Oncology Landscape: Competitive Pipelines and Global Mandates

4 Dec

By Mimi Liu, Research Analyst, LSN 

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The global market for cancer drugs and treatments is truly massive and continues to grow. According to the IMS Institute for Healthcare Informatics, global oncology spending hit $91 billion in 2013, and it is growing at a 5% clip annually.[1] In previous articles, we’ve analyzed new products and investor interest in the cardiovascular and neurology sectors. Today, let’s look at what LSN data shows in the oncology sphere.

LSN tracks more than 4,500 therapeutic assets for the neoplasms, cancer, and oncology areas, including 1,025 assets that are in the preclinical stage, 2,202 assets that are in the clinical stage, and 517 assets that are on the market. For some of these therapeutics, LSN is also able to track the type of cancer they target. Although this is a subset of the total, it is useful to analyze. (See Figures 1, 2, and 3.)

figure1

Figure 1

Figure2

Figure 2

Figure3

Figure 3

Several types of cancer, such as breast, prostate, and pancreatic, are clearly some of the hottest and most competitive areas, representing large patient populations and substantial unmet medical needs. Companies developing therapeutics for these cancers likely find it more challenging to differentiate themselves from competitors than do companies targeting other cancers. It is interesting to note that certain disease areas, such as solid tumors and brain cancer, have attracted significant R&D efforts in the preclinical and clinical stages, yet there are relatively few available products on market. This may reflect a large prospective market but significant R&D challenges.

Companies targeting cancer therapies are spread across the globe. The U.S. has the largest number overall, while the UK, Germany, and France are the European countries with the most. North America and Europe are the two areas with the highest concentration of cancer therapeutics, while several Asian countries, such as China, Japan, and South Korea also have a significant number. (See Figure 4.)

Figure4

Figure 4

With the growing number of cancer therapies and the expansion of the cancer market, there are a large number of investors with this interest. LSN has interviewed biotech investors across a wide range of categories who are interested in funding companies targeting neoplasm, cancer, and oncology therapeutics. (See Figure 5.)

Venture capital is the largest group among the ten categories of investors. Private equity firms, angel groups, and family offices also show a high interest in cancer companies. When looking for funding, companies should keep an eye on various categories of investors and the development stage they are interested in.

Figure5

Figure 5

An analysis of investors’ exposure preference by region is strikingly similar to the regional distribution of oncology companies. (See Figure 6.)

Figure6

Figure 6

Most investors are looking to allocate their capital to U.S.-based companies, which corresponds to the concentration of assets in the country. Although investors are attracted to established markets in North America and Europe, a significant portion will consider emerging markets in Asia and Latin America. Since the oncology investor landscape is rapidly shifting, it is important to note that global investors are the third largest group of investors.

For fundraising entrepreneurs, keeping track of all the different types of investors in an indication like this given the global nature of so many investors today, is no small task. However limiting your research and outreach to only a few classes of investors or just within your local geography will undoubtedly hurt your chances for a successful fundraise. In an indication with as much competition as oncology, investors have to focus on technology and management in order to be successful. More and more they are looking overseas for the best possible opportunities  and as an entrepreneur, you should be doing the same.

[1] “Cancer-drug market zooms toward $100B, thanks to costly targeted therapies,” May 6, 2014, FierceMarkets.com.

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