Judith Kulich, Jon Roffman, Cody Powers and Renuka Agarwal co-wrote this blog post with Ben Hohn.
Oncology continues to be the leading therapeutic area for first launches by emerging biopharma companies in the United States. Recent ZS analysis identified 125 U.S. biopharma companies with first launches from 2011 to 2018, and 51 of those were for novel drugs. Of these 51,14 were in oncology—the largest number of any therapeutic area.
Source: Publicly available information from Evaluate Pharma, as accessed on 2/25/19. Notes: (1) Excludes university assets, generics and biosimilars. (2) “Other” includes blood, genito-urinary, endocrine and various others (i.e., radiopharmaceuticals) that were too minimal in launch number to stand alone as therapeutic areas.
The factors that have made it favorable for oncology emerging pharma companies to launch themselves—with or without a co-promote partner—include the number of pipeline assets in development and the willingness of investors to capitalize these companies through commercialization.
Here are five key takeaways from ZS’s research and analysis of oncology first launches:
1. European launch: Recent launches suggest that companies are more willing to try to commercialize in Europe themselves, though the success of this strategy vs. partnering has proven to be limited thus far. Of the 14 oncology first launch companies, 11 subsequently launched in Europe and, of these 11, only three (Clovis, Ariad and Tesaro) chose to self-commercialize.
2. Japan launch: According to our research, not a single U.S. first launch company in oncology (or any other therapeutic area) also pursued an independent launch of the same asset in Japan. Barriers to a Japan first launch include the relatively smaller patient potential vs. Europe (about one-third) combined with pricing that’s typically more comparable to Europe pricing than U.S. pricing. Furthermore, obtaining support from Japan’s entrenched distributors can be a barrier for small new entrants.
3. Field size: One of the reasons that specialty markets such as oncology are more viable for first launches by emerging pharma companies is that a relatively smaller field footprint is required. There was a range of five to 85 sales representatives for emerging pharma that launched without a co-promote partner. Very small field sizes may reflect very small or “ultra-rare” initial indications, as was the case for Exelixis.
4. Biomarker status: Of the 14 oncology first launches, three (Rubraca, Idhifa and Vitrakvi) were assets indicated for patients defined by a biomarker. There has been a threefold increase in the number of biomarker launches since 2011, and we anticipate that as next-generation sequencing (NGS) becomes more prevalent and less expensive, biomarker launches will continue to be more common.
5. Exit values: Of the 14 oncology first launches, six of these assets (Vitrakvi, Imbruvica, Varubi, Iclusig, Xtandi and Onivyde) were subsequently acquired. All were acquired in company acquisitions except for Onivyde, which was an asset purchase only. Three of these launched with a co-promote partner and the remaining three (Varubi, Onivyde and Iclusig) launched solo in the U.S. Partnerships may continue to drive favorable exit values in oncology post-launch. For example, Pharmacyclics had a market capitalization of $8 billion when it co-promoted Imbruvica with Janssen and ultimately exited to AbbVie for $21 billion. Similarly, Medivation had a market capitalization of $3.8 billion when it co-promoted Xtandi with Astellas and ultimately exited to Pfizer for $14 billion. Recent deal values post-launch include Tesaro ($5.3 billion) and Loxo Oncology ($8 billion).
For more key insights and data on oncology first launches and launch strategy, we’ll be speaking and moderating a panel at BIO International on June 5 in Philadelphia. During the panel, we’ll also share our thoughts on upcoming potential U.S. oncology first launch companies as well as a rapidly growing list of domestic China emerging pharmaceutical oncology companies, which may be candidates for future first launches as well. We’ll also speak to innovative topics in launch, including the role that AI, machine learning and advanced analytics can play in launch strategy, and the specific challenges and nuances of launching with biomarker, cell and gene therapy, I-O indication and rare oncology assets.
ARTICLE: Always Be Launching