Top Industry Trends for Manufacturers to Watch in 2023admin
Toward the beginning of the new year, we like to take a look at some of the biggest trends that will affect the pharmaceutical industry in the coming months. This year, trending developments range from AI cementing its role in drug development to potential price wars cropping up in the wake of the Inflation Reduction Act and the changing biosimilars market. Read on to learn more about what’s coming our way and how you can prepare for the changes these trends will bring.
AI Streamlining Drug Development
You’ve seen it all over LinkedIn, and you might have even played around with it yourself. Artificial intelligence and machine learning, most often known as AI and ML, respectively, are upending entire fields and driving many to wonder how these technologies will change how they work.
The pharmaceutical industry is no different. AI has been playing a role in drug development for years, and in 2023, that trend is forecasted to continue. Right now, manufacturers are utilizing it in a wide variety of ways. A few prominent applications we’re watching include:
- Forecasting toxicity. Using various data analytics, manufacturers can forecast how different chemicals will interact with each other. This can play a role in reformulating drugs under development to eliminate toxicity.
- Predicting drug-target interactions. Similar to the point above, AI can also aid in predicting how drugs will interact with their targets, helping manufacturers project a drug’s efficacy and potential side effects.
- Aiding in clinical trials. In clinical trials, it’s critical that the right candidates are selected. AI is being used to automate participant selection by assessing prospective candidates using a variety of factors, such as personal history, current conditions, and demographic data.
- Forecasting outbreaks. During the COVID-19 pandemic, AI was used to predict outbreak trends. We’ll continue to see AI play a role in assessing data to forecast epidemics and seasonal illness outbreaks, which can help you anticipate demand for products and plan your supply chain strategy.
All of these applications streamline the drug manufacturing process, which saves time, money, and other resources. As AI continues to evolve and more data becomes available, expect AI to become a more routine tool in drug development.
Drug Price Reform, Accelerated Oversight Restriction, Price Wars, and Their Fallout
Another trend we’re going to see impacting our industry this year is changing laws’ ripple effects.
First, there’s the Inflation Reduction Act. Passed in 2022, the law introduced multiple drug pricing reforms. The first of these is the requirement that the Centers for Medicaid and Medicare Services (CMS) negotiate Medicare’s top-selling drugs’ prices with the drugs’ manufacturers. Pharmaceuticals that meet the following criteria may be chosen for price negotiation:
- Small-molecule drugs that have been approved for seven years or longer
- Biologics that have been approved for 11 years or longer
- Single-source drugs with no approved, marketed generic or biosimilar
- A drug may not be the only major agent produced by a small biotechnology manufacturer
In total, CMS will negotiate 60 drugs’ prices over the rest of the decade, with the first 10 selected by September 1, 2023.
We predict repercussions like pushback from drug makers and investors potentially pulling out of certain projects due to profit concerns. This legislation could also slow the development of certain types of drugs, such as those described above.
Under the omnibus spending package passed in December 2022, the Food and Drug Administration may now require that any drug makers seeking accelerated approval for their products begin confirmatory testing in order to receive this approval. The new legislation also streamlines the process for manufacturers to withdraw conditionally approved drugs from the market when they’ve been proven to be ineffective or inappropriate.
The Most Competitive Biosimilars Market Ever
Another trend we’ll see is the most competitive market for biosimilars ever.
First, Amjevita, a Humira biosimilar will hit the market in Q1. Then, up to eight more will enter the market by summer 2023. These lower-cost options can have a gigantic impact on the market, such as slowing the name-brand drug’s growth and driving price wars.
An Increased Emphasis on Credentialing and Regulation
The last trend we’re covering is an increased emphasis manufacturers need to place on employee credentialing and regulatory compliance as other trends, such as healthcare provider education’s move to digital platforms and an increasingly complex industry landscape, necessitate it.
Credentials and compliance have always been non-negotiable in pharma. But in 2023, those credentials and compliance extend to areas like working in digital environments and understanding biologics, which are trending in R&D pipelines across the industry. The market is changing at a rapid pace, and in order to stay relevant, manufacturers need to embrace developments and ensure medical science liaisons and sales reps fully understand them long before they hit the market.
Keep in mind, none of these trends exists in a vacuum. With drug price reforms going into effect as new biosimilars hit the market, we could see significant shifts in market share and patient access to certain drugs. At the same time, AI will continue to play a larger role in the pharmaceutical industry and manufacturers will largely find themselves facing greater pressure to maintain employee credentials and regulatory compliance.
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