Pfizer clinging on to top spot in 2016

One of the key drivers behind Pfizer’s $68bn acquisition of Wyeth last year, a need to satisfy its apparent obsession with maintaining its position as the industry’s biggest seller of pharmaceutical products, looks like it is paying off, new consensus forecasts released by EvaluatePharma in its World Preview 2016report reveal. With prescription drug sales of $47.1bn in 2016 Pfizer will come out on top, just ahead of Merck & Co at $46.3bn, another of last year’s mega-mergers with its $41bn purchase of Schering-Plough.

However, Pfizer and Merck’s lofty rankings mask the fact that their mega-mergers were defensive plays against precipitous patent cliffs as sales are forecast to remain flat or decline over the next seven years. Conversely, Abbott Laboratories is set to record an impressive 7% annual growth in prescription sales, driven by strong demand for its rheumatoid arthritis therapy Humira (Humira set to steal Avastin’s crown, May 3, 2010). A surprise entrance into the top ten league table is generics giant Teva with 7% annual growth, generating sales of $20.8bn in 2016, leaping ahead of more traditional big pharma names like Bristol-Myers Squibb, Eli Lilly and Amgen (see table below).

WW Prescription (Rx) Pharmaceutical Sales WW annual sales ($bn) Market Share Market Rank
Rank 2009 2016 CAGR (09 - 16) 2009 2016 2009 2016
1  Pfizer * 55.3 47.1 -2% 8.6% 6.0% 1 1
2  Merck & Co * 41.6 46.3 +2% 6.5% 5.9% 2 2
3  Novartis 37.3 46.0 +3% 5.8% 5.9% 4 3
4  Roche 36.0 43.9 +3% 5.6% 5.6% 6 4
5  Sanofi-Aventis 38.3 38.9 +0% 6.0% 5.0% 3 5
6  GlaxoSmithKline 36.3 38.7 +1% 5.6% 4.9% 5 6
7  Abbott Laboratories 16.5 26.1 +7% 2.6% 3.3% 10 7
8  Johnson & Johnson 21.3 24.8 +2% 3.3% 3.2% 8 8
9  AstraZeneca 31.6 22.1 -5% 4.9% 2.8% 7 9
10  Teva Pharmaceutical Industries 12.6 20.8 +7% 2.0% 2.7% 15 10
* Proforma data in 2009 (Pfizer+Wyeth / Merck+Schering-Plough)

Changing the perception of Teva

The appearance of Teva in the league table of prescription sales is further proof, if any were needed, of the extent the patent cliff will hurt the traditional big pharma groups while providing a massive boon for generics players (Vantage Point - boom time for generics as patent cliff looms large, May 18, 2009).

It also raises the question of how Teva should be perceived within the industry. Historically the Israeli group has always been labelled foremost as a generics player, the only one with the size and clout to stand up to and challenge the biggest pharma companies. Yet Teva’s recent M&A and licensing deals point to an increased appetite and desire to build a pipeline of novel drugs and become more involved in the world of branded and patented product development and commercialisation.

As such, Teva could gradually come to be seen as essentially another big pharma giant, not dissimilar from the likes of Novartis which plays a major role in both branded and generic markets.

The table above also reveals a closing of the gap between these pharma giants over the next seven years, with the range of pharmaceutical sales within the top ten companies much narrower in 2016 than last year.

While Pfizer is currently forecast to retain top spot, Merck & Co, Novartis and Roche are breathing down Pfizer’s neck, suggesting that one or two major patent decisions, or further mega-mergers, will significantly change the league table standings come 2016.

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