Pharmaceutical Industry 1st Quarter ScorecardBy
How did pharmaceutical and biopharmaceutical companies fare in the first quarter? Now that financial results are in, an analysis of first-quarter results.
The pharmaceutical and biopharmaceutical industry offered mixed revenue results for the first quarter. Certain companies reported double-digit growth lead by strong specific product sales or acquisitions while other companies reported either flat or declining sales year over year. Gilead Sciences, Biogen Idec, Actavis, and Johnson & Johnson were among the companies reporting double-digit gains. Also showing positive sales growth were Bayer Healthcare, AbbVie, Amgen, and Roche. For purposes of the analysis, only revenues from prescription pharmaceuticals and vaccines sales were included; animal health and consumer healthcare sales were excluded.
On the upside
Gilead Sciences. Gilead Sciences had a particularly strong first quarter in 2014, an almost 100% sale increase compared to the first quarter of 2013 (see Table I) led by the December 2013 launch of its new product Sovaldi (sofosbuvir), a drug to treat chronic hepatitis C virus (HCV) infection. Sovaldi had first-quarter 2014 sales of $2.274 billion, representing the company’s top-selling drug and accounting for 45% of total revenues for the quarter. Total revenues for the first quarter of 2014 increased to $5.00 billion from $2.53 billion in the first quarter of 2013. Product sales increased to $4.87 billion for the first quarter of 2014 compared to $2.39 billion for the first quarter of 2013. Other key product contributors were the antivirals Truvada (emtricitabine and tenofovir disoproxil fumarate) ($760 million in first quarter 2014 sales, +8% year over year), and Atripla (efavirenz, emtricitabine, and tenofovir) ($780 million in first quarter 2014 sales, -11% year over year).
|Table I: Pharmaceutical Majors’ First Quarter 2014 Pharmaceutical Sales*|
|AbbVie||$4.563 Bn||$4.329 Bn||+5.4%|
|AstraZeneca||$6.416 Bn||$6.385 Bn||0% (Actual)
|Bayer Healthcare||$3.861 Bn
(EUR 2.782 Bn)
(EUR 2.564 Bn)
|Bristol-Myers Squibb||$3.811 Bn||$3.831 Bn||-1%|
|Eli Lilly||$4.158 Bn||$5.103 Bn||-18.5%|
|-3% (at CER)|
|Johnson & Johnson||$7.498 Bn||$6.768 Bn||+10.8%|
|Merck & Co.||$8.451 Bn||$8.891 Bn||-5%|
|Novartis**||$11.393 Bn**||$11.377 Bn**||.1%|
|Pfizer||$10.479 Bn||$11.546 Bn||-9.0%|
(CHF 9.040 Bn)
(CHF 9.170 Bn)
|+4% (at CER)
-1% (at CHF)
(EUR 6.440 Bn)
(EUR 6.694 Bn)
|Select Big BioPharm
|Amgen||$4.521 Bn||$4.238 Bn||+7%|
|Biogen Idec||$2.130 Bn||$1.415 Bn||+50.5%|
|Gilead Sciences||$4.999 Bn||$2.532 Bn||+97.5%|
|Select Generic-Drug/Specialty Pharm Companies|
|Actavis||$2.656 Bn||$1.896 Bn||+40.6%|
|Mylan||$1.716 Bn||$1.631 Bn||+5.2%|
|Teva Pharmaceutical Industries||$5.001 Bn||$4.901 Bn||+2.0%|
*Includes prescription pharmaceutical sales (human health drugs and vaccines); consumer healthcare and animal-health sales are excluded. Includes other revenue as related and reported by the company
**For Novartis, includes sales from its Pharmaceuticals Division, Sandoz, Vaccines, and Ophthalmic Pharmaceuticals from Alcon (other sales from Alcon excluded); consumer healthcare sales excluded and sales of non ophthalmic pharmaceuticals from Alcon are excluded.
***Sales of Sanofi includes sales from pharmaceuticals (including generics), Genzyme, and vaccines. Sales from the consumer healthcare and animal health businesses are excluded.
In 2013, Pfizer’s business structures consisted of five segments: Primary Care, Specialty Care and Oncology, Established Products and Emerging Markets, Animal Health (Zoetis) and Consumer Healthcare. In 2014, Pfizer changed to a new global commercial structure consisting of three operating segments: the Global Innovative Pharmaceutical segment (GIP), the Global Vaccines, Oncology and Consumer Healthcare segment (VOC), and the Global Established Pharmaceutical segment (GEP). Sales in Table I are biopharmaceutical sales from GIP, GEP, and VO (excluding consumer healthcare).
Boehringer Ingelheim publicly posts first-half and annual results and is thus not included in the analysis.
European company sales are reported in US dollars based on an exchange rate as of May 4, 2014 of 1 EUR to USD 1.38803 and 1 £ (Sterling Pound) = USD 1.68796, except for Novartis and AstraZeneca, which report in US dollars. For companies reporting in Swiss francs, sales are reported in US dollars based on an exchange rate as of May 4, 2014, of 1CHF to USD 0.87691 Growth rates are reported in CER (constant exchange rates) when reported by the company.
Source: Company information and quarterly reports from US Securities and Exchange Commission.
Biogen Idec. Biogen Idec reported first quarter 2014 revenue of $2.1 billion, a 51% increase compared to the first quarter of 2013 (see Table I). The revenue growth year-over-year was driven by the strong performance of Tecfidera (dimethyl fumarate), a drug to treat relapsing forms of multiple sclerosis (MS) and from recording 100% of revenues from the MS drug Tysabri (natalizumab) following the company’s acquisition of complete rights for the asset in the second quarter of 2013. Tecfidera revenues were $506 million and Tysabri revenues were $441 million. Revenues of Avonex (interferon beta-1a), a drug to treat relapsing forms of multiple sclerosis (MS) revenues increased 2% compared to the first quarter of 2013 to $761 million.
Actavis. Led by its acquisition of Warner Chilcott, Actavis plc reported a 40% increase in sales to $2.66 billion for the first quarter compared to $1.90 billion in the first quarter 2013. (see Table I). Revenue from Actavis Pharma, which includes all branded, branded generic, generic, and over-the-counter products, increased 36% to $2.26 billion. Revenue from the Anda Distribution segment, which includes revenue from the distribution of third-party products primarily to independent pharmacies, pharmacy chains, pharmacy buying groups. and physicians’ offices, increased to $390.1 million in the first quarter of 2014, up from $231.0 million in the year-ago period.
Johnson & Johnson. Johnson & Johnson’s pharmaceutical sales increased 10.8% in the first quarter 2014 compared to the first quarter of 2013 to $7.5 billion (see Table I). Primary contributors to operational sales growth were Stelara (ustekinumab), a biologic approved for the treatment of moderate to severe plaque psoriasis and psoriatic arthritis; Invega/Sustenna/Xeplion (paliperidone palmitate), a once-monthly, long-acting, injectable atypical antipsychotic for the treatment of schizophrenia in adults; Prezista (darunavir), a treatment for HIV; Velcade (bortezomib), a treatment for multiple myeloma; and sales of new products. Strong sales results of new products were for: Olysio/Sovriad (simeprevir), for combination treatment of chronic hepatitis C in adult patients; Zytiga (abiraterone acetate), an oral, once-daily medication for use in combination with prednisone for the treatment of metastatic, castration-resistant prostate cancer; Xarelto (rivaroxaban), an oral anticoagulant; and Invokana (canagliflozin), a drug for the treatment of adults with Type 2 diabetes.
In other developments in the first quarter, the company received FDA approval of Imbruvica (ibrutinib) capsules for the treatment of patients with chronic lymphocytic leukemia who have received at least one prior therapy. In addition, the company submitted a new drug application for a once-daily fixed-dose antiretroviral combination tablet containing darunavir, a protease inhibitor developed by Janssen R&D Ireland and marketed as Prezista in the US with cobicistat, an investigational pharmacokinetic enhancer or boosting agent, developed by Gilead Sciences, Inc., for use in combination with other human immunodeficiency virus medicines.
Bayer. Bayer’s pharmaceutical revenues for the first quarter 2014 were EUR 2.782 billion ($3.861 billion), up from EUR 2.564 billion ($3.560 billion) in the first quarter of 2013 (see Table I). Key drivers were revenues of recently launched medicines, which registered combined sales of EUR 598 million ($830 million). These products included: the anticoagulant Xarelto (rivaroxaban), which is Bayer’s best-selling pharmaceutical product; Eylea (aflibercept), a drug to treat wet age-related macular degeneration; the colorectal cancer drug Stivarga (regorafenib); the prostate cancer drug Xofigo (radium Ra 223 dichloride); and Adempas (riociguat), a drug to treat two forms of pulmonary hypertension, which was launched in the fourth quarter of 2013.
Amgen. Amgen reported that total revenue increased 7% to $4.521 billion (see Table I), with 5% product sales growth driven by the cancer drug Kyprolis (carfilzomib), Xgeva (denosumab),a drug to treat skeletal-related events in patients with bone metastases the postmenopausal osteoporosis drug Prolia (denosumab), and Neulasta (pegfilgrastim), a drug to treat neutropenia. The first-quarter results also reflect Amgen’s acquisition of Onyx Pharmaceuticals, Inc. in October 2013.
AbbVie. AbbVie posted first-quarter 2014 sales of $4.563 billion, a 5.4% gain year over year (see Table I). Its key product, Humira (adalimumab), used to treat rheumatoid arthritis, ankylosing spondylitis, juvenile idiopathic arthritis, psoriatic arthritis, plaque psoriasis, Crohn’s disease, and ulcerative colitis, posted first-quarter sales of $2.637 billion, which represented 58% of the company’s first-quarter sales.
In other developments, AbbVie recently submitted its US regulatory application for its interferon-free combination for patients with genotype 1 hepatitis C virus. AbbVie plans to submit applications for regulatory approval of its regimen in the European Union in early May. The company expects US commercialization in 2014 and European approval in early 2015.
On the manufacturing front, AbbVie announced a $320-million investment to establish operations in Singapore for small-molecule and biologics active drug substance manufacturing, the company’s first manufacturing presence in Asia. The completed facility will provide manufacturing capacity for emerging compounds within AbbVie’s oncology and immunology pipeline to serve markets globally. Other AbbVie operations in Asia include R&D functions in Tokyo, Japan and Shanghai, China, as well as commercial operations throughout the region.
Roche. Roche posted a 4% gain in pharmaceutical sales (see Table I). The company had continued growth from the cancer drugs Avastin (bevacizumab)(first-quarter sales of CHF 1.565 billion ($1.372 billion), +9% year over year), MabThera/Rituxan (rituximab) (first-quarter sales of CHF 1.667 billion ($1.469 billion), +3% year over year) , and Herceptin (trastuzumab)(first-quarter sales of CHF 1.526 billion ($1.338 billion), +3% year over year), its three top-selling drugs. Sales of Xeloda (capecitabine), a (first-quarter sales of chemotherapy drug, were lower as the product is now off patent and faces generic competition in the United States and Europe. The company had strong uptake of recently launched products Perjeta (pertuzumab) and Kadcyla (ado-trastuzumab emtansine) for treating HER2 positive breast cancer.
AstraZeneca AstraZeneca’s revenues in the first quarter 2014 were up 3% (at constant exchange rates) to $6.461 billion (see Table I) and broadly flat on an actual basis as a result of the negative impact of exchange rate movements, chiefly the weakening of the Japanese yen versus the US dollar. Major patent expiries have now largely annualized but the impact from losses of exclusivity amounted to nearly $150 million in the quarter, with the authorized generic for the anti-hypertensive drug Toprol-XL (metoprolol) in the US and the anti-cholesterol drug Crestor (rosuvastatin) in Australia among the major drivers. The company’s US revenues were up 3%. Crestor grew by 8% in the quarter, driven by prior-year rebate adjustments. Diabetes revenues were boosted by the consolidation of the full franchise as well as progress in the market share of the diabetes drug Bydureon (exenatide extended-release for injectable suspension). The company reported that the launch of its diabetes drug Farxiga (dapagliflozin) is proceeding well. Revenue in the rest of the world (ROW) was up 3%. Revenue in Europe was down 4%, chiefly on the continuing impact of loss of exclusivity for the antipsychotic Seroquel IR (quetiapine), the antihypertensive drug Atacand (candesartan), and Nexium (esomeprazole), a drug to treat gastroesophageal reflux disease as well as erosion to Seroquel XR from adverse patent rulings in some markets coupled with at risk-launches for generics. Revenue in established ROW was up 2%, and revenue in emerging markets was up 11%.
Other companies’ results
Eli Lilly. Eli Lilly posted an 18.5% decline in pharmaceutical sales in the first quarter 2014 year over year (see Table I), primarily due to US patent expirations of the antidepressant Cymbalta (duloxetine) for which US patent expired in December 2013 and the osteoporosis drug Evista (raloxifene) for which US patent exclusivity ended in March 2014.
In other developments in the first quarter, FDA approved Eli Lilly’s Cyramza (ramucirumab) as a single-agent treatment for patients with advanced or metastatic gastric cancer or gastroesophageal junction adenocarcinoma with disease progression on or after prior fluoropyrimidine- or platinum-containing chemotherapy. Eli Lilly and its alliance partner, Boehringer Ingelheim, announced that FDA accepted the filing of the new drug application for the investigational combination tablet of empagliflozin and linagliptin for the treatment of adults with Type 2 diabetes.
Pfizer. For the first-quarter 2014, Pfizer’s overall revenues (which included revenues from biopharmaceuticals/pharmaceuticals, consumer healthcare and other revenues) were $11.353 billion, a 9% decline year-over year. Biopharmaceutical revenues decreased 9% from $11.546 billion in the first-quarter 2013 to $10.479 billion in the first quarter of 2014. The operational decrease was primarily due to the expiration of the co-promotion term of the collaboration agreement for the anti-arthritis drug Enbrel (etanercept) in the US and Canada, the ongoing expiration of the respiratory drug Spiriva (tiotropium bromide inhalation powder), collaboration in certain countries, the continued erosion of the branded anti-cholesterol drug Lipitor (atorvastatin) in the US and most other developed markets due to generic competition, as well as the loss of exclusivity and subsequent multi-source generic competition for Detrol LA I(tolterodine), a drug to treat overactive bladder, in the US and other product losses of exclusivity in certain markets. Revenues were favorably impacted primarily by the strong operational growth of the neuropathic pain/anticonvulsant drug Lyrica (pregabalin), the anticancer drug Xalkori (crizotinib) and the anticancer drug Inlyta (axitinib) globally, Enbrel outside of the US and Canada, recently launched products, the anticoagulant Eliquis (apixaban), and the arthritis Xeljanz (tofacitinib), primarily in the US, as well as the contribution from the collaboration with Mylan Inc. to market generic drugs in Japan.
Merck & Co. For Merck, first-quarter pharmaceutical sales declined 5% to $8.5 billion, including a 2% negative impact due to foreign the exchange (see Table I). Expected declines occurred in several products due to the ongoing impact of the loss of market exclusivity, including for the cancer drug Temodar (temozolomide), the asthma and allergy drug Singulair (montelukast sodium), the corticosteroid Nasonex (mometasone furoate monohydrate), and the anti-hypertensive drug Cozaar (losartan potassium)/Hyzaar (losartan potassium and hydrochlorothiazide).
These declines were partially offset by growth in the diabetes franchise of Januvia (sitagliptin)/Janumet (sitagliptin and metformin), as well as Remicade (infliximab), a drug to autoimmune diseases, such as Crohn’s Disease and rheumatoid arthritis, Simponi (golimumab), a drug to treat rheumatoid arthritis, and the HIV drug Isentress (raltegravir). Combined sales of Januvia/Janumet increased 3% to $1.3 billion. Combined sales of Remicade and Simponi grew 16% to $760 million in the first quarter, Worldwide sales of Isentress, an HIV integrase inhibitor for use in combination with other antiretroviral agents for the treatment of HIV-1 infection, increased 8% to $390 million in the first quarter of 2014.
GlaxoSmithKline. For GlaxoSmithKline, total pharmaceuticals and vaccines turnover fell by 3%, excluding 2013 divestments. Pharmaceuticals turnover fell 4% as growth in emerging markets, Japan, and Europe was more than offset by lower sales in the US and a decline in established products sales. Worldwide vaccines turnover grew 3%, as strong performances in the US and Europe were partly offset by lower reported sales in emerging markets and Japan. In the US, pharmaceuticals and vaccine turnover fell 10%, with pharmaceuticals down 15% and vaccines up 25%.
Sanofi. On an overall basis, for the first quarter of 2014, Sanofi generated sales of EUR 7.842 billion ($10.885 billion), a decrease of 2.7% on a reported basis compared to the year-ago period. Excluding sales from its consumer-health and animal-health businesses, the combined sales of its pharmaceutical business (including generics), Genzyme, and vaccines was EUR 6.440 billion ($8.934 billion) in the first quarter 2014, down from EUR 6694 billion ($9.287 billion) in the first-quarter 2013. Key contributors included the company’s diabetes division, which generated first-quarter 2014 sales of EUR 1.662 billion ($2.307 billion), an increase of 13.2%, which was led by sales of Lantus (insulin glargine), which posted sales gain of 13.5% to EUR 1.448 billion ($2.010 billion). Genzyme’s first-quarter sales increased 21.5% to EUR 566 million ($786 million). Sales of generics totaled EUR 421 million ($584 million) in the first quarter of 2014, up 8% year over year. Sales in emerging markets increased 17.9% to EUR 225 million ($312 million) in the first quarter of 2014.
Bristol-Myers Squibb. Bristol-Myers Squibb posted a 1% decline in pharmaceutical sales to $3.811 billion in the first quarter 2014 (see Table I). In the first quarter, the company completed the sale of its diabetes business to AstraZeneca, receiving $3.3 billion in closing and milestone payments during the quarter. Excluding the divested Diabetes Alliance, global revenues increased 5% to $3.6 billion. Key product sales in the first quarter included: the cancer drug Sprycel (dasatinib)($342 million in 1Q 2014, +19% year over year; the cancer drug Yervoy (ipilimumab) ($271 million, +18% year over year); the arthritis drug Orencia (abatacept), ($363 million, + 13% year over year), the hepatitis B drug Baraclude (entecavir) ($406 million, + 11% year over year), and the antidepressant Abilify (aripiprazole)($540 million, +3% year over year).
In April, 2014, Bristol-Myers Squibb acquired iPierian, Inc., a privately held biotechnology company focused on the discovery and development of new treatments for Tauopathies, a class of neurodegenerative diseases associated with the pathological aggregation of Tau protein in the human brain. In March 2014, it signed a collaboration agreement with Five Prime Therapeutics for the discovery, development and commercialization of immuno-oncology (I-O) therapies directed at targets identified in two undisclosed immune checkpoint pathways using Five Prime’s proprietary target discovery platform.
Novartis. Novartis’ Pharmaceuticals Division’s net sales reached $7.8 billion (-1%, +1% at constant currency) in the first quarter of 2014 with volume growth of 6 percentage points and a positive price impact of 1 percentage point mostly offset by the impact of generic competition (-6 percentage points, mainly for Zometa/Aclasta (zoledronate), a drug to treat hypercalcemia of malignancy which completed a full year of generic impact in the US. Quarterly volume growth was impacted by a slowdown of the cancer drug Gleevec/Glivec (imatinib) sales in the US. Growth products, including the MS drug Gilenya (fingolimod), the cancer drug Afinitor (everolimus), the cancer drugTasigna (nilotinib), the diabetes drug Galvus (vildagliptin), Lucentis (ranibizumab), a drug to treat wet age-related macular degeneration, Xolair (omalizumab), a drug to treat allergic asthma, the Q family of products (Onbrez Breezhaler/Arcapta Neohaler, Seebri Breezhaler, and Ultibro Breezhaler) and the cancer drug Jakavi (ruxolitinib), together generated sales of $3.2 billion (+17% at constant currency) or 41% of division net sales, compared to 35% in the prior-year period. The Pharmaceutical Division accounted for 56% of the company’s total first-quarter revenues of $14.022 billion. Combined sales of Novartis’ Pharmaceutical Division, its generic-drug business Sandoz, the ophthalmic pharmaceuticals of Alcon (products other than ophthalmic pharmaceuticals are excluded), and its vaccines business were $11.393 billion in the first quarter, up slightly from the year-ago period of $11.377 billion (see Table I). For purposes of the analysis, sales of the company’s consumer healthcare business are excluded as well .