The top 20 biopharma companies, including Bristol Myers Squibb, Johnson & Johnson and Merck, have about $180 billion in sales at risk from expiring patents between now and 2028, EY says.
Wall Street analysts say some companies are taking the right steps by bolstering pipelines, creating partnerships and making acquisitions. And JPMorgan says the revenue loss will be “largely manageable” due to growing pipelines and sales that are expected to remain stable through 2030.
This is in part because many of the biggest sellers coming off patent are biologics, and biosimilars don’t tend to grab market share as quickly as traditional generics. They are also more expensive to develop and more difficult to manufacture, so they are often not sold at steep discounts compared with branded versions.
As the patent cliff draws closer, companies are expected to seek more pipeline acquisitions, particularly late-stage treatments, said Arda Ural, Americas industry markets leader in health sciences and wellness for EY. He added that biotech and pharmaceutical firms currently have about $1.4 trillion available for deals.
