Stars of new-drug sales for Q2? Think BMS, Novo, Pfizer and Lilly

At the top of many quarterly earnings releases, pharma companies tout their growth rates for new drug sales. For some, it’s intended to offset news of disappointing top-line results; for all, it’s a way to emphasize the future, rather than the present.

But damn lies and statistics--the numbers can be misleading. Simple math, for instance--big percentage growth doesn’t mean absolute growth is all that impressive. Start with $100 million in sales of newer meds, and an increase to $200 million amounts to 100%. Start with $450 million, and a $200 million increase is less than 50%.

Or consider how dependent a company might be on those newer meds. AbbVie, for instance. Its new drug sales growth amounted to a hefty 79%. New drugs accounted for almost 15% of its sales for Q2. That puts it above the middle of the Big Pharma pack on both counts. But most of the rest of its revenue comes from Humira, the superstar anti-inflammatory med that will face biosimilar competition in a few years. It will have to pump up that new-drug-sales number significantly before then to have any hope of filling the Humira sales gap.

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And then there’s Bristol-Myers Squibb, with a big chunk of its revenue derived from newly approved meds. New drug sales amounted to 42% of its total sales for the quarter, far higher than any other major drugmaker’s. Novo Nordisk, in second place, totted up 24% of its sales from newer meds. Pfizer, in third, counted 20% of sales from recently approved products.

Thing is, Bristol-Myers’ Q2 sales were fueled in large part by its cancer med Opdivo. When the company reported those quarterly figures, the outlook for that med was amazingly strong, with sales estimates topping $10 billion by 2020. It was out-growing its head-to-head rival, Merck & Co.’s Keytruda, by a huge margin.

Just over a week ago, however, Opdivo fell short in an important lung cancer trial, and analysts have since cut their peak sales expectations by as much as $2.5 billion--and boosted Keytruda’s by even more.

Meanwhile, Novo Nordisk lowered its guidance despite that sales record. One of its newer meds, Victoza, was excluded from a top payer formulary, and pricing pressure is expected to take a bite out of that drug’s sales, as well as other newer meds in its portfolio. It’s hoping that some yet-to-debut drugs will help turn that around, but with the intense competition in diabetes these days, there’s no guarantee.

Pfizer, on the other hand, could find itself doing better than Bloomberg Intelligence’s expected 32% in new drug sales by 2020, simply on its breast cancer drug Ibrance alone. The drug picked up a boost from a rival’s trial failure earlier this month, and will have more time flying solo on the market to bag sales growth and lock down market share.

So could Merck, what with the sales kick it's likely to pick up from Keytruda, now that it's set for a first-line lung cancer nod from the FDA that Opdivo's unlikely to win soon.

As for sales growth among newer meds, Eli Lilly topped all of Big Pharma at growing products approved since 2010, according to a report from Bloomberg Intelligence. Its new drug sales more than doubled year-over-year, with growth of 125%. That’s impressive.

But Lilly has won fewer drug approvals since 2010 than many of its peers. Johnson & Johnson and Novartis, for instance. J&J charted nods for the prostate cancer pill Zytiga, the diabetes med Invokana, the blood cancer drug Imbruvica, the clot-fighter Xarelto and, more recently, another blood cancer treatment, Darzalex. Novartis has picked up approvals for Signifor, a treatment for acromegaly and other rare maladies; Tasigna, a follow-up to its leukemia powerhouse Gleevec; and Gilenya, the first oral multiple sclerosis med to hit the market. More recently, it rolled out the psoriasis med Cosentyx, which has surpassed all its early sales expectations.

Which is to say that both J&J and Novartis may have totted up lower percentage growth year-over-year--15.2% and 40.6%, respectively--but they were starting from a bigger dollar figure. J&J’s absolute new-drug growth amounted to $332 million, with a Q2 2016 total of $2.5 billion and $2.18 billion for the same period last year. Lilly’s new drug sales last quarter represented about the same amount of dollar growth, despite its huge percentage leap.

- see the Gadfly analysis

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