New analysis from IMS Health has painted a gloomy picture for branded medicines for the next five years as patent expiries and national policy changes take their toll. Spending for branded products in developed markets will remain at the same level in 2015 as in 2010; however, the market share for branded medicines, which fell from 70% in 2005 to 64% in 2010, is expected to decline to 53% by 2015.

The findings come from a report by the IMS Health Institute for Healthcare Informatics, which examines the global use of medicines through to 2015. There’s a lot of interesting data in the report — far too much to cover in a single blog! As a result, I’ll be looking at the report in a lot more detail in the July issue of Pharmaceutical Technology Europe. For now, I’ll just look at some of the main trends that have been identified.

In general, IMS Health expects medicines spending to reflect a slowing compound annual growth rate of 3–6% over the next five years, compared with the 6.2% that has been seen during the last five years. In a press statement, however, Murray Aitken, executive director of the IMA Health Institute for Healthcare Informatics, added that the exact spending and growth levels for 2015 are hard to predict. “Past patterns of spending offer few clues about the level of expected growth through 2015. There are unprecedented dynamics at play, which are driving rapid shifts in the mix of spending by patients and payers between branded products and generics, and across both developed and pharmerging markets.”

One of the main dynamics that IMS has identified is a move away from branded products as cheaper generic versions become available — particularly in the developed markets where patent expiries are forecast to provide payers with net savings close to $100 billion through 2015. Among the developed markets, the US is predicted to experience the largest increase in generic spending. In the emerging markets, the growth of branded products is expected to be robust as medicines expenditure reaches $285–315 billion (compared with $151 billion in 2010), but the majority of medicines spend will likely still be on generics.

Interestingly, although the use of generics is on the rise, the same cannot be said for their biologic counterparts: biosimilars. Such products are evolving rapidly and a number of new biosimilars are expected to be introduced by 2014. By 2015, however, IMS Health expects that only about 1% of total global expenditure on biologics will be attributable to biosimilars.