US Pharmaceutical Market Trends: Analyzing Growth Opportunities

US Pharmaceutical Market: Key Insights.

The US pharmaceutical market is projected to grow from US$ 846.72 billion in 2022 to US$ 1,285.79 billion by 2030 and experience a CAGR of 5.36% from 2022 to 2030, which is mainly driven by rising occupational diseases, expansion of pharmaceuticals manufacturing capacity, increase in approval of generic medicines, and growth in investment in pharmaceutical sector research and development (R&D).

Negative factors associated with increased prices of tested chemical compounds, expensive marketing approval by the regulatory authorities of potential drugs and increased expenses to bring drugs to market are anticipated to hamper the growth of the US pharmaceutical market.

Rising Workplace Associated Disorders Drives the US Pharmaceutical Market:

As reported in November 2023 by the US Department of Labor, Survey of Occupational Injuries and Illnesses (SOII) data for 2022 indicated that private industry employers experienced an increase of 7.5% in nonfatal workplace illnesses and injuries reported in 2022, year over year from 2.6 million in 2021. More specifically in absolute terms, there was an increase of 4.5 % of injuries reported in 2022 (2.3 cases, 2021 vs 2022) and 26.1% increase of illness reported in 2022 (460,700, 2021 vs 2022). The recorded increase was in illnesses as reporting respiratory illness grew 20 % in 2022 – to an estimated 365,000 cases (2022) following an undulating respiratory disease curve in 2020 and 2021.

According to the data published by the American Institute of Stress,

• 83% of those who go to work in the US are experiencing work-related stress, and 25% say that their job is the most stressful thing in life.
• Each day, about 1 million Americans miss work due to stress.
• Absenteeism linked to depression costs US companies around US$ 51 billion every year, while another US$ 26 billion is spent treating it.
• More than 50% of workers are off sick with stress-related illnesses, and productivity is lost.
• Stress at work is most often caused by excessive workloads (39% of workers); the need to balance home and work responsibilities (19%); interpersonal issues (31%); and job security (6%).

But psychological risks at work can be prevented by managing psychological risks and by targeted organizational interventions, which are interventions focused directly on working conditions, and environments, rather than those using psychosocial interventions as a metaphor for ‘training in coping’, and health risk assessment at the workplace is one of the most effective health-promoting measures with respect to both physical and mental health conditions.

At the same time, an increasing number of employees are suffering from work-related injuries and illnesses leading to a higher demand for treatment drugs, physiotherapy, medical procedures, and psychological treatments. Therefore, US pharmaceutical industry would show positive growth and an upsurge in the number of diseases occurring at workplace.

Rise in Pharmaceutical Production Capacity

These market share companies of US pharmaceutical production have ramped up their capacities to meet the clinical needs and also expand their global capacity as the exponential growth in the market space and requirement for these formulating processes for vaccine or medicine manufacturing has started scaling up in recent years. For instance, in December 2022, the American multinational pharmaceutical and biotechnology corporation, Pfizer Inc. invested US$ 750 million to expand its primary manufacturing facility in Kalamazoo, Michigan. This expansion could enable this pharma company to enhance its capacity for mRNA technology-based vaccine and medicine production. Moreover, the Portuguese pharma company, Hovione is expanding its manufacturing facility in New Jersey as part of its US$ 170 million global expansion strategy, which would enhance its global pharmaceutical production capacity by ~ 25%. This expansion will enable the company to enlarge the commercial spray drying and the active pharmaceutical ingredient (API) manufacturing capabilities and is slated to be completed by the end of 2023.

In December 2020, Piramal Pharma Solutions invested ~US$ 32 million to expand its manufacturing facility in Michigan, US to add capacity and new capabilities for API development and manufacturing. Similarly, in 2021, Amgen Inc. invested US$ 550 million to construct a new multiproduct drug-substance manufacturing facility in North Carolina.

Therefore, such endeavors by pharmaceutical companies for growth in production capacity worldwide means a more robust supply chain as well as adding value to the market in terms of pharmaceutical products, deeming US pharmaceutical market growth.

US Pharmaceutical Market Outlook: Segmental Overview

The US pharmaceutical market is remarkably divided by product type into vaccines, biologicals & biosimilars, and small molecules; further, small molecules is sub-segmented into generic and branded. Small molecules continued to be a leader in terms of market share in 2022. However, biologicals & biosimilars are forecast to witness the highest CAGR over the forecast period.

US Pharmaceutical Market, by Product – 2022 and 2030

The total pharmaceutical drugs (volume basis) by small molecules are over 70% (insulin, aspirin, antihistamines etc). They also include glucose, fatty acids, amino acids, cholesterol, and secondary metabolites like lipids, glycosides, alkaloids, and natural phenols. A brand-name drug is a medicine created by a research company that has discovered, developed and marketed it. Once a new drug is found, then its parent company would apply for a patent on it, so that it would not be taken over by other companies and then sell them under their brand name. A brand-name drug is more expensive (eg, Remicade, HUMIRA) because there is no competition to drive down its price. When patents of branded drugs are near to the expiry date, other manufacturers can apply for an FDA to sell generic versions. As manufacturers of generics do not need to do repeated costly clinical trials and generally do not incur marketing, advertising, and promotions costs of the drug, they can sell the drugs at less cost. On the other hand, companies that manufacture branded drugs often spend huge amounts for research, development, and advertising, and have to price their drug at a cost where it takes back the spend and allows them to make an expected profit. For example, as per Kantar Media, AbbVie spent ~US$ 259 million in 2015 on direct-to-consumer advertising for its HUMIRA. Such a reason has helped the past growth of the US pharmaceutical market and is anticipated to follow the same trend throughout the forecast period.

According to separate QuintilesIMS (commissioned by the Association for Accessible Medicines) data, branded specialty drugs are just 1% of prescription drugs by volume but represented 32% of total drug spend in 2022. Brand-name products accounted for ~20% of approval claims but ~40% of all abandonment, with overall new patient abandonment for generics 200% lower on average than for branded drugs. Abandonment rates for brand-name drugs are 20.5% compared with 7.7% for generics. Brand drug products are just 11% of prescriptions but represent 74%

For example, in the year 2022, the US FDA’s Center for Drug Evaluation and Research approved 37 novel drugs. Notably, the previous year in 2021, there were 50 novel new drug approvals, followed by 53 in 2020, 48 in 2019 and the highest at 59 in 2018.

In 2022, there are 17 new small-molecule drugs, which accounted for 46% of new drugs. Pfizer Inc and Johnson & Johnson are the dominant players in the branded small-molecules market in the US pharmaceutical market.

US Pharmaceutical Market: Competitive Landscape and Key Developments

Some of the significant pharma companies in the US are Johnsons's Jonson Johnson Company, Merc Co. Inc., Abbott Laboratories, Amgen Ic, Eli Lilly and Company, Bristol-Myers Squibb Company, Bayer AG, Takeda Pharmaceuticals, Zoetis Inc, Moderna Inc, Abbvie Inc, Pfizer Inc, Gilead Sciences Inc, Regeneron Pharmaceuticals Inc.

Covid-19 has devastated a lot of countries, and there might also be a possible Anger virus outbreak anytime soon. Hence, some significant players strive to expand and diversify their market presence and consumer base and leverage the market opportunities available.

In August 2023, Bristol Myers Squibb acquired mirati Therapeutics Inc. The mission of Mirati, a commercial-stage targeted oncology company, is to discover, create, and supply transformative therapies that will enhance the quality of life for patients and their families facing cancer. The assets of Mirati offer an exciting opportunity to strengthen the quality and depth of Bristol Myers Squibb’s innovative oncology franchise and creative pipeline. Through this acquisition, Bristol Myers Squibb will enhance its commercial portfolio by adding the KRAZATI, a key product for lung cancer. The business gains access to exciting and creative clinical assets for its oncology pipeline and solid prospects for both combination and single-agent immunotherapy.

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