Kindler is certainly not alone in identifying specialty pharmaceuticals as a strategic avenue of growth. AstraZeneca's CEO, David Brennan, recently projected that "by 2010, up to a quarter of our candidates for full-scale development will be biological therapeutic agents." True to form, the firm's record-breaking $15.6 billion deal with MedImmune in April delivered a fat crop of vaccines as well as late-stage products in oncology, infection, inflammation, and respiratory conditions—and upped the proportion of biologics in AstraZeneca's pipeline from 7 percent to 27 percent, putting it in the same company as Wyeth, Roche, and Lilly. And that's not counting small-molecule specialty products. Whether measured by the rise of biologics in pipelines, deals with large-molecule makers, or New Drug Applications (NDAs), Big Pharma has clearly gotten specialty religion. The reasons for this trend, in an industry that has long thrived on high-volume, small-molecule oral products, are complex. According to the Cambridge Healthtech Institute's Insight Pharma report "Specialty Pharmaceuticals: Driving Industry Growth into the Next Decade," pharma's shift is a strategic response to fierce pressures to reduce R&D costs, increase incremental revenue, and limit both premarket and postmarket risks.
Why Specialty Is So SpecialAccording to IMS Health, specialty products contributed 62 percent of the market's total growth in 2006, compared with just 35 percent in 2000. The cancer market saw unprecedented R&D investment last year, not to mention 12 percent growth. Oncological-products sales are expected to reach more than $40 billion this year, and IMS predicts that it will become the largest single sector in terms of value by 2010. Major plans and payers are also reporting skyrocketing use of cytokines, recombinant products, and other biological classes. As for the total pharma pipeline, 27 percent of all compounds are biologic in nature. (For a definition of specialty products and biologics, see "What Makes a Drug a 'Specialty'?")
Although a greater emphasis on specialty drugs is anything but a quick fix, it will help get the industry back on track with its most important constituency: patients. Companies will be seen to be wrestling with important and exciting biomedical problems and producing innovative drugs that relieve the burden of disease in terms of societal cost and human suffering.