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This cancer drug could ascend to the No. 2 spot in 2017
With some of the top-selling drugs potentially seeing their sales decline in the quarters and years that lie ahead, it looks as if Celgene's (NASDAQ:CELG) multiple myeloma blockbuster Revlimid has an outside chance of claiming the No. 2 spot among best-selling therapies in 2017. Celgene stuck by a forecast for $8 billon to $8.3 billion in full-year Revlimid sales, although it's been notoriously conservative with its sales estimates throughout the years.
A doctor discussing diagnostic test findings with an elderly patient.
Image source: Getty Images.
Revlimid's success has been based on a confluence of factors. To begin with, demand for Revlimid is on the rise. An increase in multiple myeloma diagnoses, which is a result of an increase in population and earlier detection of the disease, has lifted demand for a go-to drug used as a first- and second-line therapy.
Celgene also has exceptional pricing power with its lead drug. Though list prices of cancer drugs are often a well-kept secret, Celgene has had little trouble passing along higher price points to insurers and patients. Considering its exceptional market share in treating multiple myeloma, Revlimid shouldn't face much in the way of pricing pressure short of federal legislation that caps drug prices (which is unlikely).
Celgene also notes that duration-of-use for its key therapy has helped its sales growth. Improvements in the multiple myeloma treatment process have allowed patients to remain on Revlimid for a longer period of time, ultimately boosting sales for Celgene.
Lastly, Revlimid has multiple label expansion opportunities beyond multiple myeloma. These include first-line follicular lymphoma, relapsed/refractory indolent lymphoma, and first-line ABC-subtype diffuse large B-cell lymphoma. These aren't major money indications for Celgene like multiple myeloma, but they provide a channel to nicely increase sales.
This is what sets Revlimid apart from the rest of its peers
However, there's an additional factor that sets Revlimid apart from the group. In Dec. 2015, Celgene worked out a settlement with a number of generic-drug manufacturers over Revlimid. One manufacturer will be allowed to introduce a limited generic supply of the drug beginning in March 2022 and extending through 2025. By Jan. 31, 2026, a flood of generic Revlimid can finally enter the market. In effect, Celgene cleared a decade-long runway for its lead drug to keep growing.