Are blockbuster drugs dead in the water?

Matt Buttell

Reports suggest that blockbuster drugs - defined as a drug that generates more than $1 billion of revenue each year - are beginning to wane. Are the reports true? And if so, how can pharma shift its focus to compensate potentially massive losses?

There are myriad challenges currently facing blockbuster drugs. For a long time, the search for blockbusters has been the backbone to the R&D strategy of big pharmaceutical companies, but all that looks set to change. Led by new advances in genomics and the promise of personalized medicine, new trends in the industry point to a more "fragmented" pharmaceutical market.

Furthermore, as drugmakers face the reality that many blockbuster drugs are now going off-patent - meaning that generic copies will soon be competing for market share - the industry needs to rethink its R&D strategy.

The issue is massive, especially considering that according to a recent URCH Publishing report, about one third of the pharma market by value is accounted for by blockbuster drugs.

Off-patent

The issue of going off-patent can probably be best illustrated through Pfizer's cholesterol-lowering medication, Lipitor. According to most recent figures, for instance, Lipitor is currently the top-seller among blockbuster drugs, with sales of $2.2 billion in 2007. However, Lipitor will see US patent protection expire in June 2011.

Despite this, driven by concerns over the rise of generic versions of the drug, Pfizer have now made an agreement with Ranbaxy Laboratories to delay their generic launch until November.

"Innovation"

Back in June of this year, at a three-day symposium on cardiovascular disease, Cleveland Clinic's Dr. Steven Nissen warned that the concept of blockbuster drugs was over. He proclaimed the "low-hanging fruit" of the drug development market as "dead and gone," stressing that harder-to-develop, targeted therapies will be part of the next wave in patient care.

The concern is that too many drugs only incrementally improve on existing ones. This has led Nissen to encourage drugmakers to embrace "innovative" regulation, stressing that the federal government has the ability to turn companies back toward creating novel treatments - and develop them quickly - especially in areas like Alzheimer's, obesity and drug-resistant tuberculosis.

Neissen says the US government should create incentives to develop drugs for such treatments, including extended patent rights for innovative medications as well as FDA approvals that expire after five years if outcome trials have not been performed in that time. He suggests that, "If we encourage that kind of regulation, then regulation becomes [the pharmaceutical industry's] friend rather than the enemy."

The future

At the beginning of 2009, MarketResearch.com forecast that up to eight potential blockbusters could launch over the next 12 months.

However, as blockbuster drugs are usually widely prescribed treatments that address chronic conditions - because drugs that can treat multiple diseases and high-cost, targeted agents are better positioned for blockbuster status - contrasting predictions suggest that blockbuster status won't be reached.

In short, if the future of the pharmaceutical industry's drug development is really going to transcend beyond the boundaries of the blockbuster drugs, the industry clearly needs a new direction. Loss of income from off-patent blockbuster drugs is inevitable, to get it back, the direction R&D has to take priority.

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