FirstWord Lists: Which of the Top 10 pharma companies in 2017 will rely most on products that have already acted as growth resistors?

FirstWord Dossier’s recent report on the Top 10 pharmaceutical companies in 2017 details which companies will come to dominate the global pharmaceutical market in 2017. In addition to evaluating which products will act as drivers of growth for these companies, FirstWord has also looked at which products are forecast to retard growth.

The top 10 companies in 2017 have varying continued dependence on their five biggest resistors to growth over the 2012-17 period. FirstWord has conducted analysis to see which companies will have the greatest continued reliance on the five products that are forecast to hold back sales growth over the 2012-2017 period.

AstraZeneca and Johnson & Johnson stand out as remaining heavily reliant on five products that will already have suffered from sales declines over the preceding five year period (see table below). This paints a relatively bleak picture for these companies going into the 2017-2022 period, as they will already see more than 25 percent of their revenue streams faced by revenue erosion.

Source: FirstWord Dossier

AstraZeneca’s five resistors are forecast to have seen their sales fall by a combined $6.9 billion during the 2012-17 period, but the company is forecast to still derive sales of $7.6 billion from these products in 2017 – equivalent to 32 percent of company revenues. This would suggest that AstraZeneca will continue to face a significant fall in revenue over the years after the end of the 2012-17 period driven by the same five products that are forecast to cause the company problems through to 2017. Analyst consensus expects Crestor (rosuvastatin) to have sales decline from $6.3 billion in 2012 to $3.3 billion in 2017, at which point it will still represent 13 percent of the company’s revenues. To offset the loss of sales of over $3 billion would require the launch of three products that would be classified as blockbuster products – a not inconsiderable demand.

Johnson & Johnson is the company forecast to have the second greatest reliance in 2017 on the five products that are expected to act as the greatest drag on sales growth through to the end of the 2012-17 period. Johnson & Johnson’s reliance on Remicade (infliximab) is the major cause of this phenomenon with it expected to still contribute 19.7 percent of the company’s pharmaceutical revenues in 2017. Remicade’s sales are expected to continue their gradual decline as a result of increased competition within the anti-TNF market space. Although the product will continue to be a very important source of revenues for Johnson & Johnson, it will not serve to grow revenues.

By contrast to AstraZeneca and Johnson & Johnson, companies including Pfizer, Novartis and Sanofi would appear to have a comparatively rosy outlook. Pfizer is forecast to derive just 5 percent of revenues in 2017 from the five products that have acted as the biggest resistors to growth over the 2012-17 period. Products such as Lipitor (atorvastatin) and Celebrex (celecoxib) will by 2017 have seen the majority of their sales eroded by generic competition with only a small rump of sales left in ex-US markets. This will leave Pfizer in the enviable position of being able to look forward to driving sales growth from its new products, such as Eliquis (apixaban) and Xeljanz (tofacitinib), rather than having to worry about the continued loss of sales from competition to legacy products.

Similarly Novartis (which analyst consensus expects to retain its position as the number one pharmaceutical company in the world in 2017) is forecast to derive 8 percent of its sales in 2017 from the five products that are its biggest resistors to growth over the 2012-17 period. These five products, which include Diovan (valsartan) and Gleevec (imatinib), are all forecast to have seen significant declines in their sales throughout the 2012-17 period, whilst at the same time analyst consensus shows overall company revenue increasing rapidly as a result of the anticipated growth of newer products such as Afinitor (everolimus) and Gilenya (fingolimid).

The analysis shows that although the majority of the companies that are forecast to be leading the pharmaceutical market in 2017 have much to look forward to in terms of revenue growth, there are still some companies that have work to do to shore up their overall revenue.

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