Demographic time bomb

Population ageing is an issue often discussed in the media, but its impact on all facets of life has been poorly characterized. Globally, population ageing has occurred at an unparalleled rate in human history and all the signs are that this demographic pressure is taking countries by surprise. Decreasing fertility coupled with lengthening life expectancy has altered the age structure of the global population and shifted relative weight from younger to older age groups.¹

Faiz Kermani

The UN recently produced an in-depth report on this trend and concluded that it will not return to the young populations that our ancestors knew. It predicted that by 2050, the global population aged 60+ years will expand by more than three times to reach nearly 2 billion. Furthermore, in most countries the 80+ age group has been growing faster than any younger segment of the older population.¹ By 2050, six countries alone (Brazil, China, India, Indonesia, Japan and the US) will account for 57% of all those 80+ years in the world.

Ageing will have a tremendous impact on healthcare. While this is well known, the scale of the impact continues to be underestimated and its implications are not always viewed objectively. In 2007, the Council of Europe Parliamentary Assembly issued Recommendation 1796 stating that "old age must be regarded not as an illness but as a highly complex progressive process requiring a new approach to social policies." In the EU, the population aged 65+ years is set to reach 27.5% by 2050, while the population aged over 80 years is expected to reach 10%. Eurostat, which provides the EU with statistics at a European-wide level, calculates that this trend will require an increase in public expenditure on health care by 0.7–2.3 GDP points in the run-up to 2050.

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Market opportunities

Population ageing offers tremendous opportunities to pharmaceutical companies. The USbased National Care Planning Council estimates that, on average, a person older than 75 years uses five prescription drug medications and is using at least two overthecounter medications.

Most pharmaceutical companies have been quick to recognize the demographic implications and have tailored their R&D programmes to focus on diseases that have greatest impact in the elderly. For example, the US http://clinicaltrials.gov/ database currently lists close to 600 studies focusing on Alzheimer's disease, illustrating the high R&D intensity in this therapeutic field. Approximately 7.3 million people suffer from Alzheimer's disease in Europe, and an estimated 4 million patients in the US.^2,3 The global pharmaceutical market for Alzheimer's disease therapies is predicted to reach up to $7.8 billion by 2010² and has been predicted to grow 15% annually. Despite this, some analysts believe that the real market for Alzheimer's disease therapies still remains untapped.⁴

Pressures on the pharma industry

Although population ageing will create market opportunities for pharmaceutical companies in the long term, companies will need to plan their strategies to make the most of them and be responsive to the public's viewpoints regarding healthcare costs. One of the problems is that population ageing is placing tremendous pressure on governments' finances to provide the elderly with the highest quality healthcare. New medicines, although innovative, are generally expensive and governments are reluctant to pay for them. It has been known for a long time that healthcare demand will outpace per capita growth, but most governments have been slow to react and have been resisting calls to increase healthcare budgets. As a result, many governments have shifted the focus back to pharmaceutical companies to justify the prices of their medicines.

In the UK, for example, Eisai and Pfizer have been locked in a legal dispute with the National Institute for Health and Clinical Excellence (NICE) over its appraisal of their Alzheimer's disease drug, Aricept (donezepil). In its original decision, NICE decided not to recommend the reimbursement of Aricept, Novartis' Exelon (rivastigmine) and Shire's Reminyl (galantamine), for patients in the early stages of Alzheimer's disease.⁵ Officially, drugs are approved if they cost the UK's National Health Service less than about £30000 per qualityadjusted life year. This is taken to mean that for every £30000 spent prescribing them, the benefit enjoyed by patients must add up to the equivalent of a single patient living an extra year of goodquality life.⁶ Unhappy with NICE's ruling, Eisai and Pfizer submitted a legal challenge and forced the organization to reveal the model it had used to evaluate the drugs. As part of the legal challenge, Eisai commissioned United BioSource Corporation to independently review NICE's model. Although some inconsistencies were found, NICE was still able to keep to its original decision and Eisai and Pfizer have decided not to continue with their appeal.⁵

With respect to the battle between NICE, Eisai and Pfizer, the pharmaceutical companies received support from patients and their advocacy groups, but this type of scenario is not always the case. In the US, the pharmaceutical industry is often criticized by groups that represent seniors for charging high prices for its products. In 2003, AARP, which has 35 million members aged 50+ years, accused companies of funding senior groups to influence them to issue industryfriendly political messages.⁷ During and after the 2008 US election, the pharmaceutical industry came under regular attacks for being intransigent regarding its prices. Under pressure, in June 2009, a number of companies agreed to reduce prices of medicines for elderly Americans. The deal was expected to address medication costs of senior citizens between about $2700 and $6100 a year that are not covered by the Medicare part D plan. In the longer term, the deal is expected to be part of an $80 billion reduction in Medicare drug costs for senior citizens.

In fact, the political influence of senior citizens on healthcare policy appears to be one area where pharmaceutical companies have been reactive rather than proactive. As the elderly make up a growing portion of the population, they also represent a powerful force among the voting population. For example, in the controversial 2000 US presidential election, 72% of all American citizens aged 65–74 years voted — the highest rate of any age group.⁸

Political priorities

Unsurprisingly, politicians are realizing that they must listen to this sizeable audience to stand any chance of election and this means showing an understanding of their concerns about healthcare issues, such as prescription drug costs. Many politicians in the US have received contributions from the pharmaceutical industry, but they are now wary of being portrayed as too industry friendly.

In France, the healthcare system was rated the best in the world in 2001 by the World Health Organization; however this has come at a price. The current French government would like to reduce healthcare spending, but will need to tread carefully, as those reaching the age of retirement have spent their working life expecting that they will receive the same universal coverage as previous generations. For pharmaceutical companies, this scenario should be worrying because the government has always had a strict approach to pricing. If the government cannot shift more costs onto consumers, it may decide instead to further pressurize pharmaceutical companies to reduce the costs of their products.

Beyond politics, pharmaceutical companies will also face new regulatory requirements if they wish to develop products for the elderly population. As elderly patients are more likely than younger adults to experience complications when taking some prescription drugs, regulators want to see companies producing more safety data for this population. For companies, this means increased expenditure on clinical trials, which is already the fastest growing segment of R&D budgets.

In the US, the FDA expects appropriate clinical trials to be conducted for use of a drug by elderly persons, before a company submits an application for marketing approval.⁹ Furthermore, FDA regulations require that pharmaceutical companies report clinical drug trial data by age. Pharmaceutical companies can expect even more regulatory requirements to be introduced in the future as age differences are almost always discussed during team meetings. The FDA itself has been the subject of intense media and public criticism and, for all the reasons highlighted earlier, it will need to be able to persuade senior citizens that it takes all measures to safeguard their health when approving new drugs. In Europe, regulatory agencies are following a similar path. The European Forum for Good Clinical Practice set up the Geriatric Medicines Working Party, which has been examining healthcare services for the elderly and includes analyses of clinical trials and their suitability for this population.¹⁰

Conclusions

The ageing of the world's population creates both opportunities and challenges for the pharmaceutical industry. Companies will need to change their strategies as simply developing an effective product will be insufficient. They will need to assure regulators and patients that their clinical development programmes address any safety concerns, defend their product's pricing to consumers and prove to governments that they will be cost effective in the long term. In addition, there will be heavy competition from other companies for the growing market.

Faiz Kermani is a freelance consultant and President of the Global Health Education Foundation, a charity that supports medical education and medical research projects in developing countries. He is a member of Pharmaceutical Technology Europe's Editorial Advisory Board. faiz@doctors.org.uk

References

1. Department of Economic and Social Affairs, Population Division, United Nations, "World Population Ageing: 1950-2050". www.un.org

2. Alzheimer Europe, "Numbers of people with dementia in Europe higher than previously reported " (2009). www.alzheimer-europe.org

3. Merz, "Alzheimer's Disease" (2009). www.merz.com

4. Cognitive Labs, "Alzheimer's Market to Reach $7.8 Billion by 2010" (2006). http://blog.cognitivelabs.com

5. S. Houtlon, PharmExec (2009). http://pharmexec.findpharma.com

6. N. Hawkes, The Times (2008). www.timesonline.co.uk

7. R. Moynihan, BMJ, 326(7385), 351 (2003).

8. S. O'Brien, Senior Living (2009). http://seniorliving.about.com

9. GAO, "Prescription Drugs: FDA Guidance and Regulations Related to Data on Elderly Persons in Clinical Drug Trials" (2007). www.gao.gov

10. EFGCP, "The challenge of an ageing population for medical research: Is Europe ready to cope?" (2009). www.efgcp.be