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Copyright © 2017 IQVIA. All rights reserved.
Doug Long
Vice President, Industry Relations
August 2019
US Pharmaceuticals:
Trends, Issues, and
Outlook
Mutual Drug
2018
1
Key recent happenings in the US!
• Dollar growth is +6% (YTD May 19)
• Unadjusted TRx growth YTD Apr 19 is flat
while Adjusted 90-Day TRX growth is up 2.6%
• 90 day scripts continue to grow
• Major 17-18 Flu Season but as much this year
• 1109 measles cases-highest since 1992
• Generic $ sales decreases
Market Performance
• Walgreens &
Rite Aid
• Walgreens & Freds
• CVS & Aetna
• CVS & Stater Brothers
• Cigna & Express
Scripts
Mergers/Alliances
• DIR fees and audits
• Patient’s behavior during their
deductible period
• Co-pay cards
Reimbursement
• Record number of ANDA approvals and
faster approvals, but fewer products
launching
• Cialis
• Zytiga
• Advair Diskus
Generic Launches
• Opioids recognized as a national crisis
• FDA Priority list of no or limited generic
entries and complex generics
Regulation
• Much more public/media scrutiny on
drug prices
• Potential administrative actions
• Gross-to-net and rebates
• Generic deflation
• Less Brand price inflation
• Repeal and Replace?
Price/Politics
• Walmart &
Anthem (OTC)
• Amazon: Whole
Foods, PillPack,
Xealth, MedPlus
• UnitedHealth &
Genoa
Source: Publicly available through multiple sources
2
On average a Retail store fills over 22K adjusted Rx’s per quarter with Chain having the highest and Independents the lower counts
30,756
12,233
19,728
25,360
22,071
Chain Indep Food Mass Retail
Avg. Adj. Rx/Store – Quarter-ending Mar 2019
3
Payer-Aligned Medical-Pharmacy Future
Vertically integrated Payer models are being developed to manage the increasing pharmacy and medical costs
4
Amazon’s 2018 big moves in healthcare
January 2018 - Amazon forms partnership
• www.havenhealthcare.com
• “Advocate for the patient
and an ally to anyone who
makes patient care and cost
better”
• “free from profit-making
incentives and constraints”
• Current focus is their 1.2M
employees
• “it intends to share what it
learns to help others
June 2018 - Amazon buys PillPack
• Amazon paid $753M for PillPack
• Shares of CVS, Walgreens and Rite Aid tumbled
• What does Amazon get?*
• A company licensed in all states but Hawaii
• “the one company in the space that all the PBMs
and other pharmacy businesses were threatened
by” – Bain Capital
• Most of PillPack’s users are 50-60 and loyal
• PillPack users are worth $5,000 in revenue, the
average Prime Member is worth $1,300
* “The inside story of why Amazon bought PillPack in its effort to crack the $500 billion prescription market”, CNBC, May 13,
2019 - https://www.cnbc.com/2019/05/10/why-amazon-bought-pillpack-for-753-million-and-what-happens-next.html
5
Why is Amazon going after Pharmacy?*
ConvenienceCustomer
ExperiencePartnerships
Pre-existing customer base and distribution
capabilities
Physical StoresStreamlined Distribution
* Source – CB Insights – “The 7 Industries Amazon will Disrupt Next – 2019”
6
Why is Amazon going after Pharmacy?*
Convenience Customer Experience Partnerships
• Amazon’s model aims to limit the effort
patients need to expend while also getting
prescriptions to them within a day or two
• Amazon’s advantage here comes in its
two decades of e-commerce logistics
experience — this could help avoid
delivery mistakes, a vital consideration for
serving people with complex medication
needs
• Haven aims to streamline healthcare.
• With its own insurance offering, Amazon
would have a potential launch pad to do
the work of a traditional PBM for the
partnership’s combined 1.2M employees
• Perhaps eventually the wider public
Pre-existing customer based and
distribution capabilitiesPhysical stores Streamlined distribution
• CVS has announced an experiment in
medication delivery, offering $4.99 for next-day
delivery
• But with 100M Prime subscribers — conditioned
to expect free, fast delivery on virtually any good
• Amazon will likely be placed to offer better
distribution than CVS or other pharmacy chains
• When Amazon acquired Whole Foods in 2017, it
also acquired around 450 physical locations where
it could theoretically dispense prescriptions
• Amazon has also announced plans for a new
grocery chain, separate from its acquisition of
Whole Foods. These stores would be more like
conventional grocers, and could contain
pharmacies — either for in-store prescription
pickup, or as hubs for a local delivery service.
• The pharmaceutical supply chain involves
all kinds of middlemen, each of whom
takes a slice of profit as drugs make their
way from the manufacturer to the end-
patient user — the kind of messy
business model that Amazon has special
expertise in disrupting
* Source – CB Insights – “The 7 Industries Amazon will Disrupt Next – 2019”
Table of
Contents
7
+ Market Overview
+ Medicine Usage Trends
+ Opioids
+ Consumerization
+ Adherence
+ Innovation & Outlook to 2022
8
Total US market dollar sales growth is at mid-single digits (6.9%) year to date
Growth (%) of Sales
Total Market Retail and Mail
12.2%
4.6%
1.9%
6.1%7.0% 6.3%
-4.0%
1.0%
6.0%
11.0%
16.0%
2015 2016 2017 2018 MATAPR2019
YTDAPR2019
12.2%
5.0%
0.2%
4.3%6.2%
4.9%
-4.0%
1.0%
6.0%
11.0%
16.0%
2015 2016 2017 2018 MATAPR2019
YTDAPR2019
Source: IQVIA, National Sales Perspectives, March 2019
Note: Limited to Rx and OTC Insulins
Gro
wth
(%
)
Gro
wth
(%
)
9Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Growth Rebounded to $14.9 Billion in 2018 Due to New and Protected Brand Volume Increases and Despite Lower Price Growth
Source: IQVIA National Sales Perspectives, Jan 2019; IQVIA Institute, Apr 2019
Net Spending Growth by Product Type US$Bn
20.917.3
13.4 12.0 11.0
6.7
3.75.7
5.4
0.8
2.19.9
3.61.4 13.2
-9.8 -9.4 -11.3 -12.3-8.2
5.1 2.6
-0.8
-5.1
-0.7
1.8 3.1
1.6
-0.5
-1.4
2014 2015 2016 2017 2018
New Brands Protected Brands Price Protected Brands Volume LOE Generics Price Generics Volume Total Growth
26.6 27.1
12.2
0.8
14.9
10
Generic dollar price deflation has not flattened out: shortages may increase and greater scrutiny by Dept. Commerce
Source: Nephron Research, Glass Box Analytics, IQVIA; *February 2019 interim published out of cycle
Generic Injectables
help to offset the
persistent deflation
in generic Oral Solids
Oct-14 Apr-15 Oct-15 Apr-16 Oct-16 Apr-17 Oct-17 Apr-18 Oct-18 Feb-19*
Gx:
-11.6%
Bx:
+4.6%
11Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Medicines Spending Growth in the United States Rebounded to4.5% on a Net Price Basis
Source: IQVIA, National Sales Perspectives, Jan 2019; IQVIA Institute, Apr 2019
Total Spending on Medicines and Growth US$Bn
-5%
0%
5%
10%
15%
20%
0
100
200
300
400
500
600
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Gro
wth
Sp
en
din
g U
S$
Bn
Net Spending Invoice to Net Difference Net Spending Growth Invoice Spending Growth
12Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Real Net Per Capita Spending Per Year Grew by Only $44 Since2009 as Specialty Nearly Doubled and Traditional Drugs Declined
Source: IQVIA, National Sales Perspectives, IQVIA Institute, Jan 2019; U.S. Census Bureau; U.S. Bureau of Economic Analysis (BEA), Dec 2018
Real Net per Capita Medicine Spending and Growth by Product Type US$
738 727 699 631 603 595 605 592 546 527
262 279 289300 318 385
438 471489 517
1,000 1,006 988931 922
9811,043 1,064
1,034 1,044
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
-
200
400
600
800
1,000
1,200
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Gro
wth
Rea
l 2
01
8 U
S$
Net P
er
Ca
pita
Me
dic
ine
Sp
en
din
g
Traditional Spending Specialty Spending Total Spending
Traditional % Growth Specialty % Growth Total Spending Growth
0
Total Value of Pharmaceutical Manufacturers’ Gross-to-Net Reductions for Brand-Name Drugs, 2013 to 2018
Identifying and sizing the factors that lie between gross and net prices (CY2018)
Source: Nephron Research analysis, IQVIA, CMS and MEDPAC data
14
What Falls Between Gross and Net: $166bn in 2018
$38passed to Gov.
$166
$33passed to Gov
$39-$41 passed to payers
($3-$5 retained by
distributors,$14-$16 passed to
dispensers)
$2-$3
retained by PBMs
$2-$5
Manuf. Fee
$17-$22 in supply chain discounts (to
distributors)
$27-$31
paid by Pharma
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180
Medicaid Rebates Medicare Rebates Commerical Rebates Manufacturer FeePayments to PBMs
ManufacturerDiscounts to Supply
Chain
ManufacturerPayments to Gov. &
Patient Programs
2018 Total Gross toNet
$s,
Bill
ion
s
16Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Protected Brand Net Price Increases Moderated to 0.3% onAverage in 2018 as Invoice Price Growth Continued to Fall
Source: IQVIA National Sales Perspectives, Jan 2019; IQVIA Institute, Apr 2019
Protected Brand Invoice and Net Price Growth %
4.3%
1.6%2.9%
2.1%
0.3%
13.5%
11.2%
8.7%
7.1%
5.5%
1.6%0.1%
1.3%2.1%
1.9%
2014 2015 2016 2017 2018
Estimated Brand Net Price Growth % Brand Invoice Price Growth % Consumer Price Index
17
In MAT APRIL 2019, specialty spend is growing at 11.6% while traditional is relatively flat at 2.1%
Specialty growth is outpacing traditional growth and now has ~46% share of total non-discounted spend in the most recent 12 months
$132.7 $162.0 $179.0 $196.0$218.8 $227.4
$247.5$264.7
$267.4 $258.7$263.6 $265.7
$380.2$426.7
$446.4 $454.8$482.4 $493.1
-5%
0%
5%
10%
15%
20%
25%
30%
$0
$100
$200
$300
$400
$500
Gro
wth
N
on
-Dis
co
un
ted
Sp
en
d
(BN
s)
SPECIALTY TRADITIONAL SPECIALTY GROWTH TRADITIONAL GROWTH TOTAL MARKET GROWTH
Source: IQVIA, National Sales Perspectives, April 2019
Share of Sales 2014 2015 2016 2017 2018MAT APRIL
2019
SPECIALTY 34.9% 38.0% 40.1% 43.1% 45.4% 46.1%
TRADITIONAL 65.1% 62.0% 59.9% 56.9% 54.6% 53.9%
18
Absolute Value Growth for Top Specialty Therapy Areas
Oncology, Autoimmune, and HIV lead specialty absolute value growth
Source: IQVIA, National Sales Perspectives, April 2019
Note: top therapy areas ranked on MAT APRIL 2019 non-discounted spend
$9.5
$8.9
$1.6
-$0.2
-$3.0
$0.01
$1.1
$0.7
-$0.1
$0.4
$0.5
$0.8
$3.4
-$5 $0 $5 $10
ONCOLOGICS
AUTOIMMUNE DISEASES
HIV ANTIVIRALS
MULTIPLE SCLEROSIS
VIRAL HEPATITIS
HEMATOPOIETIC GROWTH FACTORS
POLYVAL IMMUNOGLOBLULINS IV&IM
MENTAL HEALTH
ERYTHROPOIETINS
IMMUNOSUPPRESSANTS
RESPIRATORY AGENTS
BLOOD COAGULATION
ALL OTHERS
Absolute Value Growth (US$ BNs)
∆Change from MAT APRIL 2018 to MAT APRIL 2019
$32.6
$37.8
$10.4
$5.7
$2.3
$0.3
$2.6
$2.8
-$0.7
$0.8
$2.2
$1.2
$16.5
-$10 $0 $10 $20 $30 $40
Absolute Value Growth (US$ BNs)
∆Change from 2013 to MAT APRIL 2019
19
Absolute Value Growth for Top Traditional Therapy Areas
Diabetes, anticoagulants, and vaccines lead traditional absolute value growth while pain, dermatologics, and ADHD contribute most to value decline
Source: IQVIA, National Sales Perspectives, April 2019
Note: top therapy areas ranked on MAT APRIL 2019 non-discounted spend
$6.0
$1.3
$3.0
-$1.5
$0.6
$0.3
$1.4
-$0.5
$0.7
$0.2
-$1.0
-$5.0
-$6 -$4 -$2 $0 $2 $4 $6 $8
ANTIDIABETICS
RESPIRATORY AGENTS
ANTICOAGULANTS
PAIN
NERVOUS SYSTEM DISORDERS
MENTAL HEALTH
VACCINES (PURE, COMB, OTHER)
ADHD
OTHER CARDIOVASCULARS
GI PRODUCTS
DERMATOLOGICS
ALL OTHERS
Absolute Value Growth (US$ BNs)
∆Change from MAT APRIL 2018 to MAT APRIL 2019
$34.7
$7.0
$10.5
-$4.8
$5.0
-$7.5
$4.5
-$1.3
$3.6
$3.4
-$0.6
-$23.7
-$30 -$20 -$10 $0 $10 $20 $30 $40
Absolute Value Growth (US$ BNs)
∆Change from 2013 to MAT APRIL 2019
20
Absolute Value Growth for Top Therapy Areas
Antidiabetics, oncologics, and autoimmune diseases lead absolute value growth while pain and mental health contribute most to absolute value decline
Source: IQVIA, National Sales Perspectives, April 2019
Note: top therapy areas ranked on MAT APRIL 2019 non-discounted spend
$6.0
$9.4
$8.9
$1.8
$1.6
-$0.2
$3.0
$1.0
-$0.8
$0.5
$1.4
$0.9
-$4.3
-$6 -$4 -$2 $0 $2 $4 $6 $8 $10 $12
ANTIDIABETICS
ONCOLOGICS
AUTOIMMUNE DISEASES
RESPIRATORY AGENTS
HIV ANTIVIRALS
MULTIPLE SCLEROSIS
ANTICOAGULANTS
MENTAL HEALTH
PAIN
NERVOUS SYSTEM DISORDERS
VACCINES (PURE, COMB, OTHER)
OTHER CARDIOVASCULARS
ALL OTHERS
Absolute Value Growth (US$ BNs)
∆Change from MAT APRIL 2018 to MAT APRIL 2019
$34.7
$32.4
$37.8
$9.2
$10.4
$5.6
$10.5
-$4.7
-$3.6
$5.4
$4.5
$5.2
-$2.0
-$10 $0 $10 $20 $30 $40
Absolute Value Growth (US$ BNs)
∆Change from 2013 to MAT APRIL 2019
21Source: IQVIA, National Sales Perspectives, April 2019
Limited to Rx and OTC Insulins
On a non-discounted spend basis, the top 10 products are growing at 18.7% and account for 14.8% market share
Rank ProductNon-Discounted Spend (US$ BNs)
MAT APRIL 2019 Market Share ABS Growth Growth
1 HUMIRA $19.3 3.91% $2..2 12.82%
2 ENBREL $8.0 1.63% $0.001 0.01%
3 ELIQUIS $7.9 1.60% $2.6 47.76%
4 JANUVIA $5.8 1.18% $0.5 8.93%
5 STELARA $5.5 1.12% $1.4 33.89%
6 LYRICA $5.5 1.11% $0.3 5.94%
7 XARELTO $5.5 1.11% $0.9 18.72%
8 TRULICITY $5.1 1.04% $1.9 56.73%
9 REMICADE $5.1 1.04% $-0.3 -5.27%
10 KEYTRUDA $5.0 1.01% $2.1 71.51%
TOP 10 $72.8 14.8% $11.4 18.7%
22
U.S. NAS Launches have been trending up, with 2018 the biggest year in history (59); including 28 orphans
Source: IQVIA Institute, April 2019
0
10
20
30
40
50
60
70
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
U.S. NAS Launches 2002-2018
Follower Innovator Orphan
23
Top 10 Launches in the past 24 months (sales data through Dec 2018)
9 of the top 10 launches are specialty; 2 of the top 10 launched in 2018; Shingrix is over $1BN to date
Rank ProductSpecialty/
TraditionalCompany Indication Launch
2017 –2018
$ (MNs)
Share of
Non- Retail $
Share of
Retail $
Share of
Mail $
1 Ocrevus Specialty RocheRelapsing and Primary
Progressive MSApr-2017 $2,999.1 90.3% 0.8% 8.9%
2 Mavyret Specialty Abbvie Hep C Aug-2017 $2,158.5 23.0% 28.4% 48.6%
3 Biktarvy Specialty Gilead HIV-1 Feb-2018 $1,322.1 24.5% 60.4% 15.1%
4 Dupixent Specialty Sanofi AventisModerate-to-Severe Atopic
Dermatitis (eczema)Mar-2017 $1,071.4 5.5% 11.6% 82.8%
5 Shingrix Traditional GlaxoSmithKline Shingles Dec-2017 $1,019.8 27.5% 71.9% 0.5%
6 Spinraza Specialty BiogenSpinal Muscular
Atrophy (SMA)Feb-2017 $864.0 99.9% 0.0% 0.1%
7 Imfinzi Specialty AstraZenecaNon-Small Cell Lung
Cancer (NSCLC)May-2017 $581.7 98.7% 0.3% 1.1%
8 Vosevi Specialty Gilead Hep C Jul-2017 $468.9 22.4% 27.0% 50.6%
9 Tremfya Specialty Johnson & JohnsonModerate-to-Severe
Plaque PsoriasisJul-2017 $449.6 6.6% 13.0% 80.4%
10 Symdeko Specialty Vertex Cystic Fibrosis Feb-2018 $396.7 23.1% 1.6% 75.3%
Source: IQVIA, SMART Launch MVP, January 2019
24
A record number of innovative medicines were launched in 2018 bringing 59 new treatment options to patients
34%
66%
FDA First-in-Class
Existing Mechanism
Source: IQVIA Institute, Mar 2019
20%
80%
Predictive Biomarker
No Predictive Biomarker
27%
73%
Biologics
Non-Biologics
27%
20%
12%
8%
7%
3%3%
3%3%
12%
Oncology
Infectious Disease
Neurology
Hematology
Endocrinology
Cardiovascular
Nephrology
Ophthalmology
Respiratory
Other
49%51%
Orphan
Non-Orphan
Therapy Area Orphan Designation Type of Molecule Predictive Biomarker FDA First-in-Class
N=59
New Actives Substances (NAS) Launched for the First Time in the United States in 2018
25
The profile of successful launches significantly changed since 2000, as average sales highlight growing market challenges
Source: IQVIA National Sales Perspectives (NSP) analysis Q4 2018
0
5
10
15
20
25
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*
LC
US
D B
illi
on
s
First 12-months of sales for new branded medicines
Traditional Brands Dominate the Landscape
The Dark Ages
The Age of Oncology and Specialty
26
Examples of 2017 FDA NAS approvals which offer significant clinical advances
Brineura is a treatment for a specific
form of Batten disease, a rare disease
that can cause progressive
neurological impairments
Bavencio is a novel Anti-PD-L1 agent
in the treatment of merkel cell
carcinoma
Keytruda was approved to treat
patients whose cancers have a
specific genetic biomarker
Novartis's Kymriah CAR-T cell
therapy wins FDA approval as single
treatment for patients with acute
lymphoblastic leukemia
Rare disease Breakthrough therapy
Cell therapy Predictive Biomarker
27
Late-Stage Pipeline Products and Changes from 2017 in Selected Classes
Late-stage pipeline growth is mostly driven by specialty and niche therapies across a range of diseases
The Changing Landscape of Research and Development - Innovation, Drives of Change, and Evolution of Clinical Trial Productivity ~ Report by the IQVIA Institute for Human Data Science
Source: IQVIA Pipeline Intelligence, Dec 2018; IQVIA Institute, Mar 2019
849
223
188
179
165
162
161
118
110
92
644
Oncology
Neurology - Behavioral
Infectious Diseases*
GI Products
Immunology
Pain
Dermatology
Nervous System Disorders
Endocrinology
Vaccines
All others
17
12
9
9
8
8
7
5
-3
ALS and Other Neuromuscular Disorders
GI (Rare)
Non-Narcotic Pain
NASH
Dermatology (Biologics)
Dry Eye
Schizophrenia
Parkinson's Disease
Alzheimer's Disease
Viral Hepatitis
Number of Phase II to Registered Drugs, 2018 Changes From 2017 to 2018, Selected Classes
23
28
Although unadjusted dispensed Rx growth appears to be declining, adjusted Rx growth is up 2.6% year to date
Growth (%) of Dispensed Rx
Unadjusted Rx Adjusted Rx
0.8%
2.3%
-5.6%
-0.6% -0.8% -0.7%
-7.0%
-5.0%
-3.0%
-1.0%
1.0%
3.0%
5.0%
2015 2016 2017* 2018 MATAPR2019
YTDAPR2019
1.5%
3.9%
-3.8%
2.7% 2.5% 2.6%
-7.0%
-5.0%
-3.0%
-1.0%
1.0%
3.0%
5.0%
2015 2016 2017* 2018 MATAPR2019
YTDAPR2019
Source: IQVIA, National Prescription Audit & RxInsights, April 2019; Retail, Mail, and LTC; limited to Rx and OTC Insulins
*Note: decline between 2016 and 2017 is due to VRAF enhancement from 2017 onwards
Gro
wth
(%
)
Gro
wth
(%
)
29
New Therapy Starts for Brands Launched Less Than Two Years Prior
New Flu and Shingles Vaccines are Being Widely Used, While Thereare Fewer New Starts in Other Notable Therapy Areas
Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Source: IQVIA National Prescription Audit, Jan 2019
2.2 1.8 1.1
0.6 0.8
1.4
0.7
4.8
6.8 3.6
1.8 1.8
5.4
7.5
2014 2015 2016 2017 2018
All Other Therapy Areas Vaccines Total
Vaccines and All Others, Millions Non-Vaccines
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
2017 2018
All Others Not Shown Autoimmune HCV
COPD Diabetes CGRP - Migraine
Atopic Dermatitis
0
30
2018 Retail Share of Volume for Selected Specialty Therapy Areas and Adjusted Dispensed Prescriptions, Mn
Specialty Medicines were 2.2% of Prescription Volume in 2018,but Grew at More than Double the Rate of Traditional Medicines
Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Source: IQVIA National Sales Perspectives, National Prescription Audit, Jan 2019
24.0
19.0
11.5
8.0
1.0
20.2
18.4
10.9
5.2
0.8
Oncology
Multiple Sclerosis
HIV
Autoimmune
Viral Hepatitis
2018 2013
55%
91%
78%
75%
80%
Oncology
Multiple Sclerosis
HIV
Autoimmune
Viral Hepatitis
Non-Retail Retail
19%
3%
5%
55%
18%
31Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Traditional Medicines Made up 97.8% of Prescriptions in 2018and Most Large Therapy Areas Grew Faster than the Total Market
Source: IQVIA National Prescription Audit, IQVIA Institute, Jan 2019
Traditional Drug Prescriptions and Percentage Growth in 2018 for Top 10 Therapy Areas
4.0%5.2% 5.7%
-4.5%
4.3%
-3.8%
2.4%3.5%
-2.5%
4.2%
1,190 517 463 447 357 250 243 207 188 141
-6%
-4%
-2%
0%
2%
4%
6%
8%Number of Prescriptions Mn
2.4%
4,003
32Source: IQVIA, RxInsights, April 2019
Limited to Rx and OTC Insulins
On an adjusted script basis, the top 10 therapy areas are growing at 2.5% yet declining 1.4% on an unadjusted script basis
Rank Therapy Area
Adjusted Scripts (MNs) Unadjusted Scripts (MNs)
MAT APRIL
2019
Market
Share
ABS
GrowthGrowth
MAT APRIL
2019
Market
Share
ABS
GrowthGrowth
1 ANTIHYPERTENSIVES 1,180.1 20.3% 39.9 3.5% 669.4 16.0% -10.4 -1.5%
2 MENTAL HEALTH 527.8 9.1% 27.5 5.5% 390.0 9.3% 6.7 1.8%
3 LIPID REGULATORS 469.0 8.1% 22.4 5.0% 247.4 5.9% -2.0 -0.8%
4 PAIN 423.7 7.3% -19.6 -4.4% 392.2 9.4% -22.4 -5.4%
5 DIABETES 340.4 5.9% 14.8 4.6% 214.1 5.1% -0.1 -0.1%
6 ANTIBACTERIALS 249.0 4.3% -7.7 -3.0% 245.9 5.9% -7.9 -3.1%
7 ANTI-ULCERANTS 244.9 4.2% 7.4 3.1% 160.0 3.8% -2.2 -1.4%
8 NERVOUS SYSTEM DISORDERS 243.3 4.2% 6.7 2.9% 195.7 4.7% 1.2 0.6%
9 RESPIRATORY 208.3 3.6% 5.6 2.8% 172.2 4.1% 0.4 0.3%
10 THYROID 195.4 3.4% 3.9 2.1% 113.2 2.7% -2.9 -2.5%
TOP 10 4,082.5 70.4% 101.3 2.5% 2,800.5 66.9% -39.7 -1.4%
34Source: IQVIA, RxInsights, April 2019
Limited to Rx and OTC Insulins
On an adjusted script basis, the top 10 products are growing at 4.5% yet declining -0.9% on an unadjusted script basis
Rank Product
Adjusted Scripts (MNs) Unadjusted Scripts (MNs)
MAT APR 2019 Market ShareABS
GrowthGrowth
MAT APR
2019
Market
Share
ABS
GrowthGrowth
1 ATORVASTATIN CA 214.7 3.7% 20.8 10.7% 115.2 2.7% 4.9 4.5%
2 LISINOPRIL 175.6 3.0% 4.6 2.7% 97.4 2.3% -3.1 -3.1%
3 LEVOTHYROXINE SOD 165.4 2.8% 5.2 3.2% 96. 2.3% -1.4 -1.4%
4 AMLODIPINE BESY 155.4 2.7% 11.6 8.1% 87.6 2.1% 1.7 2.0%
5 METFORMIN HCL 107.5 1.8% 2.4 2.2% 61.2 1.5% -2.6 -4.1%
6 OMEPRAZOLE (RX) 93.2 1.6% -10.5 -10.2% 58.7 1.3% -9.5 -13.9%
7 LOSARTAN POT 103.4 1.8% 16.5 19.0% 55.7 1.4% 6.1 12.3%
8 SIMVASTATIN 87.5 1.5% -6.3 -6.8% 43.6 1.0% -6.1 -12.3%
9 GABAPENTIN 86.5 1.5% 4. 4.9% 67.7 1.6% 2.1 3.2%
10 METOPROLOL SUCCIN 84.4 1.4% 6.8 8.7% 47.3 1.1% 1.3 2.8%
TOP 10 1,273.5 21.8% 53.4 4.5% 730.4 17.4% -6.5 -0.9%
36
All of the growth seen in Retail is coming from Commercial 3rd
Party and Med D
Note: Medicaid listed here represents State Medicaid, FFS Medicaid in contained within Commercial Third Party
38
Share of Total Patient Out-of-Pocket by Cost-Sharing Type (Commercial, All Brands)
Since 2013, the proportion of patient costs paid through deductibles and coinsurance has grown
Source: IQVIA Rx Benefit Design; IQVIA analysis
54%44%
24%
29%
21%26%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2013 2017
Sh
are
of
Pati
en
t O
ut-
of-
Po
cket
(%)
Deductible
Coinsurance
Co-Pay
39Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
The Rate of Prescription Abandonment Increases as CostExposure Rises
Source: IQVIA Formulary Impact Analyzer; IQVIA Analysis, Dec 2018
30-Day New-to-Brand Abandonment by Patient Out-of-Pocket Cost in 2018 (Top Brands)
0%
10%
20%
30%
40%
50%
60%
70%
80%
New
Pa
tie
nt A
ba
nd
on
me
nt (%
NB
Rxs)
Patient Out-of-Pocket Cost
Commercial Medicare
40Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Out-of-Pocket Costs have been Rising, While $13 Billion of Costshave been Offset by Coupons for Commercially-Insured Patients
Source: IQVIA National Prescription Audit, Formulary Impact Analyzer, Jan 2019
Patient Out-of-Pocket Cost for Prescriptions in Aggregate and Value Offset by Coupons, $Bn
56 58 58 59 61
6 8 10 11
13
0
10
20
30
40
50
60
70
80
2014 2015 2016 2017 2018
Out-of-Pocket Costs Coupons
41Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Patient Out-of-Pocket Costs for Brands and Generics in Total haveDecreased by $1.23 since 2014 to $9.05 on Average
Source: IQVIA Formulary Impact Analyzer, IQVIA Institute, Jan 2019
Patient Cost Exposure and Average Costs, US$
$364.92
$450.09
$511.17
$608.89
$657.08
$258.91
$322.93 $350.75
$403.36 $427.75
$29.98 $31.68 $31.50 $31.29 $30.59
$18.50 $18.92 $18.06 $19.10 $19.10
$6.74 $6.50 $6.32 $6.28 $6.18
$10.28 $10.05 $9.60 $9.28 $9.05
$0
$40
$80
$120
$160
$200
2014 2015 2016 2017 2018
Brand WAC Price Brand Pharmacy Price Brands Final Out-of-Pocket Cost
Generics Pharmacy Price Generics Final Out-of-Pocket Cost All Products Final Out-of-Pocket Cost
$300
$400
$200
$500
$600
$700
42
Generic Shares of Dispensed Prescriptions
Generics Make up 90% of Prescriptions Dispensed, up from 75%in 2009, and are Dispensed 97% of the Time when Available
Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Source: IQVIA National Prescription Audit, Jan 2019
75%78%
80%
84%86% 87% 88% 89% 90% 90%
60%
70%
80%
90%
100%
2009 2012 2015 2018
80%
83%85%
88% 89% 90% 91% 92% 92% 92%
75%
80%
85%
90%
95%
100%
93% 94%94%
96%97% 97% 97% 97% 97% 97%
90%
95%
100%
2009 2012 2015 2018
Generic (Branded and Unbranded) Market Share,
% of Total Rx
Percent of Market Accessible to Generics, % of Total Rx
Percent Dispensed as Generic When Available
(% Generic of Rx Accessible to Generics)
% T
ota
l R
x
% T
ota
l R
x%
Eff
icie
ncy
x
43Source: RBC Capital Markets, FDA
Abbreviated New Drug Application (ANDA) approvals have accelerated since 2014; but withdrawals are increasing
ANDA withdrawals spiked in fiscal 2018 as companies realized
that “me-too” type products are unlikely to be financially viable
Company avg monthly withdrawals
(2012-2018)
9
15 14
21 2118
51
2013
2012
2014
2015
2017
2016
2018
296264
320361
494 474 489
426458
517
440409
492
651
763 781
2008
2007
2003
2002
2004
2006
2005
369
2012
2009
2010
20
11
2013
2014
2015
2016
2017
2018
ANDA approvals (2002-2018)
44Source: FDA, IQVIA
High-level results from FDA approvals vs launch analysis
Count of ANDAs that launched as of December 2018
2013: 370 approvals, of which 264 (71.4%) have launched
2014: 383 approvals, of which 257 (67.1%) have launched
2015: 532 approvals, of which 352 (66.2%) have launched
2016: 586 approvals, of which 350 (59.7%) have launched
2017: 806 approvals, of which 436 (54.1%) have launched
2018: 723 approvals, of which 261 (36.1%) have launched
Count of ANDAs yet to Launch as of December 2018
2013: 370 approvals, of which 106 (28.6%) have not launched
2014: 383 approvals, of which 126 (32.9%) have not launched
2015: 532 approvals, of which 180 (33.8%) have not launched
2016: 586 approvals, of which 236 (40.3%) have not launched
2017: 806 approvals, of which 370 (45.9%) have not launched
2018: 723 approvals, of which 462 (63.9%) have not launched
1. 2017 and 2018 had a record number of
approvals
2. The average launched ANDAs in year 1 from
2013 to 2018 is 35.6% (1,209 launched of
3,400 approvals)
1. Some approvals were not commercialized due
to financial viability for the manufacturer
(especially with the onset of generic price
deflation in 2015)
45Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
At an Invoice Price Level, Impact of Losses of Exclusivity are Expected to be 46% Greater in the Next Five Years Including Biosimilars
Source: IQVIA Market Prognosis, Mar 2019
Lower Brand Invoice Spending Due to Loss of Exclusivity US$Bn
-0.1 -1.2 -1.2 -0.9-5.0
-1.7 -3.2 -3.9 -2.4-4.7
-11.5-13.3 -12.5
-16.0-10.5
-12.5
-18.7
-11.6-17.8
-28.2
-11.6
-14.5 -13.7
-16.9-15.5
-14.2
-21.9
-15.5
-20.2
-32.9
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Biologics Small Molecules
-$72Bn
-$105Bn
Total Brand Losses Due to LOE Total Loss per Year
Forecast
46Source: FDA and CDER List of Licensed Biological Products; accessed on March 21, 2019
7 of the 18 FDA approved biosimilars have launchedApproval
Count
FDA
Approval DateBiosimilar
Biosimilar
Manufacturer
Reference
Product
Reference
ManufacturerMolecule
Launch
Status
1 March 2015 Zarxio Sandoz Novartis Neupogen Amgen filgrastim 2015
2 April 2016 Inflectra Celltrion Remicade Janssen (J&J) infliximab 2016
3 August 2016 Erelzi Sandoz Novartis Enbrel Amgen etanercept
4 September 2016 Amjevita Amgen Humira Abbvie adalimumab 2023
5 May 2017 Renflexis Merck & Co Remicade Janssen (J&J) Infliximab 2017
6 August 2017 Cyltezo Boehringer Ingelheim Humira Abbvie adalimumab
7 September 2017 Mvasi Amgen Avastin Genentech bevacizumab 2019
8 December 2017 Ogivri Mylan Herceptin Genentech trastuzumab
9 December 2017 Ixifi Pfizer Remicade Janssen (J&J) Infliximab
10 May 2018 Retacrit Hospira (Pfizer) Epogen Amgen epoetin alfa 2018
11 June 2018 Fulphila Mylan Neulasta Amgen pegfilgrastim 2018
12 July 2018 Nivestym Hospira (Pfizer) Neupogen Amgen filgrastim 2018
13 October 2018 Hyrimoz Sandoz Humira Abbvie adalimumab 2023
14 November 2018 Udenyca Coherus BioSciences Neulasta Amgen pegfilgrastim 2019
15 November 2018 Truxima Celltrion Rituxan Genentech rituximab
16 December 2018 Herzuma Celltrion Herceptin Genentech trastuzumab
17 January 2019 Ontruzant Samsung Bioepis (Merck) Herceptin Genentech trastuzumab
18 March 2019 Trazimera Pfizer Herceptin Genentech trastuzumab
Launched Launch delayed No launch announced
47
Biologic spending could grow more dramatically without future biosimilar penetration
98 117 135 153 159 177 196 222 243 258
1212
1211 24
32
36
38
46
62
109130
147165
189
217
250
287
330
379
109
130
147
165 182
210
232
260
289
319
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Biologic Molecules Without Biosimilar Competition in Year Biologics With Competition in Year (Including Original and Biosimilar)
Biologic Total Scenario Without Further Biosimilars After 2017 Biologics Total ForecastSource: IQVIA MIDAS, Jun 2018; Institute Dec 2018
Notes: Line on chart represents biologic spending using average growth of molecules not facing competition in 2017 continued to 2023 to represent what spending would have been without new molecules facing biosimilar competitors. Segments for biologics with and without competition are modeled using the average historic growth rates and expected entrance of biosimilars and price and volume changes associated with biosimilar entry.
Forecast
48
Narcotic Analgesic Dispensed Volumes in Morphine Milligram Equivalents (MME) Bn
Prescription opioid volume peaked in 2011 at 246 billion milligrams of morphine and has declined by 43% to 141 billion
0
50
100
150
200
250
1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
A report by the IQVIA Institute: Medicine Use and Spending in the U.S.: A Review of 2018 and Outlook to 2023
Source: IQVIA National Prescription Audit, Dec 2017; IQVIA Xponent, Feb 2019
-17%
-43%
90+ MME per Day50=<90 MME per Day
49A report by the IQVIA Institute: Medicine Use and Spending in the U.S.: A Review of 2018 and Outlook to 2023
Opioid prescribing has declined across the country
Source: IQVIA Xponent Jun 2018, US Census Bureau, Mar 2018
Declines have been greater in some of the higher per capita states (Alternative view)
AL
AK
AZ
AR
CA
CO
CT
DE
DC
FLGA
HI
ID
IL
IN
IA
KS
KY
LA
ME
MD
MA
MI
MN
MS
MO MT
NE
NV
NH
NJ
NM
NY
NC
ND
OH
OK
OR
PA RI
SC
SD
TN
TX
UT
VT
VA
WA
WV
WIWY
All States
400
600
800
1000
1200
1400
-750-650-550-450-350-250-150-50
TR
x p
er
10
00
Pop
ula
tion
20
11
Delta in TRx per 1,000 to 2018
Opioids TRx per 1,000 Population in 2011 and absolute change to 2018
Greatest per capita declines →
2011 to 2018
50
Prescriptions and Medication Assisted Treatments (MAT) Dispensed Prescriptions
Opioids dispensed prescriptions have declined while Medication Assisted Treatment prescription volume increases
A report by the IQVIA Institute: Medicine Use and Spending in the U.S.: A Review of 2018 and Outlook to 2023
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
0
10
20
30
40
50
60
70
20
14
20
15
20
16
20
17
20
18
To
tal D
isp
en
se
d P
rescri
ptio
ns (
Mn
)
To
tal D
isp
en
sed
Pre
scrip
tion
s (
Mn
)
Calendar Quarters
Source: IQVIA Xponent Feb 2019
51Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
The Relative Per Capita Rates of Prescription Opioids andMedication-Assisted Treatment use Vary Widely by State
Source: IQVIA Xponent, US Census Bureau, Feb 2019
Retail Dispensed Prescriptions for Opioids and Medication-Assisted Treatments per Capita By State
52
Prescription opioid use could decline by one-third to one-half over the next five years from current levels
Source: IQVIA National Prescription Audit, Sep 2018; IQVIA Institute Dec 2018Note: States with MME per capita below the average of the lowest quartile do not change in the convergence scenario.
0
100
200
300
400
500
600
700
80019
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
MM
E P
er
Capita
20
18
20
19
20
20
20
21
20
22
20
23
Scenario: 2023 Usageconverges at average ofquartile of lowest percapita states in 2018
Scenario: 2023 Absoluteusage declines in the nextfive years equal to the lastfive years
Scenarios
A report by the IQVIA Institute: Global Use of Medicines: Outlook to 2023
53
Key takeaways
• Overall usage of prescription opioids has declined 17% (2018) and 43% (since 2011)
• Biggest declines in high MME/day patients
• State variations in per capita usage and declines since 2011 include multiple overlapping triggers (including
policies, regulations, and other factors)
• States have very different challenges regarding prescription opioids, and this is illustrated by the different
relationships/levels of usage of Medication-assisted treatment
• The pain r&d pipeline is the 5th largest of all therapy areas but replacement for opioid pain relief continues to be
elusive
• The outlook includes scenarios for continued aggressive reduction in usage, as well as potential moderation of
the current downward trends
54
Fentanyl is 50-100x more potent than morphine and is lethal in very small doses, as little as 0.25 milligrams1
1: https://americanaddictioncenters.org/fentanyl-treatment/similarities
2: https://www.foxnews.com/health/as-opioids-become-taboo-doctors-taper-down-or-abandon-pain-patients-driving-many-to-suicide
“A report by the Massachusetts Department of Public Health, widely cited by many pain experts, said that among 477 people whose deaths were opioid‐related in 2018, 90 percent, or 423 of them, tested positive for fentanyl – a telltale sign of illegal opioid use.”2
55
National Survey on Drug Use and Health, 2016
Only 37.5% script opioids are obtained from Health Care Providers
Note: Respondents with unknown data for Source for Most Recent Misuse or who reported Some Other Way but did not specify a valid way were excluded
Note: The percentage do not add to 100 percent due to rounding
Given by, Bought from, or Took from a Friend or
Relative, 53.0%Got through Prescription(s) or Stole from a Health Care
Provider, 37.5%
Some Other Way, 3.4%
Bought from Drug Dealer or Other Stranger, 6.0%
➢ 35.4% received Prescription
from One Doctor
➢ 1.4% received Prescriptions
from More Than One Doctor
➢ 0.7% stole from Doctor’s
Office, Clinic, Hospital or
Pharmacy
➢ 40.4% received From Friend
or Relative for free
➢ 8.9% Bought from Friend or
Relative
➢ 3.7% Took from Friend or
Relative without Asking
56
There are a number of metrics to measure improvements in adherence
Medication adherence is the core of the healthcare value chain
Source: IQVIA, Advanced Analytics, Information Partner Services
Stakeholders benefit from improved medication therapy adherence.
The Star Rating therapies have the largest ability to impact the value chain.
Stakeholder Value Chain
STAR RATING
THERAPY
ADHERENCE
PHARMACY
PHYSICIAN
CMSINSURER
HOSPITAL
PATIENT
Better Health defined by:
Lower Total Medical Costs
Less ER visits
Fewer Hospitalizations and
Readmissions
PATIENT
Increased CMS reimbursements
due to better patient outcomes:
Less ER Visits
Reduced admissions, particularly
preventable patient readmissions
HOSPITAL
Significant reduction in Total Allowable Costs
and increased CMS reimbursements,
particularly for the most vulnerable populations.
Improved Patient Health
Improved relationship with patients.
INSURER
Improved community engagement
defined by:
Rx growth
Improved patient outcomes
Increased patient store traffic
PHARMACY
Increased CMS reimbursements
and improved patients ratings:
Increase in patient engagements
Improved patient outcomes
.
PHYSICIAN
Reduced Total Healthcare Costs
Improved Patient outcomes
CMS
THE ADHERENCE VALUE PROPOSITION
57
Adherence is not uniform regionally and varies by different factors, such as method of payment: Med D is most adherent
State Level
Market
Adherence
Rates by Method
of Payment –
Diabetes
Source: IQVIA, State Level Market Adherence Rates by Method of Payment, MAT December 2018
Significant range of
variability between
states
58Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Prescription Adherence has Improved Since 2016 Across all Regions,Particularly in Medicare, Which Ranged from 78–81% in 2018
Source: IQVIA Real World Evidence, Longitudinal Prescription Data, Dec 2018
Percentage of Patients Adherent to Dispensed Prescriptions by Region
58.0%
65.1%
75.8%
68.1%
57.6%
69.1%
77.7%
71.2%
60.9%
69.5%
79.8%
72.2%
60.5%
73.1%
81.2%
74.9%
60.0%
73.4%
80.8%
75.0%
57.5%
69.3%
76.8%
70.8%
51.9%
68.6%
77.9%70.8%
Region Medicare Part D Commercial MedicaidAll Pay Types
49.8%
64.3%
73.4%
66.3%
West
Nort
he
ast
Mid
we
st
So
uth
59
States with Highest, Lowest and Average Adherence Rates per Pay Type, 2018
Adherence is a Key Driver of Better Outcomes in Chronic TherapyAreas, but Varies by State and Insurance Type
Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Source: IQVIA Real World Evidence, Longitudinal Prescription Data, Dec 2018
MS
MN
ID
MS
MN
OR
AR
VT
IA, NY
Least adherent state
Most adherent state
Average adherence
Medicare Part D Commercial Medicaid
60
Adherence rates in each market are more than 20 points higher for patients getting 90-day Rxs
90-day Rxs are an effective way to increase adherence rates
50%
80% 56%
82%
53%
80%
0
5
10
15
20
25
No 90-day Any 90-day No 90-day Any 90-day No 90-day Any 90-day
DIABETES RASA STATINS
Rx
Vo
lum
es
Mill
ion
s
Adherent to STAR therapy Not Adherent to STAR therapy
Source: IQVIA, Longitudinal Patient Data, MAT December 2018
61
Actual Adherence Rates include patients in the light and dark blue colors combined.
Across STAR Therapy categories, 9-11% of patients have the greatest influence on retailers’ adherence rates
Approximately 5% of
patients are on the cusp
of being adherent.
Retailers may be able to
convert these patients
with minor interventions.
At the same time, an
almost equal proportion of
patients have a PDC
between 80 and 85% and
are at risk of becoming
non-adherent.
67% 70%65% 65% 62%
5%5%
6% 6%6%
4%4%
4% 5%5%
24% 22%25% 25% 28%
40%
50%
60%
70%
80%
90%
100%
TOTAL RETAIL CHAIN FOOD MASS INDEPENDENT
>=85% 80-<85% 75-<80% <75%
76M Pts 61M Pts 10M Pts 6.4M Pts 8.7M Pts
Source: IQVIA, Longitudinal Patient Data, MAT December 2018
62
Clinically Complex Patient1 Sociodemographically Complex Patient1
• Poverty – Low income and/or no liquid assets
• Low levels of formal education, literacy or health
literacy
• Limited English proficiency
• Minimal or no social support – not married, living
alone, no help available for essential health
related tasks
• Poor living conditions – homeless, no heat or air
conditioning in home or apartment, unsanitary
home environment, High risk of crime
• No community resources – social support
programs, public transportation, retail outlets
• Multiple Chronic Conditions
• Severe Primary Condition (e.g.,
Severe heart failure, metastatic
cancer, end-stage renal disease)
• Concurrent mental and physical
health problems
• Disease affects multiple organ
systems
• Disease causes significant
functional deficit or disability
• Condition requires treatment by
multiple providers and/or
specialized sites of care
1“Risk Adjustment for Socioeconomic Status or Other Sociodemographic Factors TECHNICAL REPORT August 15, 2014 “, National Quality Forum
“When used in accountability applications, performance measures that are influenced by factors other than the
care received, particularly outcomes, need to be adjusted for relevant differences in patient case mix to avoid
incorrect inferences about performance.“ 1
The Case for Risk Adjustment in Medication Adherence
63
Non-Adherent Antidepressant Patients are the least adherent to their Star Therapy Meds
Patients who are Adherent to Antidepressants are the most adherent to their Star therapies
80.2% 84.6% 82.4%
49.4% 52.4% 49.1%
68.4%73.6% 71.7%
19.8% 15.4% 17.6%
50.6% 47.6% 50.9%
31.6%26.4% 28.3%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
DIABETES RASA STATINS DIABETES RASA STATINS DIABETES RASA STATINS
Adherent to Antidepressants Not Adherent to Antidepressants Not on Antidepressants
Adherent to STAR therapy Not Adherent to STAR therapy
Source: IQVIA, Longitudinal Patient Data, MAT December 2018
64
There are 4 emerging consumerization themes to consider in the ever-changing pharmacy landscape
Source: Drug Store News, Flipping the Script: The state of the pharmacy industry, August 2018
Expanded Care
• Diabetes: Counseling
patients – tend to visit the
pharmacy 3x more than an
average shopper
• Medication Therapy
Management: Pharmacists
work to boost adherence
through medication therapy
management – enhances
patient care and could result
in more revenue
• Expanded Clinical Reach:
Vaccines and travel clinics,
point-of-care testing, and
increased clinical role of the
pharmacy
Finding the Time
• Pharmacy Automation:
Improve efficiency and free
up time to enable 1)
personalized patient care and
2) clinical patient touchpoints
with a pharmacist
• Med Synchronization:
Patients can receive all
medications 1x a month
versus multiple pharmacy fills
throughout the month
Convenience – Inside
& Out
• Convenience at home:
Delivery of medications to
homes and in-home
counseling are on the
upswing in response to
Amazon as a looming
competitor
• Telepharmacy: Meeting the
needs patients in rural and
remote areas – expected to
rise~3% by 2022
• Med Synchronization:
Patients can receive all
medications 1x a month
versus multiple pharmacy fills
throughout the month
Considering Cost
• Prescription discount
cards: Lower prices and
improving patient care/
compliance
1 2 3 4
65V&A Conference 2019 - Digital Health Presentation
The majority of the payers surveyed are making investments across Digital Health solutions
Digital Therapeutics
Telehealth WearablesSmart Drug
Delivery
Connected Point of Care Diagnostics
Health Education or Other Apps
Percent of payers that are currently investing in each type of Digital Health solution
33% 75% 33% 50% 75%25%
OneGuideOscar HealthEngage Healthy PregnancyRxMentor
1. Payer Priorities
Source: IQVIA Payer Survey (n=24)
66Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.
Source: IQVIA Market Prognosis, Mar 2019; IQVIA Institute, Apr 2019
Total Spending on Medicines and Growth US$Bn
Net Total Spending Growth will Average 3–6% over the Next FiveYears, while Invoice Growth will Average 4–7%
-5%
0%
5%
10%
15%
20%
0
100
200
300
400
500
600
700
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Gro
wth
Sp
en
din
g U
S$
Bn
Net Spending Invoice to Net Difference
Net Spending Growth Invoice Spending Growth
Forecast
67
What themes should stakeholders recognize today?
Pharmacies
• Reimbursement
• Controlled Substances
• Access to Specialty Drugs
• Purchasing Alliances
• Track and Trace
• Amazon and the cash customers
Generic Manufacturers
• Purchasing Alliances
• Portfolio Optimization (“Shrink to Grow”) /
Market Saturation
• Brand /niche drugs (complex generics)
• Generic Price Deflation
• Which approvals to launch?
Wholesalers
• Contract Negotiations
• Controlled Substances
• Generic Price Deflation / Slow Brand Inflation
• Track and Trace
• Purchasing Alliances
Payers
• Managing Specialty Drug Costs
• Rising Oncology costs
• Formularies blocks and exclusive launches
Brand/Specialty Manufacturers
• Price increase backlash
• Becoming more specialized / Oral Specialty
• Declining Hep C and Pain Dollars
• Orphan Drugs
• Copay accumulators
Consumers
• Rising costs: high out-of-pocket costs /
coinsurance / accumulators
• Quality of Insurance Coverage
• Specialty Tiers
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Strong forces are driving changes in healthcare
Notes: IPC=integrated patient care
Source: IQVIA Consulting Services; Life Sciences Trends and Growth Areas
Aging population will drive more demand for mental care, homecare
and assistance, social capital and self-management services
Rising cost of care and increasing scrutiny around value will need a
structural re-appraisal of the payer role and new sustainable models
Rising prevalence of chronic diseases will drive greater demand for
disease management programs (e.g. prevention, early diagnosis, IPC)
Adherence/Compliance remains largest avoidable cost for healthcare systems
Increasing connectivity will drive convergence of solutions (e.g. mobile health,
remote monitoring, sensor-enable pills, etc.) and Healthcare Consumerism
Patient Centricity: Patients are becoming more involved in healthcare
decision making, choices, and becoming vocal about innovation requirements
69
These changes unlock new value propositions
Source: IQVIA Consulting Services; Life Sciences Trends and Growth Areas
Aging
Population
Integrated Care
Medicine
Aging
Population
Precision / Predictive
Medicine
Aging
Population
Outcomes Based
Medicine
Aging
PopulationEmpowerment
Medicine
Aging
Population
Medicine
Democratisation
Integrated care for complex chronic diseases, solutions
that help to close gaps in treatment
Disease detection, precise diagnosis and rational prescribing
Rational Prescribing and guaranteed outcomes
Information-based healthcare, improve patient outcomes by
providing daily solutions to HCPs and Providers
Any time, any place medicine (e.g. homecare, telemedicine
and virtual physician visits, etc.)…Walmart, Amazon, Apple etc
70
Disclaimer:
• The analyses, their interpretation, and related information contained herein are made and provided subject to the
assumptions, methodologies, caveats, and variables described in this report and are based on third party sources
and data reasonably believed to be reliable. No warranty is made as to the completeness or accuracy of such
third party sources or data.
• As with any attempt to estimate future events, the forecasts, projections, conclusions, and other information
included herein are subject to certain risks and uncertainties, and are not to be considered guarantees of any
particular outcome.
• All reproduction rights, quotations, broadcasting, publications reserved. No part of this presentation may be
reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording,
or any information storage and retrieval system, without express written consent of IQVIA.
• ©2019 IQVIA Incorporated and its affiliates. All rights reserved. Trademarks are registered in the United States
and in various other countries.
Thank you
71
Doug Long, Vice President, Industry Relations
Doug Long is Vice President of Industry Relations at IQVIA (formerly QuintilesIMS), the world’s
largest pharmaceutical information company. IQVIA offers services to the pharmaceutical industry
in over 100 countries around the globe. Doug has been with IQVIA since 1989.
His fundamental task is to help secure data for all existing and new databases supported by
IQVIA, manage supplier, manufacturer & association relationships, and develop information for
data partners. As direct consequence of his involvement in these areas, Doug has considerable
experience with, and a unique perspective on, the changing U.S. and global healthcare
marketplace and pharmaceutical distribution.
Doug is a frequent industry speaker and the recipient of many awards from trade groups. Before
joining IQVIA Doug held positions at Nielsen Market Research for 16 years in various sales and
marketing capacities. A native of Illinois, Doug received a BA from DePauw University and holds
an MBA in management from Fairleigh Dickinson University.