Upper GI Disorders - Innovation needed to overcome generic threat

ABOUT DATAMONITOR HEALTHCARE 2
About the Immune Disorders and Inflammation pharmaceutical analysis team 2
CHAPTER 1 EXECUTIVE SUMMARY 3
Objective of the analysis 3
Datamonitor insight into the upper GI disorder market 3
Market forecast summary 6
Contributing experts 7
Related reports 7
CHAPTER 2 MARKET DEFINITION AND OVERVIEW 9
Market definition for this report 10
Current market situation 14
The upper GI disorder market achieved a value of almost $20 billion in 2006 15
The US continues to dominate the upper GI disorder market 16
In the EU, Italy and Spain showed good growth, whereas the UK and Germany exhibited a decline in sales 17
Upper GI disorder markets in Italy and Spain experienced good growth due to increased sales of PPIs 17
Cost-cutting measures forced down the sales value of the market in Germany 18
Prevacid patent expiry affected the entire UK upper GI disorder market 18
Japan experienced a decline in the sales value of the upper GI disorder market 18
Proton pump inhibitors continue to dominate the upper GI market 19
PPIs accounted for 84% of total sales in the upper GI disorder market in 2006 19
Only Nexium and Aciphex demonstrated growth in the upper GI disorder market to 2006 20
AstraZeneca's Nexium accounted for 27% of all sales in the upper GI disorder market in 2006 21
Sales of Prevacid have declined from 2005 to 2006 23
AstraZeneca leads the way in the upper GI market 24
Strategic scoping and focus 26
CHAPTER 3 COUNTRY MARKET ASSESSMENTS 27
Summary of environmental issues affecting upper GI disorder market size 27
Seven major market opportunities and threats 30
Opportunities 30
Treatments for the PPI unresponsive population remains a serious unmet need 30
Increase in the size of the GERD and dyspepsia patient population 30
Better definition of dyspepsia in ROME III will ultimately lead to improved treatment of this disease 31
Development of fixed combinations of NSAIDs and PPIs 31
Threats 33
The incidence of H. pylori infection is decreasing and there are very effective eradication regimes 33
The upper GI market will face increasing threat from generics and over-the-counter drugs 33
Surgery may be as cost-effective as treatments for GERD 35
US: opportunities and threats 36
Opportunities 36
An opportunity for generics to increase market share 36
Growth in Medicare Part D coverage has driven sales of PPIs in the US 38
Threats 39
With the availability of cheaper alternatives many insurance companies are cutting expensive PPIs from their coverage plans 39
Parallel importation given the go-ahead, but still faces opposition 40
FDA is reviewing the long-term safety of proton pump inhibitors 41
Increasing pressure to restrict DTC advertising and a moratorium on DTC advertising of new products will affect PPI sales 42
Japan: opportunities and threats 43
Opportunities 43
Growing shift towards the use of PPIs over H2 antagonists in Japan 43
Approval of PPIs in the large non-erosive reflux disease population 45
Threats 46
Biennial price cuts will continue to pose a threat 46
Increasing shift towards the used of generics will affect brand sales 47
France: opportunities and threats 49
Opportunities 49
The Internet is recognized as a source of high-quality medical information by consumers in France 49
Threats 49
France seeks to save money from more cost-effective PPI prescribing and greater use of generics 49
Germany: opportunities and threats 51
Opportunities 51
Medicines assessment agencies in the UK and France to share information with German counterpart 51
Threats 52
Introduction of jumbo reference pricing 52
Italy: opportunities and threats 53
Opportunities 53
Innovative drug development rewarded with premium price and 100% reimbursement 53
Negligible impact of generics 54
Italy is the largest growing of all the upper GI disorder markets 55
Threats 59
Ongoing cost-containment measures 59
Implemented price reductions and AIFA payback system restricts market access and limits potential revenue 59
Spain: opportunities and threats 60
Opportunities 60
Spanish national formulary will allow health professionals to make better educated treatment decisions 60
Threats 60
Introduction of reference pricing will force the price of drugs down 60
Healthcare reforms will promote the use of generics 61
Potential for entry of generics into the market prior to patent expiry 62
UK: opportunities and threats 64
Opportunities 64
NICE recommendations will ensure continued opportunities for PPIs and gastroprokinetics 64
Threats 65
Generic erosion of branded drugs will be extensive in the UK 65
The National Audit Office insists that doctors should prescribe efficiently to help lower NHS spending 67
CHAPTER 4 FORECAST ANALYSIS 68
Key events 68
New product launches in the US and 5EU 70
Dexlansoprazole (TAK-390MR) 70
S-tenatoprazole-Na 71
Pylera 72
ADX-10059 73
New product launches in Japan 74
Pylera 74
Dexlansoprazole (TAK-390MR) 74
S-tenatoprazole-Na 75
ADX-10059 75
Additional indications 75
Omeprazon (omeprazole) approval for symptomatic GERD in Japan 75
Gaster (famotidine) approval for non-erosive reflux disease in Japan 77
Eisai seeks approval for Pariet (rabeprazole) in non-erosive reflux disease from Japanese authorities 80
Pariet (rabeprazole) wins approval for eradication of H. pylori in Japan 80
Nexium (esomeprazole) line extensions will result in increased brand sales 80
Generic erosion and pricing assumptions 82
Seven major market generic erosion and pricing assumptions 82
PPI brand erosion in the US 82
PPI brand erosion in France 83
PPI brand erosion in the UK 84
PPI brand erosion in Italy 84
PPI brand erosion in Germany 85
PPI brand erosion in Spain 86
Patent expiries 87
Losec (omeprazole) 88
Prevacid (lansoprazole) 89
PrevPac (lansoprazole, clarithromycin and amoxicillin) 90
Aciphex (rabeprazole) 91
Protonix (pantoprazole) 93
Nexium (esomeprazole) 96
Zegerid (omeprazole + bicarbonate) 98
Data definitions, limitations and assumptions 100
Standard units 100
Japanese market data 100
Derivation of sales forecasts and pricing trends 100
Forecasts 100
Forecast methodology 101
CHAPTER 5 COMMERCIAL IMPACT AND LIFECYCLE MANAGEMENT: CASE STUDIES 102
Introduction 102
Strategies to compete in the crowded PPI market 103
Innovation within the brand is essential for mature products, but standard capsules should be the initial formulation 103
Uptake of Zegerid in the US was poor due to initial suspension formulation proving that capsules are the preferred option 106
Prevacid leads in terms of brand innovation, but sales still fall short of Nexium in the US 108
Protonix was the fourth PPI to reach the US market, but drove innovation with the first iv formulation 112
Eisai has not innovated within the Aciphex brand but are investigating an extended release formulation 114
Promotional spend propelled Nexium to market leadership, but is it possible to compete with the might of AZ? 114
PPIs were second highest promoted drug class in the US in 2005 114
DTC advertising has been key to the success of Nexium 115
Companies should consider increasing e-marketing of PPIs 120
Without a massive DTC advertising spend, what can you do to compete in the upper GI market? 121
Targeting niche patient populations to gain market share in the crowded market 125
There are a number of GERD subpopulations 125
A number of market players already target nighttime GERD patients 126
Opportunities in the extraesophageal reflux disease population exist 129
TAP Pharmaceuticals is targeting Prevacid towards the pediatric population 130
PPIs, cancer and chemotherapy: opportunities for new indications 132
Head-to-head trials will continue to help competitive positioning 133
AstraZeneca performed large-scale, comparator clinical trials for Nexium 133
Aciphex will go head-to-head with Nexium 135
Future market entrants need to show superior efficacy to Nexium 135
Head-to-head: brands versus generics, is there scope for such trials? 136
Cost analysis 138
AstraZeneca priced Nexium above all other PPIs in the US 138
Pricing of pipeline products 139
Taking advantage of market changes will help to fuel sales 141
Increase in the use of PPIs in inflammatory conditions treated by NSAIDs in the wake of Vioxx withdrawal and COX-2 class cardiovascular side-effects 141
Future PPI entrants should aim to get an indication for the treatment and prevention of NSAID-associated ulcers 143
BIBLIOGRAPHY 145
Journal papers 145
Websites 149
Datamonitor reports 157
Other sources 157
APPENDIX A - MAJOR BRAND KEY FACTS 158
Key marketed products 158
APPENDIX B - MARKET FORECAST DATA 162
Seven major markets 162
M5EU 164
US 166
Japan 168
France 170
Germany 172
Italy 174
Spain 176
UK 178
APPENDIX C 180
Contributing experts 180
Report methodology 181
About Datamonitor 181
About Datamonitor Healthcare 181
About the Immune Disorders and Inflammation analysis team 182
Disclaimer 183
List of Tables
Table 1: Datamonitor's definition of upper GI disorders 11
Table 2: Key players in the upper GI disorder market 24
Table 3: Summary of environmental issues in upper GI disorder market across the seven major markets, 2007 27
Table 4: Summary of opportunities and threats in the US and Japan upper GI disorder markets, 2007 28
Table 5: Summary of opportunities and threats in the 5EU upper GI disorder markets, 2007 29
Table 6: Fixed combinations of PPI + NSAID in development for osteoarthritis, 2007 32
Table 7: Advantages and disadvantages of step-down and step-up treatment 35
Table 8: Volume (SU) market share of PPIs split by brand and generics, 2003-06 38
Table 9: Datamonitor's new product launch dates for upper GI disorders in the US and 5EU, 2007-2016 70
Table 10: Datamonitor's new product launch dates for upper GI disorders in Japan, 2007-2016 74
Table 11: Nexium line extensions in the US and EU, 2007 81
Table 12: Brand erosion of Losec (omeprazole) in France, 2003-06 84
Table 13: Brand erosion of Losec (omeprazole) in Spain, 2001-03 87
Table 14: Patent expiry dates for the in the seven major markets, 2007-2016 87
Table 15: Cost of oral tablet formulations of PPIs in the US, 2006 138
Table 16: Nexium: key facts 158
Table 17: Prevacid: key facts 159
Table 18: Aciphex: key facts 160
Table 19: Protonix: key facts 161
Table 20: Datamonitor's forecast of upper GI disorder drug sales ($m) in the seven major markets, 2006-16 162
Table 21: Datamonitor's forecast of upper GI disorder drug sales ($m) in the five major EU markets, 2006-16 164
Table 22: Datamonitor's forecast of upper GI disorder drug sales ($m) in the US, 2006-16 166
Table 23: Datamonitor's forecast of upper GI disorder drug sales ($m) in Japan, 2006-16 168
Table 24: Datamonitor's forecast of upper GI disorder drug sales ($m) in France, 2006-16 170
Table 25: Datamonitor's forecast of upper GI disorder drug sales ($m) in Germany, 2006-16 172
Table 26: Datamonitor's forecast of upper GI disorder drug sales ($m) in Italy, 2006-16 174
Table 27: Datamonitor's forecast of upper GI disorder drug sales ($m) in Spain, 2006-16 176
Table 28: Datamonitor's forecast of upper GI disorder drug sales ($m) in the UK, 2006-16 178
List of Figures
Figure 1: Datamonitor's upper GI disorder-market forecast across the seven major markets, 2006-16 6
Figure 2: Percentage of total sales split by indication in the seven major markets, 2006 13
Figure 3: Key events impacting the upper GI disorder market, 1999-2007 14
Figure 4: The upper GI disorder market value ($ billion) in the seven major markets, 2005-06 15
Figure 5: Performance of the upper GI disorder market in the seven major markets, 2005-06 16
Figure 6: Upper GI disorder-specific sales of PPI drug class across the major five EU markets ($m), 2003-06 17
Figure 7: Sales in the upper GI disorder market across the seven major markets split by drug class, 2006 19
Figure 8: Performance of key PPI brands for upper GI disorders in the seven major markets, 2005-06 20
Figure 9: Upper GI disorder-specific sales of Nexium (esomeprazole) across the six major markets, 2005-06 22
Figure 10: Upper GI disorder-specific sales of Prevacid (lansoprazole) across the seven major markets, 2005-06 23
Figure 11: Sales ($billion) and volume (SU) of branded and generic PPIs in the US, 2003-06 37
Figure 12: Total sales of PPIs in the US 2005-06 39
Figure 13: Upper GI disorder-specific sales of PPIs and H2 antagonists in Japan, 2003-06 44
Figure 14: Time to approval of PPIs for non-erosive reflux disease in Japan, 2004-09 46
Figure 15: Cost per standard unit ($/SU) of PPIs in Japan, 2003-06 47
Figure 16: Sales of PPIs in France ($m), 2005-06 50
Figure 17: Upper GI disorder-specific sales ($m) and volume (SU million) of the PPI drug class in Germany, 2003-06 53
Figure 18: Upper GI disorder market in Italy split by drug class, 2003-06 55
Figure 19: Upper GI disorder-specific sales of Takepron (lansoprazole) and lansoprazole generics in Italy, 2003-06 57
Figure 20: Total sales ($ billion) of PPIs in Italy, 2006-16 58
Figure 21: Upper GI disorder-specific sales of Prevacid (lansoprazole) and lansoprazole generics in Spain ($m), 2003-06 63
Figure 22: Sales of gastroprokinetics for GERD and dyspepsia indications in the UK ($m), 2005-06 65
Figure 23: Upper GI disorder-specific sales of Lanzo (lansoprazole) and lansoprazole generics in the UK ($m), 2004-06 66
Figure 24: Impact of key events on the upper GI disorder market in the seven major markets, 2007-2016 69
Figure 25: Diagnosis value ratio for omeprazole in the US and Japan, 2006 77
Figure 26: Upper GI-specific volume (SU, billion) of Losec (omeprazole) in the US, 2001-06 83
Figure 27: Upper GI disorder-specific sales of Takepron (lansoprazole) in Italy, 2003-06 85
Figure 28: Upper GI disorder-specific sales of Takepron (lansoprazole) in Germany, 2003-08 86
Figure 29: Upper GI disorder-specific sales ($m) of Losec (omeprazole) in Italy, 2006-2016 88
Figure 30: Upper GI disorder-specific sales ($ billion) of Prevacid (lansoprazole) in the seven major markets, 2006-2016 90
Figure 31: Sales of Prevpac (lansoprazole + amoxicillin + clarithromycin) in the US ($m), 2006-2016 91
Figure 32: Upper GI disorder-specific sales of Aciphex (rabeprazole) in the seven major markets ($ billion), 2006-2016 93
Figure 33: Upper GI disorder-specific sales of Protonix (pantoprazole) in the US ($ billion), 2006-2016 95
Figure 34: Upper GI disorder-specific sales of Nexium (esomeprazole) in the US and 5EU, 2006-2016 98
Figure 35: Upper GI disorder-specific sales of Zegerid (omeprazole + sodium bicarbonate) in the US ($m), 2006-2016 99
Figure 36: PPI formulation launch timeline, 1999-2007 104
Figure 37: Best strategy for launch of formulations of PPIs during a product's lifecycle 105
Figure 38: Upper GI disorder-specific sales ($m) of Zegerid in the US, 2003-06 107
Figure 39: Different Prevacid (lansoprazole) formulations in the US, 2007 109
Figure 40: Upper GI disorder-specific sales ($ billion) of Prevacid (lansoprazole) in the US split by formulation, 2001-06 110
Figure 41: Upper GI disorder-specific sales ($ billion) of Protonix (lansoprazole) in the US split by formulation, 2001-06 113
Figure 42: Breakdown of total promotional spend for PPI drug class in the US, 2005 115
Figure 43: Spending ($m) on DTC advertising and total brand sales in the US, 2005 118
Figure 44: Upper GI disorder-specific sales for Nexium and Prevacid in the US, 2003-06 119
Figure 45: Total promotional spend for Nexium and Prevacid in the US, 2004-06 120