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Forty Five New Active Substances Launched in 1998

A total of 45 new active substances (NAS) were launched worldwide in 1998, slightly down on the 1997 total of 50 NAS, but on a par with the previous two years of 44 and 45 respectively, in 1996 and 1995. These figures are monitored by IMS HEALTH's new pharmaceuticals introductions service, Drug Launches. Thus, the message is that innovative R&D is alive and well.

Decline in NAS from Japan

So what has changed over the last five years? A significant shift has occurred with respect to first world launches by country according to IMS HEALTH's Pharmaceutical World Review. In 1994, Japan led the field with a massive 23 first world launches, whilst in 1998 Japan only accounted for 4 first world introductions.

New Active Substance by Country of 1st Launch



Reasons include:
  • A less favourable situation regarding NAS in the domestic market, with shorter times to recoup R&D outlay.
  • NAS are no longer sustaining the high prices they originally attracted in the Japanese NHI.
  • Long approval time taken by Japanese authorities
  • In the past, many drugs developed in Japan stayed in the domestic market and did not reach US or European markets. Now most of the NAS are international products and have been licensed out at various stages along the way. However, in general they still take time to enter European and US markets despite earlier licensing in activity. By year-end 1998 none of the NAS launched in Japan as their first market had penetrated any other world market. Conversely none of the other 41 NAS had reached the Japanese market by year-end 1998. Indeed, nearly 70% of pharmaceuticals approved in the USA since 1991 have not yet been approved in Japan, according to PhRMA. This situation should change as Japan has formally undertaken to reduce average review times for new drugs to one year from April 2000, and to accept foreign data in applications, under a bilateral agreement reached with the USA at the G8 meeting in summer 1998. The current Japanese review period should only take 18 months, but in general the time taken is nearly twice that according to IMS HEALTH's Pharma Prognosis International.
NAS Increases in the US

In contrast, US first world launches of NAS have risen dramatically; in 1994 only 7 NAS were introduced in the US as their first market, but by 1998 first US introductions amounted to a massive 32 - representing 71% of NAS.

What have been the drivers of this change?
  • Increasing acceptance of clinical trials conducted in Europe.
  • The US FDA approval process has long been considered as the most stringent in the world, demanding very extensive trials, conducted predominantly in the US. There has been a general acceptance more recently, however, of the trials conducted in Europe.
  • The sustained high growth rate in the US pharma market
  • This has encouraged multinational companies to concentrate efforts on the more buoyant US market first and then pick up on EU as a close secondary concern
  • The US FDA Orphan Drug Designation
  • The US FDA's accelerated approval process for drugs classified as having significant contribution over drugs already on the market or filling a niche not already satisfied means that the approval process in the US is accelerated at the final stages in the US, overtaking European first approvals. This procedure, which has been in place for several years now, has encouraged and accelerated the development process for several important new drugs for restricted markets. The EU has yet to finalise its orphan drug policy, hence approval of these drugs takes proportionally longer than in the US. Another factor which slows down the process in some European countries is that once they have passed the first hurdle of the EMEA, they then have to wait several months, particularly in France and Italy, to receive price approval.

Sixteen of the 32 drugs introduced in the US as their first market in 1998 did not reach any other markets by the end of 1998. A further 5 drugs only reached either Puerto Rico and/or Canada by year-end. Only 7 of the 32 drugs had reached one or more of European market by year-end.

The UK had been steadily increasing in popularity as the first country of launch, rising from 4 in 1994 to 9 in 1997, but this trend came to an abrupt halt in 1998, when first introductions in the UK dropped dramatically to just one in 1998.

R&D Country of Origin

When considering the actual country of R&D for the drug by the corporation nationality, rather than the local company, the trend is reversed. It is of interest to note, however, that a number of the drugs introduced in the US as their first market actually came from European companies. German corporations are responsible for 5 of the 10 US first introductions not developed by US corporations.