Pharma’s Renaissance
By David Ormesher, CEO, closerlook
We are on the verge of a medical renaissance, a period of accelerated progress in the treatment and management of rare diseases. This reawakening also brings with it challenges that we must grapple with.
It wasn’t so long ago that the pharmaceutical industry was lamenting the dearth of drugs in the pipeline. The shrinking number of innovative new drug applications and the end of exclusivity for many blockbusters led to a rationalization of smaller sales forces and a surge in mergers and acquisitions in the quest for future revenue.
Thanks to a confluence of factors, analysts are pointing to a burgeoning list of therapies that is reinvigorating our industry. In 2018, 59 new products were approved by the FDA in 2018. Of the new approvals, 58% were orphan drugs. Nineteen of the products were first-in-class mechanisms. Revenues are projected to reach an estimated $176 billion by 2020.
The Orphan Drug Act: The Catalyst for Innovation
Rare disease was once a story of hopelessness. Approximately 80% of rare and orphan diseases are debilitating, half of them affect children, and 30% of patients will never live to see their fifth birthday. There are nearly 7,000 rare diseases that we currently know of, according to the Alliance for Regenerative Medicine (ARM), but only 5% have an FDA-approved treatment. For the thousands without effective therapy, their only hope is to try various types of experimental or off-label drugs until they find one that seems to work.
When it came to pharma’s commitment to drug discovery for rare diseases, historically very little was done to study or develop treatments for small patient populations. The research and development process was time consuming and costly, and with the reimbursement model in place at the time, there was little chance to recoup investments. This all changed when a small group of patient advocates formed a coalition called the National Organization for Rare Disorders (NORD) and influenced Congress to pass the Orphan Drug Act in 1983.
The Act didn’t initially trigger interest among industry players until Congress made additional refinements to the legislation, such as accelerated drug approvals, significant tax credits, and a seven-year market exclusivity. The result has been an explosion of new drugs.
Before 1983, few rare disease drugs came to market. In fact, according to the IQVIA Institute (formerly known as IMS) only 2 orphan drug indications were approved in 1983. By the end of 2018, a total of 86 drugs were approved for orphan indications. Drugs for rare disorders now account for about a third of all newly approved drugs and biologics, with 80-90 more expected to be approved through 2022.
Medical Advances Enabled Targeted Therapies
While legislative changes provided the business case for investing in medicines for rare diseases, the pace of progress could not have occurred without medical advances such as genomics, gene therapy, and cell therapy. Genomic technologies have given scientists the tools to add, remove, or alter an organism’s DNA. The potential to apply genome editing across medicine from discovery to the personalization of therapies is real.
It wasn’t long before stories of hopelessness changed to stories of optimism and even cures. Doctors at St. Jude Children’s Research Hospital, for example, are using gene therapy to insert a missing gene in children suffering from severe combined immunodeficiency syndrome (SCID), also called “bubble boy disease1.” Investigators at Loyola University Medical Center are genetically modifying patients’ T-cells to cure large b-cell lymphomas2.
As promising as gene therapy is, there are challenges that researchers have yet to solve. Genome editing is a permanent change that can’t be undone. This alters the patient risk profile for those participating in clinical trials. Researchers and the companies that fund them must be prepared to communicate these risks when recruiting patients.
The Role of mHealth and Data as an Accelerant
While medical advances are bolstering innovation in drug development, mobile technology and big data are eliminating many of the inefficiencies in the discovery process.
For example, with 90% of US consumers now reliant on smart phones, access to health information and tools has never been easier. For researchers, mobile health has provided a convenient tool for the management and retention of patients in clinical trials. It can help solve challenges such as distance and travel restrictions by monitoring patients remotely. Mobile devices make it easy for participants and their trial coordinators to communicate via video and audio. Gamification, embedded into apps, helps with engagement and retention.
Patient sensors and their real time data streams are also feeding the machine learning algorithms that have become critical tools in the trial process. Patient data can be securely transmitted in real time, giving investigators near immediate information. What once took months to gather and analyze has been streamlined into days. The digital transformation of the discovery process is shortening the time from idea to therapy for many rare diseases.
Centering the Focus on Patients
The story of drug development for orphan and rare diseases wouldn’t be complete without considering the role of patient advocates. Patient advocacy and caregiver groups have been active lobbyists for investment by pharma and reimbursement by payers. Patient centricity has become central to both the core values and the business model of pharma.
Recognizing the value of the voice of the patient throughout the product lifecycle, pharma companies are taking steps to integrate consumers into the planning stages. UCB indicated that the development of its new drug, Briviact, was the result of patient insights shared by pediatricians, caregivers, and advocacy groups. Shire added a nurse at the center of its patient support program for Gattex after listening to patients share their personal experience.
The Impact on Payers
The explosion in the number of these remarkable new therapies comes at a price. Many of the innovative biologic and gene therapies offer the promise of a cure or dramatic improvement after only a short course of therapy. The current healthcare system is not set up for “one-and-done” premium-priced medicines. Payers are accustomed to sharing the cost of chronic disease drugs across multiple patients over time.
According to ARM, 323 companies globally are actively developing medicines for rare disorders. Among these biotech and pharma companies, 587 drugs are in various stages of clinical trials. Over the next few years, targeted therapies and rare and orphan products will take on a much greater share of the total pharmaceutical healthcare spend in the US. Given these projections, a growing number of payers worry that their current business model will not be able to support these novel therapies once they become available.
Payers and PBMs are experimenting with different cost containment strategies. New payment models are being discussed, such as evidence-based pricing, the financing of payments to pharma over time, and payment plan systems that will follow patients as they move from employer to employer.
Express Scripts, for example, is collaborating with pharma, patient groups, and payers to make therapies accessible through aggressive price negotiation3. Both Humana and Aetna have decided to narrow the scope of coverage by approving only those patients that meet their stringent requirements4. United Healthcare, after following a similar model, has been battling a public relations crisis when news hit that the company denied a life-saving therapy because it was deemed as “unproven” and “experimental”—despite knowing the product was approved by the FDA 20 years earlier5.
Where Do Agencies Fit In?
Agencies play an important role in this complex environment. Pharma will need medical education companies to develop CME programs for diseases that most physicians have never encountered before. Promotional programs will need to be targeted and personalized. A greater focus on unbranded content will be important for physicians, patients, and caregivers as they learn about these new treatment modalities.
Patients and advocacy groups are focused on their mission of helping patients access these new medicines, and agency partners can help persuade payers these new therapies can lower the cost of care in the long term.
Direct-to-consumer advertising (DTC) will need to change to reflect this new landscape. Can therapies that target a population as small as the size of a small suburb justify the same investment in DTC advertising as drugs that treat larger populations?
More likely we’ll see a divergent in DTC spending where a portion may be spent in disease awareness campaigns and a hyper-targeted DTC approach is focused on advocacy groups and caregivers and then delivered via social channels.
Where We Go from Here
The renaissance in new breakthrough therapies for rare diseases is changing the landscape of healthcare. This period of accelerated growth in pharma was years in the making, beginning with the Orphan Drug Act of 1983 and influenced by factors such as breakthroughs in medical technologies and powered by computing advances. Biotech and genetic advances became a reality just as consumerism was becoming an important influence in healthcare decisions.
These changes bring new challenges, such as improving transparency to build trust, redefining value-based pricing, or communicating complex conditions simply. But they also present opportunities and hope. It’s a new world for pharma and their mission to bring life-giving products to market. For agencies, there are incredible opportunities to support their pharma clients to educate and inform physicians and patients about these extraordinary new therapies. For families living with rare diseases, it’s the promise that someday, their child will celebrate birthdays beyond age five, participate in sports, and graduate to become productive members of society.
References
1. https://www.stjude.org/research/news-publications/research-highlights/2019-research-highlights/st-jude-gene-therapy-holds-promise-for-treating-several-diseases.html
2. https://www.loyolamedicine.org/news/plans-first-chicago-center-car-t-cells
3. https://lab.express-scripts.com/lab/insights/drug-options/our-opportunity-to-be-better-together
4. https://www.modernhealthcare.com/insurance/judge-recuses-himself-unitedhealthcare-proton-therapy-lawsuits
