Chronic respiratory diseases affecting airways and parts of lung pose a major health risk because of aging population and previous smoking rates. Asthma, Chronic Obstructive Pulmonary Disease (COPD), lung cancer, cystic fibrosis, and sleep apnea fall under chronic diseases. To put in context the severity: after cardiovascular and cancer, respiratory diseases are the third highest cause of hospitalizations and deaths in Canada.
In 2014, about 13% of the Canadian population was affected by Asthma. It is the most common chronic disease among children. The chronic obstructive pulmonary disease (COPD) affects about 10% of all adults. In all, 2.4 million Canadians had asthma and 0.8 million had COPD in 2014. This figure of 3.2 million suffering from respiratory diseases of the total population of 35 million means that 1 in every 11 Canadian is affected by Asthma/COPD.
Early detection program: The Canadian Lung Association is concerned with the uneven death rates across provinces in Canada. The last quarter of 2014 saw the Canadian Foundation for Healthcare Improvement (CFHI) pledge CAD 1 million to teams from healthcare organizations to transform care for people living with COPD across all provinces. A new initiative titled the Value Demonstrating Initiative (VDI) on COPD, which entered testing phase in May 2015, aims at community identification of at-risk individuals through early diagnosis with spirometry and classification of patients according to severity levels in order to facilitate better access to health interventions. Since COPD is a disease that progressively gets worse, early detection can slow down the process and lead to considerable healthcare cost savings over time.
Table 1 represents sales of patented drugs in Pulmonary Therapeutic Class in the year 2012. The pulmonary therapeutic area contracted in size in 2012 compared to 2011 with a negative growth rate of 8.7%.
|2012 sales (CA$millions)||Share: 2012 sales (%)||Growth: 2012/2011 (CA$millions)||Growth: 2012/2011 (%)||Impact on change in expenditure (%)|
Table 2 provides the average rate of price change in patented drugs (Patented Medicines Price Index or PMPI) in respiratory therapeutic area in 2012. As the change in PMPI is low, the price of patented products in pulmonary therapeutic area is stable.
|Share: 2012 sales (%)||Price change: 2011 to 2012 (%)||Contribution: change in PMPI (%)|
Table 3 shows a decrease in quantity of drugs sold in respiratory therapeutic area with a minor contribution to Patented Medicines Quantity Index (PMQI) as compared to other therapeutic areas.
|2012 sales (%) of total quantity of drugs sold||Quantity change: 2011 to 2012 (%)||Contribution: Change in PMQI (%)|
In 2012, 7.2% of the drugs distributed in Canada consisted of drugs dealing with respiratory diseases as compared to 7.8% in comparator countries (France, Germany, Italy, Sweden, Switzerland, UK and US). From the above two tables, it can be inferred that the pharmaceutical companies in Canada are selling patented drugs at a higher average list price, while average demand of patented drugs is coming down.
Trends affecting uptake of new treatments
In 2015, a study revealed that 6 in 10 patients suffering from COPD face challenges when using inhalers largely due to inability to administer the effective dose. In a different study in 2014, it was found that combination drug therapy designed to open the airways and reduce inflammation may be the best treatment for older adults with asthma and COPD. This is of significance since long-acting beta-adrenoceptor agonists’ drugs are still quite popular with Breo Ellipta (Fluticasone and Vilanterol, GlaxoSmithKline) gaining approval this August 2015. In May 2015, Health Canada approved the first long-acting muscarinic antagonist (LAMA) for Canadian markets: Spiriva Respimat (Tiotropium bromide, Boehringer Ingelheim). This is in line with growing trend in the market towards combination drugs which are seen to be more effective.
Outlook for Respiratory Market
Respiratory market is a highly competitive market with older drugs competing for market share, especially in the case of Asthma. We believe that market for Asthma will most likely shrink further due to decline in prices and shift to generic versions or alternatives, mainly of Advair (GSK). It is our understanding that GSK is the leading player in the respiratory market segment and will most likely experience immense pressure across its portfolio until 2020 within Canada and other international markets. However, on the other hand COPD market is expected to grow phenomenally due to the advent of combination therapies which can significantly improve QOL (Quality of Life) for patients suffering from COPD. Indeed, there is more hope for COPD as triple combination therapies (LABA*, LAMA**, and ICS*** combinations) are in pipeline which could significantly alter the treatment dimension.
* Long-acting Beta-adrenoceptor Agonist (LABA)
** Long Acting Muscarinic antagonists (LAMA)
*** Inhaled Corticosteroids (ICS)