Andy
Senior Member (Voting rights)
Blockbuster drugs are the essential financial engines of large pharmaceutical companies, typically generating over 80% of gross revenue. These franchises are built not merely on patient volume, but on achieving a durable, dominant position by exploiting new, actionable biological mechanisms, ideally first and best in class.
The source of such commercially successful innovation is twofold: internal research engines and external assets sourced via licensing, partnerships, and mergers & acquisitions. Interestingly, about 45–50% of big pharma pipeline assets come from external innovation, but these externally sourced assets tend to represent a disproportionate share (about 65%) of revenue value, meaning the next commercial giant is likely incubating in the external innovation landscape, awaiting the right strategic partnership (McKinsey, 2022). Such ventures, if successful, are often transformative. This business model has generated a wealth of innovation across both major and niche therapeutic areas over decades.
...
While the current blockbuster market is generating vast revenue, it is also becoming saturated. Multiple products with very comparable mechanisms of action and efficacy are entering, pricing pressures are already emerging, and future competition from biosimilars and payor-driven cost constraints threatens to erode long-term margins. The market might indeed be enormous, but the number of new winners able to carve out durable, dominant positions may be smaller than anticipated, and individual company returns could fall short of sometimes hype-driven expectations.
Meanwhile, in its shadow, an underappreciated blockbuster market may be taking shape in Long COVID and related conditions like ME/CFS, POTS, Fibromyalgia and Lyme that share a lot of their symptoms and biologic mechanisms and are increasingly being grouped under the umbrella term “PAIS” (Post-Acute Infection Syndromes).
Full article on LinkedIn
[I think this should be viewable without logging in to LinkedIn.]
The source of such commercially successful innovation is twofold: internal research engines and external assets sourced via licensing, partnerships, and mergers & acquisitions. Interestingly, about 45–50% of big pharma pipeline assets come from external innovation, but these externally sourced assets tend to represent a disproportionate share (about 65%) of revenue value, meaning the next commercial giant is likely incubating in the external innovation landscape, awaiting the right strategic partnership (McKinsey, 2022). Such ventures, if successful, are often transformative. This business model has generated a wealth of innovation across both major and niche therapeutic areas over decades.
...
While the current blockbuster market is generating vast revenue, it is also becoming saturated. Multiple products with very comparable mechanisms of action and efficacy are entering, pricing pressures are already emerging, and future competition from biosimilars and payor-driven cost constraints threatens to erode long-term margins. The market might indeed be enormous, but the number of new winners able to carve out durable, dominant positions may be smaller than anticipated, and individual company returns could fall short of sometimes hype-driven expectations.
Meanwhile, in its shadow, an underappreciated blockbuster market may be taking shape in Long COVID and related conditions like ME/CFS, POTS, Fibromyalgia and Lyme that share a lot of their symptoms and biologic mechanisms and are increasingly being grouped under the umbrella term “PAIS” (Post-Acute Infection Syndromes).
Full article on LinkedIn
[I think this should be viewable without logging in to LinkedIn.]
