Diving Deep Into Specialty Pharmacy: Insights and Forecasts From IQVIA’s Doug Long

Doug Long, MBA | Image Credit: IQVIA

Doug Long, MBA, vice president of industry relations at IQVIA, delivered a comprehensive data-filled overview of industry trends and their impact on the current specialty pharmaceutical industry in his presentation at AXS24, the 20th Asembia summit, “Current Specialty Pharmaceutical Trends and a Look Ahead.”¹

The topics were wide ranging, and they touched on just about every aspect of specialty pharmacy: market trends and industry challenges, obesity medications including glucagon-like peptide 1 (GLP-1) agonists—which Long was quick to remind attendees are actually not specialty drugs; they are traditional medications that happen to have an impact on the specialty world—generic medications and their biosimilar equivalents, drug shortages, new product launches and research and development, and the US market outlook.

Market Trends and Industry Challenges

Comparing 2022 and 2023 values via IQVIA’s Health Services Utilization Index, Long noted that 4 of the 5 areas the index measures are down year-over-year (YOY). These are screening and diagnostic tests; elective procedures; office, institutional, and telehealth visits; and adult, pediatric, and flu vaccinations. Only new prescriptions have seen a jump.

“What concerns me most is the screening part of this,” he expressed. “If you’re not going to get screenings, how do you know whether you have cancer or not?”

Quickly moving on to notable trends, he highlighted 6: the growing use of immunology treatments (up 60% from 2019), the rising use of novel obesity drugs (up 181% vs 2 years ago), antimicrobial resistance from elevated antibiotic (now at prepandemic levels) use, drug shortages are impacting patient care (58% of 132 active shortages have been on this list for 2+ years), opioid use is down 67% (but more people are dying from overdoses from synthetic fentanyl), and contraceptive use is changing (routine use is down 3%, but emergency use is up 35%).

Defined daily doses (DDDs), or the volume of medicine per day, have seen consistent growth in the retail and mail order sectors since 2019 vs nonretail, which saw a sharp dip from 2019 to 2020 before rebounding between 2020 and 2021, “but is still not as strong as the retail sector,” Long noted. Further, clinics are faring just fine per this measure, but hospitals and long-term care facilities are not. In 2023, the top 3 areas of growth per DDDs were in obesity (45.1%), immunology (12.1%), and genitourinary (12.0%); contraception had the biggest drop (15.3%).

However, all channels (total market, retail, mail, and nonretail) are exhibiting strong YOY growth, in the billions; all retail channels, including chain, mass-market, and independents, have exhibited significant annual YOY growth; and clinics and long-term care are showing the strongest yearly sales growth in the nonretail area. By sales, immunology and antithrombotics are leading long-term growth, while vaccines are at the head for short-term growth.

“For the total market, specialty growth is weaker than traditional growth,” he said, at 13.0% vs 14.0%, respectively.

Overall, the specialty pharmaceutical market saw rapid growth in 2023, especially in the areas of immunology, oncology, and diabetes. And between 2012 and 2028, oncology will remain the largest therapy area. However, innovation has led to a packed market and fierce competition, such that extensive crowding is expected to lead to slowed growth in oncology, many brands competing for each immunology indication, and a drop in diabetes spending, especially in the US.² The top 3 super channels are HIV antivirals in the retail sector, immunology in the mail-order sector, and oncologics in the nonretail sector.

For growth, the top 8 specialty products have seen vigorous growth as of late, with notables including a 258.3% jump with semaglutide (Wegovy), 248.6% with upadacitinib (Rinvoq), and 141% with risankizumab (Skyrizi). Also, the top 10 therapy areas—antidiabetes, immunology, oncologics, respiratory agents, antithrombotics, HIV antivirals, vaccines, mental health, multiple sclerosis, and attention-deficit/hyperactivity disorder (ADHD)—are currently growing at a rate of 15.7% but account for 72.8% of the specialty market share.

GLP-1s

Long reiterated that although GLP-1s are traditional medications, obesity is a target for the specialty pharmaceutical market and it is projected to become a top 5 global market.³ Spending in the space has potential to reach $131 billion by 2030, with the big 3 pharma giants—Johnson & Johnson, Eli Lilly, and Novo Nordisk—leading the charge with market capitalization jumping from approximately $150 billion in September of 2020 to an estimated $550 billion in September of 2023.⁴ In the past 2 years alone, spending on obesity drugs has accelerated, and Long highlighted a purported 378% total net spending growth from 2023 to 2027.⁵

He explained that older age correlates with more comorbidities among obese individuals. For example, 18% of individuals older than 65 years have 4 comorbidities and 15% have 5 comorbidities vs 11% and 6%, respectively, of individuals aged 40 to 64 years and 0% of those aged 0 to 17 years.

“It's going to be interesting to see what happens as these drugs are used more, what impact does that use have on cardiovascular disease, cardiovascular disease drugs, and so forth,” Long posited. “Only time will tell.”

At present, more than 120 weight-loss agents are being developed by more than 60 companies, with this pipeline dominated by intravenous and subcutaneous agents, most in phase 1 and phase 2 clinical trials; oral agents account for one-third of this pipeline, with a majority in phase 1 and 2 clinical trials. The benefits of oral antiobesity meds remain a subject of great debate, Long noted, with 14 of the 17 agents in development stuck in the preclinical stage.

Generics and Biosimilars

Long explained that movement in sales for both unbranded generic and prescriptions has remained steady or is up when looking at 2021 through February 2024. Overall sales were at $54.9 billion in 2021 and ended 2023 at $54.4 billion; YOY growth is 5.3% year-to-date (YTD). Adjusted prescription sales have ranged from $5.5. billion in 2021 to $5.8 billion at year-end 2023; YTD growth is 5.8%. Unadjusted prescription sales have ranged from $3.6 billion in 2021 to $3.8 billion at year-end 2023; YTD growth is 4.8%.⁶

From 2018 to 2023, generic prescriptions comprised most prescriptions dispensed percentage-wise and branded medications made up the highest percentage of total dollars. Compared with branded medications (9.3%-9.4%), dispensed branded generic and generic scripts accounted for 90.5% to 90.6% of adjusted prescriptions dispensed. For dollars spent, these totals fell from 18.8% to 11.6% vs a jump from 81.1% to 88.4%.⁷

Sales of branded drugs have seen both growth and a narrowing of the market. In 2018, it took sales from 7 branded medications ($55 billion) to equal the entire generic market ($55.7 billion); in 2021, it took 3 ($55.2 billion and $53.6 billion); and in 2023, it took 2 ($61 billion and $54.4 billion).

From Q1 2015 through Q3 2022, launched biosimilars have accounted for 24% of competitive molecule volume, or the percentage of biologics sales accessible to approved and launched biosimilars and biosimilar efficiency (DDDs). During this same time, the percentage of the biologics market accessible to launched biosimilars has fluctuated from between 0% and 5% to just over 10% and the percentage of the biologics market accessible to approved biosimilars not launched, from just under 10% to 25%.⁸

As a percent of total 2023 sales, the combined biological/biosimilar market accounts for 40.5% vs 59.5% of small molecule drugs. Drilling down, biologicals without a launched biosimilar, 78%; biologicals with a launched biosimilar, 19.6%; and biosimilars, 2.4%.⁹

By 2027, biosimilar launch and uptake are expected to reach between $40 billion and $49 billion compared with a projected $18.1 billion in 2024 and $300 million in 2014.¹⁰

Drug Shortages

In 2017, there were 26 drugs on the FDA’s drug shortage list; by year-end 2023, there were 538. Despite this increasing and serious problem, fewer of these are being resolved, Long pointed out. Only in some cases are the shortages driven by demand, with purchasers putting in for larger order to head off expected market shortages. Although shortages for oral and branded medications are driven by demand, there is a greater degree of shortage for generic and injectable medications. Key drug shortages include in the oncology space (cisplatin and carboplatin), antibiotics (amoxicillin), GLP-1s (semaglutide [Ozempic], tirzepatide [Mounjaro], and dulaglutide [Trulicity]), and for ADHD (amphetamine salts [Adderall]).

Long pointed out that a principal reason for shortages is that the FDA is inspecting fewer smaller manufacturing sites. At present, there are over 4000 inspections that have been missed or suffering from a backlog. For domestic manufacturing sites, these inspections saw a continuous decrease from 2011 to 2021. There was a brief uptick from 2021 to 2022, before they fell again in 2023. In contrast, for foreign manufacturing sites, inspections rose between 2008 and 2019, before dropping precipitously from 2019 through 2021. An uptick began again after 2021. For example, the FDA inspected 40 sites in China from 2020 through 2022 vs 131 in 2019 alone, and in India, just 3% of sites were inspected in 2022 vs 45% in 2019.¹¹

Most shortages have lasted from 2 to 5 years (33%), followed by 5 or more years (25%), 1 year to 2 years (17%), 6 months to 1 year (13%), and less than 6 months (25%). Also, more shortages are being reported than are being resolved, Long noted.

New Product Launches/Research and Development

Product launches were up in 2023 over 2022 and 2021: 80 vs 58 and 76, respectively. In 2023, the immunology space saw the most launches, at 31%. Also, in 2023, the top launch by sales was the respiratory syncytial virus vaccine Arexvy, at $1.699 billion. Comparing 2022 with 2023, the FDA has approved 36 vs 54 new molecule entities, respectively, although fewer in 2022 showed evidence of launch, at 33 vs 54, respectively.

As of February 2024, the top therapeutic areas by launch share are immunology, anti-infectives, and central nervous system medications compared with immunology, oncology, and anti-infectives in 2023 and oncology, dermatology, and anti-infectives in 2022.However, overall, post–COVID-19 pandemic launches account for less in first-year average gross sales. Whereas this ranged from $118 million to $163 million from 2013 to 2019, these sales hit a postpandemic high of $92 million in 2020. Hepatitis C had the highest sales before the pandemic, while vaccines and GLP-1s/obesity medications top postpandemic sales.^12,13

The top 5 growth areas over the past 5 years have been in oncology, gastrointestinal, neurology, infectious disease, and immunology/allergy.¹⁴

Long concluded by noting that considering net price basis, the US market is forecasted to only grow at a compound annual growth rate of 1% to 2% over the next 5 years compared with the 4% seen over the previous 5 years, and that sales in the immunology, oncology, neurology, and COVID-19 vaccine spaces will be the primary drivers of market growth through 2026.¹⁵

References

1. Long D. Current specialty pharmaceutical trends and a look ahead. Presented at: AXS24; April 28-May 2, 2024; Las Vegas, NV. https://asembia2021.egnyte.com/fl/u6bmUePsTR#folder-link/AXS24%20Session%20Slides?p=6a8c32e6-0afd-4555-a2ea-a695c54a7179

2. Global Use of Medicines 2024: Outlook to 2028. IQVIA Institute; December 2023.

3. IQVIA EMEA Thought Leadership; IQVIA MIDAS MAT Q3 2023; Rx-only.

4. Refinitv Workspace, as of September 2023.

5. The Use of Medicines in the U.S. 2023: Usage and Spending Trends and Outlook to 2027. IQVIA Institute; March 2023.

6. IQVIA, National Sales Perspectives and RxInsights, 2024.

7. IQVIA, National Sales Perspectives, National Prescription Audit, February 2024.

8. IQVIA MIDAS, September 2022; IQVIA Institute, December 2022.

9. IQVIA National Sales Perspective.

10. IQVIA MIDAS, June 2022; IQVIA Institute, November 2022.

11. FDA Drug Shortages Database, IQVIA National Sales Perspective, June 2023; IQVISA Institute, October 2023,

12. IQVIA U.S. Launch Landscape Tracker, February 2024,

13. National Sales Perspective; Center of Launch Excellence, IQVIA,

14. QVIA Pipeline Intelligence, December 2021; IQVIA Institute, January 2022.

15. IQVIA Institute, November 2022.