BIO Releases Third Report in a Series on the State of Innovation in Highly Prevalent Chronic Diseases

Washington, DC (October 26, 2018) – Today, the Biotechnology Innovation Organization (BIO) released a new report, The State of Innovation in Highly Prevalent Chronic Diseases: Volume III Type 2 Diabetes and Obesity Therapeutics, the third in a series on the current funding and R&D landscape for drugs to treat highly prevalent, chronic diseases.

Previously published data from BIO showed that venture investment for drug development in areas such as psychiatric disorders and cardiovascular diseases has been low and declining over the last decade relative to the prevalence and cost of these diseases. This new series aims to understand the breadth and depth of innovation in the current clinical pipeline and the likelihood of meeting unmet needs in these indications.

This volume takes an in depth look at the state of innovation in diabetes mellitus type 2 and obesity therapeutics. Diabetes affects 30.3 million people in the U.S. alone, 95% of whom have type 2 diabetes, and costs the U.S. healthcare system $237 billion annually.¹ Obesity effects 114 million people in the U.S. with a total healthcare cost estimated at nearly $150 billion annually.²

This report analyzed all drugs approved for marketing in the U.S. for both type 2 diabetes and obesity, and potential future drugs that are progressing through the clinical pipeline to meet the needs of patients suffering from these conditions.

Key Takeaways for Type 2 Diabetes

• Marketed drugs: There are currently 32 unique type 2 diabetes drugs sold in the U.S. that work via 11 different mechanistic strategies. Three new mechanistic strategies were introduced onto the market in the last decade.
• Pipeline: The 84 clinical programs for type 2 diabetes encompass 36 novel chemical drug programs with new mechanistic strategies. However, no Phase III programs with novel mechanisms were found.
• R&D success rate: Clinical success in type 2 diabetes drug development has been extremely difficult for novel drugs, with only a 4.8% probability of FDA approval from phase I (vs. 9.6% across all disease areas). Since 2008, a total of 217 clinical-stage type 2 diabetes programs have been suspended.
• Clinical trial initiations: There has been a 50% decrease in trial initiations for type 2 diabetes over the last decade.
• Venture investment: Venture capital funding of U.S. companies with novel lead stage programs in type 2 diabetes is 24 times below oncology funding ($494 million vs. $12.2 billion over the last decade).

Key Takeaways for Obesity

• Marketed drugs: There are currently 10 obesity drugs marketed in the U.S. These fall into eight mechanistic strategies, with four of the eight mechanistic classes entering the market within the last decade.
• Pipeline: The obesity clinical pipeline consists of 26 programs, 14 of which are novel chemical drug programs with new treatment approaches. There are no Phase III programs for non-rare indications of obesity and only two phase II programs with novel mechanisms were found.
• R&D success rate: Clinical success in obesity novel drug development has been more difficult than type 2 diabetes, with only a 1.4% probability of FDA approval from phase I (vs. 9.6% across all disease areas). Since 2008, 57 clinical stage obesity programs have been suspended.
• Clinical trial initiations: Trial initiations for obesity decreased by 37% from the five-year period 2008-2012 vs. 2013-2017.
• Venture investment: Venture capital funding of U.S. companies with novel lead stage programs in obesity is 40 times below oncology funding ($304 million vs. 12.2 billion over the last decade).

“As this report shows, these two highly correlated diseases continue to be neglected by the investment community at a time when the diseases are reaching epidemic levels with rising healthcare costs globally,” said David Thomas, VP of Industry Research at BIO. “Moving forward, we hope our industry can find solutions to challenges identified across scientific, regulatory, and reimbursement landscapes, as well as physician education when it comes to treating obesity as a disease.”

This report, and all previous BIO Industry Analysis reports, are available for download here.

1. American Diabetes Association (ADA) website, http://www.diabetes.org/diabetes-basics/statistics/. and http://www.diabetes.org/advocacy/news-events/cost-of-diabetes.html accessed September 2018.
2. CDC website https://www.cdc.gov/nchs/data/databriefs/db288.pdf accessed August 2018.and Health Affairs. 28: 822-831 (2009).