Expiring drug patents
1 – Lipitor
The patent for the biggest selling drug in the world; Pfizer’s cholesterol reducing Lipitor, was initially due to expire in June 2011 but an extension meant it didn’t finally bite the dust in the US until November 2011 and is expected to expire once-and-for-all in May 2012 in European Union (EU).
In 2010, sales of Lipitor reportedly accounted for over $10 billion of Pfizer’s annual income, a significant portion of its total revenue. When Pfizer was granted a 10 month extension on Lipitor’s patent in the EU, the Financial Times reported it had the potential to earn the company an extra $770 million.
Well, in an attempt to cope when Lipitor loses its patent, Pfizer has apparently cut the amount of money it is investing in research and new drug development; there are rumours its R&D budget will be reduced by 30 percent within the next two years. It has also been reported that Pfizer will dedicate more of a focus to producing drugs with a slightly lower earning potential, things such as anti-inflammatory treatments and anti-cancer drugs. In 2009 the company also announced the loss of 8,000 jobs in the run up to the end of Lipitor’s licence.
2 - Plavix
Earning manufacturers Bristol-Meyers Squibb (BMS) and Sanofi Aventis over $9 billion in 2010, the patent for blood thinner Plavix is due to expire in May 2012. BMS is likely to be most affected by the loss; Plavix was responsible for 34 percent of its revenue and it is also losing the rights to fellow best seller Avapro in 2012.
3 – Enbrel
The patent loss of arthritis and psoriasis treatment Enbrel, will affect Amgen and Pfizer who together market the drug. Overall the drug was responsible for $6 billion worth of sales last year – $3.5 billion for Amgen and $3.2 billion for Pfizer. However, Enbrel’s biologic form is harder to copy which might shield the two companies from the effect of this expiration.
4 – Seroquel
Although AstraZeneca was initially going to lose the production licence to Seroquel in September 2011, an FDA extension gave the company an extra six months. It will surely be grateful for the extra time to plan how it will cope with a loss of $5.3 billion in annual sales (2010) and over 15 percent of its revenue.
5 – Singulair
Already heavily affected after generic counterparts of Cozaar and Hyzaar emerged on the pharmaceutical market, Merck had to cope with the patent expiration of its asthma and allergy treatment. In spite of the FDA warning of side effects, Singulair’s yearly sales consistently hit the $5 billion mark, another 11 percent of the company’s revenue.
6 – Zyprexa
Eli Lilly lost the exclusive production rights for its popular bipolar disorder treatment, Zyprexa, in April last year. Sales of the drug peaked at $5 billion in 2010, the equivalent to 22 percent of the company’s revenues. To cope with the loss, Eli Lilly has reportedly had to shed 5,500 members of staff.
7 – Actos
Although the patent for Takeda’s medication for type 2 diabetes isn’t due to expire until August of this year, it is likely to be one of 2012’s biggest expirations. From April-December 2010 alone Actos accounted for 27 percent of the Japanese company’s overall revenue, equating to almost $3.6 billion, just over ¥290 billion.
8 – Concerta
The expiring patent on the ADHD/ADD medication was J&J’s second major drug loss of the year; 2010 global sales of Concerta totalled $1.3 billion. Although together the two production right losses will be damaging to the pharmaceutical arm of J&J, the company has a more diverse product offering than others which should provide it with some buoyancy.
9 – Levaquin
The expiry of the Levaquin patent was just one of the blows Johnson & Johnson (J&J) had to face in 2011 and it was made even more difficult following the patent losses of its Risperdal and Topamax drugs in 2008 and 2009. An antibiotic, Levaquin was responsible for $1.4 billion worth of global sales in 2010.
10 – Cozaar/Hyzaar
Merck lost the exclusive production rights to these two blood pressure drugs back in 2010 and the affect of the expiration became noticeable last year. Before the patent expired, the drugs earned the company $3.6 billion a year, 13 percent of its overall revenue. Generic counterparts of the drugs have seen Merck’s 2010 sales fall by 41 percent.
Top 10 healthcare innovations for 2019
We take a look at some of the top 10 healthcare innovations which are transforming the sector
The telehealth market is booming. Consumers are leading increasingly busy lifestyles, with up to 60% favouring digitally-led services. Providing clinical care at a distance, increasing accessibility and eradicating potential delays has given patients greater control, boosting patient satisfaction and overall engagement. Such is its exponential growth, The Centers for Medicare and Medicaid Services in the US has recently released its proposed Physician Fee Schedule and Qualified Payment Programme updates for 2019, where telehealth services has been heavily featured, in order to deliver ‘different access points’ for patients.
9. Mobile technology
Consumers have become accustomed to accessing their data through the use of various digital tools, where the use of mobile and tablet health apps has tripled from 13% in 2014 to 48% today. Catering to this growing market, British based start-up Babylon Health is making waves on a global scale. Partnering with the National Health Service (NHS) and private health provider, Bupa, it has also cemented its presence across the flourishing Chinese market, with a membership base exceeding 1.4mn citizens across Europe, Asia and Africa. By partnering with global juggernaut Tencent, Babylon’s artificial intelligence system has enabled both parties to interact directly with users, identify specific illnesses, deliver health status assessments, and triage necessary actions. The mobile app is available to over a billion users and linked to more than 38,000 medical facilities in China alone.
8. Artificial intelligence
Artificial intelligence (AI) applications, such as predictive analytics for patient monitoring has provided significant financial savings. Applications that target hospitals and medical institutions include patient monitoring and transcribing notes for electronic health records (EHRs). The European Union is set to invest $24bn into artificial intelligence (AI) by 2020 in a bid to catch up with Asia and the US, who have invested heavily in AI and cloud services. This year, Google revealed its plans to harness AI and machine learning across a multitude of consumer technologies, particularly in healthcare. “If AI can shape healthcare, it has to work through the regulations of healthcare. In fact, I see that as one of the biggest areas where the benefits will play out for the next 10-20 years,” Google CEO Sundar Pichai has previously stated.
Blockchain is estimated to reach over $5.61bn by the end of 2025, even though it remains dependent on the ability to record and store information conveniently, economically and securely amongst different applications and systems. Providing transparency and eliminating third-party intermediaries, processes are streamlined, reducing healthcare costs exponentially. Unlocking the ability for providers to deliver a value-based healthcare system and enhance patient engagement, blockchain could save the industry up to $100-$150bn per year by 2025 in data breach-related costs, IT costs, operations costs, support function costs and personnel costs, according to BIS Research. Partnering with pharmaceutical giant GlaxoSmithKline (GSK), Ethereum blockchain-based supply chain platform, Viant sought to accelerate the pace of blockchain-based supply chain systems. Accenture and supply chain giant DHL have also developed a blockchain-based serialisation prototype which tracks pharmaceuticals from the point of origin to the consumer.
6. Health wearables
With the rise of lifestyle diseases, such as diabetes, more consumers are turning to health wearables that monitor glucose, heart rate, physical activity and sleep to gain a greater understanding of their health conditions. Following on from the release of the first Bluetooth headset back in 2000, the growing interest in wearables has seen monitoring our health and data become standardised. This data can be analysed by sophisticated algorithms to drive long-term diagnosis and support. Partnering with Google, health wearables company Fitbit is exploring the development of consumer and enterprise health solutions. Its acquisition of HIPAA-compliant health platform, Twine Health has seen the business enhance its clinical services by bringing on board a coaching platform, empowering people to seek better health outcomes.
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5. Electronic health records tools
From 2018-2022, the electronic health records (EHR) market is expected to grow at a compound average rate of 6% per year Providers and organisations continue to house fragmented technologies which create barriers towards collaboration and data sharing opportunities. This is further exacerbated if a patient straddles both public and private healthcare. Technology giant Apple has integrated patients’ medical records into its Health App as part of its iOS 11.3 beta. The data is encrypted and protected with the user’s iPhone passcode. Partnering with hospital providers and clinics, patients are now able to view their medical records from multiple providers within one platform. Johns Hopkins Medicine, Cedars-Sinai, Penn Medicine, UC San Diego Health and even the Cleveland Clinic have implemented this technology.
4. Healthcare transportation
Non-emergency health transportation remains a key issue worldwide, preventing patients from getting to or from a doctor’s appointment. 25% of lower-income patients have missed or rescheduled appointments due to lack of transportation, costing US health systems up to $150bn each year. Transportation companies such as Lyft and Uber have therefore entered the market by partnering with state governments to reduce these costs and deliver personalised patient care.
3. 3D Printing
Healthcare providers are set to represent the second largest industry sector in 3D manufacturing. The Food & Drug Administration’s decision to release its first comprehensive framework advising manufacturers of 3D medical products highlights its growing impact where more than 100,000 knee replacement surgeries are completed each year using 3D-printed, patient-matched surgical guides, for example. Through this process, surfaces and structures can be optimised for strength, weight and material use. Consultation between surgeons and patients has also been bolstered, where patients can better understand the complexity of his or her specific needs.
As consumers get more involved in the management of their health, consumer genetics and research companies have grown in popularity and scale. People want to further understand their genetic makeup, leading personal genomics and biotech company 23andMe to become one of the largest consumer-based organisations worldwide. Interestingly, this year, the company has entered a four-year collaboration with GSK to develop new treatments, but using human genetics as the basis for discovery.
Not only looking to develop treatments by analysing human genetics, pharmaceutical companies are looking to even remove hereditary genes which pass diseases down generations. In 2017, human embryos were successfully ‘edited’ through gene editing tool, CRISPR (Clustered, Regularly Interspaced, Short Palindromic Repeats), eradicating hypertrophic cardiomyopathy within 42 embryos.
1. Vertical integrations
As healthcare providers aim to provide greater transparency, promote collaboration and lower escalating patient costs, 2018 has been the year for a significant number of vertical integrations. CVS Health’s $68mn takeover of health insurer Aetna is a case in point. By influencing more of the supply chain, it will gain significant negotiating power to reduce costs for payers and patients, develop personalised solutions and improve overall outcomes. It will also promote the eradication of delays in process by removing any third parties within traditional business models. Other notable integrations are Optum’s acquisition of the DaVita Medical Group, Humana and Kindred Healthcare and Cigna and Express Scripts.
Reports have indicated that not only has the number of healthcare deals more than doubled in the last five years, the size of deals has also grown as a result of repeat investor interest, highlighting that this trend is here to stay.