The legacy of COVID-19 on the pharmaceutical industry

24-May-2022

Although the COVID-19 pandemic has by no means ended, many countries are now on the path to transitioning the virus to a state of endemicity. Yet, the latter is a complex and poorly understood concept, explains Adam Barker, Head of Healthcare Equity Research at Goodbody Healthcare

It is not at all clear what level of infections we should expect to see from COVID-19 moving forward, what burden there will be on the health system, how frequently the virus will peak and whether (like flu) there will be a blurring of the boundary between pandemic and endemic status.

However, it is also very apparent that, given the rapid response of everyone within the scientific ecosystem, the world is much better equipped to deal with this new illness. The pace at which vaccines and therapies have been delivered has been unprecedented with the virus and, crucially, the world’s response to it, leaving several important legacies.

Changing expectations of the pharmaceutical industry

Perhaps the biggest legacy of COVID-19 will be how it has impacted the pace of innovation throughout the global pharmaceutical industry, the challenges that need to be overcome and how companies and other stakeholders interact with each other.

The rapid reduction in development times for COVID-19 vaccines — falling from 10 years to just one — will no doubt increase expectations regarding how quickly areas of unmet medical need are addressed. For example, despite a push to develop novel antimicrobials in the face of growing bacterial resistance, there remains a clear unmet need and we anticipate greater calls for the pharmaceutical industry to step up and tackle this problem.

Importantly, just as public-private partnerships were crucial to the rapid development of COVID-19 vaccines, with governments making the significant move of sharing the financial risk, so too will these relationships be critical in fostering innovation in other areas of medicine. A good example being the recent decision by the UK to launch the world’s first “subscription” model for antibiotic supply in which a fixed fee is paid to pharmaceutical companies who supply antibiotics.1

Lastly, the full healthcare burden of COVID-19 and the response to the coronavirus crisis are not yet known. For instance, what will the impact of “long COVID” be? How will lockdowns impact the behaviour of other viruses going forward? Suffice to say, just as the pharmaceutical industry quickly responded to the emergence of the virus, it will also be expected to respond to the problems that are yet to become fully apparent.

The risk from infectious disease remains very relevant

COVID-19 has also acted as a poignant reminder to the developed world that the threat from infectious disease remains a key consideration for public health authorities. Although chronic disease has arguably and understandably received greater focus in developed countries in recent years, pandemics from novel viruses remain very much at the top of public health threats.

SARS-COV-2 is unlikely to be the last coronavirus with pandemic potential that could jump to humans … and many would argue that the threat from avian influenza (bird flu) is even greater than that posed from coronaviruses (China recently reported a human case of H3N8 bird flu in humans).

Regardless of how you rank the risk from any one virus, our experience with COVID-19 will likely lead to a greater focus on how such threats can be prevented and tackled if and when they arise, including the utilisation of surveillance systems and the timely sharing of information across borders.

This is absolutely crucial when it comes to quickly responding to a new threat; but, it’s important to remember that COVID-19 was initially detected as approximately 40 cases of atypical pneumonia during winter, the main period for respiratory illnesses. This is arguably the sign of a successful surveillance system and how much more they can be improved will be an interesting question to address.

Beyond surveillance, having preprepared tools to fight the virus is another option. Vaccines targeting multiple strains of a family of viruses, such as pan-influenza or pan-coronavirus vaccines, are an option, but they have proved difficult to develop for illnesses such as flu.

It remains to be seen whether the rapid rise of mRNA vaccines will help to alleviate this burden — given that, in theory, such vaccines can carry more antigens and can potentially foster a more diverse immune response.

The development of vaccines targeting new viruses will also bring into focus how we approach the research of infectious disease. For example, what role will “gain of function” experiments play in the study of potentially pandemic viruses? Does the risk that modified viruses pose justify the potential benefit of finding therapies against them? These questions are likely to come into sharper focus following the pandemic.

Outside of pan-vaccines and given the components of the virus they target, there is also the potential that antiviral drugs could show efficacy against a broad range of potential variants. Studies to assess how well drugs such as Pfizer’s PAXLOVID and Merck’s molnupiravir work against multiple types of coronaviruses will be informative in this regard.

A boost to R&D productivity?

The pharmaceutical industry worked closely with regulatory bodies during the pandemic, which helped to speed up the review process of novel drugs and vaccines. There are clearly lessons that can be learned from this experience and that can be taken forward to help to facilitate the timely delivery of medical innovation.

In addition, pharmaceutical companies have further embraced the use of digital tools that can help to improve the identification and quick enrolment of patients for clinical trials, reduce the cost of performing said trials and accelerate the pre-existing trend towards more decentralised and patient-centric clinical trial designs.

This combination of greater collaboration with regulators, reduced clinical trial costs and the ability to find and enrol patients who may benefit from a clinical trial more quickly, provides opportunities to increase R&D productivity across the industry.

Focus on cost-effectiveness to intensify

A final important consequence of the COVID-19 pandemic on the pharmaceutical industry will be the rising attention paid to the cost-effectiveness data for novel therapies that are successfully approved. An increasing focus on price efficiency from healthcare payers has been a growing trend for several years and, given government spending during the pandemic, this is only likely to intensify further.

As such, the pharmaceutical industry will increasingly have to target the best and first-in-class assets that offer sufficient clinical differentiation that would justify funding them. This will hopefully mean a growing number of therapies that offer significant benefits to patients and for diseases wherein therapies are currently lacking.

Perhaps one area of uncertainty here is how the response to COVID-19 has changed the public’s opinion and expectations on what should and should not be funded. Although the efficient allocation of resources will always be necessary in a healthcare system with cost constraints, the high level of spending on tackling COVID-19 may mean the public will continue to expect elevated spending on healthcare.

Clear and accurate communication will be required from healthcare payers to justify funding decisions when deciding against funding a new therapy.

Conclusion

The pharmaceutical industry is exiting the COVID-19 pandemic having delivered vaccines and therapies at a rapid pace. That will likely place new expectations on a sector that will remain important in terms of addressing other health issues wherein there is a high unmet medical need … and for which solutions have proven difficult to come by.

Increased collaboration between the public and private sectors, which has been so effective in the COVID-19 vaccine development, will be required, and there is also the potential for an increase in R&D productivity across the sector with lessons learned from the pandemic environment being relevant to sustaining the early momentum.

The return to pre-pandemic norms has been accelerated by a sector that delivered when called upon, and there is now an opportunity to deliver even more innovation in unprecedented timescales to patients who need it most.

Reference

1. www.ft.com/content/c7cbebe4-8597-4340-8c55-56c4b423c1d1.

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