The monoclonal antibody market represents the fastest-growing segment within the pharmaceutical industry. This sector is expected to achieve a CAGR of 14% between 2006-2012, easily outstripping the 0.6% growth rate in the small molecules market. With key products forecast to record peak sales growth and the launch of new products in the next few years, this rapid expansion is set to continue.
The evolution of antibody technology has acted as a major driver of the growth in the monoclonal antibody (mAb) market, distancing today's blockbuster products from the commercially-unsuccessful murine mAbs which were the primary focus of early-stage antibody development. While chimeric and humanized mAbs currently dominate the market this technology evolution continues, as the number of fully human mAbs to reach the market increases.
mAb market reaching its inflection point
The mAb market was ushered into its 'take off' phase by the 1997 launch of Rituxan/MabThera (rituximab) for non-Hodgkin's lymphoma (NHL). Rituxan/MabThera represented the first mAb product to succeed commercially in a high-revenue/high-growth market (oncology) and provide significant enhancements in the efficacy of treatment versus existing non-mAb therapies. As a result, Rituxan/MabThera rapidly became established as the gold-standard therapy for NHL and the first launched mAb product which went on to achieve blockbuster status.
Buoyed by the rapid success of rituximab, mAb drug developers have proceeded to launch a raft of mAb products in subsequent years, a trend driven by advances in technology allowing for the development of mAbs with higher human composition (known as humanized and fully-human mAbs). Fuelled by key mAb launches Avastin, Herceptin, Remicade, MabThera/Rituxan, Humira and Erbitux the market is presently at an inflection point of maximum sales growth, demonstrated by absolute sales growth of almost $14 billion forecast to be generated by mAb products between 2006 and 2009 60% of the forecast 2006-12 growth.
Over this period, the rapid expansion in mAb revenues will be driven by a number of key individual product franchises recording peak sales growth and the launch of new products, such as UCB-Celltech's Cimzia (certolizumab pegol) for Crohn's disease and rheumatoid arthritis. Furthermore, a number of key mAb products are the subject of horizontal indication broadening strategies. This trend is expected to further enhance revenue growth. The most notable example of this strategy is Genentech and Roche's Avastin (bevacizumab). Given its broad-spectrum mode of action (it targets angiogenesis) it can be used across a wide range of tumor types.
Although by no means representing an end of mAb market sales expansion, revenue growth will begin to slow by 2012. Competition between rival mAb products will begin to slow sales growth for some franchises (Humira sales growth at the expense of Remicade for example), while some second-generation product launches (such as MedImmune's Numax) will cannibalize sales of first-generation mAb products (MedImmune's Synagis). Ultimately, organic revenue expansion in any market is finite and this will prove the case in the mAb segment, despite the indication broadening opportunities available for many brands.
No guarantee
Despite the undoubted success of mAbs, entry into the market is not necessarily a guarantee of financial success. Just five monoclonal antibody products (Avastin, Herceptin, Humira, Remicade and Rituxan) accounted for 80% of total mAb revenues in 2006. The commercial dominance of these 'big five' is expected to continue out to 2012, with the same products forecast to account for 70% of 2012 mAb revenues. Datamonitor expects that Genentech/Roche will retain their stranglehold over the mAb market out to 2012, due to ownership of three of the 'big five' products.
The 'big five' will also account for around 60% of absolute revenue growth 200612. A striking difference is observed between average 2006 product revenues for the big five, at $3.1 billion, and average 2006 product revenues for all other marketed mAbs, at $261million. These findings challenge the sweeping strategic assertion that entry into the mAb segment is a panacea for achieving high growth and high product revenues. It is clear from Datamonitor's research that only the owners of the largest products will secure the largest rewards.
Analysis of the mAb market by company reveals a clear two-tiered structure. Four 'established' players sit at the top end of the market Genentech, Roche, Abbott and Johnson & Johnson each of which generated mAb revenues in excess of $2 billion in 2006. An additional tier of four 'emergent' players Biogen IDEC, Amgen, Novartis and UCB Pharma is also evident. Datamonitor expects this 'second tier' to expand their market presence out to 2012, with each forecast to record absolute annual mAb sales growth in excess of $1 billion over the period 2006-12.
mAbs insulated from generic threat
In terms of the wider pharmaceutical market, it is clear that the key factor influencing sales growth over the period 2006-12 is generic competition. Exposure to patent expiries and generic competition will underpin the tepid CAGR in sales of 2.2% forecast out to 2012. Furthermore, while exposure to generic competition will act as a notable 'brake' on sales growth over the period 2006-11, an increased intensity in generic competition known as the 'patent cliff' will drive an overall decline in market revenues over the period 2011-12, equal to a year-on-year decline of -7.3%. The 'patent cliff' will be caused by a raft of blockbuster drugs losing patent exclusivity over this short time period.
Analysis of total prescription pharmaceutical sales growth over the period 2006-12 by product type demonstrates that, however, it will be small molecule drugs which are exclusively impacted by the 'patent cliff'. The emergence of biosimilar or bio-generic competition has begun, however, over the period 2006-12 this threat is only applicable to first generation therapeutic protein products. Most importantly, mAb products will remain completely insulated from the threat of generic competition over 2012, a trend owed to robust patent protection and a lack of a regulatory pathway suitable to support biosimilar mAb approvals and launches. In addition to occupying a sector of the market that is insulated from generic competition, mAbs have the advantage of primarily addressing high unmet need therapy areas such as oncology and AIID.
Players that sit within the mAb segment will therefore fare better once the 'patent cliff' is reached. mAb revenues will either allow overall sales growth to continue over 2011-12 as is forecast for Roche/Genentech or mitigate against the impact of the 'patent cliff' as is forecast for Johnson & Johnson.
With their insulation from the negative force of generic competition combined with high exposure to the twin positive forces of high unmet need and 'novel target space', Datamonitor expects mAbs to continue to be the fastest growing product type excluding vaccines out to 2012. In contrast, small molecules face an unattractive combination of high exposure to generic competition, no major focus on areas of highest unmet need and little access to novel target space; all conspiring to make this product set the slowest growing to 2012.