"Blick in die Glaskugel": Vortrag Dr. Frank Wartenberg, President Central Europe, IQVIA™ auf der Pharma Trends 2018

Copyright © 2017 IQVIA. All rights reserved.

Was ist nach den Wahlergebnissen in

Deutschland, Europa und USA zu erwarten

29. November 2017, Steigenberger Hotel Berlin

Dr. Frank Wartenberg – President Central Europe

Der Blick in die

Glaskugel

1© IQVIA 2017. All rights reserved. – Der Blick in die Glaskugel – Dr. Frank Wartenberg

2

When human science meets data scienceHuman Data Science

© IQVIA 2017. All rights reserved. – Der Blick in die Glaskugel – Dr. Frank Wartenberg

Worldwide clinical and

real-world experience

informed by deep

scientific expertise

across every major

therapy area

Leading healthcare

“big data” and

technologies fueled

by commercial

expertise to find

unparalleled insights

Solutions to

help clients

drive healthcare

forward

IQVIA mobilizes unparalleled data, analytics, technology, and expertise through solutions connecting stakeholders to improve health

© IQVIA 2017. All rights reserved.

© IQVIA 2017. All rights reserved.

5

Where is Pharma headed in the next years?

Geopolitical challenges

and influences

Global and regional

market prognosis

Key market drivers and

innovations


6

Higher than region CAGR

On par with region CAGR

Lower than region CAGR

-4%

-2%

0%

2%

4%

6%

8%

10%

0,0

0,2

0,4

0,6

0,8

1,0

1,2

1,4

1,6

2016 2017 2018 2019 2020 2021

Global sales (2016-21), Trillions of constant USD

EU5

US

Pharmerging

Japan

CAGR 2016-21

Developed 2-5%

US 2-5%

Japan (-2)-1%

Germany 2-5%

UK* 2-5%

France 1-4%

Italy 2-5%

Spain 2-5%

Canada 2-5%

Pharmerging 6-9%

Pharmerging US$ 5-8%

China 6-9%

Brazil 6-9%

India 9-12%

Russia 6-9%

Turkey 11-14%

Mexico 3-6%

Gro

wth

Notes: *Subject to PPRS rebate; Ex-manufacturer price levels, not including rebates and discounts. Contains Audited + Unaudited data; Growth considered on par

if the there is overlap between country and region CAGR ranges Source: IQVIA, IMS Market Prognosis September 2017

The pharmaceutical market grows to $1.4 trillion by 2021, with a CAGR of 3-6%


7

Regional contribution to growth 2021 regional market share

44%

$285 bn

9%3%

9%

10%

19%

7%

2016-21

$256 bn

43%

9%

-2%

11%

16%

12%

11%

2011-16

China

BRI

Pharmerging

Tier 3

RoW

US

EU5

Japan

12%

Japan

14%

13%

7%

Pharmerging T3

RoW

7%

EU5

42%US

BRI

6%

China

Notes: *Subject to PPRS rebate; Ex-manufacturer price levels, not including rebates and discounts. Contains Audited + Unaudited data; Growth considered on par if

the there is overlap between country and region CAGR ranges Source: IQVIA, IMS Market Prognosis September 2017

USA to continue to dominate growth and sales whereas China and Japan expected to slow down


8

46% of the current global sales are in the USA


-5%

0%

5%

10%

15%

20%600

500

400

300

200

100

0

568

20

531

19

500

18

478

17

467

16

459

15

436

14

389

13

343

12 21

327

2011

332

Previous Q3 2016 forecastYoY growth (%)

Changes in

forecast

• List price increases

lower than anticipated

• Fewer novel drug

approvals and

product launches in

2016

• Decline in HCV sales

not balanced out by

new HCV products

• Threat to ACA, tax

credit and subsidy

reform, wider use of

Health Savings

Accounts

US sales and market growth (2011-21), Billions of USDGlobal sales

Billons of USD

US

MAT 06/2017

$1,046bn

43%

14%

7%

19%

16%

Japan

EU5Pharmerging

ROW

Notes: *Subject to PPRS rebate; Ex-manufacturer price levels, not including rebates and discounts. Contains Audited + Unaudited data; Growth considered on par if the

there is overlap between country and region CAGR ranges Source: IQVIA, IMS Market Prognosis September 2017

9

NASDAQ Biotechnology Index (IBB)

“I’m going to bring down

drug prices. I don’t like

what’s happened with

drug prices.”

– President Elect

Trump, Dec 7

“Our drug industry

has been disastrous

[…] they’re getting

away with murder.”

– President Elect

Trump, Jan 11

Every tweet or

statement

about drug

pricing raises

industry

concerns

President Trump has also openly targeted pharma and risingdrug costs, which has affected industry stock

Source: IQVIA, US & EU5 Market Trends; : iShares NASDAQ Biotechnology Index (ETF), Google Finance, Yahoo Finance, MSN Money


10

Patient Cost Exposure Distribution

20% 22% 25% 26%

66% 65% 64% 63%

7%8% 1%1%2%2%

20142013 20162015

5% 1%6%

1%1% 1%

4%4%

4%4%

Generics $0 Copay

Brands Paid >$50 Brands Paid $0.01-$50

Generics Paid >$50 Generics Paid $0.01-$50

Brands $0 Copay

24% of drug

spending

without patient

out of pocket

cost

30% of drug

spending

without patient

out of pocket

cost

OBAMACARE

The introduction of ACA shows first achievements: The share of zero patient out of pocket cost is constantly increasing


Source: IQVIA; Medicine Use and Spending in the U.S, IQVIA Institute

11

“We’re going to have

insurance for everybody…

There was a philosophy in

some circles that if you can’t

pay for it, you don’t get it… It

will be in a much simplified

form. Much less expensive

and much better.”

– President Elect Trump,

Washington Post, Jan 15

However, frustration with quality and affordability of care drove popularity of “Repeal and Replace” of the ACA


Source: IQVIA, US & EU5 Market Trends

12© IQVIA 2017. All rights reserved. – Der Blick in die Glaskugel – Dr. Frank Wartenberg

Source: http://marketbusinessnews.com/bregret-regret-voting-brexit-spreading/138359

13

Brexit could decelerate UK pharma growth over the next 5 years

35

30

25

20

15

10

5

0

21

30

20

28

19

27

18

26

17

26

16

26

15

28

14

28

13

24

12

23

2011

23

20%

15%

10%

5%

0%

Downside of Brexit

pharma forecast

growth ~1% slower

by 2021

Further critical

factors in forecast

• Pre-PPRS rebate

and other

discounts/rebates

• Patient access

schemes

UK sales and market growth (2011-21), Billions of USDGlobal sales

Billons of USD

UK

MAT 06/2017

$1,046bn

43%

12%

2%7%

19%

16%

US

Rest of EU5

Japan

Pharmerging

ROW Brexit downsideUK sales/Brexit base caseBrexit upside

YoY growth/Brexit downside YoY growth/Brexit upside

YoY growth/Brexit base case


Notes: At ex-manufacturer price levels, not including rebates and discounts. Contains Audited + Unaudited data; *YoY growth in GBP; Source: IQVIA, IMS Market Prognosis Q3 2017; IMS MIDAS 09/2017

14

Ranks 6th in Europe for manufacturing; total

pharma employment is in decline

Justified reputation as a poor launch market

Nur hinter USA, Japan und Deutschland bei # von

Pharma HQs

In den Top 10 der Anzahl Pharmamitarbeiter

weltweit

Führend bei Pharma Forschungsausgaben

Führend im Bereich HTA und RWE

Innovationshochburg?

So where does Brexit leave the UK?


Die UK ist ein wichtiger Markt zur Kommerzialisierung …

2% Weltweiter

Pharma-ausgaben

1% NAS

Umsatz Jahr 1

nach Launch

…UK ist ein schwacher Umsatztreiber

Quelle: ABPI; IMS Midas MAT Q4 2016

15

Four key areas of UK pharma industry are affected by Brexit

Trade Scientific

CommercialRegulatory

Relocation of EMA & retention of regulatory personnel

EEA regulatory network relationship

Distribution, pharmacovigilance & clinical trials

Scientific funding

Freedom of movement

International research and policy cooperation

Freedom of movement

Harmonisation of infrastructure

UK as launch market & business base

Sterling as reporting currency

Change in import/export balance

Supply chains crossing UK-EU borders

Knock-on effects of regulatory disruption


Source: IQVIA Thought Leadership

16

• £25 million of research support for start ups/SMEs

• £13 million competition to establish a new Medicines Manufacturing Innovation Centre

• £12 million to expand the Cell and Gene Therapy Manufacturing Centre in Stevenage

Commercial growth and infrastructure

• £14 million investment in 11 medical technology research centres

• £30 million to establish the Advanced Therapies Treatment Centre

• £66 million for a major vaccines lab to prepare country for emergency epidemics

NHS Collaboration

Goals in the government’s life sciences strategy

£ 160 Mio

“These measures will provide confidence for global companies to invest in the UK during and beyond Brexit.” – Mike Thompson, ABPI

Government reinforces commitment to strengthens UKs attractiveness for pharma industry


Source: IQVIA Thought Leadership

17

0%

2%

4%

6%

8%

10%

12%70

60

0

10

20

30

50

40

48

13

46

12

42

2011

45

18 19

43

52

4749

20 2117

45

16

44

1514

54

Critical factors in

forecast

• 30 new products

expected to launch in

2017

• Aging population leads

to increase in volume

• Patent expiries

increase rebate

contracts and generic

volume

• Extension of the price

moratorium

• Sick funds discount

contracts expansion,

esp. in acute diseases

Germany sales and market growth (2011-21), Billions of USDGlobal sales

Billons of USD

16%

19%

7%4%Germany

10%

43%

$1,046bn

MAT 06/2017

US

Rest of EU5

Japan

Pharmerging

ROW

YoY growth (%)Germany sales

Launch and admission to reimbursement of innovative specialty products drive German market growth


Notes: At ex-manufacturer price levels, not including rebates and discounts. Contains Audited + Unaudited data; YoY growth in LCUS$, Source: iQVIA; IMS Market Prognosis Q3 2017; IMS MIDAS 09/2017

18

65%Des Wachstums kommt

von 3 Therapiegebieten

(Krebs, Autoimmun, NOAC)

Trends und wichtige Fakten für den deutschen Pharma Markt


225Markteinführungen neuer

Substanzen 2016-2020

16%Marktanteil von AMNOG-

Produkten am deutschen

Gesamt-Rx Markt

Deutschland bleibt

Hauptzielmarkt für

neue innovative

Markteinführung und

etablierte Produkte

1%Versandhandelsanteil am

Gesamt-Rx Markt (MAT 7/17)

4,357€ Mrd. OTC Markt mit einem

Wachstum von 3,8% (MAT7/2017)

2,398€ Mrd. Einsparungen durch

Erstattungspreise und Rück-

forderungen im 1. -3- Quartal

2017

1%Anteil der Biosimilars am

Gesamt-Rx Markt (MAT 7/17)2-5%Wachstumsprognose in

etablierten Märkten inkl.

Deutschland 2016 – 2020

43%der globalen Pipeline sind

Biologika auch für Alzheimer,

Asthma, Schmerz, …

59% vom europäischen Wachstum

resultiert aus

Spezialtherapeutika

19

In May 2017 the AMVSG was enforced – Key Points

Physician information

system about

AMNOG outcomes

Price moratorium

continues until

end of 2022

Provision to keep the

negotiated prices

confidential was set aside

Principle of free pricing in

the first year after launch

is kept

EU payers continue to focus on cost containment.The May 2017 AMVSG did not change that for Germany


Source: IQVIA, http://www.bundestagswahl-bw.de

20

• The G-BA has rarely restricted to sub-populations even though it is

legally able to do so

• AMVSG does not explicitly change this

• However, the fact that this was debated politically, and the precedent

case of PCSK9i restriction, makes this an area to watch for future

submissions

Restrictions to sub populations?

• GKV negotiations have been able to consider volume in the past, but the

focus has been on simple rebates

• With AMVSG, it will be important to consider how the negotiation

dynamic may change

Impact of price-volume

negotiation?

• Physicians may fear financial penalties if they cannot justify use in

populations where the drug did not show any additional benefit

• Conversely, drugs may be preferentially used in populations where the

drug showed an added benefit

AMNOG dossiers included in

physicians’ software: Effect on

prescribing?

Looking ahead, we can think of at least three key trends or open questions to watch for Germany


Source: IQVIA, US & EU5 Market Trends

21

What drives key markets growth? The shift towards specialty medicine

Share of absolute

growth by region

Forecast 2016-2021 88%

12%

Traditional Share of Growth 2016-21

Specialty Share of Growth 2016-21

31%

69%

94%

6%

41%59%

85%

15%

LATAMLC$ 23Bn Growth

EuropeLC$ 36Bn Growth

AFMELC$ 25Bn Growth

Asia/Aust./NZLC$ 86Bn Growth

North AmericaLC$ 203Bn Growth


Source: IQVIA, IMS Market Prognosis Q3 2016; at ex-manufacturer price levels, not including rebates and discounts. Contains Audited + Unaudited data; IHII analysis; Turkey included in AFME, Russia in Asia/Aust./NZ

22

Absolute one year growth MAT 06/2017 (Top 10 TAs, Mio LCU$)

1,000600 800200 4000

Immunosuppressants

814

52

Lipid Regulators 64

Vaccines 65

Multiple Sclerosis 66

Respiratory 69

Diabetes 72

Ocular Antineovascularisation 74

Anticoagulants 253

Autoimmune 475

Oncology

Share of total

positive growth

MAT 06/2017

34%

20%

11%

3%

3%

3%

3%

3%

2%

2%

Top 5

represent

71% of

growth

In Germany, over 70% of growth comes from five TAs, three of them being specialty


Source: IQVIA, IMS MIDAS MAT Q2 2017, Rx only

23

Phase II–Registered Percent of Pipeline

28%31%

3%

4%

4%6%

6%7%

11%

Oncology Other

Mental Disease

Respiratory

Diabetes

Autoimmune

Cardiovascular &

Haematology

CNS

Infectious disease

39%30%

13%

11%

15%

30%

3%

6%

11%8%

Phase II-III

2,212

4%4%

5%6%

Pre-Reg/Reg

272

3%5%

4%

4%

The pipeline is also full of specialty, almost half of drugs in late stage are within Oncology, Antivirals & CNS


Source: IQVIA, IMS R&D Focus. Sept 2017, active phase only

24

Past/current situation

Proportion of Globally Excellent Launches by

Primary care / specialty

Future situation

Rising areas

Launch

Excellence V

(2011-2015)

13%

87%

Launch

Excellence 1

(1995-2003)

82%

18%

Primary CareSpecialty Care

Launches

typically for

diseases/

conditions with

global patient

pops in Bn-

100s m range

Launches

typically for

diseases/

conditions with

global patient

pops in 10ms-

<1m range*

Personalised

Medicine

Gene therapy

Cell therapies

Large patient

populations,

high unmet need

Orphan drugs

Alzheimer’s?

Excellent launches strengthen companies performance; specialty products are also here in focus


Source: IQVIA Thought Leadership on Launch Excellence, Launch Excellence V, *Sole specialty exception: Hepatitis C

25

1

2

Pipeline candidates 10/2017

CAR T-cells

4

27Phase II

3Phase III

Pre-reg./ Reg.

Approved

Preclin./

Phase I27

RNAi

15

44

CRISPR

25

Patisiran - Amyloidosis (Sanofi/Alnylam)SYL 1001 - Dry eye (Sylentis)QPI 1007 - Ophthalmological disorder (Biocon/Quark)Teprasiran - Transplant rejection (Alnylam)

Kymriah - Leukemia (Novartis, FDA 08/2017)

tisagenlecleucel-T - Leukemia, Lymphoma (Novartis)Axi-cel – Non-Hodgkin lymphoma (Kite Pharma/Gilead)

First advanced cell therapy received market approval, RNAi and CRISPR technologies are in earlier trial stages


Source: IQVIA Thought Leadership analysis, IMS R&D Focus October 2017; Nature news

26

Where is Pharma headed in the next years?

Specialty

products and

TAs are the key

drivers of

developed

market growth

Cell and gene

therapies could

change the

current

definitions of

pharmaco-

therapy

German pharma

sales is growing

solidly; patient

centric

approaches and

closure of

supply gaps are

in focus of

politicians

The implications

of Brexit for

pharma remain

uncertain but will

affect regulatory,

trade,

commercial, and

scientific areas

Regulator/ payer

discussions on

drug pricing and

ACA will

influence pharma

business in the

US

Global pharma

contibutes to

grow to $1.4tn

by 2021;

US remains the

main growth

driver


Source: IQVIA

Für Fragen stehe ich Ihnen gerne zur Verfügung

Dr. Frank Wartenberg

President Central Europe

[email protected]

+49 69 6604-4315

@FrankWartenberg

Healthcare

"Blick in die Glaskugel": Vortrag Dr. Frank Wartenberg, President Central Europe, IQVIA™ auf der Pharma Trends 2018