Issue Date: February 1, 2016
The Year In New Drugs
For the second year in a row, new drug approvals in the U.S. arrived at a blistering pace. Forty-five new products received the Food & Drug Administration’s green light in 2015, making it the most productive year for the pharmaceutical industry since 1996.
But unlike in 2014, when the quality of the therapies was as impressive as the quantity, few products approved in 2015 stood out as major breakthroughs. Rather, many of the new drugs were notable more for their breathtaking price tags and how swiftly they moved to the market than for their ability to transform lives.
The bounty of new drugs in 2015 included more biologics than in the previous two years: A third of the drugs approved were antibodies, peptides, or enzymes compared with about a quarter in 2014. The year’s class included fewer novel mechanisms of action—36% of approvals compared with 42% in 2014.
Although big innovations were in short supply in 2015, the nearly two-decade peak in approvals buoyed spirits in the industry. Twenty years after the sequencing of the human genome promised a new way to cure disease, “it really feels like we’re in a period and will continue to be in a period where breakthroughs are turning into new medicines,” says Glen Giovannetti, global life sciences leader at Ernst & Young.
Aside from the sheer number, the most notable feature of last year’s approval list might be the speed with which the drugs reached the market. FDA granted one or more forms of expedited review—which include priority review, accelerated approval, and orphan drug status—to 60% of the drugs approved in 2015.
At the same time, more New Drug Applications are getting FDA’s rubber stamp on their first try. Last year 39 drugs, or 87%, were approved in the first cycle—meaning the agency did not ask companies for more information that would extend the review time. In 2010, just 56% of new drugs were approved in the first cycle.
FDA attributes the improved success rate to factors such as better interactions with companies early in the development process, fewer me-too drugs, more targeted therapies, and more drugs for rare disease in which greater risk is tolerated.
That so many drugs were approved—and so many made it through the regulatory gantlet on their first try—is important affirmation of a changing attitude at FDA, Giovannetti says. Given that companies’ relationships with the agency once seemed adversarial, “the impression that regulators are interested in getting good drugs to patients is positive,” he adds.
One of the biggest recent changes at FDA was the introduction in 2012 of “breakthrough therapy designation.” Companies developing drugs that FDA considers to be truly innovative—ones with a new mechanism of action or that address a disease that currently lacks treatment options—receive extra guidance from agency staffers early in the development process.
Companies and industry watchers are now trying to gauge how much time breakthrough status can shave from the lengthy drug development process.
Between 2002 and 2013, it took an average of 7.5 years for a drug to go from Investigational New Drug Application—a request for FDA’s permission to start human studies—to regulatory approval, according to the Tufts Center for the Study of Drug Development. By comparison, the 11 drugs with breakthrough status approved in 2013 and 2014 took an average of 5.2 years to go from application to market. And the three drugs out of those 11 that had the status plus a second expedited status sailed to market in just 4.3 years.
The data set is small, stresses Christopher Milne, director of research at the Tufts center, but so far the time saved with breakthrough status—potentially more than three years—is huge. Tufts is waiting for a larger cohort of drugs approved with the designation before doing a complete analysis.
One reason it’s hard to draw definitive conclusions about the impact of the breakthrough designation is that many drugs lingered in the pipeline before companies got extra guidance from FDA. Of the 10 products with breakthrough status that were approved in 2015, six had already been in the clinic for at least four years before the special designation was introduced.
But the four companies that received the status early on in a drug’s development clearly benefited from closer FDA guidance. For example, Boehringer Ingelheim’s Praxbind, an antibody fragment that reverses the activity of the company’s blood thinner Pradaxa, went into the clinic in 2012, was granted the status in 2014, and won approval a year later.
NEW PEAK: New drug approvals in the U.S. reached a nearly 20-year high, but innovation was in short supply.
Drugs with viewable structures are denoted with a red number in the chart below.
Hover over the row and then click to view the structure(s).
Breakthrough status has proven particularly helpful for cancer drugs. AstraZeneca’s Tagrisso, which treats lung cancer driven by a specific mutation, is an example of how the status can help a compound reach the market at breakneck pace.
AstraZeneca chemists first synthesized the drug’s active ingredient in June 2011, and it was chosen as a lead candidate in 2012. FDA approved the drug in November 2015, just 2.5 years after the first patient received it in a clinical trial.
Similarly, Genentech’s Alecensa, which also targets a specific driver of lung cancer, was discovered in 2008, entered the clinic in 2010, and was approved five years later. Both Tagrisso and Alecensa also were granted “accelerated approval,” which is a way to put important treatments on the market with limited data—with the proviso that their efficacy is proved in a postapproval study.
For the many drugs with expedited approval routes, the time saved can translate into lower development costs and potentially a longer period of patent exclusivity in which they face little or no competition.
As such, some companies are willing to pay princely sums to get their drugs onto the market faster. Last year brought the first real sense of how the market might shake out for priority review vouchers (PRVs), an incentive for firms to commercialize drugs for rare pediatric or tropical diseases. The voucher, which is transferable, can be submitted alongside a New Drug Application to shave four months off its regulatory review.
In 2014, BioMarin Pharmaceutical sold the first PRV to Sanofi and Regeneron Pharmaceuticals for $68 million. The partners used the voucher to get their cholesterol-lowering treatment Praluent onto the market last year one month before a competing drug from Amgen.
Of the five vouchers earned last year, three were sold, and for much higher prices. AbbVie shelled out $350 million for the voucher United Therapeutics received upon the approval of Unituxin, an antibody to treat children with neuroblastoma.
Rare disease firm Retrophin, meanwhile, sold its voucher for Cholbam, a treatment for bile acid synthesis disorders, to Sanofi for $245 million. AstraZeneca paid an undisclosed sum to buy the third 2015 PRV from Wellstat Therapeutics, which won approval for Xuriden, a treatment for a rare metabolic disorder that has been reported in approximately 20 patients worldwide.
Drugs might be getting to patients faster, but they aren’t getting any cheaper. The list price for a dozen of the products approved in 2015 is more than $100,000 per year; drugs with breakthrough designation accounted for eight of those 12 high-ticket treatments. Moreover, several other products must be taken in combination with expensive drugs, easily bringing the combined annual cost of treatment into the six figures.
Overall, the research firm Datamonitor Healthcare forecasts that more than a dozen of the 2015 class of new drugs will become blockbusters, topping $1 billion in annual sales.
Most of the expensive products treat small patient populations—either people with rare diseases or people whose cancer is driven by a highly specific molecular mutation. In 2015, nearly half the drugs approved were for “orphan” diseases for which the patient population is fewer than 200,000 people, a definition that encompasses some types of cancer.
Companies rationalize that narrow markets are only commercially viable if they can charge enough to recoup their research costs and make a profit. But as patients, doctors, insurers, and politicians call more loudly for lower drug prices, they are asking pointed questions about the value of some of those new drugs.
Cancer drugs have come under particular scrutiny. At least eight of the ones approved in 2015 carry a six-figure list price.
The shining example of a transformative cancer drug has long been Novartis’s Gleevec, which addresses a specific subset of chronic myelogenous leukemia patients. Gleevec works so well that it has added years to patients’ lives, notes Bernard Munos, founder of the InnoThink Center for Research in Biomedical Innovation.
But Munos also points out that Gleevec is the exception rather than the rule in cancer treatments. Many products add months, not years, to survival rates. “It’s better than we had before, but in the grand scheme of things, it’s not all that great,” he says.
Patients are becoming more sensitive to the relationship between the cost of a drug and its benefits as insurance providers raise copays. “I think that realization is going to sink in as patients are being made more cost-aware,” Munos says.
It’s a realization that will surely impact the drugs of the class of 2016.
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