The Impact of COVID-19 on Pharma Markets

The Impact of COVID-19 on Pharma Markets

The pandemic has left a substantial impact on our world that will be felt for years to come. It has led to immeasurable struggle and tragedy, which is why it can be difficult to consider COVID-19’s silver linings. From a drug discovery and development standpoint, however, the pandemic has led to significant positive change.

Research organizations and pharmaceutical companies have weathered enormous challenges over the past year and counting. But the pandemic has also been a driving force behind tremendous innovation and a newfound ability to pivot at uncharacteristically rapid speeds.

Drug development accelerated and partnerships blossomed. 

The pandemic sent nearly every research and pharmaceutical company into overdrive, scrambling to shift gears and address a rapidly-spreading pandemic that was becoming grimmer by the day. This shift led to extraordinary efforts to rapidly discover, develop and manufacture preventative vaccines and treatments for the virus.  The U.S. Government responded with Operation Warp Speed (OWS), providing approximately $10B in funding to COVID-19 vaccine and therapeutic research and development.

The pandemic sent nearly every research and pharmaceutical company into overdrive, scrambling to shift gears and address a rapidly-spreading pandemic that was becoming grimmer by the day. This shift led to extraordinary efforts to rapidly discover, develop and manufacture preventative vaccines and treatments for the virus. The result of these efforts was nothing short of astounding. Within a record 10 months, several vaccines were approved for emergency use across multiple countries, raising hope that life could begin to return to normal later in 2021.

Pfizer/BioNTech’s Comirnaty (the name is a mash-up of ‘community,’ ‘immunity,’ ‘mRNA’ and ‘COVID’) was the first vaccine approved on December 11, 2020, receiving FDA Emergency Use Authorization (EUA) and marking a significant turning point in the battle against the pandemic.

Pfizer/BioNTech's Comirnaty (the name is a mash-up of ‘community,’ ‘immunity,’ ‘mRNA’ and ‘COVID’) was the first vaccine approved on December 11, 2020, receiving FDA Emergency Use Authorization (EUA) and marking a significant turning point in the battle against the pandemic. Moderna’s mRNA-1273 was approved by the FDA one week later. Both are messenger RNA (mRNA) vaccines – requiring two doses with efficacy rates of >94%.  In late February, the FDA approved the emergency use of Johnson & Johnson’s one-dose viral vector COVID-19 vaccine. J&J’s vaccine has just one dose but a potentially lower efficacy rate of 66.3%, though clinical trial design differed from the first two vaccines. (The drug was put on pause in mid-April due to concern with blood clotting, a problem also discovered with Astra Zeneca’s vaccine). Still, the rapid pace at which these vaccines were discovered and delivered gives industry leaders hope that we can continue at this faster pace in the future.

The pandemic led to a striking number of partnerships among leading life sciences companies, a trend that is also raising the hopes of industry leaders. Larger pharmaceutical companies have the financial means and experience to bring products to market, while small biotech companies have exciting new technologies. Mike DeLone of Deloitte explains, if this partnership trend continues to thrive, we can anticipate a change in how the industry innovates and delivers:

“While there have been some bumps along this road, we have witnessed what companies can accomplish when they truly collaborate, share meaningful information, and work with regulators to expedite development while ensuring safety. Now that companies have traveled down that road, I don’t think there is any way they can turn back. Imagine the power and impact of the best science, the best technology, and the best information and ideas…all coming together without boundaries as we move forward!”

The pandemic had a significant yet understandable impact on clinical trials. In 2020, in North America, nearly 60 percent of clinical trials were disrupted in some capacity, followed by Europe at 42 percent and the Asia Pacific region at 21 percent. Clinical trials felt delays, but regulatory timelines were largely unchanged.

The pandemic had a significant yet understandable impact on clinical trials. In 2020, in North America, nearly 60 percent of clinical trials were disrupted in some capacity, followed by Europe at 42 percent and the Asia Pacific region at 21 percent.

With worldwide lockdowns and social distancing measures in place, companies struggled to continue clinical trials without disruption. For some trials, the disruption meant a delayed initiation of planned trials or withdrawing them altogether. For others, it meant suspending enrollment in ongoing trials or terminating current trials. The other reason for disruption was bandwidth, as companies found themselves pausing existing research to focus on COVID-19. As of early March 2021, nearly 1,000 clinical trials were still impacted, but the trend was on the upswing, and many disrupted trials were resuming.

While COVID-19 may have delayed certain clinical trials, it did boost the use of virtual trials. This trend will undoubtedly continue after the pandemic, opening doors for both companies and patients. With virtual trials, companies can better diversify their demographics and include an expanded range of patients, leading to greater health equity across the globe.

Despite initial concerns, the pandemic had minimal impact on regulatory timelines related to non-COVID treatments. Existing U.S. and E.U. expedited pathways remain unchanged, and there have been minimal effects on the FDA’s ability to meet PDUFA deadlines. However, regulatory agencies showed unprecedented flexibility around pandemic-related research, such as proactively connecting with sponsors and creating expedited pathways specifically for COVID-19 products.

The supply chain endured significant delays.

Most pharmaceutical manufacturing facilities worldwide remained open throughout 2020 or had resumed production by Q3 2020. Early on however, lockdowns proved to be a significant challenge. They disrupted the supply chain for global pharmaceutical companies that rely heavily on Indian and Chinese API and finished dose manufacturing, especially small molecule APIs. Some governments took actions to stop the export of certain drugs altogether.

The industry responded by implementing short-term solutions to mitigate the impact on patients, while also identifying longer-term solutions to strengthen supply chains. The US government (and others – notably the E.U. and India) is calling for more domestic manufacturing, which would pre-emptively solve any future disruptions and lead to more jobs and the implementation of better manufacturing technology – though significant roadblocks (cost, time, talent) remain.

Human capital – including leadership, talent, and culture – is another area of the pharmaceutical industry that has drastically shifted over the last year. Successful leadership proved to be agile and flexible as demands rapidly changed. Talent and culture embraced change.

Human capital – including leadership, talent, and culture – is another area of the pharmaceutical industry that has drastically shifted over the last year. Successful leadership proved to be agile and flexible as demands rapidly changed. Most non-lab or non-manufacturing line workers worked from home. The result was a clear need for strong leaders who can navigate crises, think long-term, and effectively manage people – especially from remote locations.

The pandemic has led most life sciences leaders to see the positives of remote work. One benefit of this mindset which has emerged is it allows companies to diversify and widen the talent pool at all levels. Remote work also decreases operational costs while increasing employee satisfaction – two key objectives of most industry leaders. It has created its own challenge, however, as organizations may struggle to develop a solid culture capable of engaging employees across the globe – but companies have been consistently innovating in this area as well.

Agility, Resiliency and Change: Laying the Groundwork for Pharma 2.0.

The pandemic has brought out the true resiliency and ingenuity of the pharmaceutical industry. Leaders and employees showed they could pivot at a moment’s notice. Barriers broke down and the industry came together to defeat a common enemy. Regulatory agencies did not waiver in their duty to ensure the safety of patients, but they were open to change. Companies realized the evident need to embrace talent and culture changes that could take them into the future.

There is no denying the devastating impact of the pandemic, but we should also acknowledge that COVID-19 was the impetus behind many valuable developments in the life sciences.

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