Jeremy Spivey, research analyst with Cutting Edge Information, discusses the findings of his new report, Oncology Roadmap: Brand Spending Benchmarks and Market Forecast to 2013, which examines nearly 140 drugs and reports on the state of the oncology drug market. 1) Where do you see oncology pharma and biotech R&D heading in the next five years?
I think oncology drug research is headed pretty heavily in the direction of the tyrosine kinase inhibitors and monoclonal antibodies. Both drug classes have fewer side effects, and certainly in the oncology market, any drug with fewer side effects is welcome, because other than side effects being very painful, you can stack them onto other treatments without hitting a critical mass of side effects that make it totally unmanageable. The advantage for pharmaceuticals is that the patent on these drugs, particularly monoclonal antibodies, currently does not run out in the United States. The disadvantages from a perspective both of the oncologist and the pharma companies is that they are highly targeted, so you can’t just release one kind of drug and expect it to work on all kinds of cancer.
Another interesting thing is that we have a top 10 drugs list at the beginning of this report for drugs that have just been released or are getting ready to be released, and two of the drugs on this list are drugs aimed at bone health. This is an issue for anyone who is on a hormone inhibitor for prostate cancer or breast cancer. But these drugs are going up against biophosphates, which are not only a standard of care right now, but they’re generically available. One of the drugs on our list is projected to be a $3 billion drug by 2012 while going up against a drug that’s already generic. You have to wonder what the drug has in its profile that makes it look so good in terms of sales. I think in order to have those kinds of sales figures, it will need to have much lower rates of osteonecrosis of the jaw, which is a prominent side effect of the biophosphates, or be even more effective. In the last set of trials, there were low rates of osteonecrosis, but I do think oncologists and doctors in general are still hesitant, and they are looking at that very carefully in the last set of trials.2) What does this mean in terms of the cost of these blockbuster drugs?
Biologics are going to be even more expensive than the biophosphates were. Some of the biologic prices are $50,000– $100,000 for a year of treatment. This is the downside for these biologic treatments that are so targeted, because the patents may expire, but there’s no approval process for a generic in the US currently, so these drugs will essentially never face generic competition. That may be something the new administration will look at and try to remedy, but frankly these drugs are so expensive to create. Some of the cost studies have indicated that even if some of these generics face competition, it would only lower the price by 20% or 30%. So, with the targeted cancer drugs that are monoclonal antibodies, I think costs will continue to be a significant concern. As some of the small molecule chemotherapeutics continue to go off patent, people will have more and more options for cheaper and cheaper oncology drugs.3) Have you recently seen any major change in research focus?
I think biologics in the past few years have been the most recent change. There’s also been an increase in focus at the FDA of making sure they don’t release drugs that have an anticipated side effect profile. I don’t know how much this will affect oncology going forward, but in a lot of areas where drugs are treating non-fatal diseases, drugs that would have previously been approved in the last couple years have been sent back for additional testing or received complete response letters from the FDA. I think cancer researchers are going to be even more vigilant of their endpoints. They may do more trials, see more people in those trials, and they’re probably going to more specifically aim their end points than they have in times past.4) Has there been a change in the number of drugs that are released every year?
That’s actually decreased significantly in the last two years. The decrease in approvals is actually the entire reason that companies are more focused on hitting their endpoints, and making sure their drugs are safer. That’s certainly not a guarantee after Vioxx, and some of the other problems that have been seen as the FDA’s fault, whether or not that was the case. It’s not guaranteed anymore that a drug that looks fairly safe—but has questions remaining—is actually going to hit the market. The decrease in the number of drugs approved may actually translate into higher costs for patients, since drugs will face less competition and companies will want to be able to recoup more of money that they spent on research.