Oncology Industry Analysis

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1.1Key trends and characteristics of Cytostatic industry
high growth rate – higher propotion of the global pharma market in the years to come •one of the fastest growing and most profitable therapeutic areas of the next few decades •shift from accute cancer treatment to chronic disease management and prevention •more and more biotech companies enter the market – connections with pharma to help through the maze of regulatory processes and clinical development •patient advocacy programs

1.2Opportunities of L therapeutic class to pharma companies •large unmet medical needs -
o5 mil new cases every year, second leading causes of dead oaccording to WHO 10 mil cases in 2000 and expected to grow to 14,7 mil within next 20 years •low volume, high price
small marketing resources (hospitals, tenders)
significant off-label usage
favoruable reimbursment environment – global healthcare expenditure for cancer exceed $110 bn

1.3Oncology industry

The attraction of the cancer market to the pharmaceutical and biotechnology industry is as follows by Global Equity Research (Cancer, New Frontiers, UBS Warburg, October 2001): large unmet medical need

low volume, high price
small marketing resource
small R&D expenditure
significant off-label usage
favourable reimbursement environment

Global healthcare expenditures for cancer exceed $110 billion annually (for that round about 16 % get on anticancer pharmaceuticals), and every major pharma company is wing for position in that lucrative market, according to a report by C.J. Sylvester, analyst for UBS Warburg. With the growth rate of over-65 populations outpacing other demographics, the ontology market can only escalate, especially as industry shifts focus from acute-care to chronic- disease management.

Cancer will be the most critical and costly healthcare-management issue of the future, making the oncology market one of the fastest growing and most profitable therapeutic areas of the next few decades. It will also be one of the most challenging.

That challenge will come from a fundamental paradigm shift--from acute cancer treatment to chronic disease management and even prevention. Commercially, tomorrow's global oncology leaders will not only look for ways to make current acute therapies better for patients, but they will also improve outcomes by targeting disease sites and holding cancer at bay at much earlier stages. That paradigm shift is also seen in the plethora of new pipeline products that are expected to be marketed in the next three to five years. And, as more and more biotech companies enter the market, the fight to gain patient share will grow more intense.

Key european trends
EU market integration, quicker launching new products into market Slower transition to “market driven” healthcare
Growing HDP, low inflation
Price influenced by regulation rules, generics and parallel sales Low advanced “consumable” approach to the healthcare share and opportunity in cancer therapies

The generic cancer market is small, both in terms of absolute size and penetration, compared to other therapeutic fields. The principal reason for that are the limited number of cancer drugs that are off-patent, and combinations of other factors (e.g. difficulty in manufacturing) which constitute effective barriers to entry for generic companies with little experience in the cancer market.

In most countries the cytotoxic and hormonal treatment segments contain a significant proportion of off-patent drugs mainly due to increased use of older drugs in combination therapies and the fact that new drugs offered only incremental improvements in effectiveness. Furthermore, cytotoxic drugs are both difficult and expensive to produce. As a result there are relatively few companies marketing generic cytotoxic injectables compared to other...
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