Specialty Pharmacy Pipeline Session Highlights Cancer, Orphan Drug Development

Aimee Tharaldson, PharmD, senior clinical consultant of emerging therapeutics at Express Scripts, kicked off the AMCP 2018 Annual Meeting with an overview of the specialty drug pipeline.

She explained that there is no universal definition for specialty medications; however, Express Scripts defined them as a class of drugs with characteristics such as frequent dosing, intensive clinical monitoring, intensive patient training or assistance, limited distribution, or those that require specialized handling or administration. 

Dr Tharaldson started her pipeline review by highlighting some key trends impacting the specialty drug market. The first trend she highlighted was the increased competition in many of the specialty drug disease areas. 

Generics and Biosimilars

“There are a lot more options in several specialty classes,” she said. “We are seeing generics compete more in the specialty market.”

She highlighted a few generic drugs that could significantly impact the specialty drug market in the next few years, including generic versions of Zytiga (abiraterone acetate; Janssen) for the treatment of cancer, which represents about $1.3 billion in annual sales; Gileny (fingolimod; Novartis) for the treatment of multiple sclerosis (MS), which represents about $2.3 billion in annual sales; and Revlimid (lenalidomide; Celgene), for the treatment of cancer which represents about $1.5 billion in annual sales. 

Dr Tharaldson explained that biosimilars are also increasing competition in the specialty drug market. She cited data showing that there is a $54.4 billion opportunity for 71 patent expirations through 2022 in the biologics market. According to her presentation, nine biosimilars are currently approved in the United States; however, only three have launched due to patent litigation—which could push the launch for some of these biosimilars to as late as 2023.

Dr Tharaldson highlighted 10 biosimilar products in the pipeline that could receive approval within the next year. Among these products, four are expected to gain approval in May, including Retacrit (epoetin alfa; Pfizer), filgrastim (Adello Biologic), Rixathon (rituximab; Sandoz), and ABP‐980 (trastuzumab; Amgen/Allergan). 

She acknowledged that biosimilars are not currently having much of an impact; however, the FDA is currently working on policies to encourage more competition among biosimilars and allow them to capture more market share. 

Cancer Drug Development

Dr Tharaldson explained that cancer drug development is also impacting the specialty pharmacy market significantly.

She cited data showing that 1.7 million new cases of cancer are diagnosed annually in the United States, with nearly 610,000 deaths every year. However, the death rate has dropped by 25% since 1991, and now due to treatment advancements, many cancers can be treated as a chronic condition and not a catastrophic one. 

According to her presentation, there are many new approvals in the cancer drug space; however, this increase is not reducing cancer drug prices.

“In 2017, 15 new cancer drugs were approved—tying the number of cancer drug approvals in 2015,” she said. “Even though we are getting a lot of new cancer drugs reaching the market, competition really hasn’t been bringing down the prices of these medications. These are still very expensive—most new target therapies for cancer cost somewhere between $100,000 and $150,000, and more in the higher end of that range.”

Dr Tharaldson said that about 21% of the specialty drug pipeline is made up of nonorphan cancer drugs in development.

Orphan Drug Development

According to Dr Tharaldson, another key specialty market trend is orphan drug development. These drugs are used to treat conditions with patient populations of less than 200,000. She explained that there are 7000 orphan diseases affecting 30 million patients, and that these drugs can be very expensive. 

“Manufacturers are given 7 years of marketing exclusivity and other incentives for the development of orphan medications,” Dr Tharaldson said. “On average these drugs cost about 5 times the cost of nonorphan medications. About 30% of orphan drugs are blockbuster drugs that reach annual sales greater than $1 billion dollars—so, this is really where a lot of the market is focused.”

She further explained that within the specialty drug pipeline, 44% of drugs are for orphan drug conditions, with 30% of these solely for cancer. 

“Overall two-thirds of all specialty drugs in development are for orphan drugs or cancer,” she said. 

Current Specialty Drug Market

Dr Tharalson explained that 41% of all per member per year spending is on specialty drugs, according to the Express Scripts 2017 Drug Trends Report. Further, she said that the trend for specialty drug is much higher than traditional drug trend, at 11.3% vs -4.3%, respectively. 

“Specialty trend will continue to outpace traditional trend for the foreseeable future,” Dr Tharaldson said. “We are projecting that by 2019 at least half of spend under the pharmacy benefit will be for specialty medications—but less than 2% of patients actually take specialty drugs.”

According to her presentation, total average specialty drug spending is around $444 per member per year, with inflammatory conditions leading spending at $157 spent per member per year. Following inflammatory conditions, cancer, MS, HIV, and hepatitis C were the leading specialty conditions ranked by per member per year spending. 

Dr Tharaldson also reviewed 2017 FDA approvals.

“In 2017, FDA approved a record number of specialty drugs at 36, which is more than twice as many specialty drug approvals as in 2016,” she said.

—David Costill