The Specialty Pharma Market Outlook - Key players, new company growth models and emerging opportunities

Executive Summary 10
The specialty pharmaceutical sector 10
Specialty Markets 11
Case studies of Specialty Players 12
Future outlook for the specialty pharmaceuticals sector 13

Chapter 1 The specialty pharmaceuticals sector 16
Summary 16
Background 17
Scope 18
The specialty pharma opportunity 20
Evolution of the specialty pharmaceuticals sector 20
Value chain specialization and types of specialty strategies 22
Market differentiation 23
Technological differentiation 25
Product and portfolio strategies 26
Classification of specialty pharmaceutical companies 29
Branded generics companies 29
Niche indications and orphan drugs 30
Drug delivery and reformulation companies 31
Deal-flow in the specialty pharma sector 32
Financial performance in the specialty pharma sector 38
Variation in operating profitability and revenues across the sector 38

Chapter 2 Specialty therapeutic markets 44
Summary 44
Introduction 45
Analysis of key markets in the specialty pharma sector 46
Types of specialty pharmaceutical companies and market strategies 47
Dermatology 49
Market overview 49
Key players in the specialty dermatology market 54
Ophthalmology 56
Market overview 56
Key players in the specialty ophthalmology market 61
Women’s health 63
Market overview 63
Key players in the specialty women’s health market 68
Urology 70
Market overview 70
Key players in the specialty urology market 73
CNS disorders 75
Market overview 75
Key players in the specialty CNS disorders market 81
Cardiovascular diseases 84
Market overview 84
Key players in the specialty cardiovascular market 88
Future markets 90

Chapter 3 Case studies of specialty players 94
Summary 94
Introduction 95
Types of specialty pharmaceutical companies 95
Company case studies 97
Corporate strategy 97
Current dynamics of specialty pharmaceutical companies 99
Allergan 102
Summary 102
Competitive strategy 102
Portfolio analysis 105
Deal flow 108
Major franchise developments 111
R&D pipeline 113
Elan 114
Summary 114
Competitive strategy 115
Portfolio analysis 118
Deal flow 122
Major franchise developments 125
R&D pipeline 126
Biovail 128
Summary 128
Competitive strategy 129
Portfolio analysis 131
Deal flow 135
Major franchise developments 139
R&D pipeline 140
Watson 142
Summary 142
Competitive strategy 143
Portfolio analysis 145
Generics portfolio 146
Branded portfolio 148
Deal flow 150
Major franchise developments 152
R&D pipeline 155
Shire 156
Summary 156
Competitive strategy 157
Product portfolio analysis 159
Deal flow 163
Major franchise developments 166
R&D pipeline 167
K-V 169
Summary 169
Competitive strategy 169
Portfolio analysis 171
Deal flow 174
Major franchise developments 176
R&D pipeline 177

Chapter 4 Future outlook for the specialty pharmaceuticals sector 180
Summary 180
Introduction 181
Major competitive pressures on the specialty pharmaceuticals sector 181
Future specialty pharmaceutical growth models 184
Drug delivery/reformulation based specialty companies 185
Generics manufacturing based specialty companies 186
Branded/niche marketing based specialty companies 186

Chapter 5 Appendix 188
Primary research methodology 188

Index 192

Glossary 197

List of Figures
Figure 1.1: Value chains of major components of the specialty pharmaceutical sector 19
Figure 1.2: Relationships between Big Pharma and Specialty Pharma 21
Figure 1.3: Specialty Pharma - key opportunities along the value chain 22
Figure 1.4: Market differentiation strategies 24
Figure 1.5: Technological differentiation strategies 26
Figure 1.6: Target selection in the specialty pharmaceuticals sector 28
Figure 1.7: Long-term value-add strategies pursued by specialty generics companies 30
Figure 1.8: Deal flow by company type among a sample of 70 specialty pharmaceutical companies 33
Figure 1.9: Evolution of Big Pharma as a source of product acquisition 34
Figure 1.10: Synopsis of strategic fit in product/R&D acquisition 36
Figure 1.11: Deal-flow by company type among a sample of 70 specialty pharmaceutical companies 37
Figure 1.12: Comparisons of operating performance across the specialty pharmaceuticals sector 39
Figure 1.13: Comparisons of EPS across the specialty pharmaceuticals sector 41
Figure 2.14: Market matrix for specialty pharmaceutical company types across key indications 47
Figure 2.15: Comparative attractiveness of key sub-indications in the dermatology market 50
Figure 2.16: Estimated sales in the specialty dermatology market by sub-indication, 2005 51
Figure 2.17: Comparative attractiveness of key sub-indications in the ophthalmology market 57
Figure 2.18: Estimated sales in the specialty ophthalmology market by sub-indication, 2005 58
Figure 2.19: Comparative attractiveness of key sub-indications in the women’s health market 64
Figure 2.20: Estimated sales in specialty women’s health by sub-indications, 2005 65
Figure 2.21: Comparative attractiveness of key sub-indications in the urology market 70
Figure 2.22: Estimated sales in the specialty urology market by sub-indication, 2005 71
Figure 2.23: Estimated sales in the specialty CNS market by sub-indication, 2005 76
Figure 2.24: Comparative attractiveness of key sub-indications in the CNS disorders market 77
Figure 2.25: Comparative attractiveness of key sub-indications in the cardiovascular disorders market, 2005 85
Figure 2.26: Estimated sales in the cardiovascular market by sub-indication, 2005 86
Figure 2.27: Future market development in the specialty pharmaceutical sector 91
Figure 3.28: Areas of focus of specialty pharmaceutical companies 96
Figure 3.29: Specialty pharmaceuticals corporate deals, 2000-2006 98
Figure 3.30: Core competencies of specialty pharmaceutical companies 100
Figure 3.31: Allergan: SWOT analysis 103
Figure 3.32: Allergan’s commercial agreements flow, 2000-2005 111
Figure 3.33: Elan: SWOT analysis 116
Figure 3.34: Biovail: SWOT analysis 129
Figure 3.35: Biovail’s commercial agreements, 2000-2005 139
Figure 3.36: Watson: SWOT analysis 143
Figure 3.37 Watson’s commercial agreements, 2000-2006 152
Figure 3.38: Shire: SWOT analysis 158
Figure 3.39: Shire’s commercial agreements, 2000-2006 166
Figure 3.40: KV: SWOT analysis 170
Figure 3.41: KV’s commercial agreements, 2000-2006 177
Figure 4.42: Forecast future trends in the specialty pharmaceutical sector 184
Figure 4.43: Forecast changes in value chain distribution, 2011-2016 185

List of Tables
Table 2.1: Key specialty indications and market sizes, 2005 46
Table 2.2: Key players in the specialty dermatology market, 2005 54
Table 2.3: Key players in the specialty ophthalmology market, 2005 61
Table 2.4: Key players in the specialty women’s health market, 2005 68
Table 2.5: Key players in the specialty urology market, 2005 73
Table 2.6: Key players in the specialty CNS market, 2005 81
Table 2.7: Key players in the cardiovascular market, 2005 88
Table 3.8: Breakdown of segment revenues 105
Table 3.9: Allergan’s commercial agreements, 2000-2005 109
Table 3.10: Allergan’s R&D pipeline, 2006 113
Table 3.11: Elan’s breakdown of segment revenues 118
Table 3.12: Elan’s product portfolio 119
Table 3.13: Elan’s corporate agreements, 2000-2006 122
Table 3.14: Elan’s corporate agreements, 2000-2006 continued 123
Table 3.15: Elan’s recovery plan agreements, August 2002-February 2004 124
Table 3.16: Elan’s commercial agreements, 2000-2005 125
Table 3.17: Elan’s R&D pipeline, 2006 126
Table 3.18: Biovail’s product portfolio 132
Table 3.19: Biovail corporate agreements, 2000-2005 136
Table 3.20 Biovail’s R&D pipeline 140
Table 3.21: Breakdown of segment revenues 145
Table 3.22: Watson’s branded product portfolio 148
Table 3.23: Watson’s corporate agreements, 2000-2006 151
Table 3.24: Watson’s R&D pipeline 155
Table 3.25: Shire’s product portfolio 160
Table 3.26: Shire corporate agreements, 2000-2006 164
Table 3.27: Shire’s R&D pipeline 167
Table 3.28: Breakdown of segment revenues 172
Table 3.29: KV corporate agreements, 2000-2006 175