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Copyright © 2017 IQVIA. All rights reserved.

Doug Long

Vice President, Industry Relations

August 2019

US Pharmaceuticals:

Trends, Issues, and

Outlook

Mutual Drug

2018

1

Key recent happenings in the US!

• Dollar growth is +6% (YTD May 19)

• Unadjusted TRx growth YTD Apr 19 is flat

while Adjusted 90-Day TRX growth is up 2.6%

• 90 day scripts continue to grow

• Major 17-18 Flu Season but as much this year

• 1109 measles cases-highest since 1992

• Generic $ sales decreases

Market Performance

• Walgreens &

Rite Aid

• Walgreens & Freds

• CVS & Aetna

• CVS & Stater Brothers

• Cigna & Express

Scripts

Mergers/Alliances

• DIR fees and audits

• Patient’s behavior during their

deductible period

• Co-pay cards

Reimbursement

• Record number of ANDA approvals and

faster approvals, but fewer products

launching

• Cialis

• Zytiga

• Advair Diskus

Generic Launches

• Opioids recognized as a national crisis

• FDA Priority list of no or limited generic

entries and complex generics

Regulation

• Much more public/media scrutiny on

drug prices

• Potential administrative actions

• Gross-to-net and rebates

• Generic deflation

• Less Brand price inflation

• Repeal and Replace?

Price/Politics

• Walmart &

Anthem (OTC)

• Amazon: Whole

Foods, PillPack,

Xealth, MedPlus

• UnitedHealth &

Genoa

Source: Publicly available through multiple sources

2

On average a Retail store fills over 22K adjusted Rx’s per quarter with Chain having the highest and Independents the lower counts

30,756

12,233

19,728

25,360

22,071

Chain Indep Food Mass Retail

Avg. Adj. Rx/Store – Quarter-ending Mar 2019

3

Payer-Aligned Medical-Pharmacy Future

Vertically integrated Payer models are being developed to manage the increasing pharmacy and medical costs

4

Amazon’s 2018 big moves in healthcare

January 2018 - Amazon forms partnership

• www.havenhealthcare.com

• “Advocate for the patient

and an ally to anyone who

makes patient care and cost

better”

• “free from profit-making

incentives and constraints”

• Current focus is their 1.2M

employees

• “it intends to share what it

learns to help others

June 2018 - Amazon buys PillPack

• Amazon paid $753M for PillPack

• Shares of CVS, Walgreens and Rite Aid tumbled

• What does Amazon get?*

• A company licensed in all states but Hawaii

• “the one company in the space that all the PBMs

and other pharmacy businesses were threatened

by” – Bain Capital

• Most of PillPack’s users are 50-60 and loyal

• PillPack users are worth $5,000 in revenue, the

average Prime Member is worth $1,300

* “The inside story of why Amazon bought PillPack in its effort to crack the $500 billion prescription market”, CNBC, May 13,

2019 - https://www.cnbc.com/2019/05/10/why-amazon-bought-pillpack-for-753-million-and-what-happens-next.html

http://www.havenhealthcare.com/

5

Why is Amazon going after Pharmacy?*

ConvenienceCustomer

ExperiencePartnerships

Pre-existing customer base and distribution

capabilities

Physical StoresStreamlined Distribution

* Source – CB Insights – “The 7 Industries Amazon will Disrupt Next – 2019”

6

Why is Amazon going after Pharmacy?*

Convenience Customer Experience Partnerships

• Amazon’s model aims to limit the effort

patients need to expend while also getting

prescriptions to them within a day or two

• Amazon’s advantage here comes in its

two decades of e-commerce logistics

experience — this could help avoid

delivery mistakes, a vital consideration for

serving people with complex medication

needs

• Haven aims to streamline healthcare.

• With its own insurance offering, Amazon

would have a potential launch pad to do

the work of a traditional PBM for the

partnership’s combined 1.2M employees

• Perhaps eventually the wider public

Pre-existing customer based and

distribution capabilitiesPhysical stores Streamlined distribution

• CVS has announced an experiment in

medication delivery, offering $4.99 for next-day

delivery

• But with 100M Prime subscribers — conditioned

to expect free, fast delivery on virtually any good

• Amazon will likely be placed to offer better

distribution than CVS or other pharmacy chains

• When Amazon acquired Whole Foods in 2017, it

also acquired around 450 physical locations where

it could theoretically dispense prescriptions

• Amazon has also announced plans for a new

grocery chain, separate from its acquisition of

Whole Foods. These stores would be more like

conventional grocers, and could contain

pharmacies — either for in-store prescription

pickup, or as hubs for a local delivery service.

• The pharmaceutical supply chain involves

all kinds of middlemen, each of whom

takes a slice of profit as drugs make their

way from the manufacturer to the end-

patient user — the kind of messy

business model that Amazon has special

expertise in disrupting

* Source – CB Insights – “The 7 Industries Amazon will Disrupt Next – 2019”

Table of

Contents

7

+ Market Overview

+ Medicine Usage Trends

+ Opioids

+ Consumerization

+ Adherence

+ Innovation & Outlook to 2022

8

Total US market dollar sales growth is at mid-single digits (6.9%) year to date

Growth (%) of Sales

Total Market Retail and Mail

12.2%

4.6%

1.9%

6.1%7.0% 6.3%

-4.0%

1.0%

6.0%

11.0%

16.0%

2015 2016 2017 2018 MATAPR2019

YTDAPR2019

12.2%

5.0%

0.2%

4.3%6.2%

4.9%

-4.0%

1.0%

6.0%

11.0%

16.0%

2015 2016 2017 2018 MATAPR2019

YTDAPR2019

Source: IQVIA, National Sales Perspectives, March 2019

Note: Limited to Rx and OTC Insulins

Gro

wth

(%

)

Gro

wth

(%

)

9Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.

Growth Rebounded to $14.9 Billion in 2018 Due to New and Protected Brand Volume Increases and Despite Lower Price Growth

Source: IQVIA National Sales Perspectives, Jan 2019; IQVIA Institute, Apr 2019

Net Spending Growth by Product Type US$Bn

20.917.3

13.4 12.0 11.0

6.7

3.75.7

5.4

0.8

2.19.9

3.61.4 13.2

-9.8 -9.4 -11.3 -12.3-8.2

5.1 2.6

-0.8

-5.1

-0.7

1.8 3.1

1.6

-0.5

-1.4

2014 2015 2016 2017 2018

New Brands Protected Brands Price Protected Brands Volume LOE Generics Price Generics Volume Total Growth

26.6 27.1

12.2

0.8

14.9

10

Generic dollar price deflation has not flattened out: shortages may increase and greater scrutiny by Dept. Commerce

Source: Nephron Research, Glass Box Analytics, IQVIA; *February 2019 interim published out of cycle

Generic Injectables

help to offset the

persistent deflation

in generic Oral Solids

Oct-14 Apr-15 Oct-15 Apr-16 Oct-16 Apr-17 Oct-17 Apr-18 Oct-18 Feb-19*

Gx:

-11.6%

Bx:

+4.6%


Medicines Spending Growth in the United States Rebounded to4.5% on a Net Price Basis

Source: IQVIA, National Sales Perspectives, Jan 2019; IQVIA Institute, Apr 2019

Total Spending on Medicines and Growth US$Bn

-5%

0%

5%

10%

15%

20%

0

100

200

300

400

500

600

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Gro

wth

Sp

en

din

g U

S$

Bn

Net Spending Invoice to Net Difference Net Spending Growth Invoice Spending Growth


Real Net Per Capita Spending Per Year Grew by Only $44 Since2009 as Specialty Nearly Doubled and Traditional Drugs Declined

Source: IQVIA, National Sales Perspectives, IQVIA Institute, Jan 2019; U.S. Census Bureau; U.S. Bureau of Economic Analysis (BEA), Dec 2018

Real Net per Capita Medicine Spending and Growth by Product Type US$

738 727 699 631 603 595 605 592 546 527

262 279 289300 318 385

438 471489 517

1,000 1,006 988931 922

9811,043 1,064

1,034 1,044

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%

-

200

400

600

800

1,000

1,200

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Gro

wth

Rea

l 2

01

8 U

S$

Net P

er

Ca

pita

Me

dic

ine

Sp

en

din

g

Traditional Spending Specialty Spending Total Spending

Traditional % Growth Specialty % Growth Total Spending Growth

0

Total Value of Pharmaceutical Manufacturers’ Gross-to-Net Reductions for Brand-Name Drugs, 2013 to 2018

Identifying and sizing the factors that lie between gross and net prices (CY2018)

Source: Nephron Research analysis, IQVIA, CMS and MEDPAC data

14

What Falls Between Gross and Net: $166bn in 2018

$38passed to Gov.

$166

$33passed to Gov

$39-$41 passed to payers

($3-$5 retained by

distributors,$14-$16 passed to

dispensers)

$2-$3

retained by PBMs

$2-$5

Manuf. Fee

$17-$22 in supply chain discounts (to

distributors)

$27-$31

paid by Pharma

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

Medicaid Rebates Medicare Rebates Commerical Rebates Manufacturer FeePayments to PBMs

ManufacturerDiscounts to Supply

Chain

ManufacturerPayments to Gov. &

Patient Programs

2018 Total Gross toNet

$s,

Bill

ion

s


Protected Brand Net Price Increases Moderated to 0.3% onAverage in 2018 as Invoice Price Growth Continued to Fall

Source: IQVIA National Sales Perspectives, Jan 2019; IQVIA Institute, Apr 2019

Protected Brand Invoice and Net Price Growth %

4.3%

1.6%2.9%

2.1%

0.3%

13.5%

11.2%

8.7%

7.1%

5.5%

1.6%0.1%

1.3%2.1%

1.9%

2014 2015 2016 2017 2018

Estimated Brand Net Price Growth % Brand Invoice Price Growth % Consumer Price Index

17

In MAT APRIL 2019, specialty spend is growing at 11.6% while traditional is relatively flat at 2.1%

Specialty growth is outpacing traditional growth and now has ~46% share of total non-discounted spend in the most recent 12 months

$132.7 $162.0 $179.0 $196.0$218.8 $227.4

$247.5$264.7

$267.4 $258.7$263.6 $265.7

$380.2$426.7

$446.4 $454.8$482.4 $493.1

-5%

0%

5%

10%

15%

20%

25%

30%

$0

$100

$200

$300

$400

$500

Gro

wth

N

on

-Dis

co

un

ted

Sp

en

d

(BN

s)

SPECIALTY TRADITIONAL SPECIALTY GROWTH TRADITIONAL GROWTH TOTAL MARKET GROWTH

Source: IQVIA, National Sales Perspectives, April 2019

Share of Sales 2014 2015 2016 2017 2018MAT APRIL

2019

SPECIALTY 34.9% 38.0% 40.1% 43.1% 45.4% 46.1%

TRADITIONAL 65.1% 62.0% 59.9% 56.9% 54.6% 53.9%

18

Absolute Value Growth for Top Specialty Therapy Areas

Oncology, Autoimmune, and HIV lead specialty absolute value growth


Note: top therapy areas ranked on MAT APRIL 2019 non-discounted spend

$9.5

$8.9

$1.6

-$0.2

-$3.0

$0.01

$1.1

$0.7

-$0.1

$0.4

$0.5

$0.8

$3.4

-$5 $0 $5 $10

ONCOLOGICS

AUTOIMMUNE DISEASES

HIV ANTIVIRALS

MULTIPLE SCLEROSIS

VIRAL HEPATITIS

HEMATOPOIETIC GROWTH FACTORS

POLYVAL IMMUNOGLOBLULINS IV&IM

MENTAL HEALTH

ERYTHROPOIETINS

IMMUNOSUPPRESSANTS

RESPIRATORY AGENTS

BLOOD COAGULATION

ALL OTHERS

Absolute Value Growth (US$ BNs)

∆Change from MAT APRIL 2018 to MAT APRIL 2019

$32.6

$37.8

$10.4

$5.7

$2.3

$0.3

$2.6

$2.8

-$0.7

$0.8

$2.2

$1.2

$16.5

-$10 $0 $10 $20 $30 $40


∆Change from 2013 to MAT APRIL 2019

19

Absolute Value Growth for Top Traditional Therapy Areas

Diabetes, anticoagulants, and vaccines lead traditional absolute value growth while pain, dermatologics, and ADHD contribute most to value decline



$6.0

$1.3

$3.0

-$1.5

$0.6

$0.3

$1.4

-$0.5

$0.7

$0.2

-$1.0

-$5.0

-$6 -$4 -$2 $0 $2 $4 $6 $8

ANTIDIABETICS

RESPIRATORY AGENTS

ANTICOAGULANTS

PAIN

NERVOUS SYSTEM DISORDERS

MENTAL HEALTH

VACCINES (PURE, COMB, OTHER)

ADHD

OTHER CARDIOVASCULARS

GI PRODUCTS

DERMATOLOGICS

ALL OTHERS



$34.7

$7.0

$10.5

-$4.8

$5.0

-$7.5

$4.5

-$1.3

$3.6

$3.4

-$0.6

-$23.7

-$30 -$20 -$10 $0 $10 $20 $30 $40



20

Absolute Value Growth for Top Therapy Areas

Antidiabetics, oncologics, and autoimmune diseases lead absolute value growth while pain and mental health contribute most to absolute value decline



$6.0

$9.4

$8.9

$1.8

$1.6

-$0.2

$3.0

$1.0

-$0.8

$0.5

$1.4

$0.9

-$4.3

-$6 -$4 -$2 $0 $2 $4 $6 $8 $10 $12

ANTIDIABETICS

ONCOLOGICS

AUTOIMMUNE DISEASES

RESPIRATORY AGENTS

HIV ANTIVIRALS

MULTIPLE SCLEROSIS

ANTICOAGULANTS

MENTAL HEALTH

PAIN

NERVOUS SYSTEM DISORDERS

VACCINES (PURE, COMB, OTHER)

OTHER CARDIOVASCULARS

ALL OTHERS



$34.7

$32.4

$37.8

$9.2

$10.4

$5.6

$10.5

-$4.7

-$3.6

$5.4

$4.5

$5.2

-$2.0

-$10 $0 $10 $20 $30 $40



21Source: IQVIA, National Sales Perspectives, April 2019

Limited to Rx and OTC Insulins

On a non-discounted spend basis, the top 10 products are growing at 18.7% and account for 14.8% market share

Rank ProductNon-Discounted Spend (US$ BNs)

MAT APRIL 2019 Market Share ABS Growth Growth

1 HUMIRA $19.3 3.91% $2..2 12.82%

2 ENBREL $8.0 1.63% $0.001 0.01%

3 ELIQUIS $7.9 1.60% $2.6 47.76%

4 JANUVIA $5.8 1.18% $0.5 8.93%

5 STELARA $5.5 1.12% $1.4 33.89%

6 LYRICA $5.5 1.11% $0.3 5.94%

7 XARELTO $5.5 1.11% $0.9 18.72%

8 TRULICITY $5.1 1.04% $1.9 56.73%

9 REMICADE $5.1 1.04% $-0.3 -5.27%

10 KEYTRUDA $5.0 1.01% $2.1 71.51%

TOP 10 $72.8 14.8% $11.4 18.7%

22

U.S. NAS Launches have been trending up, with 2018 the biggest year in history (59); including 28 orphans

Source: IQVIA Institute, April 2019

0

10

20

30

40

50

60

70

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

U.S. NAS Launches 2002-2018

Follower Innovator Orphan

23

Top 10 Launches in the past 24 months (sales data through Dec 2018)

9 of the top 10 launches are specialty; 2 of the top 10 launched in 2018; Shingrix is over $1BN to date

Rank ProductSpecialty/

TraditionalCompany Indication Launch

2017 –2018

$ (MNs)

Share of

Non- Retail $

Share of

Retail $

Share of

Mail $

1 Ocrevus Specialty RocheRelapsing and Primary

Progressive MSApr-2017 $2,999.1 90.3% 0.8% 8.9%

2 Mavyret Specialty Abbvie Hep C Aug-2017 $2,158.5 23.0% 28.4% 48.6%

3 Biktarvy Specialty Gilead HIV-1 Feb-2018 $1,322.1 24.5% 60.4% 15.1%

4 Dupixent Specialty Sanofi AventisModerate-to-Severe Atopic

Dermatitis (eczema)Mar-2017 $1,071.4 5.5% 11.6% 82.8%

5 Shingrix Traditional GlaxoSmithKline Shingles Dec-2017 $1,019.8 27.5% 71.9% 0.5%

6 Spinraza Specialty BiogenSpinal Muscular

Atrophy (SMA)Feb-2017 $864.0 99.9% 0.0% 0.1%

7 Imfinzi Specialty AstraZenecaNon-Small Cell Lung

Cancer (NSCLC)May-2017 $581.7 98.7% 0.3% 1.1%

8 Vosevi Specialty Gilead Hep C Jul-2017 $468.9 22.4% 27.0% 50.6%

9 Tremfya Specialty Johnson & JohnsonModerate-to-Severe

Plaque PsoriasisJul-2017 $449.6 6.6% 13.0% 80.4%

10 Symdeko Specialty Vertex Cystic Fibrosis Feb-2018 $396.7 23.1% 1.6% 75.3%

Source: IQVIA, SMART Launch MVP, January 2019

24

A record number of innovative medicines were launched in 2018 bringing 59 new treatment options to patients

34%

66%

FDA First-in-Class

Existing Mechanism

Source: IQVIA Institute, Mar 2019

20%

80%

Predictive Biomarker

No Predictive Biomarker

27%

73%

Biologics

Non-Biologics

27%

20%

12%

8%

7%

3%3%

3%3%

12%

Oncology

Infectious Disease

Neurology

Hematology

Endocrinology

Cardiovascular

Nephrology

Ophthalmology

Respiratory

Other

49%51%

Orphan

Non-Orphan

Therapy Area Orphan Designation Type of Molecule Predictive Biomarker FDA First-in-Class

N=59

New Actives Substances (NAS) Launched for the First Time in the United States in 2018

25

The profile of successful launches significantly changed since 2000, as average sales highlight growing market challenges

Source: IQVIA National Sales Perspectives (NSP) analysis Q4 2018

0

5

10

15

20

25

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018*

LC

US

D B

illi

on

s

First 12-months of sales for new branded medicines

Traditional Brands Dominate the Landscape

The Dark Ages

The Age of Oncology and Specialty

26

Examples of 2017 FDA NAS approvals which offer significant clinical advances

Brineura is a treatment for a specific

form of Batten disease, a rare disease

that can cause progressive

neurological impairments

Bavencio is a novel Anti-PD-L1 agent

in the treatment of merkel cell

carcinoma

Keytruda was approved to treat

patients whose cancers have a

specific genetic biomarker

Novartis's Kymriah CAR-T cell

therapy wins FDA approval as single

treatment for patients with acute

lymphoblastic leukemia

Rare disease Breakthrough therapy

Cell therapy Predictive Biomarker

27

Late-Stage Pipeline Products and Changes from 2017 in Selected Classes

Late-stage pipeline growth is mostly driven by specialty and niche therapies across a range of diseases

The Changing Landscape of Research and Development - Innovation, Drives of Change, and Evolution of Clinical Trial Productivity ~ Report by the IQVIA Institute for Human Data Science

Source: IQVIA Pipeline Intelligence, Dec 2018; IQVIA Institute, Mar 2019

849

223

188

179

165

162

161

118

110

92

644

Oncology

Neurology - Behavioral

Infectious Diseases*

GI Products

Immunology

Pain

Dermatology

Nervous System Disorders

Endocrinology

Vaccines

All others

17

12

9

9

8

8

7

5

-3

ALS and Other Neuromuscular Disorders

GI (Rare)

Non-Narcotic Pain

NASH

Dermatology (Biologics)

Dry Eye

Schizophrenia

Parkinson's Disease

Alzheimer's Disease

Viral Hepatitis

Number of Phase II to Registered Drugs, 2018 Changes From 2017 to 2018, Selected Classes

23

28

Although unadjusted dispensed Rx growth appears to be declining, adjusted Rx growth is up 2.6% year to date

Growth (%) of Dispensed Rx

Unadjusted Rx Adjusted Rx

0.8%

2.3%

-5.6%

-0.6% -0.8% -0.7%

-7.0%

-5.0%

-3.0%

-1.0%

1.0%

3.0%

5.0%

2015 2016 2017* 2018 MATAPR2019

YTDAPR2019

1.5%

3.9%

-3.8%

2.7% 2.5% 2.6%

-7.0%

-5.0%

-3.0%

-1.0%

1.0%

3.0%

5.0%

2015 2016 2017* 2018 MATAPR2019

YTDAPR2019

Source: IQVIA, National Prescription Audit & RxInsights, April 2019; Retail, Mail, and LTC; limited to Rx and OTC Insulins

*Note: decline between 2016 and 2017 is due to VRAF enhancement from 2017 onwards

Gro

wth

(%

)

Gro

wth

(%

)

29

New Therapy Starts for Brands Launched Less Than Two Years Prior

New Flu and Shingles Vaccines are Being Widely Used, While Thereare Fewer New Starts in Other Notable Therapy Areas

Medicine Use and Spending in the U.S. - A Review of 2018 and Outlook to 2023. Report by the IQVIA Institute for Human Data Science.

Source: IQVIA National Prescription Audit, Jan 2019

2.2 1.8 1.1

0.6 0.8

1.4

0.7

4.8

6.8 3.6

1.8 1.8

5.4

7.5

2014 2015 2016 2017 2018

All Other Therapy Areas Vaccines Total

Vaccines and All Others, Millions Non-Vaccines

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

2017 2018

All Others Not Shown Autoimmune HCV

COPD Diabetes CGRP - Migraine

Atopic Dermatitis

0

30

2018 Retail Share of Volume for Selected Specialty Therapy Areas and Adjusted Dispensed Prescriptions, Mn

Specialty Medicines were 2.2% of Prescription Volume in 2018,but Grew at More than Double the Rate of Traditional Medicines


Source: IQVIA National Sales Perspectives, National Prescription Audit, Jan 2019

24.0

19.0

11.5

8.0

1.0

20.2

18.4

10.9

5.2

0.8

Oncology

Multiple Sclerosis

HIV

Autoimmune

Viral Hepatitis

2018 2013

55%

91%

78%

75%

80%

Oncology

Multiple Sclerosis

HIV

Autoimmune

Viral Hepatitis

Non-Retail Retail

19%

3%

5%

55%

18%


Traditional Medicines Made up 97.8% of Prescriptions in 2018and Most Large Therapy Areas Grew Faster than the Total Market

Source: IQVIA National Prescription Audit, IQVIA Institute, Jan 2019

Traditional Drug Prescriptions and Percentage Growth in 2018 for Top 10 Therapy Areas

4.0%5.2% 5.7%

-4.5%

4.3%

-3.8%

2.4%3.5%

-2.5%

4.2%

1,190 517 463 447 357 250 243 207 188 141

-6%

-4%

-2%

0%

2%

4%

6%

8%Number of Prescriptions Mn

2.4%

4,003

32Source: IQVIA, RxInsights, April 2019


On an adjusted script basis, the top 10 therapy areas are growing at 2.5% yet declining 1.4% on an unadjusted script basis

Rank Therapy Area

Adjusted Scripts (MNs) Unadjusted Scripts (MNs)

MAT APRIL

2019

Market

Share

ABS

GrowthGrowth

MAT APRIL

2019

Market

Share

ABS

GrowthGrowth

1 ANTIHYPERTENSIVES 1,180.1 20.3% 39.9 3.5% 669.4 16.0% -10.4 -1.5%

2 MENTAL HEALTH 527.8 9.1% 27.5 5.5% 390.0 9.3% 6.7 1.8%

3 LIPID REGULATORS 469.0 8.1% 22.4 5.0% 247.4 5.9% -2.0 -0.8%

4 PAIN 423.7 7.3% -19.6 -4.4% 392.2 9.4% -22.4 -5.4%

5 DIABETES 340.4 5.9% 14.8 4.6% 214.1 5.1% -0.1 -0.1%

6 ANTIBACTERIALS 249.0 4.3% -7.7 -3.0% 245.9 5.9% -7.9 -3.1%

7 ANTI-ULCERANTS 244.9 4.2% 7.4 3.1% 160.0 3.8% -2.2 -1.4%

8 NERVOUS SYSTEM DISORDERS 243.3 4.2% 6.7 2.9% 195.7 4.7% 1.2 0.6%

9 RESPIRATORY 208.3 3.6% 5.6 2.8% 172.2 4.1% 0.4 0.3%

10 THYROID 195.4 3.4% 3.9 2.1% 113.2 2.7% -2.9 -2.5%

TOP 10 4,082.5 70.4% 101.3 2.5% 2,800.5 66.9% -39.7 -1.4%

34Source: IQVIA, RxInsights, April 2019


On an adjusted script basis, the top 10 products are growing at 4.5% yet declining -0.9% on an unadjusted script basis

Rank Product

Adjusted Scripts (MNs) Unadjusted Scripts (MNs)

MAT APR 2019 Market ShareABS

GrowthGrowth

MAT APR

2019

Market

Share

ABS

GrowthGrowth

1 ATORVASTATIN CA 214.7 3.7% 20.8 10.7% 115.2 2.7% 4.9 4.5%

2 LISINOPRIL 175.6 3.0% 4.6 2.7% 97.4 2.3% -3.1 -3.1%

3 LEVOTHYROXINE SOD 165.4 2.8% 5.2 3.2% 96. 2.3% -1.4 -1.4%

4 AMLODIPINE BESY 155.4 2.7% 11.6 8.1% 87.6 2.1% 1.7 2.0%

5 METFORMIN HCL 107.5 1.8% 2.4 2.2% 61.2 1.5% -2.6 -4.1%

6 OMEPRAZOLE (RX) 93.2 1.6% -10.5 -10.2% 58.7 1.3% -9.5 -13.9%

7 LOSARTAN POT 103.4 1.8% 16.5 19.0% 55.7 1.4% 6.1 12.3%

8 SIMVASTATIN 87.5 1.5% -6.3 -6.8% 43.6 1.0% -6.1 -12.3%

9 GABAPENTIN 86.5 1.5% 4. 4.9% 67.7 1.6% 2.1 3.2%

10 METOPROLOL SUCCIN 84.4 1.4% 6.8 8.7% 47.3 1.1% 1.3 2.8%

TOP 10 1,273.5 21.8% 53.4 4.5% 730.4 17.4% -6.5 -0.9%

36

All of the growth seen in Retail is coming from Commercial 3rd

Party and Med D

Note: Medicaid listed here represents State Medicaid, FFS Medicaid in contained within Commercial Third Party

38

Share of Total Patient Out-of-Pocket by Cost-Sharing Type (Commercial, All Brands)

Since 2013, the proportion of patient costs paid through deductibles and coinsurance has grown

Source: IQVIA Rx Benefit Design; IQVIA analysis

54%44%

24%

29%

21%26%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2013 2017

Sh

are

of

Pati

en

t O

ut-

of-

Po

cket

(%)

Deductible

Coinsurance

Co-Pay


The Rate of Prescription Abandonment Increases as CostExposure Rises

Source: IQVIA Formulary Impact Analyzer; IQVIA Analysis, Dec 2018

30-Day New-to-Brand Abandonment by Patient Out-of-Pocket Cost in 2018 (Top Brands)

0%

10%

20%

30%

40%

50%

60%

70%

80%

New

Pa

tie

nt A

ba

nd

on

me

nt (%

NB

Rxs)

Patient Out-of-Pocket Cost

Commercial Medicare


Out-of-Pocket Costs have been Rising, While $13 Billion of Costshave been Offset by Coupons for Commercially-Insured Patients

Source: IQVIA National Prescription Audit, Formulary Impact Analyzer, Jan 2019

Patient Out-of-Pocket Cost for Prescriptions in Aggregate and Value Offset by Coupons, $Bn

56 58 58 59 61

6 8 10 11

13

0

10

20

30

40

50

60

70

80

2014 2015 2016 2017 2018

Out-of-Pocket Costs Coupons


Patient Out-of-Pocket Costs for Brands and Generics in Total haveDecreased by $1.23 since 2014 to $9.05 on Average

Source: IQVIA Formulary Impact Analyzer, IQVIA Institute, Jan 2019

Patient Cost Exposure and Average Costs, US$

$364.92

$450.09

$511.17

$608.89

$657.08

$258.91

$322.93 $350.75

$403.36 $427.75

$29.98 $31.68 $31.50 $31.29 $30.59

$18.50 $18.92 $18.06 $19.10 $19.10

$6.74 $6.50 $6.32 $6.28 $6.18

$10.28 $10.05 $9.60 $9.28 $9.05

$0

$40

$80

$120

$160

$200

2014 2015 2016 2017 2018

Brand WAC Price Brand Pharmacy Price Brands Final Out-of-Pocket Cost

Generics Pharmacy Price Generics Final Out-of-Pocket Cost All Products Final Out-of-Pocket Cost

$300

$400

$200

$500

$600

$700

42

Generic Shares of Dispensed Prescriptions

Generics Make up 90% of Prescriptions Dispensed, up from 75%in 2009, and are Dispensed 97% of the Time when Available


Source: IQVIA National Prescription Audit, Jan 2019

75%78%

80%

84%86% 87% 88% 89% 90% 90%

60%

70%

80%

90%

100%

2009 2012 2015 2018

80%

83%85%

88% 89% 90% 91% 92% 92% 92%

75%

80%

85%

90%

95%

100%

93% 94%94%

96%97% 97% 97% 97% 97% 97%

90%

95%

100%

2009 2012 2015 2018

Generic (Branded and Unbranded) Market Share,

% of Total Rx

Percent of Market Accessible to Generics, % of Total Rx

Percent Dispensed as Generic When Available

(% Generic of Rx Accessible to Generics)

% T

ota

l R

x

% T

ota

l R

x%

Eff

icie

ncy

x

43Source: RBC Capital Markets, FDA

Abbreviated New Drug Application (ANDA) approvals have accelerated since 2014; but withdrawals are increasing

ANDA withdrawals spiked in fiscal 2018 as companies realized

that “me-too” type products are unlikely to be financially viable

Company avg monthly withdrawals

(2012-2018)

9

15 14

21 2118

51

2013

2012

2014

2015

2017

2016

2018

296264

320361

494 474 489

426458

517

440409

492

651

763 781

2008

2007

2003

2002

2004

2006

2005

369

2012

2009

2010

20

11

2013

2014

2015

2016

2017

2018

ANDA approvals (2002-2018)

44Source: FDA, IQVIA

High-level results from FDA approvals vs launch analysis

Count of ANDAs that launched as of December 2018

2013: 370 approvals, of which 264 (71.4%) have launched






Count of ANDAs yet to Launch as of December 2018

2013: 370 approvals, of which 106 (28.6%) have not launched






1. 2017 and 2018 had a record number of

approvals

2. The average launched ANDAs in year 1 from

2013 to 2018 is 35.6% (1,209 launched of

3,400 approvals)

1. Some approvals were not commercialized due

to financial viability for the manufacturer

(especially with the onset of generic price

deflation in 2015)


At an Invoice Price Level, Impact of Losses of Exclusivity are Expected to be 46% Greater in the Next Five Years Including Biosimilars

Source: IQVIA Market Prognosis, Mar 2019

Lower Brand Invoice Spending Due to Loss of Exclusivity US$Bn

-0.1 -1.2 -1.2 -0.9-5.0

-1.7 -3.2 -3.9 -2.4-4.7

-11.5-13.3 -12.5

-16.0-10.5

-12.5

-18.7

-11.6-17.8

-28.2

-11.6

-14.5 -13.7

-16.9-15.5

-14.2

-21.9

-15.5

-20.2

-32.9

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Biologics Small Molecules

-$72Bn

-$105Bn

Total Brand Losses Due to LOE Total Loss per Year

Forecast

46Source: FDA and CDER List of Licensed Biological Products; accessed on March 21, 2019

7 of the 18 FDA approved biosimilars have launchedApproval

Count

FDA

Approval DateBiosimilar

Biosimilar

Manufacturer

Reference

Product

Reference

ManufacturerMolecule

Launch

Status

1 March 2015 Zarxio Sandoz Novartis Neupogen Amgen filgrastim 2015

2 April 2016 Inflectra Celltrion Remicade Janssen (J&J) infliximab 2016

3 August 2016 Erelzi Sandoz Novartis Enbrel Amgen etanercept

4 September 2016 Amjevita Amgen Humira Abbvie adalimumab 2023

5 May 2017 Renflexis Merck & Co Remicade Janssen (J&J) Infliximab 2017

6 August 2017 Cyltezo Boehringer Ingelheim Humira Abbvie adalimumab

7 September 2017 Mvasi Amgen Avastin Genentech bevacizumab 2019

8 December 2017 Ogivri Mylan Herceptin Genentech trastuzumab

9 December 2017 Ixifi Pfizer Remicade Janssen (J&J) Infliximab

10 May 2018 Retacrit Hospira (Pfizer) Epogen Amgen epoetin alfa 2018

11 June 2018 Fulphila Mylan Neulasta Amgen pegfilgrastim 2018

12 July 2018 Nivestym Hospira (Pfizer) Neupogen Amgen filgrastim 2018

13 October 2018 Hyrimoz Sandoz Humira Abbvie adalimumab 2023

14 November 2018 Udenyca Coherus BioSciences Neulasta Amgen pegfilgrastim 2019

15 November 2018 Truxima Celltrion Rituxan Genentech rituximab

16 December 2018 Herzuma Celltrion Herceptin Genentech trastuzumab

17 January 2019 Ontruzant Samsung Bioepis (Merck) Herceptin Genentech trastuzumab

18 March 2019 Trazimera Pfizer Herceptin Genentech trastuzumab

Launched Launch delayed No launch announced

47

Biologic spending could grow more dramatically without future biosimilar penetration

98 117 135 153 159 177 196 222 243 258

1212

1211 24

32

36

38

46

62

109130

147165

189

217

250

287

330

379

109

130

147

165 182

210

232

260

289

319

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Biologic Molecules Without Biosimilar Competition in Year Biologics With Competition in Year (Including Original and Biosimilar)

Biologic Total Scenario Without Further Biosimilars After 2017 Biologics Total ForecastSource: IQVIA MIDAS, Jun 2018; Institute Dec 2018

Notes: Line on chart represents biologic spending using average growth of molecules not facing competition in 2017 continued to 2023 to represent what spending would have been without new molecules facing biosimilar competitors. Segments for biologics with and without competition are modeled using the average historic growth rates and expected entrance of biosimilars and price and volume changes associated with biosimilar entry.

Forecast

48

Narcotic Analgesic Dispensed Volumes in Morphine Milligram Equivalents (MME) Bn

Prescription opioid volume peaked in 2011 at 246 billion milligrams of morphine and has declined by 43% to 141 billion

0

50

100

150

200

250

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

A report by the IQVIA Institute: Medicine Use and Spending in the U.S.: A Review of 2018 and Outlook to 2023

Source: IQVIA National Prescription Audit, Dec 2017; IQVIA Xponent, Feb 2019

-17%

-43%

90+ MME per Day50=<90 MME per Day

49A report by the IQVIA Institute: Medicine Use and Spending in the U.S.: A Review of 2018 and Outlook to 2023

Opioid prescribing has declined across the country

Source: IQVIA Xponent Jun 2018, US Census Bureau, Mar 2018

Declines have been greater in some of the higher per capita states (Alternative view)

AL

AK

AZ

AR

CA

CO

CT

DE

DC

FLGA

HI

ID

IL

IN

IA

KS

KY

LA

ME

MD

MA

MI

MN

MS

MO MT

NE

NV

NH

NJ

NM

NY

NC

ND

OH

OK

OR

PA RI

SC

SD

TN

TX

UT

VT

VA

WA

WV

WIWY

All States

400

600

800

1000

1200

1400

-750-650-550-450-350-250-150-50

TR

x p

er

10

00

Pop

ula

tion

20

11

Delta in TRx per 1,000 to 2018

Opioids TRx per 1,000 Population in 2011 and absolute change to 2018

Greatest per capita declines →

2011 to 2018

50

Prescriptions and Medication Assisted Treatments (MAT) Dispensed Prescriptions

Opioids dispensed prescriptions have declined while Medication Assisted Treatment prescription volume increases

A report by the IQVIA Institute: Medicine Use and Spending in the U.S.: A Review of 2018 and Outlook to 2023

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

0

10

20

30

40

50

60

70

20

14

20

15

20

16

20

17

20

18

To

tal D

isp

en

se

d P

rescri

ptio

ns (

Mn

)

To

tal D

isp

en

sed

Pre

scrip

tion

s (

Mn

)

Calendar Quarters

Source: IQVIA Xponent Feb 2019


The Relative Per Capita Rates of Prescription Opioids andMedication-Assisted Treatment use Vary Widely by State

Source: IQVIA Xponent, US Census Bureau, Feb 2019

Retail Dispensed Prescriptions for Opioids and Medication-Assisted Treatments per Capita By State

52

Prescription opioid use could decline by one-third to one-half over the next five years from current levels

Source: IQVIA National Prescription Audit, Sep 2018; IQVIA Institute Dec 2018Note: States with MME per capita below the average of the lowest quartile do not change in the convergence scenario.

0

100

200

300

400

500

600

700

80019

92

19

93

19

94

19

95

19

96

19

97

19

98

19

99

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

20

18

MM

E P

er

Capita

20

18

20

19

20

20

20

21

20

22

20

23

Scenario: 2023 Usageconverges at average ofquartile of lowest percapita states in 2018

Scenario: 2023 Absoluteusage declines in the nextfive years equal to the lastfive years

Scenarios

A report by the IQVIA Institute: Global Use of Medicines: Outlook to 2023

53

Key takeaways

• Overall usage of prescription opioids has declined 17% (2018) and 43% (since 2011)

• Biggest declines in high MME/day patients

• State variations in per capita usage and declines since 2011 include multiple overlapping triggers (including

policies, regulations, and other factors)

• States have very different challenges regarding prescription opioids, and this is illustrated by the different

relationships/levels of usage of Medication-assisted treatment

• The pain r&d pipeline is the 5th largest of all therapy areas but replacement for opioid pain relief continues to be

elusive

• The outlook includes scenarios for continued aggressive reduction in usage, as well as potential moderation of

the current downward trends

54

Fentanyl is 50-100x more potent than morphine and is lethal in very small doses, as little as 0.25 milligrams1

1: https://americanaddictioncenters.org/fentanyl-treatment/similarities

2: https://www.foxnews.com/health/as-opioids-become-taboo-doctors-taper-down-or-abandon-pain-patients-driving-many-to-suicide

“A report by the Massachusetts Department of Public Health, widely cited by many pain experts, said that among 477 people whose deaths were opioid‐related in 2018, 90 percent, or 423 of them, tested positive for fentanyl – a telltale sign of illegal opioid use.”2

55

National Survey on Drug Use and Health, 2016

Only 37.5% script opioids are obtained from Health Care Providers

Note: Respondents with unknown data for Source for Most Recent Misuse or who reported Some Other Way but did not specify a valid way were excluded

Note: The percentage do not add to 100 percent due to rounding

Given by, Bought from, or Took from a Friend or

Relative, 53.0%Got through Prescription(s) or Stole from a Health Care

Provider, 37.5%

Some Other Way, 3.4%

Bought from Drug Dealer or Other Stranger, 6.0%

➢ 35.4% received Prescription

from One Doctor

➢ 1.4% received Prescriptions

from More Than One Doctor

➢ 0.7% stole from Doctor’s

Office, Clinic, Hospital or

Pharmacy

➢ 40.4% received From Friend

or Relative for free

➢ 8.9% Bought from Friend or

Relative

➢ 3.7% Took from Friend or

Relative without Asking

56

There are a number of metrics to measure improvements in adherence

Medication adherence is the core of the healthcare value chain

Source: IQVIA, Advanced Analytics, Information Partner Services

Stakeholders benefit from improved medication therapy adherence.

The Star Rating therapies have the largest ability to impact the value chain.

Stakeholder Value Chain

STAR RATING

THERAPY

ADHERENCE

PHARMACY

PHYSICIAN

CMSINSURER

HOSPITAL

PATIENT

Better Health defined by:

Lower Total Medical Costs

Less ER visits

Fewer Hospitalizations and

Readmissions

PATIENT

Increased CMS reimbursements

due to better patient outcomes:

Less ER Visits

Reduced admissions, particularly

preventable patient readmissions

HOSPITAL

Significant reduction in Total Allowable Costs

and increased CMS reimbursements,

particularly for the most vulnerable populations.

Improved Patient Health

Improved relationship with patients.

INSURER

Improved community engagement

defined by:

Rx growth

Improved patient outcomes

Increased patient store traffic

PHARMACY

Increased CMS reimbursements

and improved patients ratings:

Increase in patient engagements

Improved patient outcomes

.

PHYSICIAN

Reduced Total Healthcare Costs

Improved Patient outcomes

CMS

THE ADHERENCE VALUE PROPOSITION

57

Adherence is not uniform regionally and varies by different factors, such as method of payment: Med D is most adherent

State Level

Market

Adherence

Rates by Method

of Payment –

Diabetes

Source: IQVIA, State Level Market Adherence Rates by Method of Payment, MAT December 2018

Significant range of

variability between

states


Prescription Adherence has Improved Since 2016 Across all Regions,Particularly in Medicare, Which Ranged from 78–81% in 2018

Source: IQVIA Real World Evidence, Longitudinal Prescription Data, Dec 2018

Percentage of Patients Adherent to Dispensed Prescriptions by Region

58.0%

65.1%

75.8%

68.1%

57.6%

69.1%

77.7%

71.2%

60.9%

69.5%

79.8%

72.2%

60.5%

73.1%

81.2%

74.9%

60.0%

73.4%

80.8%

75.0%

57.5%

69.3%

76.8%

70.8%

51.9%

68.6%

77.9%70.8%

Region Medicare Part D Commercial MedicaidAll Pay Types

49.8%

64.3%

73.4%

66.3%

West

Nort

he

ast

Mid

we

st

So

uth

59

States with Highest, Lowest and Average Adherence Rates per Pay Type, 2018

Adherence is a Key Driver of Better Outcomes in Chronic TherapyAreas, but Varies by State and Insurance Type


Source: IQVIA Real World Evidence, Longitudinal Prescription Data, Dec 2018

MS

MN

ID

MS

MN

OR

AR

VT

IA, NY

Least adherent state

Most adherent state

Average adherence

Medicare Part D Commercial Medicaid

60

Adherence rates in each market are more than 20 points higher for patients getting 90-day Rxs

90-day Rxs are an effective way to increase adherence rates

50%

80% 56%

82%

53%

80%

0

5

10

15

20

25

No 90-day Any 90-day No 90-day Any 90-day No 90-day Any 90-day

DIABETES RASA STATINS

Rx

Vo

lum

es

Mill

ion

s

Adherent to STAR therapy Not Adherent to STAR therapy

Source: IQVIA, Longitudinal Patient Data, MAT December 2018

61

Actual Adherence Rates include patients in the light and dark blue colors combined.

Across STAR Therapy categories, 9-11% of patients have the greatest influence on retailers’ adherence rates

Approximately 5% of

patients are on the cusp

of being adherent.

Retailers may be able to

convert these patients

with minor interventions.

At the same time, an

almost equal proportion of

patients have a PDC

between 80 and 85% and

are at risk of becoming

non-adherent.

67% 70%65% 65% 62%

5%5%

6% 6%6%

4%4%

4% 5%5%

24% 22%25% 25% 28%

40%

50%

60%

70%

80%

90%

100%

TOTAL RETAIL CHAIN FOOD MASS INDEPENDENT

>=85% 80-<85% 75-<80% <75%

76M Pts 61M Pts 10M Pts 6.4M Pts 8.7M Pts


62

Clinically Complex Patient1 Sociodemographically Complex Patient1

• Poverty – Low income and/or no liquid assets

• Low levels of formal education, literacy or health

literacy

• Limited English proficiency

• Minimal or no social support – not married, living

alone, no help available for essential health

related tasks

• Poor living conditions – homeless, no heat or air

conditioning in home or apartment, unsanitary

home environment, High risk of crime

• No community resources – social support

programs, public transportation, retail outlets

• Multiple Chronic Conditions

• Severe Primary Condition (e.g.,

Severe heart failure, metastatic

cancer, end-stage renal disease)

• Concurrent mental and physical

health problems

• Disease affects multiple organ

systems

• Disease causes significant

functional deficit or disability

• Condition requires treatment by

multiple providers and/or

specialized sites of care

1“Risk Adjustment for Socioeconomic Status or Other Sociodemographic Factors TECHNICAL REPORT August 15, 2014 “, National Quality Forum

“When used in accountability applications, performance measures that are influenced by factors other than the

care received, particularly outcomes, need to be adjusted for relevant differences in patient case mix to avoid

incorrect inferences about performance.“ 1

The Case for Risk Adjustment in Medication Adherence

63

Non-Adherent Antidepressant Patients are the least adherent to their Star Therapy Meds

Patients who are Adherent to Antidepressants are the most adherent to their Star therapies

80.2% 84.6% 82.4%

49.4% 52.4% 49.1%

68.4%73.6% 71.7%

19.8% 15.4% 17.6%

50.6% 47.6% 50.9%

31.6%26.4% 28.3%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

DIABETES RASA STATINS DIABETES RASA STATINS DIABETES RASA STATINS

Adherent to Antidepressants Not Adherent to Antidepressants Not on Antidepressants

Adherent to STAR therapy Not Adherent to STAR therapy


64

There are 4 emerging consumerization themes to consider in the ever-changing pharmacy landscape

Source: Drug Store News, Flipping the Script: The state of the pharmacy industry, August 2018

Expanded Care

• Diabetes: Counseling

patients – tend to visit the

pharmacy 3x more than an

average shopper

• Medication Therapy

Management: Pharmacists

work to boost adherence

through medication therapy

management – enhances

patient care and could result

in more revenue

• Expanded Clinical Reach:

Vaccines and travel clinics,

point-of-care testing, and

increased clinical role of the

pharmacy

Finding the Time

• Pharmacy Automation:

Improve efficiency and free

up time to enable 1)

personalized patient care and

2) clinical patient touchpoints

with a pharmacist

• Med Synchronization:

Patients can receive all

medications 1x a month

versus multiple pharmacy fills

throughout the month

Convenience – Inside

& Out

• Convenience at home:

Delivery of medications to

homes and in-home

counseling are on the

upswing in response to

Amazon as a looming

competitor

• Telepharmacy: Meeting the

needs patients in rural and

remote areas – expected to

rise~3% by 2022

• Med Synchronization:

Patients can receive all

medications 1x a month

versus multiple pharmacy fills

throughout the month

Considering Cost

• Prescription discount

cards: Lower prices and

improving patient care/

compliance

1 2 3 4

65V&A Conference 2019 - Digital Health Presentation

The majority of the payers surveyed are making investments across Digital Health solutions

Digital Therapeutics

Telehealth WearablesSmart Drug

Delivery

Connected Point of Care Diagnostics

Health Education or Other Apps

Percent of payers that are currently investing in each type of Digital Health solution

33% 75% 33% 50% 75%25%

OneGuideOscar HealthEngage Healthy PregnancyRxMentor

1. Payer Priorities

Source: IQVIA Payer Survey (n=24)


Source: IQVIA Market Prognosis, Mar 2019; IQVIA Institute, Apr 2019

Total Spending on Medicines and Growth US$Bn

Net Total Spending Growth will Average 3–6% over the Next FiveYears, while Invoice Growth will Average 4–7%

-5%

0%

5%

10%

15%

20%

0

100

200

300

400

500

600

700

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023

Gro

wth

Sp

en

din

g U

S$

Bn

Net Spending Invoice to Net Difference

Net Spending Growth Invoice Spending Growth

Forecast

67

What themes should stakeholders recognize today?

Pharmacies

• Reimbursement

• Controlled Substances

• Access to Specialty Drugs

• Purchasing Alliances

• Track and Trace

• Amazon and the cash customers

Generic Manufacturers


• Portfolio Optimization (“Shrink to Grow”) /

Market Saturation

• Brand /niche drugs (complex generics)

• Generic Price Deflation

• Which approvals to launch?

Wholesalers

• Contract Negotiations

• Controlled Substances

• Generic Price Deflation / Slow Brand Inflation

• Track and Trace


Payers

• Managing Specialty Drug Costs

• Rising Oncology costs

• Formularies blocks and exclusive launches

Brand/Specialty Manufacturers

• Price increase backlash

• Becoming more specialized / Oral Specialty

• Declining Hep C and Pain Dollars

• Orphan Drugs

• Copay accumulators

Consumers

• Rising costs: high out-of-pocket costs /

coinsurance / accumulators

• Quality of Insurance Coverage

• Specialty Tiers

68

Strong forces are driving changes in healthcare

Notes: IPC=integrated patient care

Source: IQVIA Consulting Services; Life Sciences Trends and Growth Areas

Aging population will drive more demand for mental care, homecare

and assistance, social capital and self-management services

Rising cost of care and increasing scrutiny around value will need a

structural re-appraisal of the payer role and new sustainable models

Rising prevalence of chronic diseases will drive greater demand for

disease management programs (e.g. prevention, early diagnosis, IPC)

Adherence/Compliance remains largest avoidable cost for healthcare systems

Increasing connectivity will drive convergence of solutions (e.g. mobile health,

remote monitoring, sensor-enable pills, etc.) and Healthcare Consumerism

Patient Centricity: Patients are becoming more involved in healthcare

decision making, choices, and becoming vocal about innovation requirements

69

These changes unlock new value propositions

Source: IQVIA Consulting Services; Life Sciences Trends and Growth Areas

Aging

Population

Integrated Care

Medicine

Aging

Population

Precision / Predictive

Medicine

Aging

Population

Outcomes Based

Medicine

Aging

PopulationEmpowerment

Medicine

Aging

Population

Medicine

Democratisation

Integrated care for complex chronic diseases, solutions

that help to close gaps in treatment

Disease detection, precise diagnosis and rational prescribing

Rational Prescribing and guaranteed outcomes

Information-based healthcare, improve patient outcomes by

providing daily solutions to HCPs and Providers

Any time, any place medicine (e.g. homecare, telemedicine

and virtual physician visits, etc.)…Walmart, Amazon, Apple etc

70

Disclaimer:

• The analyses, their interpretation, and related information contained herein are made and provided subject to the

assumptions, methodologies, caveats, and variables described in this report and are based on third party sources

and data reasonably believed to be reliable. No warranty is made as to the completeness or accuracy of such

third party sources or data.

• As with any attempt to estimate future events, the forecasts, projections, conclusions, and other information

included herein are subject to certain risks and uncertainties, and are not to be considered guarantees of any

particular outcome.

• All reproduction rights, quotations, broadcasting, publications reserved. No part of this presentation may be

reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopy, recording,

or any information storage and retrieval system, without express written consent of IQVIA.

• ©2019 IQVIA Incorporated and its affiliates. All rights reserved. Trademarks are registered in the United States

and in various other countries.

Thank you

71

Doug Long, Vice President, Industry Relations

Doug Long is Vice President of Industry Relations at IQVIA (formerly QuintilesIMS), the world’s

largest pharmaceutical information company. IQVIA offers services to the pharmaceutical industry

in over 100 countries around the globe. Doug has been with IQVIA since 1989.

His fundamental task is to help secure data for all existing and new databases supported by

IQVIA, manage supplier, manufacturer & association relationships, and develop information for

data partners. As direct consequence of his involvement in these areas, Doug has considerable

experience with, and a unique perspective on, the changing U.S. and global healthcare

marketplace and pharmaceutical distribution.

Doug is a frequent industry speaker and the recipient of many awards from trade groups. Before

joining IQVIA Doug held positions at Nielsen Market Research for 16 years in various sales and

marketing capacities. A native of Illinois, Doug received a BA from DePauw University and holds

an MBA in management from Fairleigh Dickinson University.

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