Global Pharma Market

Dynamics and Trends:

Disruption, Inflections and
Sustainability
W O R L D R E V I E W AR G E N T I N A

M AY 2 4 , 2 0 2 2

Murray Aitken, Executive Director

Copyright © 2020 IQVIA. All rights reserved. IQVIA® is a registered trademark of IQVIA Inc.
in the United States and various other countries.
Today’s Themes

Disruption Inflections Sustainability

2
Impact of COVID-19 on the use of medicines
Medicine use continues to be
disrupted and results in about
$175Bn reduction in global
cumulative market by 2026
COVID-related therapeutics
market is estimated to be $58Bn
cumulative through 2026
COVID vaccines market is
modeled to be about $250Bn
cumulative through 2026, though
price and volume estimates vary
More uncertainty than usual exists
about impact on medicines markets
of delayed diagnoses, mental
health disorders, new variants, and
treatment of post-COVID
conditions
3
Global spending, including COVID-19 vaccines and therapeutics,
to exceed pre-pandemic outlook by $133Bn to 2026
Changes in the historical and projected global medicine pending model due to COVID-19,
2020–2026, US$Bn
Cumulative difference, US$ Billion
3E+11

251
2,5E+11

217
2E+11
185
155
121 123 133
114
1,5E+11

105
1E+11
84 88
58 44 50 58
26 35
16
5E+10

3 0
0

-5E+10

-28 -25 -41

-1E+11
-60
-85
-1,5E+11 -115
-145 -175
-2E+11

2020 2021 2022 2023 2024 2025 2026

Cumulative difference in non-COVID spending from pre-COVID-19 levels Cumulative COVID-19 therapeutics
Cumulative Covid-19 vaccine spending Total cumulative difference from pre-COVID-19 levels
Source: IQVIA Market Prognosis, Sep 2021; IQVIA Institute, Nov 2021
The Global Use of Medicines 2022: Outlook to 2026. Report by the IQVIA Institute for Human Data Science.
4
 Global spending on COVID-19 vaccines is modeled to be $251Bn
through 2026, though cost and volume estimates vary
COVID-19 vaccination evolution as percentage of population

COVID-19 vaccine $20 Cost per dose scenarios, US$ Base case key assumptions
100
Global spending scenarios
90 $15 • The two-track vaccination rates in 2021 have left
much of the developing world unvaccinated but
80 $10 this will be addressed through 2023.
6-year total of base-
• Endemic COVID will require booster shots which
Constant US$, billion

70 case =$251Bn $5 are half the size of an initial dose and may be
(185-295)
60 given annually or more often with variations
$0 expected based on patient risk and to a degree the
50 2021 2022 2023 2024 2025 2026 wealth of countries, as well as the spread of new
variants of the virus.
40 10 Standard doses scenarios, Billions
• Although increased competition will drive down
30 8 cost per standardized dose, this will be more than
6 offset by more future usage in wealthy countries
20 for boosters while low-income countries will be
4
delayed and fewer people receiving boosters.
10 2
0 0
2021 2022 2023 2024 2025 2026 2021 2022 2023 2024 2025 2026
Scenarios range Base case scenario

Source: IQVIA Institute, Mar 2021; Pricing information from public disclosures as of Mar 25, 2021; Vaccination trends to date from Ourworldindata.org
The Global Use of Medicines 2022: Outlook to 2026. Report by the IQVIA Institute for Human Data Science.
5
Medicine use was disrupted, with varied timing and impact across
countries
Trends in medicine use in 10 developed and pharmerging markets, Standard Units indexed to Q3
2019 values
Common ICU
120% Acute therapies Chronic therapies Mental health
medications

100%

80%
Antidiabetics Vitamins and minerals Respiratory Hypertensives

120%

100%

80%

Pharmerging 10 Developed
Source: IQVIA MIDAS, Sep 2021; IQVIA Institute, Nov 2021
The Global Use of Medicines 2022: Outlook to 2026. Report by the IQVIA Institute for Human Data Science.
6
The pandemic has Increased uncertainty about demand and use
of medicines
Summary of expected impacts of the COVID-19 pandemic on patients and therapeutics

Population level mental health Impact on infectious diseases

• Depression/anxiety, stress disorders • Seasonal flu season largely absent in 2020, could
• Substance abuse / dependency result in more virulent strains in future seasons,
especially if vaccination rates drop
• Excessive hand sanitizer use could result in
Disrupted or delayed diagnoses of conditions
antimicrobial resistance or alcohol resistant microbes
• Interruption of typical healthcare seeking behaviors
due to quarantines / shutdowns could have lasting • Increased interest in better treating/preventing other
effects or result in more severe disease when pathogens with pandemic potential such as: Influenza
diagnosed, especially cancer A (H7N9), RNA viruses (paramyxoviruses,
pneumoviruses, and picornaviruses, pathogens that
utilize Anopheles and Aedes mosquitoes
Greater rates of chronic disease • Vaccine hesitancy spreads to others and results in
• Obesity, type-2 diabetes, heart disease rates increase outbreaks of previously controlled viruses such as
due to sustained reductions in activity measles, mumps, rubella

Source: IQVIA Institute for Human Data Science, Mar 2021

The Global Use of Medicines 2022: Outlook to 2026. Report by the IQVIA Institute for Human Data Science.
7
Millions of people will have long-term complications of COVID-19
infection, with uncertain prognosis and treatment
Post-COVID conditions worldwide

3.3 Mn

1.9 Mn

3.4 Mn

3.1 Mn
0.05 Mn

19.1 Mn 2.3 Mn 2.1 Mn 0.7 Mn

1.5 Mn 0.1 Mn
15.5 Mn

0.7 Mn
0.6 Mn
9.7 Mn

1.3 Mn

Rest of the world: 38.9 Mn

Source: IQVIA Institute: Assessing the Global Burden of Post-COVID-19 Conditions, Dec 2021
The Global Use of Medicines 2022: Outlook to 2026. Report by the IQVIA Institute for Human Data Science.
8
Selected inflections 2019-21
U.S. Venture Funding in Life Sciences

+105%
$22.9 -> $47.0 Bn

9
 Venture capital deal activity and investment flows accelerated in
the past two years as interest in life sciences intensified
U.S. life sciences venture capital deal value in US$Bn and number of deals closed by type

50 2500

45

40 2000

35
Deal value US$Bn

Deal counts
30 1500

25

20 1000

15

10 500

5
$8,8 $10,3 $13,5 $15,4 $14,1 $18,0 $25,7 $22,9 $34,7 $47,0
0 0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Angel & seed Early VC Later VC Deal value ($B) Deal count

Source: PitchBook-NVCA Venture Monitor Q4 2021, accessed January 2022. Available from: https://pitchbook.com/news/reports/q4-2021-pitchbook-nvca-venture-
monitor.
10
Global Trends in R&D: Overview through 2021. Report by the IQVIA Institute for Human Data Science.
Selected inflections 2019-21
U.S. Venture Funding in Life Sciences Novel Active Substance Launches

+105%
$22.9 -> $47.0 Bn
+45%
58 -> 84

11
A record 84 novel active substances (NASs) were initially
launched globally in 2021, double the number five years ago
Global launches of novel active substances (NAS) by therapy area, 2011−2021
90
84
Global NAS launches 2012-2021
80 77 Total (552)

All Others (144)

70
63 COVID-19 (15)
60 58
56
Respiratory (14)

50 48 Dermatologics (17)
45 44
41
Immunology (23)
40
35
Cardiovascular (23)
30
Anti-diabetics (24)
20 Neurology (54)

10 Infectious diseases incl vaccines

(69)
Oncology (169)
0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Source: IQVIA Institute, Jan 2022.

Global Trends in R&D: Overview through 2021. Report by the IQVIA Institute for Human Data Science.
12
Selected inflections 2019-21
U.S. Venture Funding in Life Sciences Novel Active Substance Launches

+105%
$22.9 -> $47.0 Bn
+45%
58 -> 84

Next Generation Biotherapies in Pipeline

+33%
605 -> 804

13
The next-generation biotherapeutic pipeline is focused on gene
editing, CAR-T and other cell therapies
Next-generation biotherapeutics Phase I to regulatory submission pipeline by mechanism, 2011-2021
900

800

Other
700

600
RNA therapeutics

500
CAR-T & NK cell therapy
400

300 Cell therapy

200
Gene editing & gene therapy
100

0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

Source: IQVIA Pipeline Intelligence, Dec 2021; IQVIA Institute, Jan 2022.
Global Trends in R&D: Overview through 2021. Report by the IQVIA Institute for Human Data Science.
14
Selected inflections 2019-21
U.S. Venture Funding in Life Sciences Novel Active Substance Launches

+105%
$22.9 -> $47.0 Bn
+45%
58 -> 84

Next Generation Biotherapies in Pipeline Oncology Trial Starts

+33%
605 -> 804
+26%
1,859 -> 2,336

15
Oncology trial starts reached historically high levels in 2021, up
70% from 2015 and mostly focused on rare cancer indications
Clinical trial starts by year, 2011−2021
2.500 2.500 2.500
Oncology Oncology excluding Oncology rare
2.000 2.000 rare 2.000
1.500 1.500 1.500
1.000 1.000 1.000
500 500 500
0 0 0
2011 2016 2021 2011 2016 2021 2011 2016 2021

2.500 2.500 2.500

Hematological Solid tumors Oncology with
2.000 malignancies 2.000 2.000 predictive biomarker

1.500 1.500 1.500

1.000 1.000 1.000

500 500 500

0 0 0
2011 2016 2021 2011 2016 2021 2011 2016 2021

Phase I Phase II Phase III

Source: Citeline Trialtrove, IQVIA Institute, Jan 2022.
Global Trends in R&D: Overview through 2021. Report by the IQVIA Institute for Human Data Science.
16
Selected inflections 2019-21
U.S. Venture Funding in Life Sciences Novel Active Substance Launches

+105%
$22.9 -> $47.0 Bn
+45%
58 -> 84

Next Generation Biotherapies in Pipeline Oncology Trial Starts

+33%
605 -> 804
+26%
1,859 -> 2,336

Global Biosimilar Sales

+76%
$13.1 Bn -> $23.1 Bn 17
Strong launches of biosimilars are rapidly reshaping the
biologics market and driven 76% growth since 2019

Global Biologics Top 10 (2021) Global Biosimilar Sales bn USD

25

2017 bn USD 2019 bn USD 2021 bn USD

20
Humira 22.9 Humira 26.9 Humira 32.3
Lantus 11.2 Keytruda 11.4 Keytruda 19.6
15
Enbrel 10.4 Lantus 10.0 Stelara 14.4
Remicade 8.3 Enbrel 9.7 Trulicity 13.7
MabThera 7.0 Stelara 8.8 Ozempic 12.5 10
Novorapid 6.8 Opdivo 8.4 Lantus 10.8
Herceptin 6.6 Novorapid 7.3 Enbrel 9.3 5
Avastin 6.4 Trulicity 7.3 Opdivo 9.3
Humalog 5.9 Remicade 7.0 Dupixent 7.2 0
Opdivo 5.7 Avastin 6.8 Novorapid 7.1 2017 2018 2019 2020 2021

Key: Biosimilar competition

EU US Japan ROW

Notes: Biosimilars include biocomparables; biosimilars data in constant exchange rates

Source: IQVIA MIDAS MAT Q4 2021 18
Rate of uptake of subsequent biosimilars has accelerated as
stakeholders become increasingly comfortable with biosimilars
Uptake rates 40% in 12mo, 60-70% in 24mo

Europe biosimilar uptake rates US biosimilar uptake rates

(months since launch, Treatment Days) Launch (months since launch, Treatment Days)
Launch
Dates
Dates
100% 80%
Bevacizumab Jul 20
Rituximab Nov 19

80% Adalimumab Oct 18

60%
Trastuzumab Jul 19
Pegfilgrastim Oct 18
60%
Trastuzumab Apr 18 40% Bevacizumab Jul 19

40%
Rituximab Apr 17
Pegfilgrastim Jul 18
20%
20% Etanercept Mar 16

Infliximab Nov 16
Infliximab Oct 13
0% 0%
M0 M6 M12 M18 M24 M30 M36 M0 M6 M12 M18 M24 M30 M36
Notes: Includes subcutaneous formulations for rituximab, trastuzumab and infliximab
Source: IQVIA European Thought Leadership; IQVIA MIDAS MTH Dec 2021; Rx-only 19
Selected inflections 2019-21
U.S. Venture Funding in Life Sciences Novel Active Substance Launches

+105%
$22.9 -> $47.0 Bn
+45%
58 -> 84

Next Generation Biotherapies in Pipeline Oncology Trial Starts

+33%
605 -> 804
+26%
1,859 -> 2,336

Global Biosimilar Sales Remote Contact Volume

+76%
$13.1 Bn -> $23.1 Bn
+116%
12.4Mn 1/20 ->26.4Mn 3/22
20
Remote contact with healthcare professionals has reshaped the
mix of promotion activities
Promotion Volume Contribution to Change Mar 2022 compared to January 2020

80%

60%
Remote Contact Growth Jan 2020 – Mar 2022: +116%
40%

20%

0%

-20%

-40%

-60%
Japan 32.5% China 4% USA 3% Germany Italy -16% Spain -3% France -3% UK 24.5% Korea -0.5% Canada 12%
10.5%
F2F contact volume difference Remote (e-detailing, e-meetings) contact volume difference
Other remote (e-mail, phone, texting, post) contact volume difference

Source: IQVIA Channel Dynamics, Mar 2022

21
Sustainability
Total market grows from
$1.4Tn to almost $1.8Tn in
2026, as growth rate slows
to 3-6% CAGR, compared
to 5.1% over past 5 years
and 6.5% over prior 5 years
Payer/value assessment
issues remain challenging
Large pharma companies
maintain operating
margins as they adapt
their business models
Specialty drugs account
for most of the growth, Oncology,
reaching 45% of total immunology and
market by 2026, up from diabetes remain
31% in 2016, and almost largest therapy areas
60% of total market in the over the next 5 years
10 major developed while innovation lifts
countries neurology
Geographic focus on the U.S. market, as EU
markets reflect more restrictive access and
reimbursement for innovative drugs, Japan
market declines, and China registers heightened
interest as a market and source of innovation
22
The global medicine market — using invoice price levels — is
expected to grow at 3–6% CAGR through 2026 to about $1.8Tn
Global medicine market size and growth 2011–2026, const US$Bn

Forecast
5-Year
2.000
5-Year 1,750– CAGRs
1.800 CAGRs 1,780 Overall
5-Year Overall 3-6%
1.600 3-6%
CAGRs 1.424 5.1%
1.400 Overall 0.1%
6.5%
1.200 1.112

1.000 4.8%
813 11.4% 7.8% 5-8%
800

600

400 5.3% 4.3% 2-5%

200

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Developed Pharmerging Lower income

Source: IQVIA Market Prognosis, Sep 2021; IQVIA Institute, Nov 2021
23
The Global Use of Medicines 2022: Outlook to 2026. Report by the IQVIA Institute for Human Data Science.
Specialty medicines will represent about 45% of global spending in
2026 and almost 60% of total spending in developed markets
Specialty medicines share of spending
Forecast

58%

48%
49%
45%
38% 44%

39%
35%
26%
26% 31%

22% 18%

15%
11% 11%

2011 2016 2021 2026

10 developed Other developed Pharmerging Global

Source: IQVIA Institute, Nov 2021

The Global Use of Medicines 2022: Outlook to 2026. Report by the IQVIA Institute for Human Data Science 24
 Oncology, immunology and diabetes remain largest therapy areas
over the next 5 years while innovation lifts neurology
Global historic and forecast growth for top 20 therapy areas

15%

Oncologics
Forecast 5-YR CAGR 2021–2026

10% Dermatologics
Anticoagulants
Immunology
Pain Antidiabetics
Respiratory

GI
Neurology products
5% Lipid regulators Blood coagulation
Antibacterials Ophthalmology

Hospital solutions
Cardiovascular HIV
antivirals
Anti-ulcerants Kanpo+Chinese Medicines
Cough cold, incl flu antivirals
Vaccines ex COVID
0%
-10% -5% 0% 5% 10% 15% 20%

Historic 5-YR CAGR 2016–2021

Source: IQVIA Institute, Nov 2021

The Global Use of Medicines 2022: Outlook to 2026. Report by the IQVIA Institute for Human Data Science 25
 Aggregate sales of large pharma corporations rose over 17%
or $100 billion in 2021, and over $200 billion since 2016
Large Pharma Sales and Growth 2016–2021, US$Bn
800 25%

707
700

604 20%

600
567 17,1%
547
505 517
500
15%

400

10%
300

8,8%
6,4%
200

5,8%
5%

5,9%
100

3,7%
2,7% 2,3%
0 0%

2016 2017 2018 2019 2020 2021

Sales Growth Growth excluding COVID-19 Vaccines/Therapeutics

Source: Company financial statements; IQVIA Institute, Feb 2022 26

 Operating margins for the Top 15 pharmacos rose in 2021 as
rising COGS were offset by reductions in SG&A and R&D
Operating Margin Components as Percent of Sales 2016-21
32%
30,6%COGS
30% 28,9%
28,7% 29,0%
28,0%
28,1%
28%
27,1% 28,0%
27,9% 26,3% 26,2% Op.Mgn
27,3%
26% 26,8%

25,2%
24% 24,5% 24,3% 24,0% SG&A
23,7%
22%

20%
20,4%
19,6% R&D
19,3% 19,3%
18% 18,7%
18,2%

16%
2016 2017 2018 2019 2020 2021
Source: Company Fnancial Reports
Notes: Based on total corporate performance (not limited to pharmaceutical division) for 15 largest companies based on MIDAS-reported pharma sales; Operating
Margin defined as Net product sales less Cost of Goods Sold, Selling General & Administration costs, and Research & Development
27
“Operating margin” of large pharma was 26.2% in 2021 for the
aggregate 15 largest companies
Percent of product sales 2021

95%
85%
75%
65%
% of Sales

55%
45%
26.2%
35%
Aggregate
25% Op Margin
15%
5%
-5%

"Operating Margin" R&D SG&A COGS

Methodology note: Based on company financial statements, not limited to pharma divisions. “Operating Margin” calculated based on revenue less COGS, SG&A,
and R&D. May not be same as Operating Margin in financial statements which may also include other line items.

Source: Company financial statements 28

Emerging biopharma companies are responsible for most of the
R&D pipeline, with their share continuing to grow
Share of Phase I to regulatory submission pipeline by company segment, 2001-2021
100%

90%
Academic
80%

70% Small

60%
Mid
50%

40%
Large
30%

20% EBP

10%

0%
2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021

Source: IQVIA Pipeline Intelligence, Dec 2021; IQVIA Institute, Jan 2022.
Global Trends in R&D: Overview through 2021. Report by the IQVIA Institute for Human Data Science.
29
Payer/value assessment issues remain as major challenges for
pharmaceutical companies
Payer Budgets
• Drug budgets absorb $250bn incremental spending
through 2026
• Looming large-ticket therapeutics for Alzheimer’s,
obesity, cancer early detection, NAS

RWE Use
• Expanded sources and use of RWD to
assess efficacy and safety
HTA Approaches
• Patient input and defined endpoints
• Sharing and harmonization of incorporated
approaches
• Adapting to ensure fit-for-purpose

Access and Equity

• New medicine access measures
• Equity across diverse sub-populations

30
Today’s Themes

Disruption Inflections Sustainability

31
Global Pharma Market
Dynamics and Trends:
Disruption, Inflections and
Sustainability
W O R L D R E V I E W AR G E N T I N A

M AY 2 4 , 2 0 2 2

Murray Aitken, Executive Director

Copyright © 2020 IQVIA. All rights reserved. IQVIA® is a registered trademark of IQVIA Inc.
in the United States and various other countries.