The world’s biggest pharmaceutical company Pfizer announced in June 2008 that it would be putting its “full scope and scale” behind a push into the cancer market. It has boosted anti-tumour research by 60% since 2005, at a cost of $1.6bn, in the hope of increasing the share of company sales attributed to cancer drugs from the current level of 5%.
“There are a lot of patients that are suffering,” said Pfizer chief executive Jeffrey Kindler. “And there’s a tremendous opportunity to meet their needs.”
While Pfizer is currently testing 18 medicines targeted against pancreatic, breast and lung cancers, figures released by the Pharmaceutical Research and Manufacturers of America [Phrma] in April 2008 reveal that research companies are currently testing a record-breaking 750 experimental cancer drugs in America alone.
Between 2003 and 2005 global sales for cancer-treating drugs grew by 40%.
According to IMS Health, who tracks prescription drug sales, the global market for cancer drugs is still growing rapidly with around $48bn spent on oncology products in 2008; a figure which accounts for 17% of worldwide pharmaceutical sales.
So what’s driving the growth? Why aren’t we seeing more cancer treatments on the market? And are we getting any closer to beating the Big C?
Demand for treatment
The American Cancer Society estimates that over 12 million new cancer cases were diagnosed worldwide in 2007. All those people need treatment, which creates demand for drugs and stimulates growth in the sector.
“There’s a huge clinical need which has been undelivered for years,” says Gustav Ando, manager of the healthcare business development unit [HBDU] at Global Insight. “There were segments of the oncology market where there were no drugs at all, so people were basically given drugs that were intended to fight a different sort of cancer to what they had. Now technology has advanced and drugs are targeted at specific cancers. There’s been a huge change in the market.”
Supply and revenue
Cancer drugs can plug revenue gaps created by loss of patents in other areas, as Pfizer hopes to do when competition for its cholesterol fighter Lipitor opens up in two years’ time. Analysts predict Pfizer’s revenue stream would be slashed by 25% by 2015 if the company did not branch out into other areas.
In addition, cancer drugs can reach the market twice as fast as the average medicine and, when they do get there, they can be extremely lucrative. Companies can charge as much as $50,000 for a single course of treatment.
“Companies can charge high prices for cancer drugs because there’s so much need for them and, within reason, governments are willing to pay for them as there is a clear surgical benefit from them,” says Ando.
“Also, most cancer drugs are pretty complicated to make and the patent lives are prolonged so there’s pretty good margins on them.
“You’ve only go to look at the likes of Pfizer – they steered clear of cancer drugs for years and now they’re turning to them as the market is dynamic.”
So why isn’t the world awash with cancer-fighting drugs? Despite the enormous growth being enjoyed by the global oncology market, potential cancer cures are left on laboratory shelves on a regular basis, according to Dr Victoria John, head of clinical partnerships at Cancer Research UK’s Drug Development Office.
“Companies shelve research on a regular basis,” she says. “They have limited budgets and resources and therefore they have to make difficult decisions. Cancer competes against other disease areas and companies have to weigh up the potential commercial returns against a drug’s characteristics to see if it is worth developing.”
Risk and finance
The biggest barriers facing companies wishing to develop cancer drugs are risk and finance. Current estimates suggest that it costs between $800m and $1.7bn for a cancer drug to make it from the twinkle of a scientist’s eye to a treatment in a clinic. And there’s no guarantee it’ll even make it that far.
“Cancer drugs are expensive to research because of the technology involved,” says Ando. “These are not chemical drugs, they are injectibles and biologics, which are extremely difficult to research. The problem is that there are so many good drugs available now it is difficult to improve on them, so you research 300 drugs and there’d be no guarantee that any of them would succeed. In fact, they probably wouldn’t.”
One potential solution to the problem of bowing laboratory shelves sagging under the weight of untested drugs is out-licensing. Pioneered by Eli Lilly & Co, out-licensing occurs when a pharmaceutical company enlists the help of a biotech company to develop a drug that they don’t have the time or resource to look at.
“Pharmaceutical companies can’t develop everything themselves and one of the other routes they look at is out-licensing to a biotech company,” says Dr John. “However, the concern is that they might have a fantastic drug and by out-licensing they’ve given the rights away to another company, so they’d rather not do it.”
Looming biosimilar legislation and the disregard for patents in the developing world is also threatening the intellectual property, and therefore profit margins, of companies looking to develop cancer drugs.
“Intellectual property is becoming more of an issue,” says Ando. “Companies used to be universally protected by patents but there is a pathway to approval opening up for biosimilar legislation. That will affect the intellectual property of oncology drug manufacturers.
“The other problem is in the developing world, like China and Brazil, where people simply break the patents.”
Partnerships for clinical trials
To help combat the problems faced by companies wishing to take cancer drugs to market, Cancer Research UK launched a Clinical Development Partnerships [CDP] programme in 2006 and in May 2008 AstraZeneca‘s AZD0424, a tyrosine kinase inhibitor, became the first drug to enter the initiative.
Under the terms of the partnership deal, Cancer Research UK’s Drug Development Office will conduct the clinical trials at no cost to AstraZeneca. In addition, AstraZeneca will retain the option to assume further development and marketing of the drug, with the charity receiving a share of any revenues.
“Intellectual property is one of the main reasons companies don’t want to let go of their agents,” says Dr John. “One of the key advantages of the CDP is that companies retain their commercial rights through the development of the drug. We have a dedicated team working with these companies to make sure things happen smoothly.
“Often the drugs we are looking at are low priority within a pharmaceutical company and they don’t have the time, budget or resources to spend putting agreements together.
“We can do that, and we also have the drug development office here, which has a proven track record of developing oncology drugs.”
IMS Health predicts that the global market for cancer drugs will grow twice as fast as that of other pharmaceuticals over the next five years. With expensive new treatments, increasing numbers of patients in chemotherapy in major markets and developing nations like China, Brazil and Russia investing more in treating and diagnosing cancer, IMS predicts a compound growth rate of 12–15% and tips the global market to reach $80bn by 2012.
“Double-digit sales growth in oncology drugs will be fuelled by increased use of targeted therapeutic agents introduced over the past ten years, first-time innovations coming to the market and longer treatment periods for growing numbers of patients,” says Titus Plattel, IMS vice president for oncology. “In addition, approximately 25 to 30 new anti-cancer agents are expected to be approved for a variety of new indications, helping to expand the treated patient population.”
Although they may disagree on the reasons, other experts are also confident in predicting further growth. Ando cites improvement in areas like melanoma, skin and thyroid cancer stimulating future growth, while Dr John thinks age will be a key driver.
“Cancer is in part age-related and we have an ageing population,” she says. “As we understand more about the disease, patient selection will be much tighter. So, while the overall market may be increasing, the market for a particular drug may get smaller.”
Beating the big C
“Six Novartis oncology compounds are currently in late-stage development with the potential for registration over the next five years,” a Novartis spokesman told pharmaceutical-technology.com. “These compounds include RAD001 [renal cell carcinoma and other cancers], ASA404 [non-small cell lung cancer], SOM230 [Cushing’s disease, refractory carcinoid tumors and acromegaly], LBH589 [cutaneous T-cell lymphoma and other cancers], EPO906 [ovarian cancer], and PKC412 [acute myelogenous leukemia
and aggressive systemic mastocytosis].”
So the 80 billion dollar question is: with Novartis and all the other big pharmaceutical companies working diligently to develop new oncology drugs, are we on course to beat the ‘Big C’ once and for all?
“For certain cancers, yes,” says Ando. “You can get vaccines now to prevent cervical cancer. It is feasible that we will see that erased in ten to 15 years. In other areas treatments have allowed cancer to be turned from a chronic condition into an acute disease. However, there’s still plenty of cancers where treatment can only prolong life by two to three months and then only with side effects that bring up serious quality of life issues. Until those side effects have been dealt with, we can’t really proclaim victory.”
“Cancer Research UK has made a lot of progress in this area,” says Dr John. “The company vision is to beat cancer and it has set itself ten ambitious goals for 2020 to help achieve that. Within the next ten years they hope to reduce risk, diagnose cancer earlier and have drugs with fewer side effects. We’re on the right path.”