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Specialty Drugs Top the Trends in the 2014 Pipeline

Special Feature Fifth Annual Payers' Guide to New FDA Approvals March 2014 Volume 7 - Payers' Guide
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Drug development is fraught with significant risks for failure and astronomical expenditures, but its successes are rewarded by many lives saved and high monetary compensations. According to the Pharmaceutical Research and Manufacturers of America (PhRMA), for every 5000 to 10,000 compounds in the pipeline, only 1 compound makes the full development route through the US Food and Drug Administration (FDA) approval process.1 This miniscule ratio explains why, on average, it costs $1.2 billion to get 1 drug to market––a cost that includes the expenditures for the failed compounds for the specific company.1

Furthermore, the investment in time could discourage many companies from entering the business of developing medicines: according to PhRMA, it takes 3 to 6 years to get a drug through the discovery phase and another 6 to 7 years to get a drug to the FDA review phase.1 Even the recently expanded priority and accelerated reviews by the FDA do not cut the time by more than a few months, which pales in the face of the total 9 to 13 years of drug development. The recent introduction of breakthrough therapy designation is significant, because it can cut the development process by several years, allowing the FDA to introduce important medicines to the market based on very promising phase 2 rather than phase 3 clinical trial results.

With all these challenges facing drug manufacturers, perhaps it is not surprising that the rate of new molecular entities approved by the FDA in 2013 was lower than the total approved in 2012, which was a record year for FDA approvals of new molecular entities. However, the number of new drugs that have already been approved in the first quarter of 2014 (Table 1) indicates that the FDA remains steady in its efforts to expedite the approval of innovative drugs, and 2014 may yet be another record year for new molecules entering the market.

Biotechnology Innovation

Continuing the trend seen in the past few years, reinforced by the ongoing advancements of technological innovations, specialty pharmaceuticals dominate the current drug pipeline, even though the number of patients benefiting from these drugs remains very small compared with traditional drugs. Of the total of 27 new molecular entities approved by the FDA in 2013, approximately 60% were specialty drugs.2,3 This trend is more than likely to continue in 2014, based on the continuing growth of specialty drugs in the pharmaceutical pipeline.

Not surprisingly, the share of specialty medications managed under the pharmacy benefit continues to grow. By the end of the decade, suggests one expert, more than 50% of the drugs covered under the pharmacy benefit will be specialty drugs.4

The role of biotechnology in the development of new drugs is especially apparent in the specialty drugs arena in tandem with the growing focus on targeted drugs; the role of genetics in various disease states; and the identification of biomarkers in the search for new drugs combined with “companion” diagnostics used to identify the subpopulation of patients who would benefit from those very specialized drugs and will justify their use, even with their high price tag.

The cost of specialty drugs, though, remains a challenge. Despite the growing competition in the specialty drug arena, there is no sign that increased competition is lowering the cost of these medications.4 In addition, biosimilars, which are expected to reduce the cost of specialty drugs by approximately 20%––a not-so-dramatic reduction compared with the 80% to 90% reduction with generic drugs––are yet to be approved by the FDA. Although the FDA has issued various guidance statements to help manufacturers in the development of biosimilars, it will likely take another 1 or 2 years before the first biosimilar is approved in the United States (unlike in Europe, where several biosimilars have already been approved).

By 2018, overall spending on specialty drugs by patients and by payers is expected to exceed the total spending on traditional, small-molecule drugs, even though these agents are used by a very small percentage of the total patient population in the United States.3

Nevertheless, traditional medicines, perhaps to the surprise of some healthcare stakeholders, are being developed in large numbers. The traditional pharmaceutical lines of development still boast a large number of new drugs for many clinical categories, with cardiometabolic diseases, especially diabetes, leading the way (Table 2); there are currently 180 drugs in development for diabetes alone.1

Orphan Drugs

Orphan drugs remain strong in the current pipeline. In 2013, the FDA made full use of its priority review and accelerated approval pathways to expedite patients’ access to drugs that demonstrated evidence for significant clinical benefit, and this trend is especially evident in the orphan drugs arena. Approximately 25 million people in the United States have rare diseases, which justifies the development of such drugs, although individually, each drug would benefit only 200,000 people or fewer (according to the definition of an orphan drug).3

The overall spending on orphan drugs in the United States amounts to 6% of the total drug spending, and approximately 30% of these drugs are considered “blockbusters,”3 even though the price of 1 orphan drug can be in the thousands of dollars monthly. Overall, the growth of orphan drugs is more than 20% annually compared with only 20% for nonorphan drugs.3

In 2014, already 4 orphan drugs received FDA approval (Table 1), and many more are in the pipeline; at least 9 new orphan drugs are expected to be reviewed by the FDA between 2014 and 2016, and several new drugs for pulmonary arterial hypertension (PAH) are expected to be approved between 2014 and 2017 (Table 3), in addition to the 3 new drugs that were approved in 2013 for PAH. Other key orphan drugs in late-stage development are for cystic fibrosis and for bleeding disorders.

Specialty Drugs: Oral and Subcutaneous Administration

As the competition in the specialty drug arena is growing, the number of therapeutic options in the pipeline is also expanding within certain therapeutic categories, including diabetes, certain types of cancer, inflammatory conditions, and certain neurologic disorders, especially multiple sclerosis (MS).

Last year’s report from PhRMA suggested that the drug pipeline is booming with specialty drugs, with thousands of clinical trials being conducted for novel therapies and novel mechanisms of action, targeting more than 100 different disease states, including many novel therapies for rare diseases.5

The gradual but consistent move toward oral and subcutaneous medications in specialty pharmaceuticals is a trend evident in numerous clinical categories, including cancer. Oral or subcutaneous medications, unlike infused drugs, can curb the provider’s time for direct involvement in the administration of the drug. However, although this trend may eventually save costs, it can also exacerbate concerns for nonadherence, by putting the patient in charge of taking the oral or subcutaneous medication.

Promising Drugs in Late-Stage Development

The top clinical categories in specialty drug development in 2014 include inflammatory conditions, MS, cancer, HIV/AIDS, and hepatitis C virus (HCV) infection.

Table 3 lists some of the key agents in the specialty drug pipeline for cardiometabolic disorders (which remain the number 1 combined clinical category in terms of morbidity and mortality in the United States), inflammatory conditions, and MS; these drugs are expected to receive FDA approval between 2014 and 2016.

Cardiometabolic Disorders

The traditional cardiometabolic pipeline continues to flourish, featuring many of the familiar glucose-lowering classes in late-stage development (Table 2), including 2 of the oral DPP (dipeptidyl peptidase)-4 inhibitors, omarigliptin and trelagliptin, and 4 GLP (glucagon-like peptide)-1 agonists, dulaglutide, lixisenatide (Lyxumia), semaglutide, and albiglutide (Syncria).

However, a new drug class was launched in 2013, when canagliflozin (Invokana) became the first-in-class of SGLT (sodium-glucose cotransporter)-2 inhibitors to receive FDA approval for patients with diabetes. Several new SGLT-2 inhibitors are in the drug pipeline and may join canagliflozin in 2014 or 2015 for the management of patients with diabetes.

In the specialty drugs pipeline, a new class of drugs for lipid disorders, the PCSK9 (proprotein convertase subtilisin/kexin type 9) protein inhibitors, is emerging (Table 3), reflecting the continuing need for improved mechanisms to control metabolic disorders for the ever-growing number of patients who are obese, and patients with heart disease and/or diabetes. Despite the many drugs currently available for patients with type 1 and type 2 diabetes, as noted earlier, there are now 180 drugs being developed specifically for this patient population.5

Pulmonary Arterial Hypertension

Last year, 2 new molecular entities were approved for PAH—macitentan (Opsumit) and riociguat (Adempas) ––in addition to 1 new, extended-release formulation of treprostinil (Orenitram). Currently, 2 more specialty drugs are in late-stage development for PAH, including selexipag, which is in phase 3 clinical trials and is expected to be reviewed by the FDA in 2015, and beraprost-314d, which is in earlier stage development and may not be reviewed by the FDA until 2017 (Table 3).

Inflammatory Disorders

The monoclonal antibodies (ie, interleukin inhibitors) and the anti-tumor necrosis factor (TNF) agents are currently dominating the market for inflammatory and autoimmune diseases, such as rheumatoid arthritis and psoriatic arthritis. As mentioned earlier, drug development is moving toward subcutaneous administration, and drugs that were first available for intravenous administration are now being redeveloped for subcutaneous administration. Several of these agents are close to FDA approval, with apremilast (for psoriatic arthritis) being first in line in this clinical category, with a March 2014 PDUFA (Prescription Drug User Fee Act) date (Table 3).

Furthermore, developers of the anti-TNF factor agents and the monoclonal antibodies are often seeking more than 1 indication; for example, secukinumab for psoriasis and rheumatoid arthritis and vedolizumab for ulcerative colitis and Crohn’s disease, with a May 2014 PDUFA date for the latter. Other specialty drugs in late-stage development for inflammatory/rheumatic disorders include rigerimod (Lupuzor) for lupus, rilonacept (Arcalyst) for gout, baricitinib and sarilu­mab for rheumatoid arthritis, and brodalumab for psoriasis (Table 3).

Multiple Sclerosis

Specialty drugs continue to rule the MS drug arena. Currently, 6 biologics are either in late-stage clinical trials or have already filed with the FDA; 3 of these biologics are monoclonal antibodies, with alemtuzumab (Lemtrada) still waiting for final approval after the FDA requested additional information from the manufacturer in December 2013. Dimethyl fumarate (Tecfidera), which received FDA approval for relapsing forms of MS in 2013, is the latest addition to the current therapies for this condition. In addition, a biologics license application was filed with the FDA last year for peginterferon beta-1a (Plegridy). The other MS specialty drugs in late-stage development include laquinimod, masitinib, ocrelizumab, and daclizumab (Zenapax; Table 3).

Infectious Diseases

The key specialty medicines for infectious diseases in 2014, similar to last year, are new direct-acting oral antiviral and interferon-free oral regimens that are expected to be approved in 2014 and 2015 for HCV infection; these include the oral drugs faldaprevir, asunaprevir, and vaniprevir, as well as an all-oral regimen that combines daclatasvir and asunepravir and can be used without ribavirim. This regimen was granted a breakthrough therapy status on February 24, 2014 (Table 3).

New HIV medications are being added to the current classes. The HIV pipeline includes combination therapies, new single-tablet regimens, and injectable therapies (Table 3).

Cystic Fibrosis

Cystic fibrosis is a rare disease, and therefore the drugs approved for this condition are categorized as orphan drugs. There are currently 8 agents in the pipeline for this condition that are expected to be approved between 2014 and 2016, in addition to the new expanded use for the oral therapy ivacaftor (Kalydeco), which is expected to receive FDA approval at the end of March 2014. Ivacaftor was the first drug to receive 2 breakthrough therapy designations in January 2013, soon after the FDA enacted the new law. It was the first drug that showed benefit in treating the underlying disease in some patients with cystic fibrosis.

The current cystic fibrosis pipeline includes 3 new oral therapies—ataluren, lumacaftor, and VX-661; 2 nebulizers for inhalation, levofloxacin (Aeroquin) and amikacin (Arikace); 2 dry powder inhalers, vancomycin (AeroVanc) and mannitol (Bronchitol); and 1 nasal inhalation solution, sinapultide (Aerosurf).


Continuing the trend of the past few years, cancer remains the top clinical category in the specialty pharmaceutical pipeline in 2014. Table 4 lists the key specialty drugs for solid tumors and for hematologic malignancies currently in late stages of development. Furthermore, many of the recently approved specialty cancer drugs are being submitted to the FDA again for new indications. The most recent example of this is ibrutinib (Imbruvica), which was approved for the treatment of patients with mantle-cell leukemia in late 2013 and was then approved in January 2014 for the treatment of patients with chronic lymphocytic leukemia.

Very promising results have been shown with some of the drugs in the pipeline for cancer, including idela­lisib for non-Hodgkin lymphoma; ramucirumab for gastric cancer, which was granted priority review in February 2014; LKD378 for non–small-cell lung cancer, with breakthrough therapy designation; daratumumab for multiple myeloma; lambrolizumab for advanced melanoma, which received breakthrough therapy designation; and palbociclib for breast cancer. All of these agents are expected to be approved in 2014. If they do indeed receive FDA approval this year, and if drugs already on the market receive new indications for other types of cancers, 2014 could be a record year for cancer drug approvals.

This growth in cancer therapies is likely to continue in the future, even while some cancer therapies are reaching new successes in tumor eradication or near eradication––a feat that was unthinkable not too long ago.


Judging by the current drug pipeline, encompassing both traditional and specialty medicines, it is safe to presume that cancer and diabetes will remain top targets for innovation in drug development, as new mechanisms of action, novel delivery systems, and as yet unknown therapeutic classes are being developed and introduced to the market. With the increasing role of genomics and drug sequencing, the 2014 drug pipeline promises improved patient outcomes, accompanied by the ever-greater challenge of how to pay for these lifesaving but expensive medicines. Issues of provider reimbursement and Medicare Part D regulations further complicate the question of value-based utilization of drug therapy.

Another challenge in the specialty pharmaceutical pipeline is that while many new, often small biotechnology companies enter the specialty drug development arena, large pharmaceutical companies must look for new ways to innovate in the face of such increasing competition, increased economic pressures, and looming patent losses. In the face of greater competition fostered in part by new biotechnologies, innovation continues to hold the golden key for success in the pharmaceutical pipeline.


I would like to thank Lilly Ostrovsky for her help in creating the tables for this article.

Author Disclosure Statement

Ms Buffery reported no conflicts of interest.


  1. Pharmaceutical Research and Manufacturers of America. Medicine in Development for Diabetes. 2014 Report. Accessed March 2, 2014.
  2. US Food and Drug Administration. Center for Drug Evaluation and Research. Approved drugs 2013. January 2014. approvalprocess/druginnovation/ucm381803.pdf. Accessed February 28, 2014.
  3. Specialty Pharma Journal. Specialty drugs account for more than half of approved drugs in 2013. Updated January 3, 2014. Accessed February 5, 2014.
  4. Tharaldson A. Specialty pharmaceuticals in development. Presented at: Academy of Managed Care Pharmacy 2013 NEXUS Meeting; October 17, 2013; San Antonio, CA.
  5. 5. Pharmaceutical Research and Manufacturers of America. Biologics research promises to bolster future of medicine: more than 900 biologic medicines and vaccines in development. March 11, 2013. promises-bolster-future-medicine. Accessed February 17, 2014.
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Last modified: August 30, 2021