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Pharmaceutical Technology Europe

Pharmaceutical Technology Europe, Pharmaceutical Technology Europe-06-01-2009, Volume 0, Issue 0

The latest growth forecast for the 2009 pharmaceutical market might have come as a shock to many, but there is still hope for the industry in the form of new product launches and potential blockbusters.

A grim fate for 2009 pharma?

The latest growth forecast for the 2009 pharmaceutical market might have come as a shock to many, but there is still hope for the industry in the form of new product launches and potential blockbusters.

IMS Health has forecast growth for the 2009 global pharmaceutical market to be just 2.5–3.6%, whereas a previous forecast in October 2008 had estimated growth at 4.5–5.5%, with sales exceeding $820 billion (€630 billion).

"In terms of pure financials, we're forecasting a $70 billion (€51.2 billion) reduction in the total dollar value of global pharmaceutical sales in 2009 compared with what we had forecast in October," Murray Aitken, Senior Vice President, Healthcare Insight, at IMS Health, explained to PTE in an exclusive interview.

The conclusions are drawn from the latest release of IMS Market Prognosis. "This adjustment to growth expectations is linked primarily to the lowered expectations for overall economic growth that are embedded in the Market Prognosis forecast models," Aitken explained. IMS's econometric model considers GDP, employment, consumer expenditure, government expenditure and other macroeconomic factors that are sourced from The Economist Intelligence Unit, and the estimates for these factors have changed significantly since the October forecast.

"For example, the October forecast assumed GDP would be growing in 2009 in each of the eight major developed markets — in aggregate by approximately 1.1%," said Aitken. "Our latest forecast assumes each of these markets will contract this year; in aggregate by almost 2%."

The situation in Europe is, at least, slightly more positive than that of the US where the pharmaceutical market has already been suffering for several years. "In the US, we're also starting to see the impact of rising unemployment, loss of medical insurance and reduced levels of consumer expenditure," said Aitken. Because of this, IMS is forecasting a contraction of the US market by 1–2% in 2009 — a historic low. "When we extend our forecast through 2013, we foresee variability in growth by year, but with essentially no net growth," Aitken added. In the US, where patients pay a high portion of drug costs, consumer spending is also changing; IMS is tracking a reduction in office visits and declines in new therapy starts in certain chronic care areas such as diabetes and depression.

Meanwhile, in more publicly-funded markets such as France and Turkey, Aitken explained that different policy actions are being seen, such as stimulus programmes that can have an indirect positive impact on the pharma market to the imposition of price cuts because of budget constraints. "Across the board, we're seeing a greater shift from branded products to generics and more pressure than ever to prove the value of medicines," he added.

But it's not all doom and gloom for the industry. "While the pharmaceutical industry is not recession-proof, it will feel the impact of the overall economic climate to a lesser degree than many other industries, where spending is more discretionary," said Aitken.

And a rebound is also expected in 2010. Although potential patent expirations in 2011 and 2012 will curb sales growth, approximately 50–60 new chemical or biological products are expected to launch during the next 2 years. Approximately two-thirds of these will be specialist driven and some will be first-in-class with novel mechanisms of action. In the expected launches, there could be six to ten potential blockbusters.


However, this good news doesn't alter the fact that market dynamics are changing, especially as emerging markets such as Brazil, China and India are expected to contribute more than half of the global market growth in 2009 and sustain an average 40% contribution through to 2013.

"This high level of growth in the emerging markets, combined with the contraction of the US market and ongoing low single-digit growth in other developed markets, is driving the pharmaceutical market to a new world order," said Aitken.

For the full interview with Murray Aitken, visit:

Prefilled syringes on the up

Despite consumer demand for needle-free methods of drug delivery, the traditional injection remains the dominant paradigm, and prefilled injection devices, which are quicker and easier to use and enable premeasured and presterilized dosing, are being increasingly integrated into the plans of pharma and biotech companies. According to a report from Greystone Associates, prefilled syringes are replacing vials both in terms of injections and sector revenue, and as this trend continues during the next 4 years, the number of tailored injectable drug products reaching the market is set to escalate.

But this doesn't mean that integrating this technology will be easy. One of the major issues is stability. In an exclusive interview, David Clark, Market Analyst at Greystone Associates, explained the problem. "Unlike glass vials, the drug needs to be stable for protracted periods of time while in contact with the different synthetic materials that comprise the syringe. Therefore, stability testing is a necessity."

However, drug stability is improving as advances are made in the design of prefilled syringes, such as new materials and manufacturing processes. Advances are also being made in the field of needle-free injections, but although Clark said these would "play a part" in the sector he also added: "the major movement will be within the injectable device sector; from syringes to pen injectors and auto injectors."

And how does Clark expect the sector to grow during the next few years? "A greater percentage of drugs in a given drug class will become available in prefilled syringes," he said. "A greater number of drugs indicated for chronic conditions and, by association, self-administration will also become available in automated injection devices."

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Middle East pharma to exceed $18 billion

Until recently, the Middle East has accounted for only a fraction of global pharmaceutical sales, but this will soon change as the region's pharmaceutical market is estimated to exceed $18 billion (€13.3 billion) by 2014. BioPlan's newly released book A Quick Guide to Healthcare and Biotechnology in the Middle East explains how the region offers a wealth of opportunities, which several pharma giants are already taking advantage of.

"Because of the slowdown in growth of the established markets of the US, Europe and Japan, companies are looking further afield and are now recognizing the Middle East's potential for growth," Faiz Kermani, the author of the book, told PTE. "The region has an estimated population of 280 million, which has been suggested to be one of the fastest growing in the world, and people want access to the latest healthcare technologies."

And multinational companies are capitalizing on this demand for new medicines, especially as improvements have been made to regulatory systems and intellectual property legislation. Novartis and Novo Nordisk have performed strongly, and Roche launched an Arabic version of its website in 2008. Pfizer, Amgen and Genzyme have also established regional headquarters at Dubai's biotechnology and research park, DuBiotech.

However, despite the region's potential, it won't necessarily be an easy ride for multinational companies. "This is still very much an emerging market and you have to do your homework," Kermani warned. The local regulatory bodies, for example, often have very different requirements that companies will need to be familiar with to have any chance of success.

The Middle East market is also unlikely to see the same high growth that has been witnessed in India and China. "The combined populations of India and China dwarf those of the Middle Eastern countries," said Kermani. "Companies see the Middle East as an area where they want to do better, but with India and China it is a case of having to do better if they want to keep growing at the rate of previous years.

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News bites

Acceptable compromise?

Although described by industry associations as "a step in the right direction" or an "acceptable compromise", the report on the revision of the EU animal testing Directive 86/609 adopted by members of the European Parliament requires further modifications.

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Oral vaccination platform

Cobra Biomanufacturing's Salmonellabased oral vaccine gave significantly greater protection in mice against a lethal strain of anthrax compared with the alternative approach of placing the vaccine gene on the bacterial chromosome.

For an exclusive interview regarding this technology visit:

UK bio funding woes

A survey of UK life sciences companies conducted by the UK's BioIndustry Association (BIA) has revealed that many companies are finding it extremely difficult to access financing — partly because the sector is viewed as "too risky" by investors.

For an exclusive interview with the Chairman of the BIA visit:

Aiding inhaler development

Cambridge Consultants has released an updated version of its dry powder inhaler generic specification that addresses recent regulatory requirements and technological developments to help speed up the development process and time to market for inhalation devices.

For an exclusive interview with the Head of Drug Delivery at Cambridge Consultants visit:

Sanofi axes 14 projects

A "rigorous" review of its R&D portfolio has led sanofi aventis to axe the development of 14 drugs/projects; four of which were in Phase III development. The next few months will also decide the fate of a further four products, which will be dependent on results from clinical trials.

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Disaster for biotech?

More than 70% of biotechnology executives fear that the EC's examination of anti-competitive behaviour in the pharmaceutical industry, which began in 2008, will weaken their patent protection. Coupled with the economic environment, this could spell disaster for the biotech industry.

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Big backing for stem cells

Pfizer has thrown its support and approximately €55.9 million behind stem cell research by collaborating with the UK's University College London, which is using stem cells to tackle certain opthalmic conditions. In return, Pfizer has been granted worldwide exclusive rights to develop and commercialize any resulting stem cell-based therapeutic in the opthalmology field.

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Dealing with swine flu

In light of the swine flu pandemic, the European Medicines Agency has made plans to prevent potential shortages of antiviral medicines. Recommendations includes extending the shelf life of Roche's Tamiflu, and issuing new guidelines for the use of Tamiflu and GlaxoSmithKline's Relenza.

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