Big Pharma faces $26.5B in losses this year as next big patent cliff looms, analyst says

Patents on file
With $26.5 billion in cumulative sales at risk, several important meds from Big Pharma companies face patent losses this year.

With 18 branded drugs on the line, patent losses this year could jeopardize $26.5 billion in annual sales from Big Pharma, projected to be the biggest fall-off until at least 2025, according to Bernstein analyst Tim Anderson. In a new note, Anderson is warning of a "patent cliff 2.0."

Which companies are at risk? Roche, GlaxoSmithKline, Eli Lilly, Pfizer and AstraZeneca to name a few.

This year's potential patent expiry damage is much more daunting than 2015 and 2016, when only four and nine meds from companies in Bernstein’s coverage lost exclusivity, respectively.

Related: Top 10 U.S. patent losses of 2017

Anticipated expirations for 2017 include Roche’s Rituxan, GSK’s Advair, Eli Lilly’s Humalog and Cialis, AstraZeneca’s Byetta, Pfizer’s Viagra and Merck’s Vytorin, according to the report. Together, the 2017 patent losses and associated sales declines will “continue to pressure growth” in the industry, according to Anderson.

Back in 2012, the U.S. drug market actually contracted by 1%, tallied by the IMS Institute for Healthcare Informatics, as a wave of patent losses hit top drugmakers. It was the first time the institute had ever noted a shrink in that metric. Life science commercial intelligence firm Evaluate has reported that $55 billion in total drug sales lost patent protection that year.

Related: Behold the patent cliff: U.S. drug market shrinks for first time

This time around, though, Anderson noted that about 45% of the sales at risk looking forward are for biologics, which will face biosimilar competition rather than generics. There, he said, “erosion rates will be slower,” but still “unpredictable.” Roche tops the list of drugmakers facing biosimilar threats, with Sanofi, Bristol-Myers Squibb and Lilly trailing in order.

While considering patent losses through 2025 and including the potential value of pipeline assets, Bernstein predicts that AstraZeneca will see the most growth of any pharma company it covers. It’s predicting AZ to grow at an average of 5.6% per year, while Pfizer is expected to lag the pack in the metric at 2% per year.

Excluding the value of pipeline assets, the analysts expect Bristol-Myers Squibb will see the most growth to 2025, with AstraZeneca trailing its pharma peers.

Related: Pressuring GSK's Advair, Teva launches both AirDuo RespiClick and authorized generic

On the same day Anderson released his report, Teva announced it’s launching a new inhaler, AirDuo RespiClick, and an authorized generic, aiming to take a stab at Glaxo’s top drug, Advair. The product isn’t directly substitutable, but will come at a deep discount to the hard-to-copy GSK asthma and COPD treatment.