The Pharmaceutical Industry: Key trends and strategic issues shaping the industry : Market Research Report

The Pharmaceutical Industry: Key trends and strategic issues shaping the industry

Published by: Datamonitor

Published: Feb. 14, 2007 - 83 Pages

CHAPTER 1 EXECUTIVE SUMMARY: Scope of the report; Key findings; Key macro-environmental trends triggering industry changes; Corporate strategy trends shaping the way that drug developers will increase cost savings; Trends shaping the way that drug developers will drive revenue growth
CHAPTER 2 KEY MACRO-ENVIRONMENTAL TRENDS TRIGGERING INDUSTRY CHANGES: Datamonitor believes there are three key macro-environmental factors that drove industry change in 2006; Reference pricing is an increasingly dominant cost containment tool in Western markets; Reference pricing extends into new geographical markets and new drug markets; Reference pricing is set to become increasingly restrictive in Europe and play a more significant role in the US; Price cuts remain a key tool in containing pharmaceutical spending across Europe and Japan; A range of price cuts were extensively used in both the European markets and Japan in 2006 to contain costs; Price cuts are set to remain a leading cost containment tool in Japan and Europe going forward; Political/legislative events continue to significantly impact the healthcare industry; A number of political/legislative events have impacted pharmaceutical market dynamics in 2006; By securing majorities in the House of Representatives and the Senate, the Democrats are set to have a more significant impact on healthcare in the US; With the implementation of Part D, Medicare patients received outpatient drug coverage for the first time in 2006; The 2006 healthcare reform in Spain increases the government's focus on cost containment; The introduction of the AVWG prioritizes cost containment in the German pharmaceutical market; The Médecin Traitant scheme impacts healthcare provision in France; The introduction of rules and guidelines for DTC advertising in the US; Generic usage is being increasingly incentivized; Globally, a number of initiatives were used to boost generic uptake in 2006; The introduction of biosimilars offers new opportunities for savings in the biologics market; 2006 saw the first biosimilars launched in Europe and the US; In Europe, the biosimilars environment is relatively advanced; The development of biosimilars is further behind in the US; Europe is set to lead the biosimilars market; European and US healthcare markets are becoming increasingly fragmented; Devolution in Europe, together with continued fragmentation in the US increase the complexity of the major healthcare markets; Drug companies need to devote greater resources to targeting the correct stakeholders to ensure strong profit margins and market penetration
CHAPTER 3 CORPORATE STRATEGY TRENDS SHAPING THE WAY THAT DRUG DEVELOPERS WILL DRIVE COST SAVINGS: Changes to the R&D strategy will help drive up productivity; The need to develop efficacious innovative drugs prioritizes R&D spending as the industry transitions away from blockbuster development; More structured decision making in R&D is being introduced; Prioritizing pricing and reimbursement in clinical trial design will help rationalize and improve the drug development process; Licensing and alliance strategies have evolved for early-stage R&D; GSK's CEDDs and CEEDD have helped to build up the company's early-stage pipeline; Companies are set to improve internal infrastructure to better segregate and prioritize important functionalities and improve communication within the company; Increased globalization in the pharmaceutical and biotech markets in 2006 is set to continue; India - the partner of choice for contracting out manufacturing and research activities by Western manufacturers; China - a key country in which multinational pharmaceutical players are performing drug discovery
CHAPTER 4 CORPORATE STRATEGY TRENDS SHAPING THE WAY THAT DRUG DEVELOPERS WILL DRIVE REVENUE GROWTH: Inorganic growth through M&A set to continue throughout 2007 and beyond; A number of types of M&A are used to allow drug developers to evolve; Big Pharma mergers: is the time for mega mergers over?; Mid-Pharma showing evidence of the next wave of consolidation; Pharma-Biotech mergers allow Big Pharma to capture greater innovation and revenue growth potential; Pharma turns to acquisitions of generics companies to support sales and buy into generics market growth; Pharma-Non-Pharma mergers: still rare, but may represent an alternative profit growth strategy in the future; Biotech-Biotech mergers help smaller-scale biotech companies achieve greater stability and give Big Biotech stronger pipelines; Generic-Generic mergers increase market consolidation; Increasing complexity of supplementary technology helps drug manufacturers stay ahead of the competition; New technologies make it easier to demonstrate comparability of biosimilars; Directed molecular evolution: lifecycle management for biologics; Novel diagnostics drive clearer market segmentation, and personalized medication in the future; Increasing impact of emerging markets on revenue growth in the Pharma industry; China is set to become the largest pharmaceutical market by 2050; India is increasingly becoming an important source of Pharma revenue; Other emerging markets are also likely targets for global manufacturers in the future; Biosimilars and the emerging markets; Increased brand protection is essential in protecting future revenues; Merck's Zocor novel brand protection; The failure of a follow-on drug to support revenues: Pfizer's torcetrapib discontinued; Know your patent situation and don't make assumptions: BMS's patent problems with Plavix; Counterfeit medicines continue to threaten branded revenues
CHAPTER 5 BIBLIOGRAPHY: Publications and online articles; Conference literature; Datamonitor resources; Suggested reading
CHAPTER 6 GLOSSARY: Glossary of terms
List of Tables: Table 1: Forecast sales for specific pharmaceutical and biotechnology peer sets, 2005-2011; Table 2: Key Biotech-Biotech deals in 2006; Table 3: Key Generic-Generic deals in 2006; Table 4: Brand strategy selection - pros and cons
List of Figures: Figure 1: Seven factors triggering industry changes can be grouped into three key trends; Figure 2: Driving cost savings, 2006 and beyond; Figure 3: Pros and cons of drug discovery and clinical trials in China; Figure 4: Positioning of emerging markets in terms of their outsourcing/offshoring potential, 2006; Figure 5: Driving revenue growth, 2006 and beyond; Figure 6: Summary of M&A in the Pharma, Biotech and Non-Pharma sectors in 2006; Figure 7: Comparison of the major seven developed, and emerging pharmaceutical markets, 2001-05

Abstract

Introduction

Datamonitor has identified the key trends and events that impacted the pharmaceutical market on a macro-environmental and corporate strategy level in 2006. These range from the continuation of long term trends such as the focus on cost containment to more recent impacts such as the effects of Medicare Part D and the increasing power of the Democratic part in the US.

Scope

Overview of the key macro-environmental trends driving industry change in 2006 and going forward into 2007
Review of major M&A deals in the pharma, biotech and generic sector in 2006
Analysis of the corporate strategies that companies in the pharmaceutical market are using to counter the challenges that they face

Highlights

To overcome the poor R&D productivity that has characterized the pharmaceutical industry over the last few years, companies are being forced to re-evaluate R&D strategies. Companies are continuing to use licensing and acquisitions along with better prioritised spending and more structured decision making in an effort to deliver improved returns. Pharma companies turned to a range of inorganic growth strategies in 2006 to improve sales and profit. This has allowed branded companies to expand their geographical presence, while enhancing the strength of their pipelines, frequently with the acquisition of small Pharma and biotechs providing additional products and supplementary technologies. The role of emerging markets in the pharmaceutical industry is changing: not only do markets such as India and China represent significant targets for growth because of their rapid economic expansion, but with the globalization of the industry, manufacturers are increasingly outsourcing and offshoring numerous functions there.

Reasons to Purchase

Identify the key trends that have shaped the pharmaceutical industry in 2006
Weigh up which factors are likely to have a significant impact on the industry going forward into 2007
Understand how these factors will impact drug developers

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The Pharmaceutical Industry: Key trends and strategic issues shaping the industry

Table of Contents

Abstract