Neglected tropicals diseases affect more than one billion people globally, but they have not figured prominently in pharmaceutical industry plans.
Those priorities look to be changing with today’s announcement that 13 pharma companies, including GlaxoSmithKline (NYSE:GSK), are joining with public sector and nonprofit partners to control or eliminate neglected tropical diseases (NTDs). The partnership includes the World Health Organization, the Bill & Melinda Gates Foundation, the UK Department for International Development and the U.S Agency for International Development. Their goal is to eliminate or control 10 of the 17 NTDs identified by the WHO by 2020. If successful, diseases such as sleeping sickness and leprosy will become relics of medical history.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
As companies ramp up their efforts to fight these diseases, they will also extend existing drug donation programs that help patients globally. GSK’s contributions include an extension of donations of the drug albendazole, which treats worm infestations. From 2000 to 2010, GSK donated more than 2.6 billion albendazole treatments to 58 countries, a program that GSK estimates produced an economic benefit of $24 billion.
Pharma companies should be lauded for partnering on a renewed focus on neglected diseases. But don’t mistake their actions as completely altruistic. These changes are happening because of fundamental shifts in the economics of the pharmaceutical industry.
Big Pharma got big by selling blockbuster drugs prescribed primarily to patients in North America and Europe. But the era of the blockbuster drug developed from a pharma’s internal R&D is over. The productivity of pharma R&D has diminished considerably over the last 15 years. In-licensing of products has been insufficient to feed drug pipelines intended to develop successors to the blockbuster drugs falling off the patent cliff.
Pharmas have known about these industry shifts for some time. When Andrew Witty became GSK’s CEO in 2008, he said that the British pharma giant would put additional emphasis on drug sales in emerging markets. He said that the pharma giant, which has its U.S. headquarters in Research Triangle Park, North Carolina, must move away from a reliance of selling “white pills in Western markets.” In 2007, those white pills in Western markets represented 40 percent of GSK’s sales. By 2010, the balance had shifted to just 25 percent of GSK revenue. If the pharmas did not say it outright, the numbers did: Big Pharma can no longer rely on sales of blockbuster drugs to Western markets as a way to grow the industry.
A Personalized Approach to Medication Nonadherence
At the Abarca Forward conference earlier this year, George Van Antwerp, managing director at Deloitte, discussed how social determinants of health and a personalized member experience can improve medication adherence and health outcomes.
There’s a reason that the tropical diseases targeted by the partnership have been neglected. Despite the large populations affected by these diseases, NTD R&Dso for has been cash starved. The partnership aims to address that problem with contributions of more than $785 million to support R&D, including a Gates Foundation commitment of $363 million over five years. Without those financial commitments, who knows if pharma would have or could have provided the millions needed to support the R&D efforts?
By tackling neglected diseases in markets in Africa, Latin America and Southeast Asia, pharma companies are taking the steps needed to improve outcomes for tens of millions of patients. But in doing so, the companies will also be building a market for future drug sales, a future that has the bulk of a pharma’s revenue coming largely from these emerging markets.
Bloomberg News quoted Witty citing an African proverb in his description of the neglected diseases partnership: “If you want to travel fast, travel alone; if you want to travel far, travel in a group.”
This partnership is the collective step of the pharma industry into emerging markets. Let’s see how far it takes them.
Photo from Flickr user jorgediaz1
