2012 was a healthy year for the U.S. pharmaceuticals industry, with 39 new drugs approved; the highest in 16 years.
This has largely been driven by a string of recent patent expirations, enabling generic drug makers to offer cheaper alternatives, and forcing major manufacturers to refill their product lines. Patent expirations peaked in 2012, costing big pharma companies upward of $21 billion in lost revenue.
Some of the drugs to have come off patent in 2012 included Plavix, a heart drug made by Sanofi and Bristol-Myers Squibb, and Seroquel, an antipsychotic made by AstraZeneca.
The 39 new drugs and biological products approved in 2012 compares with 30 in 2011 and just 21 in 2010, suggesting that pharmaceutical makers are poised for growth. The pharma industry has not seen figures like that since 1996.
The end of year brought a flurry of last minute approvals, with 8 recorded in December, including a new treatment from Johnson & Johnson called Sirturo for drug-resistant tuberculosis, the first new TB drug in decades.
Other approvals in 2012 included Eliquis, a drug that reduces stroke risk in patients with irregular heartbeats, from Bristol Myers-Squibb and Pfizer Inc., and Adasuve by Alexza Pharmaceuticals, the first treatment for schizophrenia and bipolar disorder that can be inhaled.
Many other approvals were for rare diseases, underscoring the drug industry's increased focus on specialized, niche products. They included Kalydeco from Vertex Pharmaceuticals Inc, for treatment of a rare form of the lung disorder cystic fibrosis, and Signifor from Novartis AG, for Cushing's disease, caused by over-production of the hormone cortisol. The last drug to be approved in 2012 was for a drug to relieve symptoms of diarrhea in patients with HIV and AIDS made by Salix Pharmaceuticals.
There are also encouraging signs that the uptick in new drug approvals could continue in 2013. The European Medicines Agency expects 54 new drug applications in 2013, up from 52 in 2012, 48 in 2011, and 34 in 2010.
The latest wave of drug approvals is a welcome distraction from the recent controversy surrounding "pay for delay,” a well-known industry practice whereby brand-name pharma companies pay generic drug makers to delay the release of their cheaper alternatives.
"Pay for delay" has recently come under fire by the Federal Trade Commission, which claims the practice is anti-competitive, costing consumers close to $3.5 billion each year in higher drug costs, and violates antitrust laws.
The practice typically involves brand-name drug makers suing generic companies for patent infringements, and then agreeing to withdraw the suit and pay the generic company if they agree to delay selling their cheaper drugs for a period of time.
In the past, drug makers have won several court cases that have allowed the practice to continue, but the U.S. Supreme Court has now agreed to hear a case challenging this common industry practice, which could soon put an end to it.