Provided by GBI Research.
Oncology is a rapidly growing therapy area, both in terms of me-too and first-in-class products, with the first-in-class segment of the pipeline growing strongly in recent years. The oncology pipeline is the largest across the industry, and is currently full of innovative products.
However, rising development costs, stringent regulations, and generic and biosimilar competition threaten to prevent the development and approval of much-needed treatments. The threat from generics is increasing as markets continue to mature, raising the overall standard and incremental benefit required of a therapy in order for it to capture a significant market share and command high prices.
There have been a number landmark trends that have shaped both the oncology market and its pipeline over the past five years.
Cancer Immunotherapy Approvals
The development and approval of cancer immunotherapies has had a strong impact on the field, particularly the approval of immune checkpoint inhibitors such as Opdivo, Yervoy and Keytruda between 2011 and 2014. Drug companies are incentivized to develop biologics, as their patent expiries will have a smaller impact on revenues than those of small molecules, due to the protective effect of the practical and regulatory challenges in developing biosimilar products.
Pharmaceutical companies and patients alike benefit from the use of cancer immunotherapies, as they can be trialed across multiple oncology indications, and are less toxic than traditional chemotherapies, meaning they can be administered to poor performance status patients, and for more rounds of treatment before administration is discontinued due to adverse effects.
A number of deals have recently been struck by oncology’s key players that reflect immuno-oncology’s significant potential. These included Celgene and Jounce announcing a $2.6 billion deal to jointly develop and commercialize Jounce's lead product candidate JTX-2011, and AbbVie signing a deal worth up to $685 million to develop and commercialize argenx's ARGX-115.
Key Patent Expiries
The recent patent expiries for the blockbuster cancer drugs Gleevec and Herceptin will enable patent access to cheaper biosimilars, and encourage the use of efficacious and low-toxicity forms of treatment for leukemia and breast cancer in public healthcare systems – which prevent the usage of drugs that are not deemed cost effective. In February 2016, the commercial launch of the generic version of Gleevec (for chronic myeloid leukemia) was approved by the FDA, after the Novartis patent expiration, and it will be made available for the first time in the US through Sun Pharmaceuticals.
What does the future hold?
The market is extremely research-intensive, being deeply reliant on a high level of R&D investment and a strong product pipeline to maintain growth and ensure long-term revenue generation. Without successful innovation – which can be broadly defined as the market launch of novel therapeutic molecules that cost-effectively treat or cure diseases – the industry would face a substantial long-term decline in revenue. Often, several companies will simultaneously attempt to bring a product to market to treat the same unmet need, in order to acquire a first-mover advantage.
Greater Selection of Combination Therapies
Three combination treatments utilizing only targeted therapies have been approved for melanoma by the FDA since 2014: Opdivo and Yervoy, Tafinlar and Mekinist, and Zelboraf and Cotellic. This is a trend that will continue for other cancers as the number of approved targeted treatments grows and combination therapies are trialed. Combination therapies utilizing drugs that work through different mechanisms decrease the chance that resistant cancer cells will develop.
Also, when targeted therapies with different mechanisms of action are combined, each drug can be used at its optimal dose, and with less adverse effects than with combination therapies using one or more chemotherapies. As a result, combination treatments can be administered to a higher proportion of cancer patients – who are often elderly and with comorbidities – to improve prognosis and reduce the chances of relapse.
Emergence of Biobetters
Biobetters will be increasingly trialed and developed for oncology, which will dissuade drug companies from developing biosimilars. Biobetters will be preferred by clinicians and will experience more rapid uptake, as they can provide a substantial enhancement in clinical efficacy, safety or convenience, and may have fewer side effects or less-frequent dosing.
In 2013, Roche obtained approval for Gazyva, a Rituxan biobetter utilized as a treatment for chronic lymphocytic leukemia. This is therefore a trend that is already occurring, but it will become far more common in the future as drug modeling and design improves.
Vaccines Fulfill an Unmet Need for Hematological Cancers
Cancer vaccines that use chimeric antigen receptor T-cell therapy – whereby T cells are taken from a patient’s own body, and genetically modified to attack and kill cancer cells – will be approved for leukemias and lymphomas. Some of these vaccines are predicted to experience a rapid uptake, as they will offer targeted treatment for refractory leukemia and lymphoma in a therapy area where there are often few targeted options.
Recent cancer immunotherapy approvals and key patent expiries will have the most impact on oncology’s treatment landscape, providing accessibility to low-toxicity treatments for patients who are generally elderly and have comorbidities. Currently, cancer immunotherapies that use immune checkpoint inhibitors are perceived as having the most promise. However, in the future, chimeric antigen receptor T-cell therapies are predicted to also become commercially successful, as treatments for refractory leukemia and lymphoma.
It is now generally agreed that the future of cancer therapy lies in the combination of therapies with different mechanisms of action. However, multiple drug usage is associated with increased toxicity. Efficacy and safety can be improved through the administration of combination therapies using only targeted drugs, and through the production of biobetters, which should become more commonplace in both the cancer pipeline and market landscape as the design and manufacturing of biologics advances.
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