Top Potential Blockbuster Drugs of 2013

-Shruti Desai, PharmD Candidate
A Blockbuster drug is defined as branded prescription drug that generate > $1 billion in revenue annually. They have served as catalysts for driving value within the global drug market during the past decade. Top biopharmaceutical companies have been especially reliant on developing these blockbusters for their growth; they have delivered the highest returns on R&D investments.

Despite industry concerns about fewer opportunities to develop billion dollar blockbusters, the number of drugs that reached blockbuster status has increased 6x in the past 15years – from 21 in 1995 to an estimated 123 in 2010. It seems like blockbusters have become the centerpiece of the biopharma industry, growing from 16% of global drug revenue in 1995 to 35% in 2010.

In my opinion, as science and market conditions continue to evolve and unmet needs shift to new territories, the face of the new blockbuster is likely to change again. Although 48 new drugs are expected to join the blockbuster category by 2015 the amount of revenue they generate is expected to account for less than 30% of global pharmaceutical sales.

As we have seen in many instances, a significant portion of smaller biotechnology startups ultimately get acquired by their pharma partners. However, most of these deals have happened after product launch, late in the commercial life cycle of the therapeutics. However, there is now a new business model that for pharmas to execute even earlier deals that provide full ownership for blockbusters to offset the potential shortcomings of the new blockbuster model and improve their chances of becoming the successful players of tomorrow

The year 2013 is off to a great start in terms of biotechnology and healthcare sector. In my opinion, we will see many volatility due to newer mandates. "The industry has done a lot to try and improve productivity and has corrected a lot of past mistakes," Deutsche Bank analyst Richard Parkes tells Reuters. "It's too early to say whether this is going to be a sustained break-out from the trend but the efforts that have been put in place should at least improve the efficiency of what is being spent."

Reuters' two top analysts, Ben Hirschler and Bill Berkrot, have scanned the horizons and identified a slate of the top potential blockbusters now in Phase III.

Multiple Sclerosis:

• Biogen Idec's ($BIIB) MS drug BG-12 is expected to win FDA approval and go on to take up larger market share with best-in-class potential.

Diabetes:

• Johnson & Johnson ($JNJ) is also tackling Endocrinology space with the SGLT2 diabetes drug canagliflozin, given a thumbs up at a recent advisory panel meeting with a good shot at penetrating a $7 billion market. 
• Also in line, Novo Nordisk's ($NVO) long-acting insulin Tresiba and separate blockbuster effort to get liraglutide for obesity.

Hepatitis C:

• With a HepC bubble in mid-late 2012, Gilead ($GILD) and AbbVie ($ABBV) are also in race for a new hepatitis C drug that can quickly emerge as the new standard of treatment.

Cancer:

• Roche ($RHHBY) has T-DM1 in Phase 3 which is a potent microtubule polymerization inhibitor conjugated to trastuzumab. 

Others: 

• Lilly ($LLY) has 13 drugs in Phase III. 
• GSK ($GSK) now has 6 drugs up for regulatory approval. 

I am mostly interested in the small cap biotechnology companies but I felt this article will provide a global picture on biotechnology sector.

Disclosure: No position in any of the companies mentioned above 

Sources: FierceBiotech, Reuters, Google Finance