COVID-19 Two Year Review

The Challenges and Opportunities of the COVID-19 Pandemic: A Review at Two Years In

Introduction

As we enter 2022, we are approaching the two–year anniversary of the COVID-19 pandemic spreading across the world and in many ways, changing life as we knew it. After the initial chaos, with many businesses effectively shutting down in response to unprecedented lockdowns, the pharmaceutical industry has learnt to adapt. Now, two years in, we review the challenges still faced by the industry, as well as the opportunities that have arisen. 

Healthcare systems have been overstretched by the pandemic 

Despite COVID-9 undoubtedly still creating problems across the globe, within the pharmaceutical world, there are just two stand-out issues that are still challenging the industry two years on: 

1. Over-stretched healthcare systems and budgets 
2. HTA agencies being saturated by COVID causing delays to access 

The first challenge is that COVID has been a huge expense to healthcare systems across the world. A paper released by the NHS in September 2021 found that COVID increased annual running costs of the NHS by a staggering £4-5 bn (1). In Italy, it was found that a single intensive care stay due to COVID was costing hospitals on average €25,000 (2). Match these costs with healthcare systems which, even in pre-pandemic times, were facing an uptick in healthcare expenditure (3), and we are seeing intense pressure on healthcare budgets across the globe. 

Governments, healthcare systems and other providers and payers will be looking to save money, or at the very least curb the growth in healthcare expenditure. Pharmaceutical expenditure makes up a significant proportion of healthcare spending. Data on the G20 country group from OECD (the Organisation for Economic Co-operation and Development) shows that prescription and over-the-counter drugs make up between 11.5%-22.2% of total healthcare costs (4). Even in the UK, at the lower bound of this range, data from as far back as 2018 saw that drug spending was rising at a substantially faster rate than the total NHS budget (5). Given this data, it is not a stretch to suggest that it is likely governments and healthcare systems will be looking at minimising increase in drug costs over the coming years in response to COVID-related budget pressures. Attempts to minimise drug costs could be seen in changes to HTA methodology, for example, stricter rules regarding budget impact or health economic thresholds. Utilisation of discounts, rebates or managed entry agreements may also increase. 

The second challenge regards delays in access caused by healthcare systems and HTA agencies being saturated by COVID-related activities. In April, one study found that the number of HTA reports published in 2020 was down by 31% and 43% compared to the previous 5-year average in the UK and France respectively (6). This continues to pose a challenge as we enter 2022, as such delays are expected to cause backlogs that will have not yet cleared. However, this story is not universal, as the original study did find that the HTA publication rate in Germany was in fact up by 24% (6). Further to this, the Office for Life Sciences’ Annual report on the UK life Science Sector published data stating that in fact the pandemic had limited impact on NICE appraisal times, with appraisal times for oncology products decreasing in the 2020/21 period (7). However, we expect that backlogs caused by COVID will still create obstacle for Pharma, at least in some markets. 

COVID has introduced a new therapy area and a push to digitalisation 

However, there are certainly opportunities that have arisen in the face of the challenges the pandemic has brought: 

1. COVID has presented a new, well-funded therapy area opening up space for both new treatments and preventative measures 

• Vaccines 
• Monoclonal antibody treatments 
• Antiviral treatments 

1. COVID has accelerated adoption of digitalised healthcare 

2021 was a busy year for COVID treatments and preventative interventions. Just over a year ago, at the end of 2020, we were just starting to see vaccines being introduced across Europe, with the Pfizer and AstraZeneca vaccines dominating early rollout. Now, there are five vaccinations authorised for use by the EMA, with Moderna, Janssen and Novovax joining the ranks, and four more vaccines under rolling review. Unsurprisingly, huge sales from national and EU-level procurement have been seen for these products, particularly those launched during last winters wave. To date more than 1 billion doses have been delivered to the EU Member States through joint procurement (8). 

2021 also saw the introduction of monoclonal antibody therapy for the treatment of COVID. Ronapreve®, Roche and Regeneron’s antibody cocktail of casirivimab and imdevimab was the first to receive marketing authorisation at an EMA level in November of this year, although it had already been rolled out at a national level and was FDA certified back in March9. Both GSK and Celltrion’s antibody therapies followed, with Astra Zeneca’s venture still under rolling review. Novel antivirals have also been introduced, Merck’s molnupiravir is currently awaiting a decision on marketing authorisation and Pfizer’s ritonavir is under rolling review. Despite these treatments coming later in the year than the vaccines, they have also benefited from government level procurement, even before receiving marketing authorisation. All the way back in January of 2021, the German government spent €400 million procuring doses of the then unlicensed antibody therapies by Roche/Regeneron and Eli Lilly (10) – who’s rolling review was terminated in November (11). In October, the UK government procured 480,000 courses of molnupiravir and 250,000 courses of ritonavir, with a further 4.25 million in December (12). 

The other opportunity that should be on the radar of the pharmaceutical industry is the benefits from a world that has adapted to remote working and virtual meetings. Remote working has allowed crucial meetings, for example with HTA agencies, to take place virtually. This allowed these meetings to continue during the days of deepest lockdown, but also had clear benefits in making meetings more accessible, reducing travel costs and of course environmental benefits. But more evolutionary than this, is the adoption of digitised healthcare. Digitalisation ranges from telecare, with prescriptions being given out over the phone and even email, to the use of AI in the collection of real-world data (3). The growing use of digital and virtual tools will open up avenues for innovation which the pharmaceutical industry can benefit from. A move towards a more digital world was indeed already underway, but the forced remoteness of the past two years has accelerated this shift. 

How will these challenges and opportunities shape the future of the industry? 

As we currently review the challenges and opportunities that have arisen with the pandemic, it is clear that the situation is very different to that of a year ago and will likely look very different in another year’s time. So how do we predict the current challenges and opportunities will shape the future of the industry? 

Looking at our challenges, it is likely the massive economic burden caused by the pandemic will have ripple effects going forwards into the coming years, as such a strain on healthcare budgets will take a while to be absorbed. Looking at the backlog and delays to access caused by the pandemic, the situation is more fluid with variations from country to country. It therefore remains to be seen whether this will be a long-running problem and will likely continue to vary across markets. 

Let’s turn now to our opportunities. When reviewing the influx of vaccinations and treatments into the COVID space over the last year, it would be easy to say the market is now saturated, with little opportunity left. However, an unmet need may still remain, particularly if new variants of COVID render current treatments less efficacious. Eventually of course, most of us hope that the pandemic will fizzle out leaving these treatments redundant. However, with COVID still very much present, there is no imminent closing of the COVID space. Looking now at digitalisation, here is an opportunity that is certainly expected to continue long-term. Of course, as discussed earlier, this is not something created by the pandemic but rather accelerated by it. As such, even as COVID becomes a less prominent part of life, the digitalisation of healthcare and pharmaceuticals will likely continue to grow. 

Sources 

1. NHS Confederation and NHS Providers. 2021. A reckoning: the continuing cost of COVID-19. https://www.nhsconfed.org/sites/default/files/2021-09/A-reckoning-continuing-cost-of-COVID-19.pdf [Accessed 07/01/22] 
2. Quotidiano Sanita. 2021. Altems: “Each Covid hospitalization in intensive care costs an average of 25,000 euros. Getting vaccinated is also good for public health funds”  http://www.quotidianosanita.it/studi-e-analisi/articolo.php?articolo_id=99902 [Accessed 07/01/22] 
3. PWC and EFPIA. 2021. Health systems after COVID-19. https://media-exp1.licdn.com/dms/document/C561FAQGsRTFa64PAyw/feedshare-document-pdf-analyzed/0/1626449027147?e=1641654000&v=beta&t=Np0FIZ_FPhZ6tNg5NvOo9gfjSenUSbUzTA_83fp8FLc [Accessed 07/01/22] 
4. OECD. Pharmaceutical Spending. https://data.oecd.org/healthres/pharmaceutical-spending.htm [Accessed 07/01/22]. 
5. Ewbank L., et al. 2018. The rising cost of medicines to the NHS: what’s the story? https://www.kingsfund.org.uk/publications/rising-cost-medicines-nhs [Accessed 07/01/22] 
6. Rickwood, S. 2021. Three pillars of post-pandemic launch excellence. https://pharmaphorum.com/views-and-analysis/three-pillars-of-post-pandemic-launch-excellence [Accessed 07/01/22] 
7. Office for Life Sciences. 2021. Life Science Competitiveness Indicators 2021. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1007243/Life_Science_Competitiveness_Indicators_2021_report_final.pdf [Accessed 07/01/22] 
8. European Commission. 2021. European Commission obtains further acceleration of deliveries of vaccine doses to Member States. https://ec.europa.eu/commission/presscorner/detail/en/ip_21_6932 [Accessed 07/01/22] 
9. Roche. 2021. Ronapreve approved by European Commission to treat non-hospitalised COVID-19 patients and for prophylaxis of the disease. https://www.roche.com/investors/updates/inv-update-2021-11-12.htm [Accessed 07/01/22] 
10. Oltermann, P. 2021. Germany to administer Covid drugs used to treat Donald Trump. https://www.theguardian.com/world/2021/jan/25/germany-to-administer-covid-antibody-cocktailsdrugs-used-treat-donald-trump [Accessed 07/01/22] 
11. EMA. 2021. EMA ends rolling review of the antibodies bamlanivimab and etesevimab for COVID-19 following withdrawal by Lilly. https://www.ema.europa.eu/en/news/ema-ends-rolling-review-antibodies-bamlanivimab-etesevimab-covid-19-following-withdrawal-lilly [Accessed 07/01/22] 
12. DHSC. 2021. UK secures millions more antivirals to help fight Omicron. https://www.gov.uk/government/news/uk-secures-millions-more-antivirals-to-help-fight-omicron [Accessed 07/01/22].