The biologics market is one of the fast-growing healthcare and pharmaceutical domains owing to its potential scope for higher profits for players and investors in the coming years. Wide prevalence of chronic illness especially cancer and high spending for healthcare treatment among a chunk of the global population present two vital factors driving the market. However, the prospect of the market development completely depend on the nature of various regulations and laws of a particular country in respect to other country in terms of marketing biological products as the development of these products are subjected to government regulations. Thus, it is very important for investors to be aware of the government regulation regarding biologic products of that particular country in which they are looking for to invest their capital.
This blog will briefly deal with the conceptual understanding of biologics or biological products and existing trend for the market expansion, which ultimately pave a way for determining various market opportunities of these products in the future. Several factors are coming into play major roles in shaping the future of this market but the significance of their roles can be diminished or expanded as per the change in the policies of governments over the coming years. However, some definite conclusion about the market future can be made by evaluating the existing market trends as these factors have full potentials to drive the market expansion at a rapid pace in the near future.
Biologics and its Applications
Biologics, also known as biologic products, are range of drugs primarily designed for the treatment of numerous microbial diseases and chronic illness including cancer. These products are basically derived or produced from various components of a living organism or organisms associated with animal, human, and microorganisms. Some of the notable products derived from organisms are gene-based biologics, vaccines, cellular-based biologics, blood components, tissues, monoclonal antibodies, and recombinant hormones/proteins. Several types of advanced biotechnology to extract these biologics, which are widely used for the treatment of several health conditions or diseases such as Crohn’s disease, rheumatoid arthritis, anemia, hormone, respiratory syncytial virus (RSV) prophylaxis, hepatitis B, hemophilia, chronic migraine, HPV prevention, and inflammatory bowel disease. According to the 2018 report by the World Health Organization (WHO), chronic diseases were responsible for over 41 million people death each year globally. Following cardiovascular diseases, cancer death accounted for about 9 million death every year. As per the data by the American Cancer Society, in 2018, an estimated of 1.73 million new cancer cases were diagnosed and 0.6 million died of the disease in the US. As per the Globocan Report 2020, the global has witnessed nearly 20 million new cancer cases and about 9.9 million are reported cancer deaths.
Biologics market drugs are also sometimes known as genetic modifying proteins as they can alter the behavior or manner of natural biologic cells or intra-cells to control the level of proteins production or modify hormones of a patient. One key aspect of the gaining high traction of these products among patients is that these drugs produce agents that can activate or suppress the immune system, which provides effective treatment result. Over the years, biologics have revolutionized treatment system or techniques for various chronic illness especially for cancer treatment or patients with rare diseases. With the advancement of technology, these drugs offer better solutions as compared to traditional or conventional methods for the treatment of patients, who require certain intervention or interference in the immune system. At present, the drugs are available in powder form, which is normally administered into a patient’s body by injection or infusion as these proteins are easily dissolvable and would be less effective if taken orally.
Major Trends of the Biologics Market
Followings are five major trends that an investor needs to look into for better returns on investment as these factors play vital roles in the market expansion in the near future.
1. COVID-19 Vaccine Development
Several pharmaceutical giants started joining into an intense race to find vaccines to cure coronavirus disease right from the outbreak of the COVID-19 pandemic, which originated in Wuhan province, China in December 2019. Scientists across the globe have conducted a series of research and studies about the crucial role of biological products to enhance immune system and other measures to protect or prevent from high-contagious disease. Due to public pressure and alarming nature of virus spread worldwide, several initiatives had been taken by governments of different countries to encourage development of COVID vaccines by granting massive subsidies to their domestic pharmaceutical companies. Many firms had to collaborate with renowned academic institutions for conducting extensive research and laboratory experiments in a view to find a COVID-19 vaccine. As a result, demand for biologics has been rapidly increased during the pandemic.
2. Favorable Government Regulations for Biologics Drug Development
Unease and lengthy process in the approval of biologics drugs by regulatory agencies has been a big challenge for the manufacturers as these products had to meet certain criteria about drugs components and effectiveness regarding antibodies and antigens. Over the years, however, several changes had been made by governments across the globe to make the approval process easy or at least less complicated. Among regulators, the US Food and Drug Administration (FDA) has led the restructuring of its existing regulations in favor of biologics drugs developers and manufacturers, which allowed the firms to implement innovative technologies and expand testing methods. One of the key steps taken by the FDA for the expansion of drug development was the elimination of outdated standards that restricted testing capacities. Ranging from standard solutions to biologics license applicants to storage conditions for products, the FDA amended its regulations to establish a favorable process for the pharmaceutical industry.
3. Extensive R&D Programs for Better Chronic Illness Treatment
Considering a wide prevalence of chronic illness such as cancer globally, the demand for advanced diagnostics and innovative drugs for the treatment has been rising significantly. Over the years, companies across the globe have invested a huge funding for R&D programs to expand the laboratory testing for genetically-engineered biologics for various health condition treatments including rheumatoid arthritis and Crohn’s diseases. Main focus for R&D programs is on the improvement of gene sequencing and cell modification, which may allow to target a specific area of the immune system of a patient.
4. High Returns on Investment for Biologics Products
Effective treatment result and high prices of biologics products are two key reasons that cause the drugs manufacturers to generate heavy returns on investment. Increasing demand for biologics products can be a result of slowdown of innovation rate for the small molecules methods, which are extensively used for the treatment of rare diseases. Despite the high price of biologics treatment, the failure of other substitute treatment helps to push the market expansion for biologics.
5. Existing Massive Pipeline of Biologics Drugs
Rising success rates for clinical trials and laboratory testing for biologics, many pharmaceutical firms are lining up to develop innovative drugs and effective biologics to boost the disease treatment worldwide. Several drugs are in its initial phase for clinical trial and some of them are in the final phase of the test, i.e. phase III clinical test that show the existing massive pipeline of biologics. Pharmaceutical giants such as Novartis International AG, F. Hoffmann-La Roche AG, Amgen Inc., GlaxoSmithKline PLC, and Eli Lilly and Company have spent on several antibody drugs development and some of them are in the final phase. For instance, Moreover, Novartis International AG, a Switzerland-based pharmaceutical company, offers a series of monoclonal antibodies in pipeline including OMB157, Xolair, RTH258, Cosentyx, and Lucentis in phase III clinical trial while monoclonal antibodies QGE031 and BYM338 are in phase II clinical trials.
Market Opportunities in Developing Countries
Although the biologics market has a formidable space in various developed countries especially in North America and Europe, the popularity of these products are relatively low in demand in low or middle income economies of developing countries. Lack of availability of products, high cost treatment, and lack of awareness for advanced treatment process among a large number of patients act as key restraints that hinder the market growth in various parts of Africa, Latin America, and Asia Pacific. However, the growing number of patients suffering from rare disease and chronic illness in developing regions along with rising preference for consumers to spend more on healthcare issues present several key opportunities of the products. Taking into account of the series of development of technologies and rising R&D programs, it is possible to develop cost-effective drugs for both chronic and rare disease patients. Reducing the price of biologics drugs and easy accessibility of drugs can bring a drastic change in the potential of market opportunities in developing countries.