4 min readChanging Dynamics in the European Non-Hodgkin’s Lymphoma Market

There are about 1.8 million people worldwide living with non-Hodgkin’s lymphoma (NHL). It is the sixth most common form of cancer in Europe. The disease is complicated in nature with about 25-30 sub types. Its incidence in Europe varies from 4 to 14 for every 100,000 people. In the European Union alone approximately 50,000 new cases are diagnosed each year. The risk of developing the disease increases with age, especially among the 55-85 year group. The incidence rate peaks between the ages of 75 and 85 years. With rising life expectancy levels across Europe, the demand for NHL drugs is set to grow.

The European non-Hodgkin’s lymphoma therapeutics market has been monopolised by MabThera, also known as Rituxan in the US. MabThera is a monoclonal antibody, co-marketed by Genentech and Biogen Idec in the US. In Europe and rest of the world it is marketed by Roche and Chugai in Japan.

Over the years, MabThera has been recognised as a ‘wonder drug’ for NHL treatment. Consequently, it has become the biggest cash cow for Roche/Genentech/Biogen Idec with global sales of about $5 billion in 2007. In fact, the penetration of MabThera for the treatment of first line aggressive cases in the key five European countries of U.K, France, Germany, Spain and Italy is about a staggering 84%.

CHOP chemotherapy is the major therapy indicated for most forms of NHL. The drugs used in this regimen are: Cyclophosphamide, Adriamycin,Vincristine, Prednisone. However, it is highly genericised with limited prospects for revenue growth. Currently MabThera with CHOP chemotherapy is the standard treatment for NHL. However, market dynamics are poised to change in the near future due to the anticipated launch of many promising pipeline drugs.

The European non-Hodgkin’s lymphoma therapeutics market is estimated to reach $7.2 billion in 2013 from the current size of $2.2 billion. The relapsing nature of NHL is impelling the need for new therapeutic options. Though MabThera is very popular and gained widespread acceptance among oncologists, there still exists a high unmet need among NHL patients. This could be a major driver of growth for this market.

The complicated nature of NHL with about 30 sub-types poses serious challenge for the entry of novel drugs. Many of the sub types have a very low prevalence and would be unprofitable to invest in R&D.

The European sales of MabThera grew at about 23% in 2006. However, this growth is expected to decrease over the coming years, since MabThera has already hit maturity phase in US & Japan. This could potentially hinder the overall market growth in terms of revenues. In order to maintain its lion’s share of the market, Roche has launched life cycle maximisation by positioning MabThera for other indications of NHL, as well as positioning it for Maintenance therapy. MabThera has also been recently approved for the treatment of rheumatoid arthritis which could boost its future growth. If Roche finds success in its life cycle maximisation efforts for MabThera, it can easily retain market leadership position at least for the next 5-6 years. Furthermore, it must be noted that most drugs in the pipeline are being positioned as add-on combination therapies with MabThera or CHOP chemotherapy.

Stringent regulatory regime policies could prolong the market entry time for new drugs. Despite efforts by the FDA and EMEA to accelerate the drug approval process, there exists a backlog for new drug approvals. This backlog seems to hamper innovative drug research and development process, since it has an adverse impact on investor’s confidence. For instance, companies such as Favrille and Genitope are facing mounting operating expenses due to high investments in research. Any regulatory setback could jeopardise their business sustainability.

Zevalin is the first approved radio-immunotherapy. It was approved in Europe for commercialisation in 2004 for the treatment of follicular non-Hodgkin’s lymphoma. It is distributed in Europe by Schering AG. The innovator, Biogen Idec holds the rights for marketing in the US. In 2005, Zevalin generated about $21 million in revenues in Europe. However, Zevalin sales did not match the expectations. On August 2007, Cell Therapeutics acquired Zevalin from Biogen Idec for about $30 million.

Another promising radio-immuno therapy is Bexxar from GSK. It is marketed in Europe by Amersham Health which has been recently accquired by GE Healthcare. In the US it is marketed by GSK.

Oncology has attracted heavy R&D investments mainly due to its premium pricing. Favrille’s Favid, Genmab/ GSK’s HuMax-CD20 (Ofatumumab), Genitope’s MyVax, Accentia/Biovest’s BIOVAXID, Millennium Pharmaceuticals/Johnson & Johnson Pharmaceutical’s Velcade are some of the promising drugs in phase 3 stage of clinical trials for NHL. Entry of these drugs would certainly change the NHL market dynamics in Europe as well as rest of the world.

Add-on drugs, in combination with the current market leader MabThera or chemotherapy is a prospective market driver. There is a huge potential for add-on drugs complementing MabThera. For instance, Favrille’s FavId, positioned as an add-on to MabThera is a potential blockbuster candidate. Most oncologists are satisfied with MabThera and may not immediately replace it for new drugs. Hence, combination drugs with MabThera or CHOP would gain easier acceptance among oncologists and patients.

The EMEA and US FDA have indicated that true survival benefits would be the standard for regulatory approvals. Hence, pharmaceutical or biotech companies should focus only on those drugs which truly improve patient survival rates. This would bolster their regulatory approval process.

Big Pharma should evaluate opportunities to in license or acquire molecules in order to supplement their pipeline. It must be noted that major investments in the oncology space are coming from small to medium sized biotech companies. Investments in R&D by big pharma are not yielding desired results. Hence, in-licensing would be a viable option for them. In fact, this would be a win-win situation for both.

For instance, in December 2006, GlaxoSmithKline and Genmab entered into a worldwide agreement to co-develop and commercialize HuMax-CD20 (ofatumumab). This not only strengthens GSK’s existing pipeline but also compliments their NHL drug Bexxar, since both these drugs are for the same target population. HuMax-CD20 is the most promising piple line drug for NHL, and a potential block buster candidate. It is eagerly watched by the industry players.

On the other hand, small sized biotechnology companies should focus on their core competency in research. Though NHL is a niche market and may not require huge marketing budget, small sized research focused biotech companies should look for marketing alliance with a stronger partner to ensure commercial success of their promising drugs. Furthermore, many of the small sized research-focused biotech companies are already in huge debts. Their sales & marketing experience is limited. Hence, such strategic alliances would minimise drug development risk and maximize product reach.

The current growth of this market could slow down since MabThera has hit maturity phase. However, the NHL market is expected to accelerate from 2012 onwards, considering many promising pipe line drugs are currently at phase 3 stages of clinical trials and is anticipated to hit the European market in 2-4 years.