After failed repeal of Obamacare in 2018 and again in 2019, the Affordable Care Act may very well be here to stay. Cost savings on drugs and product growth will have to come from new areas of drug discovery and product launches. Companies in the pharmaceutical and medical device industry saw their biopharma recruiting hiring pace pick up along with the economy and the stock market. In 2020 more resources will be needed for workforce planning as new biosimilars and specialty products hit the market with new launch strategies; including payer access and reimbursement plans. Twenty twenty is looking to be a positive and exciting time in biopharma recruiting for anyone seeking a career in the pharmaceutical industry.
Top 5 Trends in 2019
1. Biosimilars
With some of the world’s best-known biologics continuing to face patent expiration in the coming years, the biosimilars market is set for continued growth and a primary spot for biopharma recruiting. We estimate sales will potentially triple in size to $15 billion by 2020, or closely thereafter. The European market should continue to mature while the US offers opportunities, albeit with practical challenges. On both sides of the Atlantic, however, downward price pressure suggests competition will be intense.
2. Moving Closer To Value-Based Healthcare
Linked to the affordability debate, many of our clients saw 2019 as a key year for the development of the robust systems needed to deliver truly value-based healthcare. Aaron Mitchell, Principal at ZS Associates, says that data and analytics are the key to value-based healthcare. “Pharma is facing an evolving evidence landscape requiring new data sources and analytical methods to address new clinical endpoints that demonstrate the value of therapies.” With payers pushing for more value evidence and decision-making among providers moving to expert committees, patient data is become an ever more valuable asset. Barriers include the need for regulatory agencies to clarify data rules and for data collection and evidence generation to start earlier in a drug’s lifecycle, plus the need for pharma to make better use of existing data sources and to take a leadership role in the development of new clinical endpoints.
3. Emerging Markets
The growing importance of emerging markets can no longer be ignored in biopharma recruiting. The pharmaceutical industry is turning to these markets for growth and profitability. The increased spending power of these so-called “pharmerging” markets means that new pharma products need to be launched on a global scale more than ever before. This year’s pharmerging markets will increasingly influence the global strategy for the pharmaceutical industry.
4. Collaboration/Joint Ventures Between BioPharmas
There is an increasing willingness for parties to enter joint venture deals. These deals enable both parties to benefit from the upside of a big product win, whereas traditional licensing deals forfeit upside for near term upfront, milestone and royalty payments.
Joint venture partnering allows the parties to securitize value and reduce risk, but keep a part of the potential upside should the product reach the market. Even if the licensor does not commercialize the product they can either sell those rights to the licensee partner or another partner for an amount higher than would have been achieved via an earlier stage licensing deal.
5. Access and Affordability
In terms of market access, the rising cost of healthcare is being met by increasing demands for new evidence and definitions of positive health outcomes. As PricewaterhouseCoopers comments in their report on the pharmaceutical industry, “The growing conflict between drug access and affordability will create fresh pressure for data that show these expensive medications work better than others and are worth the premium.”
Communicating new evidence about drug value to key stakeholders – insurers, physicians and patients – will require additional skills and techniques. Account managers, sales reps and patient engagement specialists will need to collaborate with quantitative analysts or bio-informaticists to tailor new drug information for each different audience.
By using new and sophisticated apps, pharma companies will be able to customize new drug information faster and more easily, demonstrating value to payers in new and engaging ways.
Top 5 Trends for 2020
1. Expanding Biosimilar Markets Due to Biologic Patent Expirations
As the pharmaceutical regulatory agencies grapple with legal safety and procedural standards for biosimilars, and the public clamors for lower drug costs and more access to pharmaceuticals, manufacturing must adapt to new markets. The expectation is that biosimilar drug markets will increase around the world. Latin American countries are an area to watch as these countries have their own research and development for producing and commercializing patent expired biologic drugs.
The FDA expects to review more biosimilar applications in 2020 because 66 biologic U.S. patents are expiring between 2020 and 2025.
2. Company Stock Prices Rebound
The Trump effect on the stock market has propelled biotech and pharma stocks higher. Tariffs and trade wars will settle down and the pharma market will rebound. President Trump has been trying to apply European socialized drug pricing to the US Market with little or no success or support.
3. Contract Developments, Collaborations, Mergers and Acquisitions
IQVIA predicts that the $1.2 trillion 2018 value of the pharmaceutical industry will increase by 2023 to $1.5 trillion. Contract development and manufacturing organizations, needing to improve speed, increase efficiencies and expand globally are consolidating. Mergers and acquisitions are also being driven by an aging population with a greater demand for generic drugs combined with drug patent expirations. Older companies are teaming up with visionary, newer investment growth companies. Boehringer Ingelheim’s acquisition of a biotechnology Swiss company will target immune responses in cancer research. The global research collaboration of Gilead and Galapagos promises new innovative drug discoveries. AbbVie’s acquisition of Allergan will expand its therapeutic focus on inflammatory diseases.
4. New Drug Pricing and Reimbursement Approaches
The health care payment landscape continues to shift from a quantity-based, fee-for-service model to a value-based system that rewards providers for quality outcomes and reduced costs. Prescription medications consume an estimated 17% of total health care costs. Drug manufacturers can continue to expect pressure to reduce costs for consumers.
5. Shifting Market Share
The global pharmaceutical and medical device industry will find that moderate growth over the next five years will be the norm. New product growth in specialty markets is a trend that is shifting market share from large companies to mid-sized companies and thereby creating different career options for the more entrepreneurial candidates.
We would be happy to discuss any of these trends or your needs for 2020 further. As always, Smith Hanley Associates is happy to be your biopharma recruiting resource for Commercial and Clinical opportunities in healthcare.
Nancy Ragonese, Practice Lead, Pharma Commercial Sales, nragonese@smithhanley.com, 203-319-4315
Nihar Parikh, Recruiter, Biostatisticians and MSLs, nparikh@smithhanley.com, 203-319-4308
