biopharmaceuticals in perspective summer...
TRANSCRIPT
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CHARTPACK
BIOPHARMACEUTICALS IN PERSPECTIVE SUMMER 2018
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Dr. MaysounMaysoun is another pioneer making a difference in breast cancer research. For the last 20 years she has dedicated her life to researching and developing therapies for types of breast cancer that are resistant to other forms of treatment. Her work and dedication helps turn thousands of patients like Jessica into better cancer fight-ers. Maysoun, along with the hundreds of other biopharmaceutical researchers, turns “what if” into “what is” by challenging what we know about breast cancer. For patients, this progress helps transform a terrifying breast cancer diagnosis into a healthier and longer life.
JessicaJessica was just 36 and working in oncology research when she was diagnosed with a particularly aggressive form of stage II breast cancer. As a new mom, she feared she would not live to see her son turn three. But as luck and the power of research would have it, a recently developed life-saving treatment was available. “If the targeted drug I was given wasn’t around, I wouldn’t be here today,” Jessica recalls. Becoming a cancer survivor only increased Jessica’s passion for her work. “My diagnosis and subsequent journey made me realize on an even deeper level just how personal the battle is for both patients and scientists alike...”
RESEARCHERS MAKING AN IMPACT
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TABLE OF CONTENTS
Cover photo: Maysoun, Sanofi researcher and Jessica, Eli Lilly researcher and breast cancer survivor Interior back cover photo courtesy of AbbVie
Introduction 1
1 Advances in Treatment 32 Research and Development 233 Market Dynamics 474 Cost Sharing Trends 715 Spending on Medicines 896 Outcomes and Savings 1117 Economic Impact 1258 International Costs and Access 147
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INTRODUCTION
This chart pack provides facts and figures about prescription medicines and their role in the health care system. Topics include medicines’ impact on health and quality of life, the drug discovery and development process, health care spending and costs, the challenges of addressing treatment gaps and improving the use of prescribed therapies, the contributions of the biopharmaceutical sector, and costs and access in other developed countries.
Data and information in this publication were drawn from a wide range of sources, including government agency reports, peer-reviewed journals, and the Pharmaceutical Research and Manufacturers of America’s (PhRMA’s) own research and analysis. PhRMA hopes this publication provides useful context for discussions regarding the role of medicines and the US economy.
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ADVANCES IN TREATMENTMedicines’ Impact on Health and Quality of Life
Prescription medicines have yielded important advances, helping patients live longer and healthier lives. Over the past 25 years, prescription medicines have transformed the trajectory of many debilitating diseases and conditions, including heart disease, HIV/AIDS, cancer, and hepatitis C, resulting in decreased death rates, improved health outcomes, and better quality of life for patients.
Today, new drugs are targeting the underlying causes of disease in ways never seen before, and diseases previously regarded as deadly are now manageable and even curable. In this new era of medicine, breakthrough science and personalized therapies are revolutionizing the way we treat patients with a broad range of chronic and rare conditions. Looking forward, continued advances in biopharmaceutical innovation will be critical in addressing unmet needs, improving public health, and solving future health care challenges.
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Increases in US Life ExpectancyInnovative medicines have played an integral role in improving life expectancy over the last century.1
US Life Expectancy, 1950-20152*
*Life expectancies before 1997 and those in and after 1997 were calculated using a slightly different methodology.
60
65
70
75
80
85
2010200019901980197019601950
77.478.8 79.3
81.0 81.2
At
Bir
th (i
n Y
ears
)
71.1
73.1
74.7
70
71.8
74.1
76.2 76.3
65.666.6
67.1
2020
2015
Men
Women
41 Advances in Treatment
Source: CDC1,2
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A Decade of Advances
2007
• New class of medicines to treat high blood pressure
• First treatment for fibromyalgia
2009
• First treatment for peripheral T-cell lymphoma
• First new drug for gout in 40 years
• First drug to treat spinal muscular atrophy
• New personalized therapy for chronic lymphocytic leukemia
• First drug to treat all 6 forms of hepatitis C
• First drug to target root cause of cystic fibrosis
• First drug to treat Cushing’s disease
• Oral treatments for hepatitis C provide cure rates of more than 90%
• 17 new drugs to treat patients with rare diseases
20172013 20152011
2008
• New type of treatment for Crohn’s disease
• First drug for symptoms of Huntington’s disease
2010
• 2 new multiple sclerosis drugs
• First therapeutic cancer vaccine
• 2 new personalized medicines to treat the most dangerous forms of skin cancer
• New oral treatment for multiple sclerosis
• 2 new drugs for difficult-to-treat forms of high cholesterol
• New cystic fibrosis drug for patients with a genetic mutation that is the most common cause of the disease
• First lupus drug in 50 years
• 2 new personalized medicines
• First gene therapies approved
• First drug to treat primary progressive multiple sclerosis
• 16 new drugs to treat cancer
2012 2014 2016
51 Advances in Treatment
Source: FDA3
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Multiple Sclerosis (MS)Advances in recent years, including convenient oral medicines and the first-ever treatment for progressive MS, offer patients greater opportunity to better manage MS and slow disease progression.4
Rheumatoid Arthritis (RA)Therapeutic advances have transformed the RA treatment paradigm, shifting from a focus on managing symptoms to aiming for slowed disease progression and even disease remission.8
Cancer New therapies have contributed to a 26% decline in cancer death rates since the 1990s.6 The chance a cancer patient will live 5 years or more has increased 41% across all cancers since 1975.7
Hepatitis C Recent therapeutic advances can cure the disease and help patients avoid serious disease complications—including cirrhosis, advanced liver disease, liver cancer, and death.5
Medicines Are Transforming the Treatment of Many Diseases
61 Advances in Treatment
Sources: PhRMA4,5; Siegel RL et al.6; ACS7; Boston Healthcare Associates8
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Medicines Are Transforming Treatment of Many Rare Diseases
Collectively, rare diseases affect 30 million Americans. Treatments are available for only 5% of rare diseases, but recent advances are providing important new options to many patients for the first time.9
Cystic Fibrosis (CF)10Advances in understanding the biology of this condition, which primarily affects the lungs and digestive system, have led to new medicines targeting the root cause of CF—rather than just the symptoms—including in patients with genetic mutation known to be the most common cause of the disease.
Sickle Cell Disease13The first treatment in 20 years was approved in 2017 to treat this inherited blood disorder which restricts blood vessels, limits the delivery of oxygen to the body’s tissues, and causes severe pain and organ damage. The drug was approved to reduce complications associated with the disease.
Batten Disease11The first-ever treatment for a form of this disease, which causes progressive neurological and severe impairments, was approved in 2017. The medicine replaces an enzyme that patients lack and is approved to slow loss of walking ability in patients 3 years and older.
“Sly Syndrome” (MPS VII)12MPS VII is a progressive, metabolic condition affecting fewer than 150 patients worldwide. It can result in skeletal and organ abnormalities and may lead to heart disease, airway obstruction, and developmental disability. The first-ever treatment for this condition was approved in 2017.
71 Advances in Treatment
Sources: Global Genes9; PhRMA10; FDA11-13
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THEN:Treatments for rheumatoid arthritis were generally effective at reducing joint inflammation but were limited to treating the symptoms of the disease, allowing for a steady, rapid progression from disease onset to disability.
NOW:Biologic disease-modifying antirheumatic drugs target the underlying sources of inflammation, which improves physical functioning and prevents irreversible joint damage, making disease remission possible.
Rheumatoid Arthritis: Medicines Are Transforming the Lives of Patients
81 Advances in Treatment
Source: Boston Healthcare Associates14
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AIDS Mortality in the United StatesThe number of US AIDS deaths decreased dramatically following the introduction of highly active antiretroviral therapy (HAART) combinations in 1996.15 As a result of HAART and all the important medical innovations that followed, it is estimated that more than 862,000 premature deaths have been avoided in the United States alone.16
Annual Number of AIDS Deaths in the United States15
0
5
10
15
20
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1988
1987
Dea
ths
Per
10
0,0
00
Po
pu
lati
on
91 Advances in Treatment
Sources: CDC15; Truven Health Analytics16
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HIV/AIDS: Treatment Advances Build Over TimeDramatic declines in death rates did not occur with one single breakthrough but rather through a series of advances providing important treatment options for patients over time.17,18
*AZT: Azidothymidine
1987 1994 20031996 2007 2012
20011991 200619951984 2011 2016
• First nucleotide analog approved
• AZT* labeling expanded for dosing, earlier use, and pediatric use
• First treatment (AZT*) introduced (a nucleoside analog reverse-transcriptase inhibitor)
• Rates of transmission from mother to infant dropped to less than 2%
• First one-pill-a-day treatment approved
• AZT* found to reduce the risk of transmis-sion from mother to infant
• First protease inhibitors approved
• HIV identified as the cause of AIDS
• First fusion inhibitors approved
• HAART combinations introduced
• First C-C chemokine receptor type 5 agonist approved
• HHS recommendedearlier initiation of treatment to control immunologic response
• First approval of a medicine for preexposure prophylaxis (PrEP)
1981AIDS firstreported
• HIV/AIDS death rate in the US dropped 88%since the introduction of HAART
PrEPAZT
88%
101 Advances in Treatment
Sources: Boston Healthcare Associates17; CDC18
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— William Nelson, MD, PhD, Director, Sidney Kimmel
Comprehensive Cancer Center22
Cancers: Decline in Death RatesSince peaking in the 1990s, cancer death rates have declined 26%.19 Approximately 73% of survival gains in cancer are attributable to new treatments, including medicines.20
I think some of the treatments that we have developed over the last half century or so are really starting to pay off and, honestly, [it] seems limitless as to what may pay off in the future.”
1991–2000 2001–2010 2011–2015 Total Decline
26%
6.0%
12.5%
7.6%
Percent Change by Decade in US Death Rates From Cancer19,21
111 Advances in Treatment
Sources: Seigel RL et al.19; Seabury SA et al.20; NCI21; Dunellari A22
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After Introductionof Imatinib
Before Introductionof Imatinib
31%
89%
Chronic Leukemia: Increased Survival RatesWhen the first-in-class drug imatinib was approved in 2001 to treat chronic myeloid leukemia (CML), the transformative impact of this new class of medicines had not been completely realized.23
• After initial approval, continued research revealed that imatinib had a greater impact when initiated earlier in the progression of the disease.
• Further research also revealed that imatinib was effective in combating other types of cancer.
• Additional drugs in this class have since been approved that target mutated forms of CML in patients who have become resistant or intolerant to imatinib.24
• Today, survival rates have improved dramatically, and CML patients are living close to normal life spans.25
5-Year Survival Rates for CML Patients26,27
121 Advances in Treatment
Sources: Boston Healthcare Associates23; PhRMA24; Gambacorti-Passerini C et al.25; ACS26; Druker BJ et al.27
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0
100
200
300
400
500
600
700
2017
2015
2013
2011
2009
2007
2005
2003
2001
1999
1997
1995
1993
1991
1989
1987
1985
1983
Cumulative Prior Orphan Drug Approvals New Orphan Drug Approvals
*Drug approvals for rare diseases include initial approvals of new medicines and subsequent approvals of existing medicines.
Rare Diseases: Drug Approvals for Rare Diseases Have Increased
Rare diseases are those that affect 200,000 or fewer people in the United States.28
Number of Drug Approvals for Rare Diseases29*
have been approved since the passage of the Orphan Drug Act in 1983,
CONTINUED INNOVATION
650 orphan drugsAlthough more than
is still very much needed.28
131 Advances in Treatment
Sources: NIH28; FDA29
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*Age-adjusted death rates based on year 2000 US standard population. 1980-1998 causes of death are classified by the International Classification of Diseases, Ninth Revision (ICD-9). Beginning in 1999, causes of death have been classified by the International Statistical Classification of Diseases and Related Health Problems, Tenth Revision (ICD-10).
Cardiovascular Disease: Declining Rates of DeathTremendous strides have been made in reducing cardiovascular disease morbidity and mortality, thanks in part to new medicines.
US Death Rates Due to Diseases of the Heart*
0
50
100
150
200
250
300
350
400
450
2015201320112009200720052003200119991997199519931991198919871985198319811979
402 397 389375
356
Age
-Ad
just
ed D
eath
Rat
es p
er 1
00
,00
0
332314 310
296280
267250
236217
196183 174 170 169
37%.
HEART DISEASE
Since 2000 alone, the death rate from
has declined by
141 Advances in Treatment
Sources: CDC30,31
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Medicines Are Improving Patients’ Quality of LifeRelative to medical technology available a decade ago, new treatments for complex chronic conditions are better tolerated, more efficacious, and more convenient, thereby improving not only life expectancy, but quality of life for patients.
*HIV, rheumatoid arthritis, leukemias, non-Hodgkin’s lymphoma, multiple sclerosis, and lupus.**Chart reflects unweighted estimates reported in study.
10-Year Decline in Number of Patients With Complex Chronic Conditions* Experiencing Quality-of-Life Impairment**
-9% -5% -4% -3%
765,500fewer patients
408,000fewer patients
306,000fewer patients
289,000fewer patients
Functional Physical Social Cognitive
151 Advances in Treatment
Source: Brien MJ et al.32
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Hepatitis C: Advances Driving Down Prevalence of Disease
The introduction of direct acting antivirals (DAAs) and subsequent improvements in cure rates revolutionized the treatment of hepatitis C (HCV), significantly driving down prevalence of disease.
Decreasing Number of HCV-Infected Patients, by Insurance Type, US 2010-203033*
*Model takes into account launch of DAAs, change in HCV screening policies and implementation of the Affordable Care Act.
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
20302028202620242022202020182016201420122010
1st Generation DAAs (Protease Inhibitors) 63-80% 2nd Generation DAAs (Polymerase Inhibitors) 84-90%3rd Generation DAAs (Combination Antivirals) 93-100%
Cure Rates34,35
Cu
mu
lati
ve P
reva
len
ce
Other PublicMedicaidMedicarePrivateUninsured
161 Advances in Treatment
Sources: Chhatwal J et al.33; PhRMA34; FDA35
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267,000 265,000 148,000 21,000
Liver-Related Deaths Advanced Cirrhosis Liver Cancer Liver Transplants
Projected Reductions in Hepatitis C–Related Complications
Relative to the previous standard of care, with the availability of today’s curative hepatitis C treatments, the United States is projected to avoid significant disease-related complications by 2050.36 Medicaid alone is estimated to have avoided HCV-related health care costs of nearly $800 million in 2016, with savings expected to accumulate year after year.37
Reduction in Cases of HCV–Related Complications by 2050, All Payers*
*Model takes into account launch of DAAs, changes in HCV screening policies, and implementation of the Affordable Care Act.
171 Advances in Treatment
Sources: Chhatwal J et al.36; Roebuck MC et al.37
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*Assumes research advances that delay the average age of onset of Alzheimer’s disease by 5 years beginning in 2025.**Projected savings to Medicare and Medicaid assume research breakthroughs that slow the progression of Alzheimer’s disease. This would dramatically reduce spending for comorbid conditions and expensive nursing home care.
Future Impact: Need for New Treatments for Alzheimer’s Disease
The development of a new treatment that delays the onset of Alzheimer’s could reduce Medicare and Medicaid spending on patients with Alzheimer’s by $218 billion annually by 2050.*
Projected Annual Medicare and Medicaid Spending With and Without New Treatment Advances (in Billions)**
$182 $262 $377 $547$182 $310 $529 $765
2020 2030 2040 2050
Current TrajectoryProjected With Delayed Onset Due to Treatment Advances
181 Advances in Treatment
Source: Alzheimer’s Association38
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Notes and Sources1. Centers for Disease Control and Prevention (CDC). Ten great public health achievements in the 20th century: 1900 to 1999. https://www.cdc.gov
/mmwr/preview/mmwrhtml/00056796.htm. Last updated April 26, 2013. Accessed May 2017.
2. Murphy SL, Xu J, Kochanek KD, et al.; Centers for Disease Control and Prevention (CDC), National Center for Health Statistics, National Vital Statistics System. Deaths: final data for 2015. Natl Vital Statistics Rep. 2017;66(6). https://www.cdc.gov/nchs/data/nvsr/nvsr66/nvsr66_06.pdf. Updated November 27, 2017. Accessed March 2018.
3. Food and Drug Administration (FDA). Drugs@FDA: FDA approved drug products. FDA Web site. http://www.accessdata.fda.gov/scripts/cder /drugsatfda. Accessed April 2018.
4. Pharmaceutical Research and Manufacturers of America (PhRMA). Multiple sclerosis: expanded treatment options improve outcomes for a disabling chronic condition. In: A Decade of Innovation in Chronic Diseases: 2006-2016, 13-15. http://phrma-docs.phrma.org/sites/default/files /pdf/decade-of-innovation-chronic-disease.pdf. Published February 2016. Accessed April 2018.
5. Pharmaceutical Research and Manufacturers of America (PhRMA). Hepatitis C: breakthroughs revolutionize treatment for patients. In: A Decade of Innovation in Chronic Diseases: 2006-2016, 24-27. http://phrma-docs.phrma.org/sites/default/files/pdf/decade-of-innovation-chronic -disease.pdf. Published February 2016. Accessed April 2018.
6. Siegel RL, Miller KD, Jemal A. Cancer Statistics, 2018. CA Cancer J Clin. 2018;68:7-30. https://onlinelibrary.wiley.com/doi/epdf/10.3322/caac .21442. Accessed April 2018.
7. American Cancer Society (ACS). Cancer facts & figures: 2018. https://www.cancer.org/content/dam/cancer-org/research/cancer-facts-and -statistics/annual-cancer-facts-and-figures/2018/cancer-facts-and-figures-2018.pdf. Accessed April 2018.
8. Augustyn C, Walker B, Goss TF; Boston Healthcare Associates. Recognizing the value of innovation in the treatment of rheumatoid arthritis. http://www.phrma.org/sites/default/files/pdf/BHARAWhitepaperMarch2013.pdf. Published March 2013. Accessed April 2018.
9. Global Genes. RARE diseases: facts and statistics. http://globalgenes.org/rare-diseases-facts-statistics. Accessed May 2017.
10. Pharmaceutical Research and Manufacturers of America (PhRMA). A decade of innovation in rare diseases: 2005-2015. http://phrma-docs .phrma.org/sites/default/files/pdf/PhRMA-Decade-of-Innovation-Rare-Diseases.pdf. Published 2015. Accessed May 2017.
11. Food and Drug Administration (FDA). FDA approves first treatment for a form of Batten disease. https://www.fda.gov/newsevents/newsroom /pressannouncements/ucm555613.htm. Published April 27, 2017. Accessed April 2017.
12. Food and Drug Administration (FDA). FDA approves treatment for rare genetic enzyme disorder. https://www.fda.gov/newsevents/newsroom /pressannouncements/ucm585308.htm. Published November 15, 2017. Accessed April 2017.
13. Food and Drug Administration (FDA). FDA approves new treatment for sickle cell disease. https://www.fda.gov/newsevents/newsroom /pressannouncements/ucm566084.htm. Published July 7, 2017. Accessed April 2017.
191 Advances in Treatment
https://www.cdc.gov/mmwr/preview/mmwrhtml/00056796.htmhttps://www.cdc.gov/mmwr/preview/mmwrhtml/00056796.htmhttps://www.cdc.gov/nchs/data/nvsr/nvsr66/nvsr66_06.pdfhttp://www.accessdata.fda.gov/scripts/cder/drugsatfdahttp://www.accessdata.fda.gov/scripts/cder/drugsatfdahttp://phrma-docs.phrma.org/sites/default/files/pdf/decade-of-innovation-chronic-disease.pdfhttp://phrma-docs.phrma.org/sites/default/files/pdf/decade-of-innovation-chronic-disease.pdfhttp://phrma-docs.phrma.org/sites/default/files/pdf/decade-of-innovation-chronic-disease.pdfhttp://phrma-docs.phrma.org/sites/default/files/pdf/decade-of-innovation-chronic-disease.pdfhttps://onlinelibrary.wiley.com/doi/epdf/10.3322/caac.21442https://onlinelibrary.wiley.com/doi/epdf/10.3322/caac.21442https://www.cancer.org/content/dam/cancer-org/research/cancer-facts-and-statistics/annual-cancer-facts-and-figures/2018/cancer-facts-and-figures-2018.pdfhttps://www.cancer.org/content/dam/cancer-org/research/cancer-facts-and-statistics/annual-cancer-facts-and-figures/2018/cancer-facts-and-figures-2018.pdfhttp://phrma-docs.phrma.org/sites/default/files/pdf/PhRMA-Decade-of-Innovation-Rare-Diseases.pdfhttp://phrma-docs.phrma.org/sites/default/files/pdf/PhRMA-Decade-of-Innovation-Rare-Diseases.pdfhttps://www.fda.gov/newsevents/newsroom/pressannouncements/ucm555613.htmhttps://www.fda.gov/newsevents/newsroom/pressannouncements/ucm555613.htmhttps://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm585308.htmhttps://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm585308.htmhttps://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm566084.htmhttps://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm566084.htm
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14. Augustyn C, Walker B, Goss TF; Boston Healthcare Associates. Recognizing the value of innovation in the treatment of rheumatoid arthritis. http://www.phrma.org/sites/default/files/pdf/BHARAWhitepaperMarch2013.pdf. Published March 2013. Accessed May 2017.
15. Centers for Disease Control and Prevention, National Center for Health Statistics. Health, United States, 2016: with special feature on racial and ethnic health disparities. https://www.cdc.gov/nchs/data/hus/hus16.pdf. Published 2017. Accessed June 2018.
16. Lacey MJ, Hanna GJ, Miller JD, Foster TS, Russell MW; Truven Health Analytics. Impact of pharmaceutical innovation in HIV/AIDS treatment during the highly active antiretroviral therapy (HAART) era in the US, 1987-2010: an epidemiologic and cost-impact modeling case study. http://truvenhealth.com/Portals/0/Assets/Life-Sciences/White-Papers/pharma-innovation-hiv-aids-treatment.pdf. Published December 2014. Accessed March 2018.
17. Augustyn C, Walker B, Goss TF; Boston Healthcare Associates. Recognizing the value of innovation in the treatment of rheumatoid arthritis. http://www.phrma.org/sites/default/files/pdf/BHARAWhitepaperMarch2013.pdf. Published March 2013. Accessed May 2017.
18. Centers for Disease Control and Prevention, National Center for Health Statistics. Health, United States, 2016: with chartbook on long-term trends in health. https://www.cdc.gov/nchs/data/hus/hus16.pdf. Published 2017. Accessed June 2018.
19. Siegel RL, Miller KD, Jemal A. Cancer Statistics, 2018. CA Cancer J Clin. 2018;68:7-30. https://onlinelibrary.wiley.com/doi/epdf/10.3322/caac.21442. Accessed April 2018.
20. Seabury SA, Goldman DP, Lakdawalla DN, et al. Quantifying gains in the war on cancer due to improved treatment and earlier detection. Forum for Health Econ Policy. 2016;19(1):141-156.
21. National Cancer Institute (NCI), Surveillance, Epidemiology, and End Results Program. Cancer stats facts: Cancer of any site: number of new cases and deaths per 100,000 people (all races, males and females), age-adjusted. https://seer.cancer.gov/statfacts/html/all.html. Accessed April 2018.
22. Dunellari A. Researchers optimistic about future of cancer treatment. VOA. http://www.voanews.com/content/researchers-optimistic-about -future-cancer-treatment/3144653.html. Published January 13, 2016. Accessed May 2017.
23. Goss TF, Picard EH, Tarab A; Boston Healthcare Associates. Recognizing value in oncology innovation. http://www.phrma.org/sites/default/files /flash/phrma_innovation_oncology.pdf. Published June 2012. Accessed May 2017.
24. Pharmaceutical Research and Manufacturers of America (PhRMA). A decade of innovation in rare diseases: 2005-2015. http://phrma-docs .phrma.org/sites/default/files/pdf/PhRMA-Decade-of-Innovation-Rare-Diseases.pdf. Published 2015. Accessed May 2017.
25. Gambacorti-Passerini C, Antolini L, Mahon F-X, et al. Multicenter independent assessment of outcomes in chronic myeloid leukemia patients treated with imatinib. J Natl Cancer Inst. 2011;103(7):553-561.
26. American Cancer Society (ACS). Thirty-one percent 5-year survival rate reported for cases diagnosed during 1991-1992. Cancer facts & figures 2012. ACS Web site. https://www.cancer.org/research/cancer-facts-statistics/all-cancer-facts-figures/cancer-facts-figures-2012.html. Accessed May 2017.
Notes and Sources
201 Advances in Treatment
http://www.phrma.org/sites/default/files/pdf/BHARAWhitepaperMarch2013.pdfhttps://www.cdc.gov/nchs/data/hus/hus16.pdfhttp://truvenhealth.com/Portals/0/Assets/Life-Sciences/White-Papers/pharma-innovation-hiv-aids-treatment.pdfhttp://www.phrma.org/sites/default/files/pdf/BHARAWhitepaperMarch2013.pdfhttps://www.cdc.gov/nchs/data/hus/hus16.pdfhttps://onlinelibrary.wiley.com/doi/epdf/10.3322/caac.21442https://seer.cancer.gov/statfacts/html/all.htmlhttp://www.voanews.com/content/researchers-optimistic-about-future-cancer-treatment/3144653.htmlhttp://www.voanews.com/content/researchers-optimistic-about-future-cancer-treatment/3144653.htmlhttp://www.phrma.org/sites/default/files/flash/phrma_innovation_oncology.pdfhttp://www.phrma.org/sites/default/files/flash/phrma_innovation_oncology.pdfhttp://phrma-docs.phrma.org/sites/default/files/pdf/PhRMA-Decade-of-Innovation-Rare-Diseases.pdfhttp://phrma-docs.phrma.org/sites/default/files/pdf/PhRMA-Decade-of-Innovation-Rare-Diseases.pdfhttps://www.cancer.org/research/cancer-facts-statistics/all-cancer-facts-figures/cancer-facts-figures-2012.html
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27. Druker BJ, Guilhot F, O’Brien SG, et al. Five-year follow-up of patients receiving imatinib for chronic myeloid leukemia. N Engl J Med. 2006;355(23):2408-2417.
28. National Institutes of Health (NIH), National Center for Advancing Translational Sciences; US Department of Health and Human Services. FAQs about Rare Diseases. https://rarediseases.info.nih.gov/diseases/pages/31/faqs-about-rare-diseases. Last Updated November 30, 2017. Accessed May 2018.
29. Food and Drug Administration (FDA). Search orphan drug designations and approvals. FDA Web site. http://www.accessdata.fda.gov/scripts /opdlisting/oopd/index.cfm. Accessed March 2018.
30. Centers for Disease Control and Prevention (CDC), National Center for Health Statistics (NCHS), National Vital Statistics System. Age-adjusted death rates for 72 selected causes by race and sex using year 2000 standard population: United States, 1979-98. http://www.cdc.gov/nchs/data /mortab/aadr7998s.pdf. Accessed May 2017.
31. Murphy SL, Xu J, Kochanek, KD, et al.; Centers for Disease Control and Prevention, National Center for Health Statistics, National Vital Statistics System. Deaths: final data for 2015. Natl Vital Statistics Rep. 2017;66(6). https://www.cdc.gov/nchs/data/nvsr/nvsr66/nvsr66_06.pdf. Published November 2017. Accessed June 2018.
32. Brien MJ, Carnow W, Dowdy MC, Zuo G. Quantifying improvements in life quality of individuals with complex chronic medical conditions over the past decade. http://phrma-docs.phrma.org/files/dmfile/Study---Quality-of-Life-Improvements-Over-the-Past-Decade---March-2016.pdf. Published March 12, 2016. Accessed May 2017.
33. Chhatwal J, Wang X, Ayer T, et al. Hepatitis C disease burden in the United States in the era of oral direct-acting antivirals. Hepatology. 2016;64(5):1442-1450. First published March 25, 2016, DOI: (10.1002/hep.28571). https://aasldpubs.onlinelibrary.wiley.com/doi/abs/10.1002 /hep.28571. Accessed April 2018.
34. Pharmaceutical Research and Manufacturers of America (PhRMA). A decade of innovation in chronic diseases: 2006-2016. http://phrma.org /sites/default/files/pdf/decade-of-innovation-chronic-disease.pdf. Published February 2016. Accessed May 2018.
35. Food and Drug Administration (FDA). Drugs@FDA: FDA approved drug products. FDA Web site. http://www.accessdata.fda.gov/scripts/cder /drugsatfda. Accessed May 2018.
36. Chhatwal J, Wang X, Ayer T, et al. Hepatitis C disease burden in the United States in the era of oral direct-acting antivirals. Hepatology. 2016;64(5):1442-1450. First published March 25, 2016, DOI: (10.1002/hep.28571). https://aasldpubs.onlinelibrary.wiley.com/doi/abs/10.1002 /hep.28571. Accessed April 2018.
37. Roebuck MC, Liberman JN. Burden of illness of chronic hepatitis C in Medicaid. ISPOR 2018. Baltimore, MD. May 2018. https://www.ispor.org /ScientificPresentationsDatabase/Presentation/80647?pdfid=54932
38. Alzheimer’s Association. Changing the trajectory of Alzheimer’s disease: how a treatment by 2025 saves lives and dollars. http://www.alz.org /documents_custom/trajectory.pdf. Published 2015. Accessed May 2017.
Notes and Sources
211 Advances in Treatment
http://www.accessdata.fda.gov/scripts/opdlisting/oopd/index.cfmhttp://www.accessdata.fda.gov/scripts/opdlisting/oopd/index.cfmhttp://www.cdc.gov/nchs/data/mortab/aadr7998s.pdfhttp://www.cdc.gov/nchs/data/mortab/aadr7998s.pdfhttps://www.cdc.gov/nchs/data/nvsr/nvsr66/nvsr66_06.pdfhttp://phrma-docs.phrma.org/files/dmfile/Study---Quality-of-Life-Improvements-Over-the-Past-Decade---March-2016.pdfhttps://aasldpubs.onlinelibrary.wiley.com/doi/abs/10.1002/hep.28571 https://aasldpubs.onlinelibrary.wiley.com/doi/abs/10.1002/hep.28571 http://phrma.org/sites/default/files/pdf/decade-of-innovation-chronic-disease.pdfhttp://phrma.org/sites/default/files/pdf/decade-of-innovation-chronic-disease.pdfhttp://www.accessdata.fda.gov/scripts/cder/drugsatfdahttp://www.accessdata.fda.gov/scripts/cder/drugsatfdahttps://aasldpubs.onlinelibrary.wiley.com/doi/abs/10.1002/hep.28571 https://aasldpubs.onlinelibrary.wiley.com/doi/abs/10.1002/hep.28571 https://www.ispor.org/ScientificPresentationsDatabase/Presentation/80647?pdfid=54932https://www.ispor.org/ScientificPresentationsDatabase/Presentation/80647?pdfid=54932http://www.alz.org/documents_custom/trajectory.pdfhttp://www.alz.org/documents_custom/trajectory.pdf
-
22
-
23
RESEARCH AND DEVELOPMENTThe Process of Drug Discovery and Development
The rapid pace of scientific advances is bringing tremendous hope to patients. The pipeline for new medicines has never been more promising, with about 7,000 medicines in development around the world. Over the past decade, PhRMA member companies have invested more than half a trillion dollars in biopharmaceutical research and development (R&D), accounting for the majority of private biopharmaceutical R&D spending. Development of new medicines is a long and rigorous process, with many setbacks along the way. As scientific complexities create new challenges in R&D, biopharmaceutical companies are working to create efficiencies and enter new collaborations across the research ecosystem.
2
23
-
About 7,000 Medicines in Development Globally1
Biopharmaceutical researchers are pursuing many innovative scientific approaches that are driving therapeutic advances.
AUTOIMMUNE DISEASESNext-generation oral S1P receptor modulators may offer enhanced efficacy and reduced side effects.
GENETIC DISORDERSGene therapies can halt the progression of many diseases by directly altering the genetic mutations that cause them.
RNAi technology can prevent disease from occurring by interfering with the expression of genes.
ALZHEIMER’S DISEASEβ-secretase inhibitors block the enzyme that causes plaque formation, which could halt progression of the disease.
CANCERChimeric antigen receptor (CAR) t-cell immunotherapy involves the personalized modification of immune-boosting T-cells to target and kill blood cancer cells.
CRISPR/Cas9 technology edits gene sequences in T-cells, reprogramming them to seek and destroy tumor cells.
242 Research and Development
Source: Adis R&D Insight Database1
-
*Defined as single products that are counted only once regardless of the number of indications pursued
AUTOIMMUNE DISEASES311
DIABETES171
RARE DISEASES566
CANCERS1,120
ALZHEIMER’S DISEASE85
MENTAL HEALTH DISORDERS135
NEUROLOGICAL DISORDERS537
HEART DISEASE & STROKE200
About 4,000 Medicines in Development in the United States
Biopharmaceutical researchers are working on new medicines* for many diseases, including:
252 Research and Development
Source: Adis R&D Insight Database2
-
Potential First-in-Class Medicines in the PipelineAn average of 74% of drugs in the clinical pipeline are potential first-in-class medicines.
Percentage of Products in Clinical Development and Regulatory Review That Are Potentially First-in-Class, Selected Therapeutic Areas, 2016
0% 20% 40% 60% 80% 100%
Diabetes
Cardiovascular
Neurology
Psychiatry
Cancer
Alzheimer's Disease 86%
79%
74%
73%
75%
73%
262 Research and Development
Source: Analysis Group3
-
Harnessing Innovation in Rare DiseasesSince the passage of the Orphan Drug Act in 1983, we have seen tremendous advances in treatments for rare diseases,* with the Food and Drug Administration approving more than 600 orphan drugs (compared with fewer than 10 in the decade before passage).
rare diseasesknown today
7,000
Rare diseases affect
30 MILLIONAMERICANS
85%-90% of rare diseasesare serious or life-threatening
560 MEDICINESare in development for
More than
RARE DISEASES
Approved treatments are available for
ONLY 5%of all rare diseases
*Rare diseases are defined as conditions for which there are fewer than 200,000 patients diagnosed in the United States.
272 Research and Development
Source: PhRMA4
-
Biopharmaceutical Companies Are Committed to Advancing Personalized Medicine
In recent years, we have seen remarkable advances in targeted therapy, and the R&D pipeline has never been more promising.
34%5MORE THANof new medicines
42%6
have the potential to be
IN THE PIPELINE
of new medicinesapproved by the
FDA in 2017 were
PERSONALIZED MEDICINES
282 Research and Development
Sources: Personalized Medicine Coalition5; Tufts CSDD6
-
The R&D Process for New Drugs Is Lengthy and Costly, With High Risk of Failure
From drug discovery through FDA approval, developing a new medicine on average takes 10 to 15 years and costs $2.6 billion.* Less than 12% of the candidate medicines that make it into phase I clinical trials are approved by the FDA.
*The average research & development (R&D) cost required to bring a new FDA-approved medicine to patients is estimated to be $2.6 billion over the past decade (in 2013 dollars), including the cost of the many potential medicines that do not make it through to FDA approval.
PHASE I PHASE II PHASE III PHASE IVIN
D S
UB
MIT
TE
D
ND
A/B
LA S
UB
MIT
TE
D
FDA
AP
PR
OV
AL
TENS HUNDREDS THOUSANDS
NUMBER OF VOLUNTEERS
POTENTIAL NEW MEDICINES
BASICRESEARCH
DRUGDISCOVERY CLINICAL TRIALS
FDA REVIEW
POST-APPROVALRESEARCH &
MONITORING
PRE-CLINICAL
1 FDA-APPROVEDMEDICINE
Key: IND=Investigational New Drug Application, NDA=New Drug Application, BLA=Biologics License Application
292 Research and Development
Sources: PhRMA adaptation of DiMasi JA et al.; Tufts CSDD7; FDA8
-
The Private Sector Leads the Translation of Basic Research Findings into New Medicines
0%
20%
40%
60%
80%
100%
ManufacturingDevelopmentDiscovery
58%
73%81%
PublicPrivate
Percent Contribution of R&D Milestones Achieved by Private and Public Sectors
302 Research and Development
Source: Chakravarthy R et al.9
-
Biopharmaceutical Industry Does the Majority of Research to Translate Basic Science Into New Medicines
While basic science is often initiated in government and academia, it is biopharmaceutical firms that provide the necessary expertise and experience needed to develop new medicines.10
Applied Research
Basic Research
Applied Research
BasicResearch
2016 Biopharmaceutical Industry R&D Investment: $89.8 Billion11
2016 NIH Research Spending: $30.5 Billion11
In addition to basic research and biopharmaceutical-related research, NIH supports applied research on medical devices, diagnostics, prevention, and other areas.12
312 Research and Development
Sources: Chakravarthy R et al.10; Research!America11; NIH12
-
Innovative Biopharmaceutical Companies Sit at the Heart of a Dynamic R&D Ecosystem in the United States
The vibrant US biomedical R&D ecosystem is critical in bringing new medicines to patients and maintaining US leadership in biopharmaceutical R&D.
FDA
Clinical Trial SitesClinical
Research Orgs
NIH
Pharmacists & Providers
New Medicines to Patients
Biopharma Research Companies Nonprofits
VentureCapital
Patent & Trademark OfficeStart-Ups
Academic Research Institutions
322 Research and Development
-
Technology Transfer Between Universities and Industry Has Resulted in
Economic Growth and New Drugs for PatientsEstablished in 1980, the Bayh-Dole Act created a uniform framework for the sharing of technology between universities and the private sector that has facilitated timely and effective commercialization of federally funded research.
MORE THAN 1,000start-up companies
were formed13
POSITIVE IMPACT OF BAYH-DOLE
NEARLY 800commercial products
stemming from universityresearch were introduced13
ABOUT 4.2 MILLIONUS jobs supported
across all industries14
Commercialization of federally funded research has increased dramatically.
From 1996 to 2015, licensing activity spurred by Bayh-Dole included:
contributed to US GDP14$591 BILLION
Close to
In 2016:
332 Research and Development
Sources: Association of University Technology Managers13; Pressman L et al.14
-
Collaboration Is Key in Researching and Developing New Medicines
The rapid pace of scientific and technological advances is propelling a new era in biopharmaceutical innovation in the United States. As the science becomes more complex, partnerships are crucial to advancing biomedical progress. Examples of key collaborative efforts across the R&D spectrum include:
AMP (ACCELERATING MEDICINES PARTNERSHIP)
Developing new diagnostics and biological targets for treatments in Alzheimer’s disease, type 2 diabetes, rheumatoid arthritis, Parkinson’s disease, and lupus15
Combining expertise and resources to rapidly identify, develop, and qualify biomarkers, which will then advance new therapies and guide improvements in regulatory and clinical decision making16
THE PARTNERS biopharmaceutical companies, NIH, CMS, FDA, patient and disease organizations
THE PARTNERS biopharmaceutical companies, NIH, patient and disease organizations
THE PARTNERS biopharmaceutical companies, NIH, FDA, patient and disease organizations
BIOMARKERS CONSORTIUM
LUNG-MAP (LUNG CANCER MASTER PROTOCOL)
Using comprehensive genetic screening to identify mutations in lung cancer patients in order to direct them to a specific investigational treatment, while operating under a single clinical trial protocol17
342 Research and Development
Sources: NIH15; FNIH16; Lung-MAP17
-
0
50
100
150
200
250
300
350
0
2,000
4,000
6,000
8,000
10,000
0
100
200
300
400
500
600
33434
The number of
CONSORTIA9xincreased
PARTNERSHIPSmore than doubled
New R&D
4,000 9,0002014200520142005
PARTNERSHIPSmore than doubled
Early-stage
256 57820142005
Researchers Are Harnessing Collaborations to Accelerate Innovation
In recent years, stakeholders across the biopharmaceutical research ecosystem have shifted to non-asset-based, precompetitive partnership models in order to leverage their strengths in creative ways, create efficiencies, and tackle scientific and technological challenges.
352 Research and Development
Source: Deloitte18
-
PhRMA Member Company R&D Investment
PhRMA Member Company R&D Expenditures, 1995-2016
$0
$10
$20
$30
$40
$50
$60
$70
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
2001
2000
1999
1998
1997
1996
1995
$15.2
$26.0
$39.9
$50.7
$65.5
Exp
end
itu
res
(in
Bill
ion
s o
f Do
llars
)
362 Research and Development
Source: PhRMA19
-
The Costs of Drug Development Have More Than Doubled Over the Past Decade
Many factors are driving increasing costs of biopharmaceutical R&D, including increased clinical trial complexity, larger clinical trial sizes, greater focus on targeting chronic and degenerative diseases, and higher failure rates for drugs tested in earlier-phase clinical studies.
1970s 1980s 1990s-Early 2000s 2000s-Early 2010s
$179M
$413M
$1.0B
$2.6BAVERAGE COST TO DEVELOP ONE NEW APPROVED DRUG—INCLUDING THE COST OF FAILURES (in Constant 2013 Dollars)
372 Research and Development
Source: DiMasi JA et al.20
-
Setbacks in Alzheimer’s Disease Research Provide Stepping Stones for Future Innovation
Since 1998, 123 medicines in development for the treatment of Alzheimer’s disease have not made it through clinical trials, with only 4 gaining FDA approval. These setbacks highlight the complexity of the R&D process. Though disappointing, they provide important knowledge to fuel future research.
Unsuccessful Alzheimer’s Drugs in Development, 1998-2014
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
2 7 9 10 5 2 3 2 9 5 13 14 12 8 5 10 7
1NEW
APPROVAL
1NEW
APPROVAL
1NEW
APPROVAL
1NEW
APPROVAL
382 Research and Development
Source: PhRMA21
-
*Setbacks and advances from 1998 to 2014
MELANOMA BRAIN CANCER LUNG CANCER96 unsuccessful attempts 7 new drugs
* *
75 unsuccessful attempts 3 new drugs
167 unsuccessful attempts 10 new drugs
*
Cancer Researchers Build on Knowledge Gained From Setbacks to Inform Future Advances
Developing a new cancer medicine is a complex process, fraught with setbacks, but these so-called “failures” are not wasted efforts. Researchers learn from them to inform future study and direct research efforts.
The scientific process is thoughtful, deliberate, and sometimes slow, but each advance, while helping patients, now also points toward new research questions and unexplored opportunities.”
— Clifford A. Hudis, MD, FACP22Chief Executive Officer, American Society of Clinical Oncology
Chief, Breast Medicine Service, Memorial Sloan Kettering Cancer Center Professor, Weill Cornell Medical College
392 Research and Development
Sources: Patel JD et al.22; PhRMA23
-
Pediatric Clinical Research: Overcoming ChallengesThe Best Pharmaceuticals for Children Act (BPCA) and Pediatric Research Equity Act (PREA) establish regulatory requirements and provide important incentives that help increase the number of clinical studies in pediatric populations. These laws spur pediatric research and help researchers overcome unique challenges for this vulnerable population.
?
>80%of medicines used to treat children did not have pediatric dosing information27
Small patient populations
Distinct dosage and formulation requirements
Unique ethical, scientific, and medical considerations
Difficult to enroll patients in trials
Unique Challenges in PEDIATRIC RESEARCH28
That number has been reduced to
50%27
BPCA/PREA Success
Since 2007,more than 670 pediatric studies have been completed.25,26
Since 1998,more than 670 pediatric labeling changes24 •
•
•
BEFOREBPCA/PREA
AFTERBPCA/PREA
•
402 Research and Development
Sources: FDA24-26; Yao L27; ACS28
-
The Complexity of Clinical Trials Has IncreasedDuring the past decade, clinical trial designs and procedures have become much more complex, reducing trial participation and retention rates.
137
110 187
5031
40 65
929,203494,236
2001–2005THEN
Typical Phase III Protocol Increase inCOMPLEXITY
2011–2015NOW
+86%
+70%
+61%
+63%
+88%
Endpoints
THEN & NOWClinical Trial Complexity Procedures
Eligibility Criteria
Investigative Sites
Data Points Collected
(Mean of Total Numbers)
412 Research and Development
Source: Getz KA et al.29
-
Enhancing the Drug Discovery, Development, and Review Process
The 21st Century Cures Act and Prescription Drug User Fee Act help ensure the FDA has the tools and resources needed to better manage the significant emerging science and innovation of today to meet the challenges of tomorrow.
INTEGRATING PATIENT PERSPECTIVEAdvance patient-focused drug development at the FDA and throughout the clinical trials process through appropriate incorporation of patient input and increased patient engagement.
ADVANCING USE OF REAL WORLD EVIDENCEKeep pace with latest technological advances by enabling use of real world evidence and real world data in regulatory decision making.
INCREASING ACCEPTANCE OF INNOVATIVE CLINICAL TRIAL DESIGNSCreate efficiencies in drug development through use of adaptive clinical trial designs as well as increased use of advanced data analytics.
ACCELERATING QUALIFICATION AND USE OF BIOMARKERSSpeed drug development timelines by creating efficiencies in review of biomarkers in order to advance personalized medicines and companion diagnostics.
422 Research and Development
-
Notes and Sources1. Adis R&D Insight Database. Accessed May 2018.
2. Adis R&D Insight Database. Disease-specific numbers are available in the Pharmaceutical Research and Manufacturers of America’s (PhRMA’s) Medicines in Development reports. http://www.phrma.org/science/in-the-pipeline/medicines-in-development. Accessed May 2018.
3. Long G; Analysis Group. The biopharmaceutical pipeline: innovative therapies in clinical development. http://phrma-docs.phrma.org/files/dmfile /Biopharmaceutical-Pipeline-Full-Report.pdf. Published July 2017. Accessed May 2018.
4. Pharmaceutical Research and Manufacturers of America (PhRMA). Spurring innovation in rare diseases. http://phrma-docs.phrma .org/files/dmfile/RareDisease_Backgrounder.pdf. 2018 update. Accessed April 2018.
5. Personalized Medicine Coalition. Personalized medicine at FDA: 2017 progress report. http://www.personalizedmedicinecoalition.org/Userfiles /PMC-Corporate/file/PM_at_FDA_2017_Progress_Report.pdf. Accessed April 2018.
6. Tufts Center for the Study of Drug Development (CSDD). Personalized medicine gains traction but still faces multiple challenges. Tufts CSDD Impact Rep. 2015;17(3).
7. PhRMA adaptation of DiMasi JA, Grabowski HG, Hansen RW. Innovation in the pharmaceutical industry: new estimates of R&D costs. J Health Economics. 2016;47:20-33. Tufts Center for the Study of Drug Development (CSDD). Innovation in the pharmaceutical industry: new estimates of R&D costs. In: Briefing: Cost of Developing a New Drug. From: Briefing on R&D Costs, Nov. 18 2014. Published November 18, 2014.
8. Food and Drug Administration (FDA). U.S. Food and Drug Administration drug approval process. http://www.fda.gov/downloads/Drugs /ResourcesForYou/Consumers/UCM284393.pdf. Accessed May 2017.
9. Chakravarthy R, Cotter K, DiMasi J, et al. Public and private sector contributions to research & development of the most transformational drugs in the past 25 years: from theory to therapy. Therapeutic Innovation & Regulatory Science. 2016;50(6):759-768.
10. Chakravarthy R, Cotter K, DiMasi J, et al. Public and private sector contributions to research & development of the most transformational drugs in the past 25 years: from theory to therapy. Therapeutic Innovation & Regulatory Science. 2016;50(6):759-768.
11. Research!America. U.S. Investments in Medical and Health Research and Development, 2013-2016. Arlington, VA. Fall 2017.
12. National Institutes of Health (NIH). Overall appropriations. https://officeofbudget.od.nih.gov/pdfs/FY17/Overview-Overall%20Appropriations.pdf. Accessed May 2018.
13. Association of University Technology Managers. Statistics Access for Technology Transfer (STATT) database. http://www.autm.net/resources -surveys/research-reports-databases/statt-database-(1). Accessed April 2018.
432 Research and Development
http://www.phrma.org/science/in-the-pipeline/medicines-in-developmenthttp://phrma-docs.phrma.org/files/dmfile/Biopharmaceutical-Pipeline-Full-Report.pdfhttp://phrma-docs.phrma.org/files/dmfile/Biopharmaceutical-Pipeline-Full-Report.pdfhttp://phrma-docs.phrma.org/files/dmfile/RareDisease_Backgrounder.pdfhttp://phrma-docs.phrma.org/files/dmfile/RareDisease_Backgrounder.pdfhttp://www.personalizedmedicinecoalition.org/Userfiles/PMC-Corporate/file/PM_at_FDA_2017_Progress_Report.pdfhttp://www.personalizedmedicinecoalition.org/Userfiles/PMC-Corporate/file/PM_at_FDA_2017_Progress_Report.pdfhttp://www.fda.gov/downloads/Drugs/ResourcesForYou/Consumers/UCM284393.pdfhttp://www.fda.gov/downloads/Drugs/ResourcesForYou/Consumers/UCM284393.pdfhttps://officeofbudget.od.nih.gov/pdfs/FY17/Overview-Overall%20Appropriations.pdfhttp://www.autm.net/resources-surveys/research-reports-databases/statt-database-(1)http://www.autm.net/resources-surveys/research-reports-databases/statt-database-(1)
-
Notes and Sources14. Pressman L, Planting M, Yuskavage R, et al. The economic contribution of university/nonprofit inventions in the United States: 1996-2015. June
2017. https://www.autm.net/AUTMMain/media/Partner-Events/Documents/Economic-_Contribution_University-Nonprofit_Inventions _US_1996-2015_BIO_AUTM.pdf. Accessed April 2018.
15. National Institutes of Health (NIH). Accelerating Medicines Partnership (AMP). https://www.nih.gov/research-training/accelerating-medicines -partnership-amp. Accessed May 2017.
16. Foundation for the National Institutes of Health (FNIH). Biomarkers Consortium. https://fnih.org/what-we-do/biomarkers-consortium. Accessed May 2017.
17. Lung-MAP. About Lung-MAP. http://www.lung-map.org/about-lung-map. Accessed May 2017.
18. Lesser N, Hefner M; Deloitte. Partnering for progress: how collaborations are fueling biomedical advances. https://www2.deloitte.com/content /dam/Deloitte/us/Documents/life-sciences-health-care/us-lshc-partnering-for-progress-how-collaborations-are-fueling-biomedical-advances .pdf. Published 2017. Accessed June 2017.
19. Pharmaceutical Research and Manufacturers of America (PhRMA). PhRMA Annual Membership Survey, 1995-2016. Washington, DC: PhRMA; 2017.
20. DiMasi JA, Grabowski HG, Hansen RW. Innovation in the pharmaceutical industry: new estimates of R&D costs. J Health Economics. 2016;47:20-33. Previous research by DiMasi and Grabowski estimated the average R&D costs in the early 2000s at $1.2 billion in constant 2000 dollars (see DiMasi JA, Grabowski HG. The cost of biopharmaceutical R&D: is biotech different? Managerial Decis Economics. 2007;28:469-479). That estimate is based on the same underlying survey as estimates for the 1990s to early 2000s reported here ($800 million in constant 2000 dollars) but is updated for changes in the cost of capital.
21. Pharmaceutical Research and Manufacturers of America (PhRMA). Researching Alzheimer’s medicines: setbacks and stepping stones. http://phrma.org/sites/default/files/pdf/alzheimers-setbacks-and-stepping-stones.pdf. Published 2015. Accessed May 2017.
22. Patel JD, Krilov L, Adams S, et al. Clinical cancer advances 2013: annual report on progress against cancer from the American Society of Clinical Oncology. J Clin Oncol. 2014;32(2):129-160. http://jco.ascopubs.org/content/early/2013/12/09/JCO.2013.53.7076.full.pdf+html. Accessed May 2017.
23. Pharmaceutical Research and Manufacturers of America (PhRMA). Researching cancer medicines: setbacks and stepping stones. http://www .phrma.org/sites/default/files/pdf/2014-cancer-setbacks-report.pdf. Published 2014. Accessed May 2017.
24. Food and Drug Administration (FDA). New pediatric labeling information database. http://www.accessdata.fda.gov/scripts/sda/sdNavigation .cfm?sd=labelingdatabase. Last updated February 28, 2018. Accessed April 2018.
442 Research and Development
https://www.autm.net/AUTMMain/media/Partner-Events/Documents/Economic-_Contribution_University-Nonprofit_Inventions_US_1996-2015_BIO_AUTM.pdfhttps://www.autm.net/AUTMMain/media/Partner-Events/Documents/Economic-_Contribution_University-Nonprofit_Inventions_US_1996-2015_BIO_AUTM.pdfhttps://www.nih.gov/research-training/accelerating-medicines-partnership-amphttps://www.nih.gov/research-training/accelerating-medicines-partnership-amphttps://fnih.org/what-we-do/biomarkers-consortiumhttp://www.lung-map.org/about-lung-maphttps://www2.deloitte.com/content/dam/Deloitte/us/Documents/life-sciences-health-care/us-lshc-partnering-for-progress-how-collaborations-are-fueling-biomedical-advances.pdfhttps://www2.deloitte.com/content/dam/Deloitte/us/Documents/life-sciences-health-care/us-lshc-partnering-for-progress-how-collaborations-are-fueling-biomedical-advances.pdfhttps://www2.deloitte.com/content/dam/Deloitte/us/Documents/life-sciences-health-care/us-lshc-partnering-for-progress-how-collaborations-are-fueling-biomedical-advances.pdfhttp://phrma.org/sites/default/files/pdf/alzheimers-setbacks-and-stepping-stones.pdfhttp://jco.ascopubs.org/content/early/2013/12/09/JCO.2013.53.7076.full.pdf+htmlhttp://www.phrma.org/sites/default/files/pdf/2014-cancer-setbacks-report.pdfhttp://www.phrma.org/sites/default/files/pdf/2014-cancer-setbacks-report.pdfhttp://www.accessdata.fda.gov/scripts/sda/sdNavigation.cfm?sd=labelingdatabasehttp://www.accessdata.fda.gov/scripts/sda/sdNavigation.cfm?sd=labelingdatabase
-
Notes and Sources25. Food and Drug Administration (FDA). Breakdown of FDAAA completed pediatric studies. http://www.fda.gov/Drugs/Development
ApprovalProcess/DevelopmentResources/ucm190622.htm. Last updated May 10, 2017. Accessed April 2018.
26. Food and Drug Administration (FDA). Number of pediatric studies completed (under both PREA and BPCA). https://www.accessdata.fda.gov /scripts/fdatrack/view/track.cfm?program=cder&id=CDER-RRDS-Number-of-pediatric-studies-completed. Information current as of December 31, 2017. Accessed April 2018.
27. Yao L. FDA takes step to encourage pediatric drug studies. FDA Voice. https://blogs.fda.gov/fdavoice/index.php/2013/08/fda-takes-step-to -encourage-pediatric-drug-studies. Published August 26, 2013. Accessed May 2017.
28. American Cancer Society (ACS). Childhood cancer research landscape report: translating discovery into cures for children with cancer. https://www.cancer.org/content/cancer/en/research/childhood-cancer-research-highlights/childhood-cancer-research-landscape-report.html. Published 2016. Accessed May 2017.
29. Getz KA, Campo RA. New benchmarks characterizing growth in protocol design complexity. Therapeutic Innovation & Regul Sci. 2018;52(1):22-28.
452 Research and Development
http://www.fda.gov/Drugs/DevelopmentApprovalProcess/DevelopmentResources/ucm190622.htmhttp://www.fda.gov/Drugs/DevelopmentApprovalProcess/DevelopmentResources/ucm190622.htmhttps://www.accessdata.fda.gov/scripts/fdatrack/view/track.cfm?program=cder&id=CDER-RRDS-Number-of-pediatric-studies-completedhttps://www.accessdata.fda.gov/scripts/fdatrack/view/track.cfm?program=cder&id=CDER-RRDS-Number-of-pediatric-studies-completedhttps://blogs.fda.gov/fdavoice/index.php/2013/08/fda-takes-step-to-encourage-pediatric-drug-studieshttps://blogs.fda.gov/fdavoice/index.php/2013/08/fda-takes-step-to-encourage-pediatric-drug-studieshttps://www.cancer.org/content/cancer/en/research/childhood-cancer-research-highlights/childhood-cancer-research-landscape-report.htmlhttps://www.cancer.org/content/cancer/en/research/childhood-cancer-research-highlights/childhood-cancer-research-landscape-report.html
-
46
-
47
MARKET DYNAMICSThe Economics of Drug Development and the Market Forces That Shape Spending on Medicines
Competition is a hallmark of the US prescription medicines market. Negotiating power is concentrated among a few pharmacy benefit managers (PBMs), which forces new medicines to compete for coverage and increases the likelihood of excluding medicines from coverage altogether. The built-in cost containment of the prescription drug lifecycle remains unique in health care, where new medicines eventually lead to lower-cost generics—and soon many biosimilars—that bring long-term value to patients.
Ongoing investment in R&D depends on the commercial success of a few products that must make up for all the rest, including those that never reach the market. Average returns on R&D investments have been declining. Accounting for uncertainty and risk, biopharmaceutical industry profits are in the middle range among all industries.
The market is rapidly evolving, increasingly linking payment to results and affecting how drugs are prescribed. Value-based contracts and other market-based arrangements show promise for improving outcomes and reducing costs.
3
47
-
Illustrative Pharmaceutical LifecycleNew pharmaceutical medicines typically face competition after a relatively short time on the market, first from brand competitors, and eventually from generics.
DRUG DEVELOPMENT BRAND DRUG LIFESPAN** GENERICS
Most brands already have at least one brand competitor when they enter the market or get one within 2 years.2
FDAApproval
GenericsEnter Market
Average time to develop a new medicine:
Average time on marketbefore generic entry:
12.5 years4*At least 10-15 years3
*For brand medicines with more than $250 million in annual sales in 2008 dollars, which account for 92% of sales of the brand medicines analyzed** Brand drug market share generally declines rapidly after generic entry.
Generics remain in use for many years at a small fraction of the original brand's cost.
483 Market Dynamics
Sources: PhRMA1; Tufts CSDD2,4; Grabowski H et al.3
-
Medicines Offer Built-in Cost Containment, Which Is Unique in Health Care
The price of a medicine commonly used to prevent cardiovascular disease dropped 90% between 2005 and 2015, while the average charge for a surgical procedure to treat it increased 92% over the same period.
$47,692
$92,251$2.13
$0.22
2005 20152005 2015
Percutaneous Coronary Angioplasty5 Atorvastatin 10mg6
-90%+92%
493 Market Dynamics
Sources: PhRMA analysis of HCUP Hospital Charge data5; IQVIA6
-
Powerful Purchasers Negotiate on Behalf of PayersNegotiating power is increasingly concentrated among fewer pharmacy benefit managers (PBMs), each purchasing medicines for more people than the populations of entire European countries.
OptumRx (UnitedHealthGroup)
CVS Health (Caremark)
Express Scripts
All Other
24%
25%
22%29%
Top 3 PBMs'Market Share
71%
PBMs and insurers determine:
FORMULARYif a medicine is covered
TIER PLACEMENTpatient cost sharing
ACCESSIBILITYutilization management through prior authorization or fail first
PROVIDER INCENTIVESpreferred treatment guidelines and pathways
Total Equivalent Prescription Claims Managed, 2017
503 Market Dynamics
Source: Drug Channels Institute7
-
2018201720162015201420132012
3850
72
95
124
154 154
48
66
87 85
159
00
Express Scripts
CVS Caremark
Number of Brand Medicines Excluded From PBM Formularies Has Increased Over Time
When a medicine is excluded from a pharmacy benefit manager’s (PBM’s) formulary, patients cannot access it without paying the list price. This can interrupt the continuity of a patient’s treatment as well as their doctor’s ability to make prescribing decisions that best meet their patients’ needs.8
Number of Brand Medicines Excluded from PBM Formulary9
513 Market Dynamics
Sources: Tufts CSDD8; Drug Channels Institute9
-
Case Study in Manufacturer-Payer Negotiations: Hepatitis C Medicines
Leveraging increased competition in the hepatitis C market, payers negotiated deep discounts off list prices for new medicines with manufacturers, reducing prices below those in many Western European countries.10
What Payers Claimed Would Happen What Actually Happened
“What they have done with this particular drug will break the country.... It will make pharmacy benefits no longer sustainable. Companies just aren’t going to be able to handle paying for this drug.”
— Express Scripts, April 201411
“This pricing, which Gilead attempts to justify as the cost of medical advancement, will have a tsunami effect across our entire health care system.”
— America’s Health Insurance Plans, July 201412
“The price is sufficiently low that we can go to our clients and say that they can treat every patient with hepatitis C.”
— Express Scripts, January 201513
“We are receiving market-leading rates from both companies. Neither company wanted to be left off the formulary.”
— Prime Therapeutics, January 201514
“Competitive market forces and hard-nosed bargaining make “tremendously effective” new hepatitis C medicines not just more accessible to ailing patients—but also offer good value to the U.S. health care system.”
— The New York Times Editorial Board, September 201515
523 Market Dynamics
Sources: LaMattina J10; Cortez MF11; Ignagni K12; Silverman E13; Langreth R14; New York Times Editorial Board15
-
Brand-to-Brand Competition Drives Savings in US Market-Based System
Payers leverage purchasing power and competition among brand medicines to negotiate substantial discounts on medicines.
-26%
-26%
-69%$
$
$
$
$
$
Hepatitis C
Cholesterol
Type II Diabetes
2013
2013
2016
2017
2017
2017
Avg. Net Brand Price
PCSK9 inhibitors
SGLT2 inhibitors
Direct-acting antiviralsFirst in class* 6 drugs in class
3 drugs in class
2 drugs in class
First in class*
First in class*
*Indicates year of launch of the first drug in this pharmacologic class.
533 Market Dynamics
Source: PhRMA analysis of SSR health data16
-
*A “medicine” is defined as a novel active substance (ie, a molecular or biologic entity or combination product in which at least one element had not been previously approved by the FDA). Sales are global sales, net of rebates and discounts.
Few Approved Medicines Are Commercially SuccessfulOngoing investment in R&D depends on the commercial success of a few products that must make up for all the rest, including those that never reach the market.
Present Value of Lifetime Sales of Medicines* Introduced, 1991-2009
$0
$10
$20
$30
$40
$50
$60
10%20%30%40%50%60%70%80%90%100%
Medicines by Lifetime Sales Percent
20
05
Do
llars
, in
Bill
ion
s
543 Market Dynamics
Source: Berndt ER et al.17
-
Note: All numbers are 3-year moving averages for brand medicines with more than $250 million in annual sales in 2008 dollars, which account for 92% of sales of the brand medicines analyzed.
Earlier and More Frequent Patent Challenges by Generic Companies
As early as 4 years after brand launch, a generic company may file a Paragraph IV certification with the FDA to challenge patents associated with the brand medicine, often allowing generic market entry before the patent expiration date.
0
5
10
15
20
25
14.3
1995
Patent challenges are occurring earlier...
Average Time From Brand Launch to Paragraph IV Patent Challenge
Brands by Year of First Generic Entry
Nu
mb
er o
f Yea
rs
2005
8.5 5.2
2014
25%
1995
...and are more common
Share of Brand Products Experiencing at Least One Paragraph IV Patent Challenge Prior to Generic Entry
Brands by Year of First Generic Entry
2005
60% 94%
2014
553 Market Dynamics
Source: Grabowski H et al.18
-
Farming/Agriculture
Construction Supplies
Retail (General)
Electronics (General)
Software (Internet)
Biopharmaceutical**
Health Care Info Technology
Food Wholesalers
Auto Parts
Aerospace/Defense
Health Care Support Services
Advertising
11.8%
1.4%
3.1%
5.1%
5.4%
6.3%
7.5%
8.1%
13.3%
24.7%
62.2%
37.8%
-2.4%
-2.2% Shipbuilding/Marine
Telecom (Wireless)
Biopharmaceutical Profits Are in Line With Those of Other Industries
Adjusted for the significant risk and capital investments required to develop medicines, biopharmaceutical industry profits are average among industries.
Average Economic Profit for Selected Industries, 2015-2017*
* Economic profits are accounting profits minus capital expenses. **Represents the weighted average of pharmaceuticals (8.7%) and biotechnology (6.0%), which are listed as separate industries in the source data.
563 Market Dynamics
Source: Adapted from Bates White19
-
0%
2%
4%
6%
8%
10%
12%
20172016201520142013201220112010
10.1%
7.6% 7.3%
4.8%5.5%
4.2%3.7%
3.2%
Increasingly Complex Science and Challenging Markets Have Led to Diminishing
Returns on Research InvestmentsDespite headlines about large revenues from new drug launches, biopharmaceutical companies have faced declining financial returns on their R&D investments.
Projected Internal Rate of Return for R&D Investments, 2010-2017
573 Market Dynamics
Source: Deloitte20
-
PBM Profit Margins Are Well Above Others in the Drug Distribution and Supply Chain
Pharmacy benefits managers (PBMs) do not take possession of the medicines they manage, keeping their spending on fixed assets and other expenses very low.
Share of Gross Profit Converted to EBITDA, 2016-2017*
*Calculated as EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin divided by gross margin
Analysts at Bernstein tried to get a better picture of how profitable these companies are by excluding the cost of the drugs that are included in their revenue...By this analysis, pharmacy-benefit managers are exceptionally profitable.”
— Charley Grant, Wall Street Journal22
0% 20% 40% 60% 80% 100%
PBMs
Distributors
Insurers
Pharmacies
85%
46%
31%
29%
583 Market Dynamics
Sources: Bernstein Research21; Wall Street Journal22
-
Accounting Treatment of R&D Overstates Biopharmaceutical Profits
Correctly accounting for R&D as a long-lived investment tends to reduce substantially, if not to eliminate altogether, the inference that pharmaceutical companies are on average achieving supranormal profit returns.”
— Frederic Scherer, AEI-Brookings Joint Center for Regulatory Studies23
[T]he standard accounting measure of profits overstates true returns to R&D-intensive industries, such as pharmaceuticals, and makes it difficult to meaningfully compare profit levels among industries. Accounting measures treat most R&D spending (except for capital equipment) as a deductible business expense rather than as a capitalized investment. But the intangible assets that research and development generate—such as accumulated knowledge, new research capabilities, and patents—increase the value of a company’s asset base. Not accounting for that value overstates a firm’s true return on its assets.”
— Congressional Budget Office24
593 Market Dynamics
Sources: Scherer FM23; CBO24
-
Hospitals Mark Up Medicines in the Outpatient Setting, Driving Up Costs to Patients and the Health System
Hospitals mark up medicine prices, on average, nearly 500%. The amount hospitals receive after negotiations with commercial payers is, on average, more than 250% what they paid to acquire the medicine.25
>1000%900-999% 800-899% 700-799% 600-699% 500-599% 400-499% 300-399% 200-299% 100-199%
-
Direct-to-Consumer Advertising Increases Awareness of Conditions and Treatments
A recent survey of consumers demonstrated the positive contribution of direct-to-consumer (DTC) advertising to patients’ knowledge.
How strongly do you agree or disagree with each statement?Percentage who AGREE with each statement
(Survey of consumers, n=1564, April 2017)
...allow people to be moreinvolved in their health care
...alert people to symptoms that are relatedto a medical condition they may have
...tell people about new treatments 88%
81%
79%
DTC ads
613 Market Dynamics
Source: Princeton Survey Research Associates International27
-
Clinical Factors Are the Biggest Driver of Physicians’ Prescribing Decisions
Factors Influencing Physicians’ Prescribing Decisions in the United States, 2013
Information from insurance and prescription benefitsmanager representatives
Information from pharmaceutical company representatives
Pharmaceutical company-sponsored educational programsfeaturing physician speakers, not Continuing Medical Education
Information from colleagues and peers
Patient’s insurance coverage and formulary
Clinical practice guidelines
Articles in peer-reviewed medical journals
Patient’s particular situation, including drug interactions,side effects, and contraindications
Clinical knowledge and experience 91% 8%
89% 9%
50% 42%
48% 44%
39% 44%
38% 54%
11% 47%
10% 53%
10% 35%
A great deal Some
623 Market Dynamics
Source: KRC Research28
-
Increasing Provider Accountability for Cost of Care and Pathway Compliance Is Influencing Prescribing Decisions
Patients in health plans that incentivize providers to prescribe certain treatments
THEN NOW
Hospital participation in accountable care organizations responsible for cost of care31,32
Medicare payments tied to alternative payment models, which include cost or quality incentives33
Commercial market payments in which provider is at risk for cost of care34,35
37%
6%
0%
6%
90%
37%
50%
29%2013
2009
2011
201429
2016
Goal for 2018
2016
2017 (Projected)30
633 Market Dynamics
Sources: EMD Serono29,30; American Hospital Association31,32; HHS33; Catalyst for Payment Reform34; HCP LAN35
-
Value-Based Contracts Deliver Results for PatientsValue-based contracts have the potential to benefit patients and the health care system by improving patient outcomes, reducing medical costs, and reducing the costs of medicines.
We’ve been able to get the best of both worlds. The insurer gets competitive guaranteed discounts on prescriptions, and the manufacturer is aligned and accountable when something doesn’t work.”
— Chris Bradbury, Cigna37
Outcomes-Based Contracts are associated with
28% lowerpatient copayments.
Value-Based Contracts could generate more than
$12 Billionif they reduced the diabetes burden in the United States
by only 5%.
643 Market Dynamics
Sources: PhRMA36; Bloomberg37
-
Innovative Market-Based Arrangements That Link Payment for Medicines to Outcomes Are on the Rise
New US Publicly Announced Outcomes-Based Contracts and Projected Future Increase
Oncology
Neuromuscular Disorder
Metabolic DisorderCardiovascularAutoimmuneAll Others
2018-20222013-2017
11
7
27
24
6
4
8
17
832
1
1
65
The number of publicly announced
outcomes-based contracts is
expected to more than double by
2022.
653 Market Dynamics
Source: IQVIA Institute38
-
Notes and Sources1. Pharmaceutical Research and Manufacturers of America (PhRMA). Drug Discovery and Development: Understanding the R&D Process. Washington,
DC: PhRMA; 2014.
2. Tufts Center for the Study of Drug Development (CSDD). Cost of developing a new drug [briefing]. https://csdd.tufts.edu/csddnews/2018/3/9 /march-2016-tufts-csdd-rd-cost-study. Published November 18, 2014. Accessed May 2018.
3. Grabowksi H, Long G, Mortimer R, et al. Updated trends in US brand-name and generic drug competition. J Med Econ. 2016;19(9):836-844.
4. 1970s data: Tufts Center for the Study of Drug Development (CSDD). Unpublished data, March 2010; 2005-2011 data: Tufts CSDD. First-in-class drugs in competitive development races with later entrants. Tufts CSDD Impact Rep. 2015;17(6).
5. Average hospital charge data from Healthcare Cost and Utilization Project Hospital Charge Database 2005, 2013, and 2015. https://www.ahrq .gov/research/data/hcup/index.html. Accessed May 2018.
6. Invoice price data for atorvastatin 10mg from IQVIA National Sales Perspectives data for 2005 (branded Lipitor) and 2015 (generic). https://www .iqvia.com/locations/united-states/commercial-operations/essential-information/sales-information. Accessed May 2018.
7. Fein AJ; Drug Channels Institute. The 2018 economic report on U.S. pharmacies and pharmacy benefit managers (by license only). http://drugchannelsinstitute.com/products/industry_report/pharmacy. Published February 2018. Accessed February 2018.
8. Tufts Center for the Study of Drug Development (CSDD). Rapid growth in PBM exclusion lists poses challenge to drug developers. Tufts CSDD Impact Report, 18(3): 2016. https://csdd.tufts.edu/s/Summary-MayJunIR2016.pdf
9. Fein AJ; Drug Channels Institute. What’s in, what’s out: the new 2018 CVS Health and Express Scripts formulary exclusion lists. http://www .drugchannels.net/2017/08/whats-in-whats-out-new-2018-cvs-health.html. Published August 3, 2017. Accessed May 2018.
10. LaMattina J. For hepatitis C drugs, U.S. prices are cheaper than in Europe. Forbes. http://www.forbes.com/sites/johnlamattina/2015/12/04/for -hepatitis-c-drugs-u-s-prices-are-cheaper-than-in-europe/#7ced43f564bb. Published December 4, 2015. Accessed May 2017. Citing comments made at Forbes Healthcare Summit 2015.
11. Cortez MF. Express Scripts raises pressure on Gilead for drug price. Bloomberg. Published April 8, 2014. Accessed May 2018.
12. Ignagni K. We all pay for $1,000 a pill drug. CNN. http://edition.cnn.com/2014/07/07/opinion/ignagni-hepatitis-c-drug. Published July 24, 2014. Accessed May 2017.
13. Silverman E. ‘The big issue has not been choice, but access:’ Express Scripts’ Miller explains. Wall Street Journal. http://blogs.wsj.com/pharmalot /2015/01/06/the-big-issue-has-not-been-choice-but-access-express-scripts-miller-explains. Published January 6, 2015. Accessed May 2017.
663 Market Dynamics
https://csdd.tufts.edu/csddnews/2018/3/9/march-2016-tufts-csdd-rd-cost-studyhttps://csdd.tufts.edu/csddnews/2018/3/9/march-2016-tufts-csdd-rd-cost-studyhttps://www.ahrq.gov/research/data/hcup/index.htmlhttps://www.ahrq.gov/research/data/hcup/index.htmlhttps://www.iqvia.com/locations/united-states/commercial-operations/essential-information/sales-informationhttps://www.iqvia.com/locations/united-states/commercial-operations/essential-information/sales-informationhttp://drugchannelsinstitute.com/products/industry_report/pharmacyhttp://www.drugchannels.net/2017/08/whats-in-whats-out-new-2018-cvs-health.htmlhttp://www.drugchannels.net/2017/08/whats-in-whats-out-new-2018-cvs-health.htmlhttp://www.forbes.com/sites/johnlamattina/2015/12/04/for-hepatitis-c-drugs-u-s-prices-are-cheaper-than-in-europe/#7ced43f564bbhttp://www.forbes.com/sites/johnlamattina/2015/12/04/for-hepatitis-c-drugs-u-s-prices-are-cheaper-than-in-europe/#7ced43f564bbhttp://edition.cnn.com/2014/07/07/opinion/ignagni-hepatitis-c-drughttp://blogs.wsj.com/pharmalot/2015/01/06/the-big-issue-has-not-been-choice-but-access-express-scripts-miller-explainshttp://blogs.wsj.com/pharmalot/2015/01/06/the-big-issue-has-not-been-choice-but-access-express-scripts-miller-explains
-
Notes and Sources14. Langreth R. Hepatitis drug prices fall so low, no exclusives needed. Bloomberg. Published January 12, 2015. Accessed May 2018.
15. New York Times Editorial Board. Costly hepatitis C drugs for everyone? New York Times. https://www.nytimes.com/2015/09/02/opinion/costly -hepatitis-c-drugs-for-everyone.html?_r=0. Published September 2, 2015. Accessed May 2017.
16. SSR health data. http://www.ssrhealth.com/research-archive. May 2018.
17. Berndt ER, Nass D, Kleinrock M, et al. Decline in economic returns from new drugs raises questions about sustaining innovations. Health Aff. 2015;34(2):245-252.
18. Grabowksi H, Long G, Mortimer R, et al. Updated trends in US brand-name and generic drug competition. J Med Econ. 2016;19(9):836-844.
19. Adapted by PhRMA from Bates White, Economic profitability of the biopharmaceutical industry. Report for PhRMA, June 2018. Economic profit for each industry is calculated as: (net operating profit less adjusted taxes) - (invested capital x weighted average cost of capital).
20. Deloitte Centre for Health Solutions. A new future for R&D? Measuring the return from pharmaceutical innovation 2017. https://www2.deloitte .com/uk/en/pages/life-sciences-and-healthcare/articles/measuring-return-from-pharmaceutical-innovation.html. Published 2018. Accessed May 2018.
21. Wilkes, L; Bernstein Research (Subscription Analyst Report). US healthcare services: Amazon—dual threats to healthcare services and their implications to the sector including ESRX. February 22, 2018.
22. Grant C. Hidden profits in the prescription drug supply chain. Wall Street Journal. https://www.wsj.com/articles/hidden-profits-in-the -prescription-drug-supply-chain-1519484401. Published February 24, 2018. Accessed May 2018.
23. Scherer FM. Pharmaceutical innovation. AEI-Brookings Joint Center for Regulatory Studies Working Paper 07-13. July 2007. https://papers.ssrn .com/sol3/papers.cfm?abstract_id=902395##. Published July 2007. Accessed May 2018.
24. Congressional Budget Office (CBO). Research and development in the pharmaceutical industry. http://www.cbo.gov/sites/default/files/cbofiles /ftpdocs/76xx/doc7615/10-02-drugr-d.pdf. Published October 2006. Accessed May 2017.
25. The Moran Company. Hospital charges and reimbursement for drugs: analysis of markups relative to acquisition cost. http://www .themorancompany.com/wp-content/uploads/2017/10/Hospital-Charges-Report-2017_FINAL.pdf. Published October 2017. Accessed May 2018.
26. The Moran Company. Hospital charges and reimbursement for medicines: analysis of cost-to- charge ratios. Publication expected June 2018. Accessed June 2018.
27. Survey conducted by Princeton Survey Research Associates International for PhRMA. April 2017.
673 Market Dynamics
https://www.nytimes.com/2015/09/02/opinion/costly-hepatitis-c-drugs-for-everyone.html?_r=0https://www.nytimes.com/2015/09/02/opinion/costly-hepatitis-c-drugs-for-everyone.html?_r=0http://www.ssrhealth.com/research-archivehttps://www2.deloitte.com/uk/en/pages/life-sciences-and-healthcare/articles/measuring-return-from-pharmaceutical-innovation.htmlhttps://www2.deloitte.com/uk/en/pages/life-sciences-and-healthcare/articles/measuring-return-from-pharmaceutical-innovation.htmlhttps://www.wsj.com/articles/hidden-profits-in-the-prescription-drug-supply-chain-1519484401https://www.wsj.com/articles/hidden-profits-in-the-prescription-drug-supply-chain-1519484401https://papers.ssrn.com/sol3/papers.cfm?abstract_id=902395##https://papers.ssrn.com/sol3/papers.cfm?abstract_id=902395##http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/76xx/doc7615/10-02-drugr-d.pdfhttp://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/76xx/doc7615/10-02-drugr-d.pdfhttp://www.themorancompany.com/wp-content/uploads/2017/10/Hospital-Charges-Report-2017_FINAL.pdfhttp://www.themorancompany.com/wp-content/uploads/2017/10/Hospital-Charges-Report-2017_FINAL.pdf
-
Notes and Sources28. KRC Research; for PhRMA. Survey of Physicians About Pharmaceutical and Biotech Research Company Activities and Information: Nationally
Representative Survey of 502 Physicians. Washington, DC: KRC Research; February 2014.
29. EMD Serono. EMD Serono Specialty Digest™: Managed Care Strategies for Specialty Pharmaceuticals. 12th ed. Darmstadt, Germany: EMD Serono; 2016. https://www.specialtydigestemdserono.com. Accessed June 2018.
30. EMD Serono. EMD Serono Specialty Digest™: Managed Care Strategies for Specialty Pharmaceuticals. 13th ed. Darmstadt, Germany: EMD Serono; 2017.
31. American Hospital Association. AHA Hospital Statistics™, 2016 Edition. https://ams.aha.org/eweb/DynamicPage.aspx?WebCode=ProdDetail Add&ivd_prc_prd_key=1e02290d-23b0-411a-b853-5cc9bcfbe6dd. Accessed June 2017.
32. American Hospital Association. AHA Hospital Statistics™, 2018 Edition. https://ams.aha.org/eweb/DynamicPage.aspx?WebCode=ProdDetail Add&ivd_prc_prd_key=41bb9379-9984-4115-8086-0a4bd166150d. Accessed March 2018.
33. US Department of Health and Human Services (HHS). HHS reaches goal of tying 30 percent of Medicare payments to quality ahead of schedule. (Press release). https://mountsinaihealth.me/file/2016/05/HHS-reaches-goal-of-tying-30-percent-of-Medicare-payment-to-quality-ahead-of -schedule.pdf. Published March 3, 2016. Accessed June 2017.
34. Catalyst for Payment Reform. 2014 national scorecard on payment reform. https://www.catalyze.org/wp-content/uploads/2017/04/2014 -National-Scorecard.zip. Published 2014. Accessed June 2017.
35. Health Care Payment Learning & Action Network (HCP LAN). APM measurement: LAN insights into APM adoption. http://hcp-lan.org /workproducts/measurement_discussion%20article_2017.pdf. Published 2017. Accessed March 2018.
36. PhRMA. Delivering results for patients: the value of value-based contracts. https://www.phrma.org/report/delivering-results-for -patients-the-value-of-value-based-contracts. Published February 26, 2018. Accessed May 2018.
37. Hopkins JS, Langreth R, Paton J. Big pharma’s offer to Trump: discounts when drugs don’t work. Bloomberg. https://www.bloomberg.com/news /articles/2017-02-06/big-pharma-s-offer-to-trump-discounts-when-drugs-don-t-work. Published February 6, 2017. Accessed June 2018.
38. IQVIA Institute for Human Data Science. Medicine use and spending in the U.S. A review of 2017 and outlook to 2022. https://www.iqvia.com /institute/reports/medicine-use-and-spending-in-the-us-review-of-2017-outlook-to-2022. Published April 19, 2018. Accessed April 2018.
683 Market Dynamics
https://www.specialtydigestemdserono.comhttps://ams.aha.org/eweb/DynamicPage.aspx?WebCode=ProdDetailAdd&ivd_prc_prd_key=1e02290d-23b0-411a-b85