GDHC005PLR-Global Pharmaceutical Market Sample 1-30,375,376 · global pharmaceutical market benchmark report - RETROSPECTIVE AND FORWARD-LOOKING ANALYSIS OF THE Global Pharmaceutical

REFERENCE CODE GDHC005PLR | PUBLICATION DATE OCTOBER 2014

GLOBAL PHARMACEUTICAL MARKET BENCHMARK REPORT - RETROSPECTIVE AND FORWARD-

LOOKING ANALYSIS OF THE LEADING PHARMACEUTICAL COMPANIES

Global Pharmaceutical Market Benchmark Report - Retrospective and Forward-Looking Analysis of the Leading Pharmaceutical Companies 2 © GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form.

GLOBAL PHARMACEUTICAL MARKET BENCHMARK REPORT - RETROSPECTIVE AND FORWARD-LOOKING ANALYSIS OF THE

LEADING PHARMACEUTICAL COMPANIES

Executive Summary

Pfizer was the Peer Group Benchmark Leader

According to GlobalData’s proprietary

benchmarking analysis, Pfizer was the Global

Pharmaceutical Market Benchmark Leader in 2013

with an overall score of 6.22. Pfizer’s leadership

status was the result of cost-cutting largely the

headcount reductions from the divesture of its

Animal Health business. This along with other

rationalization measures, contributed to the

company’s income growth, and helped to drive

Pfizer’s net margin performance in 2013.

Pharmaceutical Market Beginning to Show Signs of Stability

According to GlobalData’s Global Pharmaceutical

Market Benchmark Report, the combined peer

group revenue and average operating margin

remained stable in 2013 when compared with

2012. Revenue from this peer group came in

slightly lower by -0.2% to $718.7 billion. The

average operating margin of the peer group was

steady at 21.5%; however this was down by 90

basis points when compared to 2011. On the

clinical side, R&D spending grew by $800 million to

$111.9 billion in 2013, an increase of 0.7%.

Combined Peer Group Revenue ($m) and Average Operating Margin, 2010-2013

$697,800

$730,515

$719,943 $718,688

21.8%

22.4%

21.5% 21.5%

21%

22%

22%

23%

23%

24%

24%

25%

25%

$680,000

$690,000

$700,000

$710,000

$720,000

$730,000

$740,000

2010 2011 2012 2013

Revenue Avg. Op Margin Source: GlobalData Pharma eTrack & company SEC filings.

J&J was the growth leader in absolute dollars,

increasing by $4.1 billion in 2013 driven by the

company’s immunology and oncology portfolios.

Biogen Idec was the peer group revenue growth

leader in 2013. Biogen’s sales increased to $5.5

billion in 2013, a 25.7% rise from the $4.2 billion

the company reported in 2012. Revenues soared

as a result of Tysabri (natalizumab), the company’s

injectable monotherapy for treating relapsing forms

of multiple sclerosis (MS), and the new oral MS

drug Tecfidera (dimethyl fumarate). Sales of

Tysabri grew 36.4% year-to-year from $1.1 billion

in 2012 to $1.5 billion in 2013. The company also

benefited from recognizing $876.1 million in new

revenues from sales of Tecfidera despite having

only been approved in March of 2013.

Peer Group R&D Spending

The growth in peer group R&D spending was

largely the result of the industry’s top spenders,

Roche, Novartis and J&J. Roche was the R&D

spending leader in 2013, outlaying almost $10




Executive Summary

billion in the clinic, representing 19.8% of the

company’s total sales. Roche’s R&D spending was

bolstered by continued investments in oncology

and neuroscience therapeutic areas such as the

company’s investigational anti-PD-L1 antibody

targeting lung cancer, and the advancement of its

programs for Alzheimer’s disease. Meanwhile,

Novartis, and J&J each added about $500 million

to their respective clinics. Novartis’ R&D spending

grew by 5.6% to $9.9 billion and J&J spent $8.2

billion, which was up 6.8% when compared to the

same period in 2012.

Combined Peer Group R&D Spend ($m), 2010–2013

$111,617

$111,165 $111,193

$111,930

$110,600

$110,800

$111,000

$111,200

$111,400

$111,600

$111,800

$112,000

2010 2011 2012 2013R&D Spend

Source: GlobalData Pharma eTrack & Company SEC filings.

In efforts to improve margins, cost-cutting

remained a strategic necessity for some

companies. Pfizer shaved over $1.2 billion in R&D

spend and Merck cut over $600 million in its

clinical operations. In addition, the companies’

reduced their workforces to help stabilize profits in

the aftermath of their patent losses.

FDA Approvals Drive Much Needed Value in the Sector

While the 27 NME approvals by the FDA in 2013

were below the 39 seen in 2012 — the highest

number of NME approvals since 1997 — at least

15 of the 2013 arrivals are expected to achieve

blockbuster status by 2019. This is four more than

the 11 drugs the FDA approved in 2012 expected

to attain blockbuster sales. Consequently, as

shown in the figure below, the value added by the

new therapies that gained FDA approval in 2013

far exceeds that of 2012’s approvals, despite there

being 12 fewer NMEs approved.

Combined Revenue ($m) Projections of 2013 NMEs vs. 2012 NMEs, 2012–2019

$1,293$5,451

$10,521$16,528

$22,988$29,063

$34,613$40,710

$2,414

$24,177$30,320

$38,423$44,343

$49,408

$55,342

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

2012 2013 2014(F) 2015(F) 2016(F) 2017(F) 2018(F) 2019(F)

WW

Sal

es (

$m)

2012 FDA Approvals 2013 FDA Approvals Source: GlobalData Pharma eTrack [Accessed July 24, 2014] & company SEC filings.

The year 2013 will go down as one of the most

prolific in the industry, not necessarily in terms of

the number of new drug approvals, but almost

certainly in terms of the underlying value added by

this new wave of therapies. Of the 27 NMEs

approved by the FDA in 2013, more than half are

expected each to achieve worldwide blockbuster

status, with the total revenues for this group of




Executive Summary

assets estimated to reach more than $55 billion by

2019. What is particularly astonishing is that the

revenue this group of assets is expected to

achieve is almost entirely attributable to three new

therapies: Gilead’s Sovaldi, Biogen’s Tecfidera,

and J&J’s Olysio.

Patent Cliff to Erode $65B in Sales by 2019

GlobalData estimates the patent cliff will erase

approximately $65 billion in sales through 2019 as

some of the top-selling drugs lose patent

exclusivity. The drug makers that will be hardest hit

will include Otsuka, GSK, Eli Lilly, and

AstraZeneca. Otsuka’s anti-psychotic drug Abilify

(aripiprazole) which it co-markets with BMS will

lose $6.2 billion by 2019 as the result of generic

competition. Similarly, GSK’s Advair will see its

sales plummet by $4.8 billion in the same time

frame.

Patent Cliff Sales ($m) Erosion, 2013–2019

$99,567

$84,802

$72,054

$61,654

$51,064 $41,937

$34,915

$-

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

2013 2014(F) 2015(F) 2016(F) 2017(F) 2018(F) 2019(F)

-$64,652m

Source: GlobalData, Pharma eTrack [Accessed April 23, 2014].

Deal Values Soar Due to Shire Acquisition

The total number of deals (M&A and licensing) in

the pharmaceutical market fell slightly from 1,494

in 2012 to 1,483 in 2013. While both years were

down by about 300 deals from 2011 (1,800), the

total deal value across M&A and licensing has

remained very stable at about $85 billion over the

past three years. Moving ahead through the rest of

CY2014, the total deal value jumps significantly to

around $135 billion through the end of July, which

takes into account AbbVie’s $54 billion

megamerger with Shire. While the total deal value

has already eclipsed those of previous four years,

GlobalData expects the number of deals in 2014

will fall short of historical averages.

Global Pharmaceutical Market, Total Deals and Deal Values ($m), 2009–2014

1,833

1,785 1,800

1,494 1,483

580

$238,346

$71,453 $84,178 $81,232 $88,983

$135,194

$-

$50,000

$100,000

$150,000

$200,000

$250,000

0

250

500

750

1,000

1,250

1,500

1,750

2,000

2009 2010 2011 2012 2013 2014

No. of Deals Deal Value (US $M)

Source: GlobalData, Pharma eTrack, [Accessed July 31, 2014]; & company data. Note: Includes all M&A, asset transactions, and licensing deals. Deal values included wherever disclosed.

In total dollar terms, AbbVie’s acquisition of Shire

is valued at approximately $53 billion, making it the

sixth largest merger in the history of the

pharmaceutical industry. AbbVie’s rationale for this




Executive Summary

deal consists of a mix of portfolio diversification,

cost synergies, tax savings, and the lowering of the

company’s dependency on Humira (adalimumab)

for generating sales. Clearly, AbbVie is targeting

Shire’s marketed drug portfolio which includes

therapies in CNS, rare diseases and

gastrointestinal disorders. The graph below shows

GlobalData’s Net Present Value (NPV) analysis of

Shire’s leading assets.

Shire’s Leading Assets by Net Present Value ($m)

$632 $721 $1,008 $1,074

$1,660 $2,181 $2,190 $2,284

$3,061 $9,779

$- $5,000 $10,000 $15,000

FB-s0701Adderall XR

PentasaFirazyr

VprivElaprase

CinryzeLialda/Mezavant

ReplagalVyvanse

NPV ($m)

Source: GlobalData, Pharma eTrack, [Accessed on: July 18, 2014]; & Company Data.

AstraZeneca Rejects Pfizer’s Takeover Offer

As the May 26 deadline passed to begin

negotiations, AstraZeneca rejected Pfizer’s third

takeover bid for the UK drugmaker. AZ’s board

turned down Pfizer’s final offer of roughly $120

billion, or $92.48 per share, with a 45% cash

component citing that Pfizer’s proposal significantly

undervalued the company and its prospects. In

addition to believing that Pfizer’s offer was too low,

AstraZeneca had grave concerns about Pfizer’s

post-acquisition track record, and its inversion

strategy. Pfizer stated that if it had purchased AZ, it

would change its domicile to the relatively tax-

friendly UK – which would inevitably mean cuts to

AZ’s business in the US. AstraZeneca only had to

look at Pfizer’s recent past as an example. When

Pfizer bought Wyeth in 2009, it slashed over $4

billion in costs and cut payroll by almost 20,000 -

the majority of which fell on legacy Wyeth

operations. AstraZeneca had little reason to expect

anything different this time around.

CNS Franchise: A Fragmented Market Exposed to Generics

The CNS market remains fragmented. Some

pockets within the CNS franchise have been met

with clinical development and investment into

specific neurological conditions such as multiple

sclerosis, and schizophrenia. However, others

areas such as Parkinson’s and Alzheimer’s

diseases have seen a lack of new market

competition and novel treatment approaches.

Many drug makers have abandoned their research

efforts into these disorders in search of areas with

greater return-on-investment, and more

commercial viability. GlobalData estimates that the

peer group CNS market remained relatively flat in

2013, rising by only 2.2% to approximately $69

billion.

Pfizer is the leader in the CNS franchise,

commanding about 12% of the CNS market.

Pfizer’s strong position is largely the result of its

anticonvulsant drug Lyrica (pregabalin) which

posted $4.8 billion in sales in 2013 and is one of

the top-selling drugs in the franchise.




Executive Summary

CNS Market Share, 2013

AZ, 3.3%Bayer, 2.1% Biogen

Idec, 8.5%

BMS, 3.6%Daiichi, 1.8%

Eisai, 3.0%

Eli Lilly, 11.2%

GSK, 3.4%

J&J, 6.2%Merck

KGaA, 3.8%Novartis, 7.8%

Otsuka, 11.6%

Pfizer, 12.4%

Sanofi, 1.9%

Shire, 3.0%

Teva, 8.0%

UCB, 3.0%

Other, 5.4%

Source: GlobalData Pharma eTrack & analyst consensus estimates. Note: 2013 total: $69.3bn. peer group only.

Conversely, companies such as Eli Lilly and

AstraZeneca have lost share of the CNS market

since 2010. Eli Lilly’s share fell mainly from the

decrease in sales of Zyprexa (olanzapine) Lilly’s

dopamine antagonist used to treat schizophrenia,

and bipolar disorder. Back in 2010, sales from

Zyprexa were over $5 billion. However, in 2013,

Zyprexa sales have plummeted to $1.2 billion as a

result of the drug losing its US patent exclusivity in

2011. Meanwhile, AZ has given up the greatest

share of the CNS market over the past three years.

AZ’s CNS segment has been bleeding sales as a

result of the company losing its patent on Seroquel

(quetiapine fumarate), another treatment for bipolar

disorder. This has led to the entry of cheaper

generic alternatives from Teva, and Sandoz.

Regeneron’s Eylea Will Be the Top-Selling Eye Drug by 2016

In November of 2011, Regeneron shook-up the

ophthalmology market when the FDA approved

Eylea (afilibercept) for treating wet-AMD. Since

then, Eylea has been beating analyst estimates

and has gone on to reach blockbuster status

representing one of the most successful drug

launches by a biotechnology company. In 2013,

sales of Eylea surged to over $1.4 billion, a 68.1%

year-to-year increase from $838 million in 2012.

Regeneron has been driving the market

penetration for Eylea by expanding the drug’s

territory coverage to include Japan, Australia,

Colombia, Brazil and the UK, and its treatment

label to comprise other disease of the eye, such as

diabetic macular edema, and branch/central retinal

vein occlusion.

Eylea vs. Lucentis Sales ($m), 2007–2009

$896

$2,072

$6,871

$1,219

$4,184 $4,836

$-$1,000 $2,000

$3,000 $4,000 $5,000

$6,000 $7,000 $8,000

2007 2008 2009 2010 2011 2012 2013 2014 (F)

2015 (F)

2016 (F)

2017 (F)

2018 (F)

2019 (F)

Eylea Lucentis

Eylea will surpass Lucentis in 2016

Source: GlobalData Pharma eTrack & analyst consensus estimates. Note: Assumes current growth rates and no additional label expansions.




Executive Summary

One of the key drivers behind the success of Eylea

is patients switching to the drug from Lucentis

(ranbizumab), and off-label Avastin. Results from

Regeneron’s two Phase III trials, VIEW 1, and

VIEW 2 demonstrated that Eylea was non-inferior

to ranbizumab at maintaining visual acuity, and

there was no drop-off associated with less frequent

dosing. GlobalData expects the less frequent

dosing schedule has led to a decrease in office

visits, and therefore fewer IVT injections which has

driven patients’ switching behavior, therefore, and

helped to fuel Eylea sales.

Pipeline Highlight: Amgen Delivers First-Ever Ph. III Data on New Class of PCSK9 Drugs

Amgen announced data from its Phase III TESLA

trial evaluating evolocumab (formerly, AMG-145)

met its primary endpoint of percent reduction from

baseline in LDL-C. Evolocumab is an

investigational fully human monoclonal antibody

that inhibits PCSK9, a protein that reduces the

liver's ability to remove LDL-C, or “bad cholesterol”

from the blood. TESLA was a two-part Phase II/III

trial evaluating evolocumab in patients with

homozygous familial hypercholesterolemia (HoFH),

a rare and serious genetic disorder characterized

by severely elevated LDL-C at an early age. HoFH

occurs in approximately one in a million individuals,

who have two altered copies of a cholesterol-

regulating gene that result in absent or defective

LDL receptor function. HoFH can cause a four-fold

increase in LDL-C levels.

If successful, Amgen will be first to market in this

new category of cardio medicines with a regulatory

filing expected by the end of this year. However,

Amgen is not alone in the PCSK9 class.

Regeneron and Sanofi are moving forward with

their drug alirocumab, while Pfizer’s bococizumab

remains a respectable third runner. In the

aggregate, these three drugs will create at least a

$10 billion market opportunity with each drug fixed

to hit $3.5 billion in peak sales. Being first-to-

market might not be beneficial to Amgen as payers

and pharmacy benefit managers are concerned

about the cost of treatment running as high as

$1,500 per prescription. Many patients with hard-

to-control cholesterol are taking cheap generic

statins; the majority of them could be moved to the

biologic therapy resulting in staggering cost to the

healthcare system given that there are some 70

million patients with high cholesterol.


Table of Contents



1 Table of Contents

1 Table of Contents ....................................................................................................................... 8

1.1 List of Tables .................................................................................................................... 16

1.2 List of Figures ................................................................................................................... 17

2 Introduction ............................................................................................................................... 25

2.1 Report Scope .................................................................................................................... 25

2.1.1 Company Covereage .................................................................................................... 26

2.1.2 Therapy Franchise Coverage ........................................................................................ 26

2.2 Upcoming Reports ............................................................................................................ 27

2.3 Recently Published Reports .............................................................................................. 27

2.4 GlobalData’s Benchmarking Methodology ......................................................................... 27

2.5 Benchmark Leader: Pfizer ................................................................................................. 28

3 Global Pharmaceutical Market Dynamics.................................................................................. 31

3.1 Sector Overview ................................................................................................................ 32

3.1.1 Peer Group Growth Rate ............................................................................................... 32

3.1.2 Peer Group R&D Spending ........................................................................................... 33

3.2 Corporate Valuations ........................................................................................................ 34

3.2.1 Market Capitalization ..................................................................................................... 34

3.2.2 Top 30 Pharma Valuations Compared Against the S&P500 .......................................... 36

3.3 FDA Approved 27 Novel New Drugs in 2013 .................................................................... 37

3.3.1 From 2004 through 2013, CDER has Averaged 26 NME Approvals per Year ............... 38

3.3.2 Multiple Pathways for Accelerating Drug Approvals....................................................... 39

3.3.3 CDER Met or Exceeded PDUFA Goal Dates for All 27 NMEs Approved in 2013 .......... 41

3.3.4 Drug Approvals Signify a Commercial Focus on High Growth Therapeutic Areas ......... 42

3.3.5 List of Approved NMEs in 2013 ..................................................................................... 43

3.3.6 GlobalData Sales Forecast for 2013 Approved Drugs ................................................... 44

3.4 New Approvals Drive Much Needed Value in the Pharmaceutical Market ......................... 46


Table of Contents



3.4.1 Exceptional Uptake of Sovaldi and Tecfidera Paves the way for New Optimism in Pharma......................................................................................................................... 48

3.5 Patent Cliff to Erode $65B in Sales by 2019 ...................................................................... 52

3.5.1 Top 50 Patent Expiries .................................................................................................. 53

3.6 Orphan Drugs: No Longer a Rare Opportunity .................................................................. 55

3.7 Regulatory Notes .............................................................................................................. 58

3.7.1 FDA Issues Draft Guidance on Determination of Product Exclusivity for Biologics ........ 58

3.7.2 Federal Appeals Court Rules FDA Has Authority to Regulate Stem Cells ..................... 60

4 Collaboration and Acquisition Strategies ................................................................................... 62

4.1 Deal Values Soar Due to Shire Acquisition ....................................................................... 62

4.2 Deep Dive: AbbVie Acquires Shire as the Threat of Humira Biosimilars Looms ................ 68

4.2.1 Deal Terms ................................................................................................................... 68

4.2.2 Combined Entity Holds Promise for AbbVie .................................................................. 68

4.2.3 Tax Inversion Impact on Humira Cash Flow .................................................................. 70

4.2.4 Shire Purchase Softens the Impact of AbbVie’s Maturing Portfolio ................................ 71

4.2.5 Acquisition Reduces AbbVie’s Dependency on Humira Sales ....................................... 72

4.2.6 Shire Sales Forecasts and Portfolio Valuation ............................................................... 75

4.3 M&A Analysis .................................................................................................................... 78

4.3.1 Roche Makes Respiratory Play with InterMune Buy ...................................................... 78

4.3.2 AstraZeneca Rejects Pfizer’s Takeover Bid ................................................................... 80

4.3.3 Teva Acquires Novel Migraine Prophylaxis Treatment .................................................. 81

4.3.4 Valeant’s Business Model Not Conducive for Allergan .................................................. 82

4.3.5 Shire Boosts Rare Disease Pipeline .............................................................................. 82

4.3.6 BMS Acquires Neuro Firm iPierian ................................................................................ 84

4.3.7 Amgen Dives into Multiple Myeloma Market, Gains Rights to Kyprolis .......................... 84

4.3.8 Bayer Buys-Out Cancer Partner Algeta, Purchases Conceptus .................................... 85

4.3.9 AZ Strengthens Respiratory Portfolio ............................................................................ 85

4.3.10 J&J Pays Big for Aragon’s Lead Pipeline Candidate ...................................................... 86


Table of Contents



4.3.11 Allergan Enhances Leadership Position in Neurology ................................................... 87

4.3.12 Astex Deal Might Stem the Bleeding for Otsuka ............................................................ 87

4.3.13 Select Generic M&As .................................................................................................... 87

4.4 Licensing and Partnerships ............................................................................................... 94

4.4.1 BMS on a Shopping Spree for Cancer Immunotherapies .............................................. 94

4.4.2 Bayer Scoops-Up Orion’s Phase III Prostate Cancer Drug ............................................ 96

4.4.3 GSK Signs Deal with Adaptimmune to Develop T-cells ................................................. 96

4.4.4 Celgene: A Licensing Machine ...................................................................................... 97

4.4.5 Novartis Pens Deal for Ophthotech’s Wet-AMD Treatment Fovista ............................... 99

4.4.6 Merck Inks Potential Mega Deal with Ablynx, Sells-Off Eye Drugs .............................. 100

4.4.7 Biogen Forges Preclinical Alzheimer’s Pact with Proteostasis ..................................... 102

4.4.8 Roche Turns on the Switch in Epigenetics .................................................................. 102

5 Financial Management............................................................................................................ 104

5.1 Global Pharmaceutical Market Competitive Landscape Assessment .............................. 104

5.1.1 The Drug Sector Began to Show Signs of Stabilization in 2013 ................................... 104

5.2 Financial Management: Heat Map................................................................................... 106

5.2.1 Gilead was the Financial Management Leader in 2013 ............................................... 106

5.3 Financial Performance Metrics ........................................................................................ 109

5.3.1 Revenue ...................................................................................................................... 109

5.3.2 Revenue Growth YtY ................................................................................................... 111

5.3.3 Operating Income ........................................................................................................ 113

5.3.4 Operating Income Growth YtY ..................................................................................... 115

5.3.5 Operating Margin ........................................................................................................ 117

5.3.6 Operating Income per FTE .......................................................................................... 119

5.3.7 Net Margin .................................................................................................................. 121

6 Expense Management ............................................................................................................ 123

6.1 Global Pharmaceutical Market Competitive Landscape Assessment .............................. 123


Table of Contents



6.1.1 Consistent Cost Structures Give Drugmakers Margin Stability .................................... 123

6.1.2 Eisai Pushes Arena’s Belviq with More Reps and Ad Spending .................................. 124

6.2 Expense Management: Heat Map ................................................................................... 125

6.2.1 Eisai was the Expense Management Leader in 2013 .................................................. 125

6.3 Expense Performance Metrics ........................................................................................ 128

6.3.1 S,G&A Spending ......................................................................................................... 128

6.3.2 S,G&A Spending as a Percentage of Revenue ........................................................... 130

6.3.3 S&M Spending ............................................................................................................ 132

6.3.4 R&D Spending ............................................................................................................ 133

6.3.5 R&D Spending Growth ................................................................................................ 136

6.3.6 R&D Spending as a Percentage of Revenue ............................................................... 138

7 Therapy Franchise Analysis .................................................................................................... 141

7.1 Cardiovascular ................................................................................................................ 144

7.1.1 Commercial Landscape ............................................................................................... 144

7.1.2 Pipeline Highlights ....................................................................................................... 151

7.2 CNS ................................................................................................................................ 155



7.3 Diabetes.......................................................................................................................... 166



7.4 Gastrointestinal ............................................................................................................... 174



7.5 Hematology ..................................................................................................................... 180




Table of Contents



7.6 Immunology .................................................................................................................... 187



7.7 Infectious Disease ........................................................................................................... 200



7.8 Oncology......................................................................................................................... 208



7.9 Ophthalmology ................................................................................................................ 223



7.10 Respiratory ..................................................................................................................... 236



7.11 Vaccines ......................................................................................................................... 246



8 Regional Analysis ................................................................................................................... 257

8.1 North America Landscape Assessment........................................................................... 257

8.1.1 Growth Driven by Biotechs and Specialty Pharma ...................................................... 257

8.2 Regional Developments .................................................................................................. 260

8.2.1 Gilead’s Price of Sovaldi May be a Pill too Tough to Swallow ...................................... 260

8.2.2 States’ Take Efforts into Their Own Hands to Limit the Influx of Opioids ..................... 260

8.3 Revenue and Growth Leaders ........................................................................................ 261

8.3.1 Revenue ...................................................................................................................... 261



Table of Contents



8.4 Europe Landscape Assessment ...................................................................................... 264

8.4.1 AstraZeneca Pulls Down EU Market ........................................................................... 264


8.5.1 Merck KGaA Targets Italian Production Site for Investment ........................................ 267

8.5.2 Pfizer Partners with UK Academics to Develop Rare Disease Drugs .......................... 268

8.5.3 Bayer’s Eylea Hits Road Block in Germany ................................................................. 268

8.6 Revenue & Growth Leaders ............................................................................................ 269

8.6.1 Revenue ...................................................................................................................... 269


8.7 Asia-Pacific Landscape Assessment ............................................................................... 272

8.7.1 Astellas Pharma was the Growth Leader in Asia ......................................................... 272


8.8.1 China Targets Big Pharma in Corruption Investigation ................................................ 274

8.8.2 UCB Secures Asian Marketing Rights to Biogen’s MS Drugs ...................................... 275

8.8.3 Merck KGaA Targets China with Allergy and Diabetes Plants ..................................... 275


8.9.1 Revenue ...................................................................................................................... 276


8.10 Japan Landscape Assessment ....................................................................................... 278

8.10.1 Daiichi Sankyo Trumps its Domestic Rivals ................................................................. 278


8.11.1 Revenue ...................................................................................................................... 280


8.12 Emerging Markets Landscape Assessment .................................................................... 283

8.12.1 Differences in Regulatory and Commercialization Pathways Makes BRICs More Difficult than Previously Thought ............................................................................................. 283


8.13.1 India to Receive Deep Discount on Sovaldi Price ........................................................ 285


Table of Contents



8.13.2 Pharma Furious Over Compulsory Licensing in India .................................................. 286

8.13.3 India Commits $500M to Doubling its Regulatory Force .............................................. 287

8.13.4 Abbott Grows Footprint in Latin America with CFR Buy ............................................... 287

8.13.5 GSK to Freeze Vaccine Prices for Developing Countries ............................................ 287

8.13.6 Drug Manufacturers Look to the Middle East for Untapped Opportunities ................... 288


8.14.1 Revenue ...................................................................................................................... 288


9 Resource Management Strategies .......................................................................................... 292

9.1 Human Capital Management ........................................................................................... 293

9.1.1 Headcount Analysis..................................................................................................... 293

9.1.2 Layoffs in 2013 ............................................................................................................ 297

9.2 Drugmakers Expand Manufacturing Capacity for Biologics ............................................. 297

9.2.1 Roche Ramps up Production in Switzerland ................................................................ 297

9.2.2 Drugmakers Advance into Asia to Grab Share ............................................................ 298

9.2.3 Eisai Plans Major Sales Push in Russian Market ........................................................ 300

9.2.4 Daiichi Unloads Ranbaxy Problems to Sun Pharma .................................................... 300

9.3 Firm Utilization: Heat Map ............................................................................................... 301

9.3.1 Pfizer was the Firm Utilization Leader in 2013 ............................................................. 301

9.4 Firm Utilization Metrics .................................................................................................... 304

9.4.1 Headcount Growth YtY ................................................................................................ 304

9.4.2 Revenue per Employee ............................................................................................... 305

9.4.3 R&D Expense per R&D Employee .............................................................................. 307

9.4.4 G&A Expense per G&A Employee .............................................................................. 309

9.4.5 S&M Expense per S&M Employee .............................................................................. 311

9.5 Capital Management: Heat Map ...................................................................................... 312

9.5.1 Allergan was the Capital Management Leader due to its Higher Liquidity .................... 312


Table of Contents



9.6 Capital Structure Metrics ................................................................................................. 313

9.6.1 Debt/Equity ................................................................................................................. 313

9.6.2 Sales/Assets ............................................................................................................... 315

9.6.3 Return on Capital Employed ........................................................................................ 316

9.6.4 Cash Ratio .................................................................................................................. 318

9.6.5 Current Ratio ............................................................................................................... 319

9.6.6 Quick Ratio ................................................................................................................. 320

10 Future Outlook ........................................................................................................................ 322

10.1 Global Pharmaceutical Market ........................................................................................ 323

10.2 Company Forecasts ........................................................................................................ 328

11 Market Data ............................................................................................................................ 330

11.1 Global Pharmaceutical Market ........................................................................................ 330

11.1.1 Pharmaceutical Revenue Forecast for 128 Leading Companies ................................. 330

11.2 Pipeline Analysis ............................................................................................................. 333

11.2.1 Forecasts & Valuations ............................................................................................... 333

11.3 Company Pipeline Profiles .............................................................................................. 336

11.4 Molecule Type................................................................................................................. 367

11.4.1 Biologics Versus Small Molecules ............................................................................... 367

12 Appendix................................................................................................................................. 372

12.1 Research Methodology ................................................................................................... 372

12.1.1 Coverage .................................................................................................................... 372

12.1.2 Secondary Research ................................................................................................... 372

12.2 About the Author ............................................................................................................. 373

12.2.1 Adam Dion, Industry Analyst ....................................................................................... 373

12.3 Director, Healthcare Industry Dynamics .......................................................................... 374

12.4 Global Head of Healthcare .............................................................................................. 374

12.5 About the Industry Dynamics Team ................................................................................ 374


Table of Contents



12.6 About GlobalData ............................................................................................................ 375

12.7 Disclosure Information .................................................................................................... 375

12.8 Disclaimer ....................................................................................................................... 375

1.1 List of Tables

Table 1: GlobalData Benchmark Rankings, Global Pharmaceutical Market, 2013 ........................................... 29

Table 2: GlobalData Benchmark Rankings (cont’d), Global Pharmaceutical Market, 2013 .............................. 30

Table 3: List of Approved New Molecular Entities, 2013 ................................................................................. 43

Table 4: Sales Forecast ($m) for Recently Approved Drugs, 2013 .................................................................. 45

Table 5: Top 50 Patent Expiries, Sales ($m), 2013–2019 ............................................................................... 53

Table 6: Financial Management Composite Scores, 2013 ............................................................................ 107

Table 7: Expense Management Composite Scores, S,G&A, 2013 ................................................................ 126

Table 8: Expense Management Composite Scores, R&D, 2013 ................................................................... 127

Table 9: Therapy Franchise Market Outlook ($m) and Compound Annual Growth Rate, 2010–2019 ............ 143

Table 10: Top Largest Layoffs, 2013 ............................................................................................................ 297

Table 11: Firm Utilization Composite Scores, 2013 ...................................................................................... 302

Table 12: Firm Utilization Composite Scores (cont’d), 2013 .......................................................................... 303

Table 13: Capital Management Composite Scores, Debt & Profitability Ratios, 2013 .................................... 312

Table 14: Capital Management Composite Scores, Debt & Profitability Ratios, 2013 .................................... 313

Table 15: Capital Management Composite Scores, Liquidity Ratios, 2013 .................................................... 317

Table 16: Capital Management Composite Scores, Liquidity Ratios, 2013 .................................................... 318


Table of Contents



1.2 List of Figures

Figure 1: Combined Peer Group Revenue ($m) and Average Operating Margin, 2010–2013 ......................... 32

Figure 2: Combined Peer Group R&D Spend ($m), 2010–2013 ..................................................................... 33

Figure 3: Total Market Capitalization ($bn), 2010–2014 ................................................................................. 34

Figure 4: Market Capitalization ($bn) by Company, 2014 ............................................................................... 35

Figure 5: Change in Market Capitalization ($bn) by Company ........................................................................ 36

Figure 6: Top 30 Pharmaceutical Companies Valuation vs. S&P500 .............................................................. 37

Figure 7: Number of NME Approvals and Applications Filed, 2004–2013 ....................................................... 38

Figure 8: Percentage of NMEs by Approval Pathway, 2011–2013 .................................................................. 40

Figure 9: Percentage of NMEs Approved First in the US and on First Cycle of Review, 2011–2013 ................ 41

Figure 10: Combined Revenue Projections of 2013 FDA Approvals vs. 2012 FDA Approvals ($m), 2012–2019

................................................................................................................................................... 47

Figure 11: First Full-Year Sales ($m) of Major Product Launches by Year, 2009–2013 ................................... 48

Figure 12: Revenue Projections for 2013 FDA Approvals ($m), 2013–2019 ................................................... 49

Figure 13: Patent Cliff Sales ($m) Erosion, 2013–2019 .................................................................................. 52

Figure 14: Percentage of Biosimilar Exposure on Company Revenues, 2013 ................................................. 55

Figure 15: Orphan Peer Group ($m) and Compound Annual Growth Rate, 2010–2019 .................................. 57

Figure 16: Leading Orphan Drug Sales ($m), 2013 vs. 2019 .......................................................................... 58

Figure 17: Global Pharmaceutical Market, Total Deals and Deal Values ($m), 2009–2014 ............................ 63

Figure 18: Number of M&A Deals and Deal Values ($m), 2009–2014............................................................. 64

Figure 19: Number of Licensing Deals and Deal Values ($m), 2009–2014 ..................................................... 65

Figure 20: M&A Deal Values ($m) by Company, 2004–2014 .......................................................................... 66

Figure 21: Licensing Deal Values ($m) by Company, 2004–2014 ................................................................... 67

Figure 22: Projected Total Revenues ($m) for AbbVie/Shire Merger, 2014–2019 ........................................... 69


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Figure 23: Tax Savings Impact of Shire Merger on Humira Cash Flow ($m), 2014–2029 ................................ 71

Figure 24: Humira as a Percentage (%) of Total Sales Pre-and Post-Acquisition of Shire, 2014–2019............ 73

Figure 25: Potential Threat of Biosimilars on Humira Cash Flow ($m), 2014–2029 ......................................... 74

Figure 26: Combined Six-Year Forecast Revenues ($m) Across Shire’s Portfolio ........................................... 76

Figure 27: Shire Leading Assets by Net Present Value ($m) .......................................................................... 77

Figure 28: InterMune, Esbriet, Sales Forecast ($m), 2013–2019 .................................................................... 79

Figure 29: Global Pharmaceutical Market Landscape Assessment – FY2013 Revenue Growth vs. Operating

Margin ....................................................................................................................................... 106

Figure 30: Revenue ($m) by Company, 2013 ............................................................................................... 110

Figure 31: Revenue Growth by Company, 2013 ........................................................................................... 112

Figure 32: Operating Income ($m) by Company, 2013 ................................................................................. 114

Figure 33: Operating Income Growth by Company, 2013 ............................................................................. 116

Figure 34: Operating Margin by Company, 2013 .......................................................................................... 118

Figure 35: Operating Income per Employee, 2013 ....................................................................................... 120

Figure 36: Net Margin by Company, 2013 .................................................................................................... 122

Figure 37: Global Pharmaceutical Market Landscape Assessment – FY2013 S,G&A Expense vs. R&D

Expense .................................................................................................................................... 124

Figure 38: S,G&A Spending ($m) by Company, 2013 .................................................................................. 129

Figure 39: S,G&A Spend as a Percentage of Revenue by Company, 2013 .................................................. 131

Figure 40: Sales and Marketing Spending ($m) by Company, 2013 ............................................................. 133

Figure 41: R&D Spending ($m) by Company, 2013 ...................................................................................... 135

Figure 42: R&D Spending Growth by Company, 2013 .................................................................................. 137

Figure 43: R&D Spending as a Percentage of Revenue by Company, 2013 ................................................. 139

Figure 44: Peer Group Rx Sales ($m) & Compound Annual Growth Rate, 2010–2019 ................................. 144

Figure 45: Cardiovascular Market Size ($m) and Compound Annual Growth Rate, 2010–2019 .................... 145


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Figure 46: Cardiovascular Market Share, 2013 ............................................................................................ 146

Figure 47: Cardiovascular Market Share, 2010 ............................................................................................ 147

Figure 48: Cardiovascular Drug Sales ($m), 2013 vs. 2019 .......................................................................... 148

Figure 49: CNS Market Size ($m) and Compound Annual Growth Rate, 2010–2019 .................................... 156

Figure 50: CNS Market Share, 2013 ............................................................................................................ 157

Figure 51: CNS Market Share, 2010 ............................................................................................................ 158

Figure 52: CNS Drug Sales ($m), 2006–2019 .............................................................................................. 159

Figure 53: CNS Drug Sales ($m), 2013 vs. 2019 .......................................................................................... 160

Figure 54: Diabetes Market Size ($m) and Compound Annual Growth Rate, 2010–2019 .............................. 167

Figure 55: Diabetes Market Share, 2013 ...................................................................................................... 168

Figure 56: Diabetes Market Share, 2010 ...................................................................................................... 169

Figure 57: Diabetes Drug Sales ($m), 2013 vs. 2019 ................................................................................... 170

Figure 58: Gastrointestinal Market Size ($m) and Compound Annual Growth Rate, 2010–2019 ................... 175

Figure 59: Gastrointestinal Market Share, 2013 ........................................................................................... 176

Figure 60: Gastrointestinal Market Share, 2010 ........................................................................................... 177

Figure 61: Gastrointestinal Drug Sales ($m), 2013 vs. 2019 ......................................................................... 178

Figure 62: Hematology Market Size ($m) and Compound Annual Growth Rate, 2010–2019 ......................... 181

Figure 63: Hematology Market Share, 2013 ................................................................................................. 182

Figure 64: Hematology Market Share, 2010 ................................................................................................. 183

Figure 65: Hematology Drug Sales ($m), 2013 vs. 2019 .............................................................................. 184

Figure 66: Immunology Market Size ($m) and Compound Annual Growth Rate, 2010–2019 ........................ 188

Figure 67: Immunology Market Share, 2013................................................................................................. 189

Figure 68: Immunology Market Share, 2010................................................................................................. 190

Figure 69: Immunology Drug Sales ($m), 2006–2019 .................................................................................. 191


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Figure 70: Immunology Drug Sales ($m), 2013 vs. 2019 .............................................................................. 192

Figure 71: Infectious Diseases Market Size ($m) and Compound Annual Growth Rate, 2010–2019 ............. 201

Figure 72: Infectious Disease Market Share, 2013 ....................................................................................... 203

Figure 73: Infectious Disease Market Share, 2010 ....................................................................................... 204

Figure 74: Infectious Disease Drug Sales ($m), 2013 vs. 2019 ..................................................................... 206

Figure 75: Oncology Market Size ($m) and Compound Annual Growth Rate, 2010–2019 ............................. 210

Figure 76: Oncology Market Share, 2013 ..................................................................................................... 211

Figure 77: Revlimid vs. MabThera/Rituxan Sales ($m), 2006–2019 ............................................................. 212

Figure 78: Oncology Market Share, 2010 ..................................................................................................... 212

Figure 79: Oncology Drug Sales ($m), 2013 vs. 2019 .................................................................................. 215

Figure 80: Ophthalmology Market Size ($m) and Compound Annual Growth Rate, 2010–2019 .................... 225

Figure 81: Ophthalmology Market Share, 2013 ............................................................................................ 226

Figure 82: Eylea vs. Lucentis Sales ($m), 2007–2019 .................................................................................. 227

Figure 83: Ophthalmology Market Share, 2010 ............................................................................................ 228

Figure 84: Ophthalmology Drug Sales ($m), 2013 vs. 2019.......................................................................... 230

Figure 85: Respiratory Market Size ($m) and Compound Annual Growth Rate, 2010–2019.......................... 237

Figure 86: Respiratory Market Share, 2013 .................................................................................................. 238

Figure 87: Respiratory Market Share, 2010 .................................................................................................. 239

Figure 88: Spiriva vs. Advair Sales ($m), 2006–2019 ................................................................................... 240

Figure 89: Respiratory Drug Sales ($m), 2013 vs. 2019 ............................................................................... 241

Figure 90: Vaccine Market Size ($m) and Compound Annual Growth Rate, 2010–2019 ............................... 247

Figure 91: Vaccines Market Share, 2013 ..................................................................................................... 249

Figure 92: Vaccines Market Share, 2010 ..................................................................................................... 250

Figure 93: Vaccine Drug Sales ($m), 2013 vs. 2019 ..................................................................................... 251


Table of Contents



Figure 94: North America Landscape Assessment, 2013 ............................................................................ 258

Figure 95: North America Landscape Assessment (cont’d), 2013 ................................................................ 259

Figure 96: North America Revenue ($m) by Company, 2013 ........................................................................ 262

Figure 97: North America Revenue Growth by Company, 2013 .................................................................... 264

Figure 98: Europe Landscape Assessment, 2013 ........................................................................................ 266

Figure 99: Europe Landscape Assessment (cont’d), 2013 ............................................................................ 267

Figure 100: Europe Revenue ($m) by Company, 2013 ................................................................................. 270

Figure 101: Europe Revenue Growth by Company, 2013 ............................................................................. 272

Figure 102: APAC Landscape Assessment, 2013 ........................................................................................ 273

Figure 103: APAC Landscape Assessment (cont’d), 2013............................................................................ 274

Figure 104: APAC Revenue ($m) by Company, 2013 .................................................................................. 277

Figure 105: APAC Revenue Growth by Company, 2013 .............................................................................. 278

Figure 106: Japan Landscape Assessment, 2013 ........................................................................................ 279

Figure 107: Japan Revenue ($m) by Company, 2013 .................................................................................. 281

Figure 108: Japan Revenue Growth by Company, 2013 .............................................................................. 282

Figure 109: Emerging Markets Landscape Assessment, 2013 ..................................................................... 284

Figure 110: Emerging Markets Landscape Assessment (cont’d), 2013 ......................................................... 285

Figure 111: Emerging Markets Revenue ($m) by Company, 2013 ................................................................ 290

Figure 112: Emerging Markets Revenue Growth by Company, 2013 ............................................................ 291

Figure 113: Peer Group Headcount, Total, 2010–2013 ................................................................................ 293

Figure 114: Headcount by Company, 2013 vs. 2012 .................................................................................... 294

Figure 115: Peer Group Headcount, R&D, 2010–2013 ................................................................................. 295

Figure 116: R&D Headcount by Company, 2013 vs. 2012 ............................................................................ 296

Figure 117: Headcount Growth by Company, 2013 ...................................................................................... 305


Table of Contents



Figure 118: Revenue per Employee (In $ Thousands) by Company, 2013 ................................................... 306

Figure 119: R&D Expense per R&D Employee (In $ Thousands) by Company, 2013 ................................... 308

Figure 120: G&A Expense per G&A Employee (In $ Thousands) by Company, 2012 ................................... 310

Figure 121: S&M Expense per S&M Employee (In $ Thousands) by Company, 2013 ................................... 311

Figure 122: Debt to Equity Ratio by Company, 2013 .................................................................................... 314

Figure 123: Sales to Assets Ratio by Company, 2013 .................................................................................. 315

Figure 124: Return on Capital Employed Ratio by Company, 2013 .............................................................. 316

Figure 125: Cash Ratio by Company, 2013 .................................................................................................. 319

Figure 126: Current Ratio by Company, 2013 .............................................................................................. 320

Figure 127: Quick Ratio by Company, 2013 ................................................................................................. 321

Figure 128: Pharmaceutical Benchmark Peer Group, Global Market Forecast, ($m), 2013–2019 ................. 324

Figure 129: Pharmaceutical Revenue Forecast ($m) by Peer Group, 2013 vs. 2019 .................................... 325

Figure 130: Marketed and Pipeline Sales ($m) by Company, 2013 ............................................................... 326

Figure 131: Percentage of Total Revenues, Pharma vs. Non-Pharma, 2013 ................................................ 327

Figure 132: Total Revenue ($m) Forecasts by Company, 2013 vs. 2019 ...................................................... 328

Figure 133: Prescription Drug Sales ($m) Forecasts by Company, 2013 vs. 2019 ........................................ 329

Figure 134: Global Pharmaceutical Market Forecast ($m), 2013–2019 ......................................................... 331

Figure 135: Marketed Product and Pipeline Sales Contributions ($m), 2019 ................................................. 332

Figure 136: Total Pharmaceutical Pipeline Revenue ($m), 2013–2019 ......................................................... 333

Figure 137: Marketed vs. Pipeline Sales Contribution ($m), 2019 ................................................................. 334

Figure 138: Pipeline Net Present Value ($m) by Company ........................................................................... 335

Figure 139: Pipeline Sales ($m) by Company, 2019 ..................................................................................... 336

Figure 140: AbbVie, Number of Clinical Trials, Phase and Therapy Area, 2014 ............................................ 337

Figure 141: Allergan, Number of Clinical Trials, Phase and Therapy Area, 2014 .......................................... 338


Table of Contents



Figure 142: Amgen, Number of Clinical Trials, Phase and Therapy Area, 2014 ............................................ 339

Figure 143: Astellas, Number of Clinical Trials, Phase and Therapy Area, 2014 ........................................... 340

Figure 144: AstraZeneca, Number of Clinical Trials, Phase and Therapy Area, 2014 ................................... 341

Figure 145: Baxter, Number of Clinical Trials, Phase and Therapy Area, 2014 ............................................. 342

Figure 146: Bayer, Number of Clinical Trials, Phase and Therapy Area, 2014 .............................................. 343

Figure 147: Biogen Idec, Number of Clinical Trials, Phase and Therapy Area, 2014 ..................................... 344

Figure 148: Boehringer Ingelheim, Number of Clinical Trials, Phase and Therapy Area, 2014 ...................... 345

Figure 149: BMS, Number of Clinical Trials, Phase and Therapy Area, 2014 ................................................ 346

Figure 150: Celgene, Number of Clinical Trials, Phase and Therapy Area, 2014 .......................................... 347

Figure 151: CSL, Number of Clinical Trials, Phase and Therapy Area, 2014 ................................................ 348

Figure 152: Daiichi Sankyo, Number of Clinical Trials, Phase and Therapy Area, 2014 ................................ 349

Figure 153: Eisai, Number of Clinical Trials, Phase and Therapy Area, 2014 ................................................ 350

Figure 154: Eli Lilly, Number of Clinical Trials, Phase and Therapy Area, 2014 ............................................ 351

Figure 155: F. H. La-Roche, Number of Clinical Trials, Phase and Therapy Area, 2014................................ 352

Figure 156: Gilead, Number of Clinical Trials, Phase and Therapy Area, 2014 ............................................. 353

Figure 157: GSK, Number of Clinical Trials, Phase and Therapy Area, 2014 ................................................ 354

Figure 158: Johnson & Johnson, Number of Clinical Trials, Phase and Therapy Area, 2014 ......................... 355

Figure 159: Merck, Number of Clinical Trials, Phase and Therapy Area, 2014 .............................................. 356

Figure 160: Merck KGaA, Number of Clinical Trials, Phase and Therapy Area, 2014 ................................... 357

Figure 161: Novartis, Number of Clinical Trials, Phase and Therapy Area, 2014 .......................................... 358

Figure 162: Novo Nordisk, Number of Clinical Trials, Phase and Therapy Area, 2014 .................................. 359

Figure 163: Otsuka, Number of Clinical Trials, Phase and Therapy Area, 2014 ............................................ 360

Figure 164: Pfizer, Number of Clinical Trials, Phase and Therapy Area, 2014 .............................................. 361

Figure 165: Sanofi, Number of Clinical Trials, Phase and Therapy Area, 2014 ............................................. 362


Table of Contents



Figure 166: Shire, Number of Clinical Trials, Phase and Therapy Area, 2014 ............................................... 363

Figure 167: Takeda, Number of Clinical Trials, Phase and Therapy Area, 2014............................................ 364

Figure 168: Teva, Number of Clinical Trials, Phase and Therapy Area, 2014 ............................................... 365

Figure 169: UCB Pharma, Number of Clinical Trials, Phase and Therapy Area, 2014 ................................... 366

Figure 170: Revenue Forecast ($m) by Molecule Type, Small Molecule vs. Biologics, 2019 ......................... 367

Figure 171: Biologics Sales ($m) by Company, 2013 ................................................................................... 368

Figure 172: Percentage of Total Revenues, Biologics vs. Small Molecules, 2013 ......................................... 369

Figure 173: Biologics and Small Molecule Sales ($m) by Company, 2013 .................................................... 370

Figure 174: Net Present Value of Biologics Portfolio ($m) by Company, 2013 .............................................. 371




Introduction

2 Introduction

2.1 Report Scope

The Global Pharmaceutical Market Benchmark Report applies GlobalData’s proprietary ranking

methodology to compare the competitive positions of 30 leading drug companies on 25 financial

metrics. These companies are analyzed based on financial performance, cost-containment, capital

structure, and firm utilization tos illustrate the different strategies these companies are using to

increase value for their shareholders and create a competitive advantage. Throughout the report,

GlobalData’s Industry Dynamics Team provides expert insight, expanding on each of the metrics

discussed.

In addition to the financial metrics, this report discusses trends impacting the pharmaceutical

marketplace including FDA approvals, patent/generic erosion, regulatory changes, and the impact

of the ACA on Rx, along with partnering and acquisition activity, and operations strategy. The

report also provides a drill-down analysis identifying the revenue and growth leaders across 4

geographic regions (US, EU, Japan/Asia, and Emerging markets), and 11 therapeutic franchises.

Lastly, this report provides GlobalData’s outlook on the Global Pharmaceutical market, and each

company’s future competitive position including six-year forecasts for all 30 companies covered in

the report.

GlobalData identified these 30 leading drug companies to apply its benchmarking methodology

providing a foundation for strategic discussion and analysis. GlobalData’s coverage examines

these companies from a unique company-centric lens – combining financial performance and

resources allocation with partnering activity and regional developments to assess a company’s

overall strategy. This type of coverage is unlike any other analysis available, and delivers a

consistent view into the evolution of these companies’ corporate growth.

Key Questions Answered

What specific strategies are these drug companies employing to gain market share?

What drivers accounted for the revenue growth for the company over the past year?

Which trends will affect the global pharmaceutical market over the next few years?

What particular services or capabilities are my competitors developing?




Introduction

Who are the revenue and growth leaders in each therapeutic and geographical area?

What specific business development activities are taking place, in terms of partnerships or

M&A?

How are drug companies growing their physical infrastructures and human resources to better

serve the needs of their customers?

What region-specific operations and capabilities are drug makers adding to gain share in the

emerging markets?

Key Benefits

This report will enable you to:

Analyze and track the strategies that these drug companies are using to gain share in the

increasingly competitive market

Understand the underlying financial metrics that differentiate certain companies from the pack

in terms of growth and profitability, spending and asset structure

Identify the important disease areas, types of products, and geographical areas where

companies are expanding to ensure their future success.

Use this information as an independent source for your due diligence and transaction strategy

Benchmark your company’s performance against a group of similar drug companies to assess

areas of strength and uncover opportunities

2.1.1 Company Covereage

Abbott, AbbVie, Allergan, Amgen, Astellas, AstraZeneca, Baxter, Bayer, Biogen Idec, Boehringer

Ingelheim, Bristol-Myers Squibb, Celgene, CSL, Daiichi Sankyo, Eisai, Eli Lilly, F. Hoffmann-La

Roche, Gilead, GlaxoSmithKline, Johnson & Johnson, Merck, Merck KGaA, Novartis, Novo

Nordisk, Otsuka, Pfizer, Regeneron (Eylea sales only), Sanofi, Shire, Takeda, Teva, and UCB.

2.1.2 Therapy Franchise Coverage

Cardiovascular, CNS, Diabetes, Gastrointestinal, Hematology, Immunology, Infectious Diseases,

Oncology, Ophthalmology, Respiratory, and Vaccines.




Introduction

2.2 Upcoming Reports

Report dates are to be determined, and titles are subject to change

PharmaSphere (2014): Emerging Biotechnologies: Stem Cells Market Analysis (TBD, 2014)

PharmaSphere (2014): North America Market Access Report (TBD, 2014)

PharmaLeaders (2014): Midcap Biotech Benchmark Report (December, 2014)

2.3 Recently Published Reports

PharmaSphere (2014): Regulatory Frameworks and Product Pipelines in the Global Biosimilars

Market (May, 2014)

PharmaSphere (2014): Emerging Biotech Investment Report – Strategic Trends in Private Equity

and Venture Capital Funding (March, 2014)

PharmaLeaders (2013): CRO Benchmark Report – Financial Performance Benchmarking and

Competitive Landscape Assessment of Leading CROs (August, 2013)

PharmaSphere (2013): Early-Stage Technology Transfer Collaborations – Enabling Platform

Technologies & Deal Synergies between Academia and the Pharmaceutical Industry (April, 2013)

PharmaLeaders (2013): Innovative Mid-Cap Biotechnology Benchmark Report – Financial

Benchmarking, Pipeline Assessment & Competitive Analysis of Innovative Biotechs (January,

2013)

2.4 GlobalData’s Benchmarking Methodology

GlobalData’s Global Pharmaceutical Market Benchmark Report ranks 30 leading drug companies

on 25 financial metrics. These metrics include company-specific data such as revenues, margins,

expenses and balance sheet ratios that are weighted and combined into an aggregate composite

score that leads to a rank of each company’s overall financial performance. The ranking scale

ranges from 1.00–10.00, with the average being 5.00, and higher rankings representing better

overall performance. GlobalData believes one of the many strengths of our proprietary ranking

methodology is that company rankings are data-driven and empirical, not subjective or whimsical. It

is important to note that these rankings are retrospective and are intended to help illustrate the

strategies that companies are using to succeed financially, and should not be considered as an

endorsement by GlobalData, or a recommendation to purchase any securities. It is essential to




Introduction

recognize that there are many factors that determine the success of any company, not just financial

performance, such as clinical pipeline, leadership of management and organizational structure,

which are not accounted for directly in our methodology. The rankings are primarily intended to

serve as an impetus for analytical discussion, and for examining a company’s relative competitive

position in a very dynamic industry.

2.5 Benchmark Leader: Pfizer

Pfizer was the Global Pharmaceutical Market Benchmark Leader in 2013 with an overall score of

6.22. Pfizer’s leadership status was driven by the company’s significantly higher Financial

Management (FM), and Firm Utilization (FRM) metrics. Pfizer’s aggregated FM composite score

was 6.32 placing it 5th overall, largely due to the company’s year-to-year growth in operating

income and its class-leading net margin performance. Pfizer posted nearly $11.5 billion in

operating profit in 2013, an increase of 19.9% when compared to the same period in 2012. This

was significantly higher than the peer group average of 4.4% for this metric. Also, Pfizer benefited

from the sale of its Animal Health business in June of 2013. The disposition was completed through

a series of steps, including the IPO of Zoetis as a separate entity resulting in the Pfizer to recognize

a gain of approximately $10.3 billion, net of tax. This drove Pfizer’s net margin to 42.7% of total

revenues, which was the highest among the peer group.

Lastly, Pfizer’s scores on FRM contributed to the company’s leadership status in 2013. Pfizer’s

aggregate FRM score was 6.22 placing it 1st overall within the peer group. Pfizer had the 2nd

highest score on headcount year-to-year growth of 8.74 (behind Shire’s 9.47) attributable to the

company cutting its headcount from around 91,500 FTEs in 2012 to about 77,700 FTEs in 2013.

Again, the company’s divesture of its Animal Health segment was the main contributor, as Pfizer

reduced its global workforce by 9,300 FTEs after the IPO of Zoetis.




Introduction

The table below shows each company’s individual composite scores and overall score for 2013.

For spacing purposes, this table has been split.

Table 1: GlobalData Benchmark Rankings, Global Pharmaceutical Market, 2013 GD Rank Company Financial Mgt Expense Mgt Capital Mgt Resources Mgt Overall Score

1 Pfizer 6.32 4.89 6.07 6.22 5.87

2 Allergan 5.18 5.40 7.89 4.89 5.84

3 Amgen 6.03 4.66 7.19 5.12 5.75

4 Merck KGaA 5.67 6.01 5.42 5.82 5.73

5 Shire 6.18 6.47 4.76 5.42 5.71

6 CSL 4.41 6.61 5.67 5.57 5.57

7 Novo Nordisk 6.05 5.30 5.66 4.93 5.49

8 Otsuka 4.37 5.03 6.69 5.57 5.42

9 Abbott 4.07 6.05 5.18 5.81 5.28

10 AbbVie 5.43 5.43 4.56 5.16 5.14

11 Biogen Idec 6.68 5.04 5.04 3.65 5.11

12 F.H. La-Roche 6.81 4.21 4.21 4.62 5.08

13 J&J 6.52 2.91 2.91 5.52 5.07

14 Sanofi 4.44 4.70 4.70 5.71 4.94

15 Eisai 2.65 6.78 5.32 5.19 4.92

16 BMS 4.40 5.54 4.92 5.17 4.88

Source: GlobalData Key: Green represents an area where the company is outperforming its peers Red represents an area where the company is currently challenged versus peers Note: Scale (1.00-10.00), Avg. Score = 5.00




Introduction

The table below continues with each company’s individual composite scores and overall score for

2013. For spacing purposes, this table was split.

Table 2: GlobalData Benchmark Rankings (cont’d), Global Pharmaceutical Market, 2013

GD Rank Company Financial Management

Expense Management

Capital Management

Resources Management

Overall Score

17 Celgene 5.98 4.13 6.40 2.86 4.84

18 Gilead 6.90 5.42 4.41 2.37 4.77

19 Astellas 3.44 5.36 5.77 4.47 4.76

20 Eli Lilly 4.96 4.71 4.47 4.85 4.75

21 UCB 3.55 5.81 4.19 5.39 4.74

22 Teva 3.12 5.97 3.80 5.89 4.70

23 Baxter 3.76 6.06 4.00 4.93 4.69

24 Merck 3.86 4.69 4.50 5.54 4.65

25 GSK 5.39 4.35 3.05 5.65 4.61

26 Novartis 5.31 3.27 4.22 5.36 4.54

27 B. Ingelheim 4.54 4.64 4.22 4.74 4.53

28 Bayer 4.61 4.29 3.60 5.20 4.42

29 Daiichi Sankyo 3.78 5.07 4.82 3.63 4.32

30 AZ 3.76 3.38 4.23 5.28 4.16

31 Takeda 2.97 3.38 4.75 4.49 3.89

Source: GlobalData Key: Green represents an area where the company is outperforming its peers Red represents an area where the company is currently challenged versus peers Note: Scale (1.00-10.00), Avg. Score = 5.00

Takeda was the Global Pharmaceutical Market Benchmark laggard in 2013 with an overall score of

3.91. Contributing to the company’s laggard status were very low scores for FM, and Expense

Management (EM) metrics. Takeda’s aggregate score was 2.97 for FM, and 3.34 for EM, both very

low when compared with the peer group average of 5.00. Rounding out the bottom three laggards

were AstraZeneca at 4.12 and Daiichi Sankyo at 4.35.


Appendix



12.6 About GlobalData

GlobalData is a leading global provider of business intelligence in the Healthcare industry.

GlobalData provides its clients with up-to-date information and analysis on the latest developments

in drug research, disease analysis, and clinical research and development. Our integrated business

intelligence solutions include a range of interactive online databases, analytical tools, reports and

forecasts. Our analysis is supported by a 24/7 client support and analyst team.

GlobalData has offices in New York, San Francisco, Boston, London, India, Korea, Tokyo, and

Singapore.

12.7 Disclosure Information

GlobalData is a product of GlobalData Ltd, a UK registered company. GlobalData Ltd has no

current or intended investment banking or corporate finance relationships or operations. The

material presented in this report is provided for information purposes only and is not to be used or

considered as a recommendation to buy, hold or sell any securities or other financial instruments.

No GlobalData Ltd directors, officers or employees are on the Board of Directors of a covered

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GDHC005PLR-Global Pharmaceutical Market Sample 1-30,375,376 · global pharmaceutical market benchmark report - RETROSPECTIVE AND FORWARD-LOOKING ANALYSIS OF THE Global Pharmaceutical