Global prescription sales of biotechnology drugs grew 12.5% in 2007 to total over $75 billion, rising at nearly double the rate of the global pharmaceutical market, reports IMS Health.

The range of biotech products and their use in multiple therapy areas have grown steadily over the last five years, with 22 drugs generating sales exceeding $1 billion in 2007 compared with just six in 2002 and, last year, targeted oncology therapies, autoimmune agents, anti-diabetes products and pure vaccines accounted for most of both the market and its growth. The USA remains the largest market, with 56% of total sales in 2007, but Europe’s five major markets have steadily increased their share, reaching 24% last year. In contrast, Japan’s market share is down slightly, to 5% of global sales.

However, 2007’s growth moderated from 2006’s 18.2% and IMS forecasts that, in the next five years, the global market will more closely parallel the traditional pharmaceutical marketplace, reflecting changing industry dynamics.

“After 20 years of what some would call a charmed life, biotech is now facing a new reality,” said Murray Aitken, senior vice president, Healthcare Insight, IMS. “Loss of exclusivity and competition from biosimilars, crowded therapy areas with weaker sales growth, payers showing more reluctance to fund innovative drugs without compelling value propositions and safety concerns for some therapies will all contribute to a more moderate growth environment through 2012. Yet we expect the biotech sector to remain one of the most robust segments of the marketplace with a continued strong flow of innovative products to the market.”

IMS believes the key market dynamics influencing future market growth will include:

- Continued strong flow of innovative products: biotech now represents 25% of the total pharmaceutical R&D pipeline. Only three new products were launched in 2007, but the near-term pipeline is robust and includes six products expected to be launched by end-2009, each with potentially $1 billion in sales. They include innovative treatments for respiratory syncytial virus, melanoma and osteoporosis;

- Intensifying scrutiny by payers to demonstrate the effectiveness and value of biotech products: increasingly, in countries including the UK, Spain, Italy, Canada and Germany, health technology assessment (HTA) agencies assess the value of all biopharmaceutical products and recommend their inclusion on reimbursement lists at national and regional levels. In the USA, health plans also are more rigorously assessing both the clinical efficacy and economic rationale for using new products relative to existing, less expensive treatments;

- Greater impact from product safety issues: the challenge of balancing patient safety with efficacy of treatment is particularly acute in many therapy areas where biotech products have become an important part of treatment protocols. 2007’s regulatory reviews and the US Food and Drug Administration (FDA) labeling change led to fewer patients using erythropoeisis stimulating agents (ESAs), and this month, the FDA reported that it is evaluating anti-tumour necrosis factor (TNF) treatments as a potential cause of lymphoma and other cancers in children being treated for juvenile idiopathic arthritis or Crohn’s disease;

- Growing competition among biotech products: and also with alternative treatments, in several key therapy areas. Market expansion increasingly will be predicated on companies’ ability to use biomarkers or other means of differentiating treatment response in patient segments; and

- Emerging competition from biosimilars: ie, “follow-on biologics” or “biogenerics.” These are expected to have only a modest impact on the market over the next 5-10 years, but they represent a shift in the marketplace that will, over time, bring emerging competition following loss of exclusivity. The US regulatory approval process for biosimilars remains subject to legislative action and implementation by the FDA, but is expected to be resolved in the near-term.

“In today’s market environment and for the foreseeable future, companies with biotech products in their portfolios will succeed only if they meet increasingly demanding regulatory standards, deploy effective commercial models that are accompanied by compelling evidence of their products’ value and develop pricing and market access strategies that ensure that patients have access to the benefits that these new products deliver,” concluded Mr Aitken.