Analyzing the ten-year pattern of the global top 50 pharmaceutical industry: why Roche counterattacked Pfizer and why it has been falling frequently

In June 2021, the US "Pharmaceutical Manager" magazine announced the "2021 Global Top 50 Pharmaceutical Companies" list.
The list includes the sales revenue, annual R&D investment and annual R&D investment of the top 50 global pharmaceutical companies in the prescription drug business in the past year.
Core product revenue
.

Looking back at the changes in the landscape of the top 50 global pharmaceutical companies in the past 10 years (2012 to 2021), it is thought-provoking
.

Beginning in 2019, the top 50 global pharmaceutical companies have undergone disruptive changes.
China Biopharmaceuticals and Hengrui Pharmaceuticals entered for the first time, PK on the same stage as the global TOP50
.

At the same time, a major change in the global hegemony has also occurred.
In 2020, the tumor drug giant Roche squeezed out Pfizer for the first time and reached the top 50 global pharmaceutical companies, which to a certain extent announced the arrival of the era of tumor immunity
.

When the global focus is gradually on China, when will Chinese pharmaceutical companies advance to the top 20? We are looking forward to it
.

01 Chinese pharmaceutical companies: when can they enter the top 20?

For the pharmaceutical industry, 2019 is an extremely extraordinary year
.

This year, the reform results of the pharmaceutical industry began to appear
.

In 2020, the top 50 global pharmaceutical companies will welcome two more pharmaceutical companies
.

The epidemic has increased the fire.
One year later, both in terms of vaccines and anti-epidemic, China has really attracted the attention of the world
.

As the “threshold” of global pharmaceutical TOP50 selection is rising every year, it is not easy to get in.
It needs to compete with global pharmaceutical companies and have the ability to grow beyond their opponents
.
Taking the past three years as an example, from 2019 to 2021, the 50th largest company’s prescription drug sales were US$2.
461 billion, US$2.
787 billion and US$2.
823 billion, respectively
.

Nowadays, Chinese pharmaceutical companies have achieved a breakthrough in the top 50.
In recent years, they have passed the top 40 mark.
When will they be able to enter the top 30? Top 20? Even the top 10? This is a question that China's pharmaceutical innovation needs to answer in the future
.

From the perspective of prescription drug sales, in 2021, Teva Pharmaceuticals, ranked 20th, had prescription drug sales of 11.
009 billion U.
S.
dollars last year, Servier ranked 30th was 5.
155 billion U.
S.
dollars, and Constant ranked 38th.
Switzerland is 4.
203 billion US dollars
.
From the existing static data alone, Chinese pharmaceutical companies are only US$950 million (approximately RMB 6.
1 billion) away from the top 30 and US$ 7 billion (approximately RMB 45 billion) from the top 20
.

Taking Hengrui as an example, its sales revenue grew 19.
09% year-on-year last year, while Servier’s global revenue growth rate was 3.
6%.
If Hengrui wants to enter the top 30 within a year, it only needs its sales year-on-year growth rate to exceed the growth rate of its competitors.
The range of 22% can be achieved
.
This means that Hengrui will grow at least 26% in 2021
.

The top 30 is just around the corner, but the top 20 is still far away
.
45 billion yuan, approximately equal to 1.
67 Hengrui for one year and 2.
16 stone medicine for one year
.
In terms of pharmaceutical calculations, some institutions have given Hengrui PD-1 a very optimistic sales valuation, 10 billion yuan in 2021.
If this calculation is based on this calculation, Hengrui will have to develop another 4.
5 PD-1
.

Therefore, advancing to the top 20 can be regarded as the beginning of a qualitative change in China's new medicine to a certain extent
.
When will it survive the top 20? How to survive the top 20?

As early as 2017, 7 corporate scientists including Yang Dajun Yang and Jerry Xu Ting of Yasheng Pharmaceuticals tried to discuss the "Chinese pharmaceutical companies' entry at the 9th China Pharmaceutical Entrepreneurs, Scientists and Investors Conference" exclusively hosted by "E-Pharmaceutical Managers".
How far does the top 20 global pharmaceutical companies have to go?" Replied
.

Yang Dajun proposed: First, products should enter the global market, and second, mergers and acquisitions
.
"We currently have very few products sold globally in China.
If our company wants to enter the top 20 global pharmaceutical companies in the future, the products will definitely need to enter the global market
.
Because regardless of whether your product ranks second or first in the Chinese market, you have up to 20 %-30% of the market, and 70%-80% of the market is abroad
.
In addition, whether it is from the government point of view or market demand, future integration is a must
.
If it is difficult to rank among the top 10 in the world by relying on only one company, Roche bought Genentech, and Pfizer was not Pfizer in its infancy
.
It became the number one after integrating four or five companies .
So I think China must go to the top 20 in the world through integration, complementary advantages, and the continuous development of the Chinese market.
Growth can be done
.
"

Industrial Securities also mentioned that the path taken by Japan's Takeda from localization to an international pharmaceutical company is a typical representative of the direction that domestic pharmaceutical companies can choose in the future
.

The internationalization of Takeda began in 1985.
At that time, Japan's drugs were widely controlled by fees, and Takeda's generic drugs were affected, and they turned to seek innovation and internationalization as the two fulcrums
.
In 1985, Takeda leveraged Abbott to establish subsidiaries abroad; in the mid to late 1990s, it directly established a series of branches abroad, including Takeda in the United States, Takeda in the United Kingdom, Takeda in Ireland, and Takeda in China (Tianjin).
The pace of internationalization
.

The second step is to own a blockbuster drug.
In 1995, its lansoprazole was approved in the United States.
The rapid growth of this blockbuster drug made Takeda a member of a multinational pharmaceutical company.
In the following five years, Takeda’s Cantasha Tan and pioglitazone have been approved in the United States, and Takeda’s overseas revenue has almost tripled during this period, and its overseas share has increased from 11% to 29%, reaching US$2.
6 billion
.

After opening the market, Takeda also completed the initial capital accumulation, and then launched a series of large-scale mergers and acquisitions to expand the international territory from developed countries to emerging markets
.
In this process, Takeda established R&D centers in the United States, Europe, and Singapore to realize R&D internationalization; at the same time, it built more than 30 production bases around the world to realize the globalization of the supply chain
.

The Chinese pharmaceutical companies on the list are also well aware of the importance of the international market and have already begun to make arrangements
.
Take Hengrui as an example.
In recent years, Hengrui has been globalizing its R&D and drug commercialization
.
In terms of R&D, Hengrui has successively established R&D centers in New Jersey, Boston, and Nagoya, Japan
.
Last year, Hengrui Medicine also invested in the establishment of a clinical center in Basel, Switzerland, and improved its R&D layout in Europe
.
In terms of the internationalization of new drugs, Hengrui will license Carrelizumab, Pirrotinib, and SHR 1701 projects to Crystal Genomics of South Korea, HLB-LS of South Korea, and East Asia Pharmaceuticals of South Korea in 2020
.

However, it is not easy to bring the medicine to the international market
.
Previously, Hengrui stated frankly in the survey that “how to make good medicines in the international market, especially Baekje and Cinda have signed large cooperation agreements.
Hengrui also wants to do it.
Everyone needs to be more patient
.
”

From the perspective of products and processes, Chinese pharmaceutical companies are still far from each other
.
The fastest channel is mergers and acquisitions.
Takeda has established a dedicated investment center during the expansion phase of mergers and acquisitions.
Several domestic pharmaceutical companies on the list seem to be lacking in the use of capital
.
They rarely use high-risk capital forces such as equity mergers and acquisitions, and the way to expand their scale is still self-construction
.

02 Roche: Will the glory continue?

Roche's counterattack will start in 2013, and Roche once again advanced this year
.

The list data shows that Roche got rid of the fifth place for many years in a row, rose to the third place, and maintained the third place for the next four years
.

The reason for this breakthrough lies in the product
.
In 2013, the total sales of the 20 best-selling oncology drugs in the pharmaceutical industry were US$53 billion
.
Roche relied on Rituximab (rituximab), bevacizumab and Herceptin (sales of approximately US$21 billion) to dominate the top three on the TOP20 oncology drug sales list, contributing approximately 40% of sales
.
Together with the sales of Tarceva and Xeloda, Roche contributed US$24 billion in sales in the 2013 TOP20 oncology drug sales list, nearly half of the total sales
.

Roche's second breakthrough was in 2019, and there followed steadily rising
.

In 2019, Roche got rid of the third position and rose to the second place, a short distance away from the global hegemon
.
Accumulated and developed thinly, Roche has become the number one in 2020 and maintained the number one position in 2021
.

The analysis of the reason is still in the product.
Although the comprehensive sales capacity of the top 10 global pharmaceutical companies has increased year by year, the listing of blockbuster drugs has brought Roche a higher growth rate to surpass its opponents and eventually win the first place
.

In summary, it is not without reason that Roche completed the counterattack
.
From the perspective of products, Roche has stepped on the beat for every wave in the field of oncology drugs
.

In the era of targeted drugs, Roche's three core products have allowed it to dominate the oncology drug market and have also allowed its prescription drug sales to grow steadily
.
In the era of tumor immunity, Roche has also worked hard to seize the PD-(L)1 craze.
Following Merck, BMS and other companies, Roche launched the world's first PD-L1 monoclonal antibody atelizumab
.
In addition, Roche is the first company in the world to have ADC products on the market in terms of antibody-derived innovative drugs.
Its Kadcyla (enmetrastuzumab), as the only ADC drug, entered the global top 100 drug list for the first time this year.
Sales were 1.
745 billion U.
S.
dollars
.

These layouts allowed Roche to usher in an explosion in 2019
.

In 2019, Roche's prescription drug sales increased by 8.
3%, and this result also enabled Roche to win the top 50 list of global pharmaceutical companies in 2020
.

Its “blockbuster” colorectal cancer targeting drug Avastin reached US$7.
118 billion in sales in 2019, accounting for 15% of Roche’s total revenue from the pharmaceutical business
.
Ritual Hua and Herceptin followed closely behind, contributing US$6.
518 billion and US$6.
078 billion in sales, respectively
.
The sales of the three master varieties accounted for 40% of their total sales .
PD-L1 monoclonal antibody achieved a sales growth of 143% in 2019, reaching US$2.
08 billion
.
The ADC drug Kadcyla increased its volume by 45% in 2019, reaching US$1.
55 billion
.
The entire oncology business accounts for more than 60% of Roche's total revenue
.

In addition, the expansion of the Chinese market has also contributed to Roche's sales revenue
.
In 2019, Roche's sales in China reached 21.
79 billion yuan, an increase of 36%
.
Among them, rituximab increased by 16%; HER2-positive breast cancer drugs (Herceptin, Perjeta and Kadcyla) increased by 59%; bevacizumab increased by 47%
.
In February 2020, the National Food and Drug Administration approved atelizumab for the first-line treatment of extensive-stage small cell lung cancer (SCLC)
.
Atelizumab has also become the second PD-L1 tumor immunotherapy approved in China after AstraZeneca's Imfinzi (duvalizumab)
.
So far, atelizumab has another sales market
.

And for today's hot double-antibody, cell and gene therapy, Roche has also spared no expense in the layout and has already gained
.

As early as 2014, Roche acquired the bispecific antibody developer Dutalys, an Austrian biotechnology company, at a price of US$489 million, thereby obtaining the dual antibody platform DutaMab
.
In December 2020, the two global multi-center phase III clinical trials of Faricimab by Roche's subsidiary Genentech reached the primary endpoints
.
Faricimab is a double antibody targeting Ang-2 and VEGF-A to treat a variety of retinal diseases
.

In 2019, Roche first completed the acquisition of Spark Therapeutics, a star gene therapy company, at a price of US$4.
8 billion, and obtained the first "targeted mutation" gene therapy LUXTURNA
.
At the end of 2017, LUXTURNA was approved to be marketed for the treatment of an inherited retinopathy (IRD), which is also the first therapy to directly correct defective genes on the market in the United States
.
In 2018, Luxturna gene therapy was priced at approximately US$850,000 per year, becoming another one-day-priced drug
.

Subsequently, Roche obtained the exclusive promotion rights for the gene therapy SRP-9001 of gene therapy company Sarepta Therapeutics for the treatment of Duchenne muscular dystrophy (DMD) outside the United States for US$2.
85 billion.
This transaction also set a single gene therapy asset at the time.
The record of the maximum amount of authorization
.

With the approval of double antibodies and more gene therapies in the future, Roche's prescription drug sales may increase again
.

03 Pfizer: Will you come back after the fall?

Looking back at the 10-year list, the change in the ranking of "Universal Pharmaceutical Factory" Pfizer is the most regrettable
.

In the past 10 years, Pfizer has reached the top six times
.
Before the 2020 list was released, Pfizer had ranked first for 4 consecutive years
.
In 2020, Pfizer fell to No.
3; in 2021, Pfizer dropped out of the top 5 and its ranking dropped to No.
8
.

Pfizer’s prescription drug sales in 2020 were US$35.
608 billion, which is US$11.
884 billion from Roche, which is almost an Astellas’ sales of prescription drugs in 2020 (US$11.
515 billion)
.
When Pfizer ranked third in 2020, Pfizer's prescription drug sales in 2019 were US$43.
662 billion
.
Going forward, when Pfizer was still No.
1 on the 2019 list, its prescription drug sales were 45.
302 billion U.
S.
dollars
.

It can be seen that Pfizer's fall to the championship is not only because its opponents gradually become stronger, but also because its sales fell precipitously
.
The main reason for the sharp decline in Pfizer's prescription drug sales was its divestiture of expired patent drugs and consumer health care businesses
.

This is both the result and the cause
.

In 2017, a report released by EvaluatePharma, a pharmaceutical market research organization, predicted that Pfizer would lose its top spot in the sales of prescription drugs by 2022
.
Although many analysts thought there was no need to worry about this forecast, the fact is that Pfizer has fallen to the championship in 2020, 2 years earlier than the forecast
.

The report pointed out that the continued squeeze of drug prices and the expiration of patents will bring risks to some pharmaceutical companies
.
The report reads: "The main factor hindering the continued increase in sales of some pharmaceutical companies is that with the expiration of product patents, sales of US$194 billion will be at risk
.
The rate of decline in sales of some of the largest biologics in the industry and The extent has not been determined, and many of them are facing erosion from biosimilars
.
This may lead to a second patent cliff in the industry
.
"

Patent expiration is a fate that almost all major pharmaceutical companies cannot escape, and so is Pfizer
.
In 2007, the patent of Pfizer’s second best-selling drug Luohuoxi expired; in 2011, the patent of Pfizer’s first best-selling drug Lipitor expired; in 2012, the patent of Viagra expired
.
The expiration of patents for several blockbuster products in succession has had an impact on the sales of Pfizer's prescription drugs
.
At first, Pfizer was still trying to maintain the expired patent drug
.
In 2018, Pfizer announced that it would split its business into three parts: biopharmaceuticals, Pfizer Pertron and health drugs.
Pfizer Pertron is a global business group focused on brand-name drugs and generic drugs with expired patents, including 20 expired patents.
Brands of solid oral preparations, including Lerica, Lipitor, Luohuxi, Viagra and Celebrex, as well as some generic drugs
.

However, within less than a year of Pfizer's establishment, Pfizer merged Pfizer and Mylan to form a new company, Viatris
.
Obviously, no matter how much Pfizer maintains expired patented drugs, it will be difficult to reverse the fate of being hit by generic drugs, so Pfizer stripped out expired patented drugs
.

After the expired patent drugs were stripped off, another problem of Pfizer became immediately apparent: the lack of innovative drugs
.

As the "largest pharmaceutical factory in the universe", Pfizer naturally has many pipelines
.
In the existing 100 pipelines, it can be said that all the popular tracks on the market are covered
.
From PD-L1 to ADC, to the new crown vaccine, cell and gene therapy, Pfizer has a layout
.
But why did Pfizer still not outperform Roche and Novartis?

If the layout of the Roche pipeline is on the right "beat", then Pfizer is often "half a beat" slowly
.

During the hot period of PD-(L)1, Roche launched the world's first PD-L1 product atelizumab in 2016, quickly seizing the bladder cancer market
.
In 2017, Pfizer launched its PD-L1 monoclonal antibody Bavencio to the market for the treatment of locally advanced or metastatic urothelial carcinoma (mUC)
.
In 2019, Roche’s PD-L1 monoclonal antibody Tecentriq had sales of nearly US$2 billion, and Pfizer’s PD-L1 monoclonal antibody Bavencio had sales of approximately US$111 million, a gap of nearly 20 times
.

In addition to the late approval and fewer indications, the reasons for this are related to the repeated failures of Bavencio's clinical trials and fewer breakthroughs
.
According to statistics, in 2018, Bavencio failed successively in three phase III clinical trials of ovarian cancer, gastric cancer, and lung cancer.
In 2019, it lost again in gastric cancer
.

In May 2021, Pfizer announced the suspension of patient recruitment for the Phase II clinical trial MagnetisMM-3 of its BCMA/CD3 dual anti-elranatamab due to 3 cases of weekly nerve damage in the trial
.

Fortunately, Pfizer has seized the opportunity brought by the epidemic and is ahead of other companies in the research and development of the new crown vaccine
.
According to its financial results, the new crown vaccine will bring about 26 billion US dollars in revenue in 2021, which may help it regain the championship
.

However, there is not much time left for Pfizer to develop in the field of innovative drugs
.
As the new crown epidemic is gradually brought under control, its vaccine revenue will also decrease
.
The patents for its three important products, the pneumococcal vaccine Prevnar 13, the cardiovascular drug Eliquis, and the prostate cancer drug Xtandi, will expire in 2026 and 2027
.
Some analysts predict that this will cost Pfizer up to 20 billion U.
S.
dollars in sales
.
This means that only 5 years are left for Pfizer from innovation to successfully launching the next "blockbuster"
.

04 Novartis: Can you break the curse of "the second in the millennium"?

In addition to the rise of Roche and the fall of Pfizer, the 10-year list also presents an interesting phenomenon, that is, Novartis’s "Millennium No.
2"
.
In 10 years, Novartis ranked second 8 times and won the championship twice
.

Pfizer is not the only one encountering the "patent cliff", and Novartis is also facing the same dilemma
.
In 2015, the patent of Novartis' star product Gleevec expired, and its generic drug was launched in the United States in February of the following year
.
Since then, Gleevec’s sales have plummeted.
Sales revenue in 2016 was US$3.
323 billion, a decrease of US$1.
335 billion from 2015, a drop of nearly 30%
.
In 2020, the patent for the blockbuster drug Everolimus expired, and foreign companies such as Par Pharmaceutical, Teva Pharmaceuticals, and domestic companies such as Jiangsu Hausen and Hisun Pharmaceutical have imitated them
.

Faced with the same dilemma, Novartis has no good solution, and it also needs to place hope on innovative drugs and innovative therapies
.
But unlike Pfizer, Novartis has gained a lot in innovative therapies and successfully passed the bottleneck period
.

In 2017, Novartis launched Kymriah, the world's first CAR-T cell drug, marking the first year of CAR-T cell therapy
.
In the following three years, Kymriah's revenue increased gradually and began to become a new engine for Novartis' performance growth
.
In addition to holding the world's first CAR-T drug Kymriah, Novartis also has the world's most expensive drug-Zolgensma, a gene therapy for spinal muscular atrophy
.
The price of 2.
12 million US dollars gives its sales growth an extra layer of protection
.

The annual report shows that Novartis's pharmaceutical business will increase its sales revenue by 4% in 2020, reaching US$24.
302 billion
.
Among them, the tumor business increased by 2%, and sales revenue was US$14.
711 billion; the generic drug business decreased by 1%, and the sales revenue was US$9.
646 billion
.
The psoriasis drug Cosentyx and the new heart failure drug Entresto are still the main forces of Novartis's performance growth
.
In 2020, Keshanting and Entresto contributed a total of US$6.
5 billion, an increase of 25% year-on-year
.

The new therapy Kymriah will achieve a 68% increase in sales in 2020, reaching $474 million
.
Gene therapy Zolgensma and breast cancer treatment Piqray ushered in an outbreak in 2020, with year-on-year growth of 151% and 176% respectively
.
Among them, Zolgensma has been approved in 37 countries and achieved sales of US$920 million in 2020
.
Piqray's sales revenue is 320 million U.
S.
dollars
.

At present, Novartis has also regarded a series of breakthrough new products such as Kymriah, Zolgensma, Leqvio, Beovu, Tabrecta as the main driving force of performance growth
.
In Novartis' planning and layout, these innovative therapies are gradually growing into the main force of sales
.

And can Novartis break the curse of "the second in the millennium" and become the world's number one? Some reports gave definite answers
.
The forecast report jointly launched by Yahoo and Fiercepharma pointed out that Novartis is expected to become the sales leader of global pharmaceutical companies in 2024
.
The Evaluate Pharma forecast report believes that Novartis may surpass Roche, Pfizer and other companies to become the world's number one in 2022
.

Perhaps the answer will be revealed after the report of the top 50 global pharmaceutical companies next year
.