2013's story: Fewer drug approvals, better-selling drugs

Drug approvals this year are about quality more than quantity. It looks like the year could end with 34 drugs and biologics approved, down significantly from the record 43 last year. Fewer, yes, but this year will have turned out a new crop of blockbusters whose combined revenues 5 years out are forecast to reach $18.7 billion, besting last year's record of $16.4 billion in projected sales.

This will be the result of the industry moving away from me-too drugs and putting its efforts behind drugs for hard-to-treat and specialist diseases, according to a report released today by EP Vantage, the editorial group of EvalutePharma. A good example is Biogen Idec's ($BIIB) multiple sclerosis drug Tecfidera. The projected blockbuster has already blasted past analysts' forecasts in each of three quarters this year and is expected to reach sales of $2.9 billion in 2018, EP Vantage says.

The FDA has approved 27 drugs through Nov. 11. Those 27 alone are projected to have combined sales of $13.9 billion. The $18.7 billion total assumes the 7 still awaiting approval this year get FDA support. The setback earlier this year for Novo Nordisk's ($NVO) diabetes drug Tresiba is a good reminder that expected approvals don't always materialize. The number also assumes approval of Gilead Sciences' ($GILD) sofosbuvir, the highly anticipated drug which would be part of an interferon-free, all-oral hep C regimen. Based on analysts' 5-year sales projections, it would be the most valuable drug approved in 2013, with sales expected to hit nearly $3 billion in 2018, edging out Tecfidera. That means sofosbuvir would make up 16% of the total for the class of 2013.

"Barring any upsets this will make 2013 a year to remember in terms of future blockbuster sales," said Lisa Urquhart, EP Vantage editor.

The report also finds that the FDA is clearly focused on pushing to market early drugs with substantial need and proven efficacy. The report points to Roche's ($RHHBY) chronic lymphocytic leukemia treatment Gazyva, which the agency anointed 6 weeks early. The drug, Roche's heir apparent to its hugely successful Rituxan, is the first approved under the agency's new breakthrough therapy designation program.

"Increased efforts on the part of the FDA to speed up drug development and also companies choosing to expand into rare diseases or niche patient populations is having a big impact on productivity," Urquhart said.

- here's the report

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