of ovarian, fallopian tube and peritoneal cancer once they progressed through three courses of platinum-based chemotherapy.
The manufacturers of the drug, AstraZeneca, made strong claims about the performance of its product in tests.
A spokeswoman on behalf of the pharmaceutical corporation stated that there is an 82% risk reduction in time to progression as compared to the standard “watch and wait” approach.
Professor Jonathan Ledermann, professor of medical oncology at the University College London Cancer Institute, and primary investigator of the pivotal olaparib clinical trial, indicated that the study had led to a great deal of optimism about the potential of this medicine.
“The positive Nice guidance for olaparib represents a turning point for how women with ovarian cancer and a BRCA mutation are treated by the NHS in England. These patients with recurrent ovarian cancer tend to have a poor prognosis and until now their treatment options have been limited to conventional chemotherapy and surgery. I urge NHS England to implement this guidance immediately as there are many patients who are waiting for treatment and who could benefit significantly.”
Ovarian cancer is the fifth most common cancer in women, and accounts for approximately three per cent of cancers overall.
A woman’s lifetime risk of developing invasive ovarian cancer is 1 in 75. A woman’s lifetime risk of dying from invasive ovarian cancer is 1 in 100.
The median age at which women are diagnosed is 63, meaning that half of women are younger than 63 when diagnosed with ovarian cancer.
There are over 4,000 deaths in the UK from ovarian cancer annually.
Health experts have suggested that statins do little good in the fight against high cholesterol, and that simply eating an apple every day would be more beneficial for the public.
In a debate in the BMC Medicine Journal, consultant cardiologist Dr Aseem Malhotra and Professor Simon Capewell of Liverpool University expressed their belief that statins result in severe side-effects, while having little benefit on health for the majority of people that take them.
While studies have suggested that statins can indeed have a positive influence on health, Malhotra and Capewell argue that this is not reflected by real-world usage.
Data on statins indicates that around 50% of patients ceased taking the drug within 12 months of commencing, and 62% of these people stated that the reasoning behind this was muscle pain and fatigue.
“The published literature states an unequivocal mortality benefit for patients with established heart disease. However the same does not apply to primary prevention, especially in individuals of low risk. The focus in primary prevention should the form be on foods and food groups that have a proven benefit in reducing hard endpoints and mortality,” Malhotra argued.
In addition, Malhotra stated in the article that lifestyle factors should be considered central to this issue, and that simply addressing the cause of high cholesterol will have the most beneficial influence.
“For those at low risk, eating an apple a day has an equivalent risk reduction for myocardial infarction as taking a statin. More than 80 per cent of cardiovascular disease is attributable to environmental factors, notably unhealthy diet and also smoking, alcohol and physical inactivity. The focus in primary prevention should the form be on foods and food groups that have a proven benefit in reducing hard endpoints and mortality.”
Britain is rapidly becoming the European capital of statins, considering that it has already generated the second highest rate of prescription of the drug.
This is occurring in the context of spiralling obesity and diabetes rates, and has prompted aggressive prescription of the medication by GPs.
Critics of this trend point to the fact that doctors’ pay is linked to the take-up of the pills.
This has led to statins becoming the most commonly prescribed medication in Britain, costing the NHS in the region of £1/2 billion annually.
It seems rather elementary to conclude that the financial incentives offered to general practitioners is leading to statins being prescribed in many unsuitable circumstances.
Under revised NHS guidance, the majority of men aged over 60, and women over 65, are offered the drugs, even if they only have a one in 10 chance of developing cardiovascular disease within 10 years.
Capwell instead argues that the dangers of the drug significantly outweigh the benefits.
“Pfizers own patient information leaflet of atorvastatin states that the common side effects of the drug include pain in the throat, nauseam indigestion, join and muscle pain and increases in blood sugar levels. Fortunately the majority of these symptoms may be reversible on cessation of the drug. However the small increased (0.5 – 1.1 per cent) risk of type 2 diabetes now directly attributed to statins should not be dismissed lightly.”
7 million people in the United Kingdom are currently prescribed statins, while over half of all adults in England have raised cholesterol.
AstraZeneca, the UK pharmaceuticals group, has won a significant legal victory related to one of its ovarian cancer drugs.
However, in the process of the legal proceedings, AstraZeneca promised to cut the price of the drugs and fund some treatment costs going forward.
The concessions made by AstraZeneca are indicative of the financial pressures that drug manufacturers in the UK are facing.
This agreement can be placed in the context of the mounting fiscal pressure on the health system as a whole.
The National Institute for Health and Care Excellence (NICE) indicated that it was prepared to recommend olaparib — also known by its trade name Lynparza — for use by NHS England.
This was a reversal of a decision made in June to reject the drug for distribution in the United Kingdom.
However, with the authorities cautious about the consequences of the verdict, the recommendation was made with restrictions put in place as well.
These will provide guidelines with regard to which patients shall be eligible to take the ovarian cancer drug.
The verdict coincided with a separate decision to reject a push by Johnson & Johnson, the US drugmaker, to win wider access for NHS patients to a heavily promoted prostate cancer drug called abiraterone.
Both of the drugs were developed in the United Kingdom, and AstraZeneca has suggested that the legal battle the company has face is indicative of the barriers preventing homegrown innovation in the pharmaceutical field.
However, critics of the pharmaceutical industry suggest that big pharma manufacturers only have themselves to blame for the high prices that have lead to legal restrictions.
In final draft guidance, NICE recommended use of olaparib only after three or more courses of chemotherapy.
There was also an additional condition that AstraZeneca would be responsible for footing the bill for patients who remained on the drug for a period in excess of 15 months.
Lisa Anson, head of AstrAstraZenecaeneca in the UK, agreed with the ruling, but also suggested that patients in the NHS are losing out on vital treatment owing to overly restrictive conditions.
“Despite being a world leader in the discovery and development of groundbreaking medicines, the UK has the worst overall cancer outcomes in western Europe.”
It was he pointed out that Anson obviously has a vested interest in this issue.
Johnson & Johnson indicated that it was extremely disappointed by NICE’s decision not to recommend use of abiraterone.
There were 4,271 deaths from ovarian cancer in 2012 in the UK.
The Swiss drugmaker Roche Holding has withdrawn from its role in creating an antibiotic to treat so-called superbug infections.
Roche Holding confirmed on Sunday that it would no longer be part of this process.
It was back in 2013 that the company had paid in the region of $500 million for the rights to this particular product to the privately held partner Polyphor.
At the time this represented the first major foray into the battle against superbugs from a major pharmaceutical corporation.
The problem of bugs developing in hospitals which are resistant to traditional antibiotics has been a major issue for institutions all over the country.
It was hoped that this Roche deal, worth 465 million francs, would make a serious impact on the problem.
Yet it now seems that the major pharmaceutical manufacturer has permanently withdrawn himself from the process of developing this product.
“Roche has decided to discontinue its involvement in the clinical development of the investigational antibiotic RG7929 / POL7080 for the treatment of patients with severe Pseudomonas aeruginosa infections and will return the asset to Polyphor,” a company spokesman commented.
Musing on the reasons that Roche had drawn out of the manufacturing of a superbug solution, the spokesman continued that there were development problems for the corporation during the developmental process.
In particular, the internal assessment of the corporation was that “a streamlined development path as originally planned is no longer an option for Roche”.
According to the World Health Organization, superbug infections represent one of the largest health challenges of the 21st century.
Some of the best known superbug infections include multi-drug-resistant typhoid, tuberculosis and gonorrhea.
It is already known that such viruses killed hundreds of thousands of people every year, and the continuing rise of antibiotic resistance suggest that this process will expand further in the future, in the absnce of a new solution to the issue.
Commenting further on the overarching issue of superbug resistance, the spokesman from Roche acknowledged that antimicrobial resistance remained a major threat to public health.
He also indicated that the company would continue to focus on this issue going forward as part of its infectious disease research and development strategy.
So there is at least hope that Roche can make a contribution to the fight against superbugs in the foreseeable future.
It has also emerged that the experimental product that the Swiss corporation was working on previously, currently in the second phase of the clinical trials, will instead be developed solely by Polyphor.
A study carried out at the Institute of Cancer Research in London may have led to a major drug breakthrough.
It is hoped that the research has produced a drug that targets precise genetic mutations in prostate cancer.
This is the first such pharmaceutical product of its type.
The product of the study, Olaparib, had low overall success, but slowed tumour growth in 88 per cent of patients with specific DNA mutations.
Cancer Research UK has already commented on the trial, stating that the results are exciting.
Prostate cancer is the fifth highest killer among cancers in men.
As cancer medicine continues to develop, treating the condition via mutated DNA is becoming a state-of-the-art technology.
One such drug, Herceptin, has already been produced to address breast cancer.
Results from the trial have been published in the New England Journal of Medicine, which indicated that the new product was effective on 14 of 16 men with such mutations.
Levels of the prostate-specific antigen which is produced by tumours was more than halved.
The study also indicated that there was a significant reduction in the number of prostate cancer cells detected in the blood and in the size of secondary tumours.
Overall, the research indicates that this new drug could be successful in treating prostate cancer.
Dr Joaquin Mateo, one of the researchers involved in the study, was optimistic about the prospects of the drug.
“It is very promising. Those entering the trial had an expected survival of 10 to 12 months and we have many patients on the drug for longer than a year.”
Yet despite the positive news, analysts remain cautious about the prospects of this new research.
In particular, a much more extensive clinical trial will be required before doctors can determine confidently whether or not be trouble truly extend life expectancy.
Nonetheless, Dr Mateo believes that the drug produced in the trial could be the first of many available on the market. “This is the first drug that targets specific genetically defined populations and we are going to see more and more of these coming in the next few years.”
Commenting on the outcome of this particular trial, Cancer Research UK’s Dr Aine McCarthy added:“This trial is exciting because it could offer a new way to treat prostate cancer by targeting genetic mistakes in cancers that have spread. The hope is that this approach could help save many more lives in the future.”
There are over 10,000 deaths from prostate cancer every year in the UK.
The London-based clinical research specialist MeDiNova has opened a new centre in London in order to meet increased demand for its services.
MeDiNova is a dedicated research company, with the principal aim of recruiting large numbers of patients within a short timeframe, providing high quality clinical trial data and maintaining high retention rates.
Based at Mount Vernon Hospital and Queen Mary’s Hospital in the UK, MeDiNova began its clinal research programme back in 1997.
MeDiNova works with a network of Physicians and GP’s to recruit suitable patients for clinical trials.
Over the last 18 years, the company has conducted over 300 clinical trials across a broad range of therapeutic areas in Phases I, II, III and IV.
The principal investigators at principal investigators MeDiNova, who collectively possess decades of clinical experience, are as follows:
Dr Mayura Deshpande MBBS MSc PG Dip
Dr Gowri Subramanian MB BCh BAO
Dr Baljit Chokkar MBChB
Dr Syed Abdus Saboor Aftab MD MBBS MRCP(UK) MRCP SCE(UK)
Finally, Dr Naren Savani MBBS LRCP MRCS DRCOG, who founded the company, acts as a Non Executive Director and Medical director to the company overseeing the clinical team.
The latest MeDiNova research centre will be named the East London Clinical Studies Centre, and is located at Blackburn House in Eastern Road, Romford.
According to the company, the newly opened clinical centre will enable MeDiNova to increase its intake of volunteers.
In particular, the company intends to research diabetes and respiratory problems in the foreseeable future, as well as providing regular monitoring for a diverse range of other conditions.
Diabetes can be considered of particular importance, as clinical evidence indicates that the number of people suffering with Type II diabetes in particular has increased exponentially in Britain over the last couple of decades.
MeDiNova also operates the North London Clinical Studies Centre at Mount Vernon Hospital in Northwood, and the South London Clinical Studies Centre at Queen Mary’s Hospital in Sidcup.
Kumar Muthalagappan, Chief Executive of MeDiNova, was of the opinion that the new centre will potentially allow MeDiNova to extend its reach to thousands more people across East and Greater London.
“As with our other two sites, the East London Clinical Studies Centre is strategically located in an area of high population density so we are able to deliver effective results on time and, together with our volunteers, really help make a difference in shaping advances in future treatments.”
The new centre will be staffed by 40 professional research investigators, with numerous fully professional doctors and nurses on hand.
MeDiNova has been noted for its close work with some of the world’s leading pharmaceutical companies, with CROs and biotech also part of its modus operandi.
In the London area alone, MeDiNova has scanned more than 12,000 people for osteoporosis over the past two years, using its DXA scanner, which measures bone mineral density.
Muthalagappan added: “The opening of our Romford clinic is part of our long-term plan to allow MeDiNova to continue progressing by increasing our resources and building on our achievements to date.
“Already we are able to conduct trials in no less than 45 areas. Over time our three sites will allow us to continue building on this offering and to reach out to potentially thousands more residents across a far wider catchment area who will be able to benefit from screening for a range of conditions including Osteoporosis, Diabetes and COPD.”
The Association of the British Pharmaceutical Association (ABPI) has responded to the recent report of the National Audit Office (NAO) with regard to this investigation into the Cancer Drugs Fund.
In its final report on the subject, the NAO concluded that there are major problems with regard to the fund in the immediate future.
It was asserted by the NAO that unless significant measures were taken to improve the funding of the Cancer Drugs Fund, numerous medicines would need to be removed from the list permanently.
Speaking about the assertions of the National Audit Office, Dr Richard Torbett, Executive Director, Commercial at the Association of the British Pharmaceutical Association, acknowledged that the audit office report should be considered an important document.
“We welcome this report which sheds an important light on the impact and the sustainability of the Cancer Drugs Fund and we are pleased to have had the opportunity to contribute our views,” Torbett stated.
Torbett also acknowledged that the situation in the United Kingdom with regard to cancer drugs is less than ideal.
“Whilst the Cancer Drugs Fund improved patient access to cancer medicines that are not routinely available on the NHS, the report makes clear that the use of new cancer drugs in the UK still remains below the average in other comparable countries. We remain adamant that this needs to change,” Torbett asserted.
Far from being in disagreement with the National Audit Office report, Torbett in fact acknowledge that legitimacy of conclusions made by the organisation.
“We want to see many more patients benefitting from new and innovative medicines, including cancer medicines, and we have long voiced the view that the Cancer Drugs Fund is not sustainable in its current form, as the NAO report highlights,” Torbett conceded.
Although there are clearly significant organisational, structural and financial problems faced by the fund in the medium-to-long-term, Torbett also suggested a potential resolution to the existing situation that could assist cancer patients across the United Kingdom.
“What is needed is a wholesale reform of NICE, which, along with NHS England, needs to develop a longer-term sustainable solution to the evaluation and commissioning of cancer medicines. We therefore look forward to the upcoming consultation on the Cancer Drugs Fund and remain committed to working with all parties to achieve a more joined-up system which allows many more NHS patients to benefit from life-enhancing medicines,” Torbett espoused.
It was reported in May 2015 that the total global spending on cancer drugs exceeded $100 billion in 2014.
A team of researchers in Ohio is currently attempting to develop a so-called wonder drug that tackles both Alzheimer’s and Type 2 diabetes.
These conditions are known for sharing two destructive proteins that play a key role in the conditions and their development.
Clinical research being carried out at the University of Akron has raised expectation that a cure for the conditions could kill both birds with one stone in the foreseeable future.
With federal funding to the order of £200,000, this critical study could have global implications.
The US National Science Foundation has backed the researchers to produce an antidote to these two conditions, and the potential of a cure is certainly an exciting prospect for medicine and public health across the planet.
Recent years have seen a diabetes epidemic across the Western world in particular, with excessive added sugar in process food considered a major factor in this worrying trend.
The Daily Health Bulletin reported in March, 2011 that 280 million people worldwide (approximately 6.5 per cent of the world’s population) is diabetic.
Just months later, a study in The Lancet demonstrated that the number of adults with Type 2 diabetes has more than doubled in the last thirty years, soaring to almost 10 per cent of the world population.
And the burden on the National Health Service is also extremely well documented.
Official figures indicate that diabetes costs the NHS £1 million every hour. This amounts to a figure of over £8 billion per annum.
However, scientists working on the drug have noted that the majority of Alzheimer’s patients possess either Type II diabetes, or else are glucose intolerant.
Studies have indicated that diabetes sufferers aged 60 and over are twice as likely to develop Alzheimer’s as normally adjusted individuals.
And it is believed that a chemical interaction between two destructive proteins present in both conditions plays a key role in their development, leading researchers to assert that treating them simultaneously should be feasible.
The search for one of medicine’s most valuable secrets is being led by American scientist Dr Jie Zheng.
The experienced expert in chemical and biochemical engineering believes that it will indeed be possible to treat both conditions with a solitary tablet, and that this drug could emerge by 2025.
Both Alzheimer’s and Type 2 diabetes are caused by peptide aggregates, and feature extremely similar biological and structural functions.
An abnormal accumulation of Abeta peptides is linked to Alzheimer’s, while an abnormal accumulation of human islet amyloid polypeptide or hIAPP is linked to Type 2 diabetes.
The research is particularly building on previous studies that have suggested that animals fed a diet which would leave them vulnerable to diabetes can result in their brains being crippled with insoluble protein plaques; one of the features of Alzheimer’s.
According to a newly released report from Moody’s, the industrial outlook for the global pharmaceutical industry looks to be extremely healthy.
Although the pharmaceutical industry will experience pricing pressure over the next 12 to 18 months, the success of new products will more than offset this issue.
Key European pharmaceutical manufacturers such as AstraZeneca are predicted to play a major role in the industry going forward.
Moody’s also suggests that oncology will be the largest growth opportunity in the entire industry.
Newly launched cancer drugs, such as Bristol-Myers Squibb’s Opdivo and Merck & Co.’s Keytruda have significant upside according to the financial analysis and credit ratings agency.
In addition, according to Michael Levesque, Moody’s Senior Vice President and lead author for the report, “innovation, alongside research and development productivity improvements, has also produced stronger late-stage pipelines, which means other new products will be launched over the next 12 to 18 months.”
Moody’s projects that the majority of pharmaceutical products in the United States will rise, and this will be a major driver of global growth.
Meanwhile, another factor supporting overall global growth in the pharmaceutical sector throughout the next financial year will be synergies from acquisitions.
This will particularly be the case within the speciality pharmaceutical categories, in which acquirers such as Allergan and Valeant Pharmaceuticals will obtain lasting cost reductions.
“We expect acquisition activity to remain strong, given the cost-saving opportunities, the emergence of high-potential pipeline drugs, and companies’ desire for greater scale and diversification,” Levesque asserted.
But the picture painted by the report is not entirely rosy. Moody’s projects that the global pharmaceutical industry will face longer-term challenges relating to the sustainability of drug prices.
The profitability of pharmaceuticals is being influenced by consumer behaviour in Europe and Japan, where the use of unbranded, generic drugs is becoming increasingly common.
It is also predicted by the report that upcoming launches of biosimilar products will begin to have a negative impact on the sales of major biotech products, such as Amgen’s Neulasta and Pfizer’s Enbrel.
Moody’s projects 4-5 percent annualised growth in the pharmaceutical marketplace over the next 12 to 18 months, with improved drug pipelines contributing to this positive overall picture.
“Most rated companies will continue to benefit from modest top-line growth, supported by lower sales erosion from generic competition, first product revenues from recently launched drugs and continued robust growth in emerging markets,” commented Stanislas Duquesnoy, Moody’s Vice President and Senior Analyst.
“Pricing trends should remain positive, although certain therapeutic areas, such as treatments for respiratory illnesses and diabetes, will continue to face increased payor scrutiny, especially in the US, for the remainder of 2015,” Duquesnoy added.