The pharmaceutical industry has changed significantly in the last 20 years.

  • Twenty years ago, the market was dominated by large multinationals that were fully integrated companies with their own discovery, development, and manufacturing engines. Today, these companies rely heavily on outsourced services. They in-license or acquire most of their innovation and outsource clinical development and manufacturing.

 

  • Twenty years ago, most blockbuster drugs were small molecules designed to address large therapeutics areas such as cardiovascular and CNS. Today, companies are developing biologics to address the needs of narrower patient populations. As a result, large sales forces have been replaced by highly skilled small group of key account managers and medical science liaison who can have more in depth discussions with physicians.

 

  • Twenty years ago, market access was not such an important aspect. Companies would just leverage their massive sales force to make their products “top of mind” with physicians and win prescriptions. Today, having a comprehensive market access strategy including pharmaco-economics is essential in successfully selling a pharmaceutical product.

 

  • Twenty years ago, the US, Europe, and Japan were the key markets where all innovation took place. Today South Korea and China have built R&D capabilities and are having global success. Twenty years ago, local emerging markets companies sold their products as branded generics without having the need to perform bio-equivalence studies. Today, more and more regulatory authorities are requiring studies and driving bad actors out of the system.

 

Twenty Years AgoToday
Vertically integrated companies with discovery, development, manufacturing, and commercial capabilitiesHighly decentralized companies that in-license or acquire most of their innovation
Seeking to develop blockbuster drugs that were small molecules designed to address large therapeutics areasDeveloping biologics to address the needs of narrower patient populations.
Large sales forces driven by “Top of Mind” strategy.Highly skilled small group of key account managers and medical science liaison who can have more in depth discussions with physicians.
Little focus on market accessHaving a comprehensive market access strategy including pharmaco-economics is essential in successfully selling a pharmaceutical product.
US, Europe, and Japan were the key markets where all innovation took placeSouth Korea and China have built R&D capabilities and are having global success
Local emerging markets companies sold their products as branded generics without having the need to perform bio-equivalence studiesMore and more regulatory authorities are requiring studies and driving bad actors out of the system.
Small chemical-based molecules made the bulk of new developmentsInnovation is much more complex. We went from chemical-based compounds to reformulations, to biologics, to cell therapy, and now gene therapy

WHAT IMPACT DO THIS CHANGES HAVE ON THE PHARMACEUTICAL INDUSTRY ?

These changes are likely to have a significant impact on an industry that remains much too fragmented. Access to innovation is becoming costlier because technologies used to develop new drugs are becoming more and more complex. We went from developing small chemical-based molecules, to drug delivery technologies, to biologics, to cell therapy such as CAR-T and now gene therapy such as CRISPR.

 

  • In emerging markets, this means that branded generic companies’ ability to copy innovation is diminishing while, at the same time, the use of pure generics is growing, leading to margin erosion. The only way to survive for these companies will be to scale up, pay to get access to innovation through M&A and in-licensing, or sell themselves.

 

  • In developed market, the era of “me toos” is disappearing fast. Developing or acquiring new drug will become more competitive and require additional financing, which could be obtained by securing non-dilutive global or regional licensing deals.

Alan Vanderborght

Alan Vanderborght

Chief Executive Officer at KYBORA
see my profile
Alan Vanderborght

Latest posts by Alan Vanderborght (see all)

    Contact Us


    OUR SERVICES

    Acquisition

    buy-side

    Divestment

    Businessmen making handshake in the city - business etiquette, congratulation, merger and acquisition concepts, panoramic banner, Vintage tone Retro filter effect,soft focus, office background. Partnership, Deal

    In-Licensing

    licensing-in

    Out-Licensing

    Depositphotos_118613238_l-2015

    How can we help you achieve success?

    If you are facing these challenges, please contact us. We can help you address them effectively.

    OUR SUCCESS STORIES

    OUR TEAM