Emerging biotechs are more active than big pharmas in late-stage R&D

Little Guys Launching

While FDA approvals were at a record high in 2018, smaller biotech companies were less likely to rely on big pharma and more likely to be doing later-stage pipeline work, according to a new report by the IQVIA Institute for Human Data Science, "The Changing Landscape of Research and Development: Innovation, Drivers of Change, and Evolution of Clinical Trial Productivity." Meanwhile, big pharma was seeing its R&D share drop as emerging life science companies appeared to be prepared to go it alone, reported Ben Adams in Fierce Biotech.

IQVIA, the company created by a merger of pharma analytics firm IMS Health and CRO Quintiles, has compiled an index that “reflects changes in trial complexity, success and duration” from a 10-year historical view of these parameters and “recasts the data with a future perspective that identifies critical productivity changes expected through 2023.” While 2018 was a big year for FDA approvals, with 59 new therapies getting the nod, big pharmas filed for less than half of the launches. Emerging biopharmaceutical companies filed for 64 percent (38 of the 59 medications).

While the IQVIA report said that the “importance of large pharma in originating molecules is decreasing,” big pharma companies “remain important partners” for biotech. On the other hand, it appears to be less important for smaller biopharma companies to team up with big pharma companies and their big sales teams. According to the report, “The dynamics of development, M&A and licensing activity seem to be shifting, and emerging companies are retaining control of their assets to a greater degree.” While emerging biopharma companies spent less than $200 million per year on R&D and had less than $500 million in sales, they accounted for 72 percent of all late-stage pipeline activity, up from 61 percent ten years ago.

The top 15 largest pharmaceutical companies spent more than $100 billion for the first time last year, but those with more than $10 billion in yearly drug sales have had their R&D share drop from 31 percent to only 20 percent in the past 10 years. According to the report, “This pipeline mix reflects smaller companies being most active in the fastest growing areas of oncology and orphan drugs, and their diminishing need for partnering or acquisition to develop and commercialize their innovative medicines.” 

Life science companies can be happy that investment in medical innovation increased in 2018, “reflecting confidence in scientific development to propel new treatments to tackle unmet health needs across a broad range of diseases.” In 2018, more than 1,300 life science venture capital deals were closed with a total value of more than $23 billion. According to the National Venture Capital Association, that represents an increase of $10 billion in deal value from five years before.

The length of time between patent filing and product launch has decreased by an average of half a year. Still the average time is 13.7 years. According to IQVIA, “Of the 2018 new drug launches, four new molecular entities launched in less than eight years, while another 12 drugs launched more than 20 years after their first patent filing, reflecting in some cases older mechanisms of action and the approval of drugs that had launched in countries outside the U.S.”

Other highlights of the IQVIA report were the increasing importance of artificial intelligence, real-world data, patient-reported outcomes and stronger biomarkers and diagnostics in both trials and post-marketing tests. These factors drive productivity and better success in drug development and beyond. 



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