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Beyond the patent cliff: Signs of recovery for Biopharma

The patent cliff for blockbusters peaked in 2012. Now Biopharma companies must have a growth strategy and quickly build capabilities to deliver it.


The pharma patent cliff for blockbuster products has reached its peak in 2012, leaving the industry to face a “new normal” where growth is attainable, albeit more difficult to achieve.

Despite shifting global markets, pricing and reimbursement changes, and R&D productivity challenges, Accenture’s biopharmaceutical industry study indicates that from 2013 onward, the negative effect from sales lost due to patent expiry will lessen, and sales from the drug pipeline and current portfolio will improve.

Our research further reveals that a few select companies have clearly articulated a new strategy to dominate in their chosen areas of focus and have quickly mobilized to build the new capabilities required to put bring their strategy for growth to life.


View our infographic to get an overview of the key findings from our research. [PDF, 111KB]


Accenture’s study of the biopharmaceutical industry is in its seventh year and has analyzed the long term performance of “pure biopharma” pharmaceutical companies (those with more than 75 percent of their revenue derived from patented or generic biopharmaceutical products).

Our 2012 update is based on year end 2011 financials and analyzes the 16 largest pure biopharmaceutical companies in the world over a seven-year period. Collectively these companies had US$487 billion in 2011 aggregate revenue, and represented a 54 percent share of the global pharmaceutical market. The results have been compared with our 2010 study (based on year-end 2009 financials) to identify relative movements in the performance rankings.

A detailed analysis of historic financial performance is combined with analyst forecasts to get a forward-looking picture of revenue growth from the existing portfolio and new products launches, and understand the impact of the patent cliff and mature products on market share and revenues.

Key Findings

  • The pharma patent cliff is baked into today’s current valuations: Enterprise Value has stagnated over the last eight years with future value swinging increasingly negative in most cases, indicating the patent cliff has been largely baked into the company valuations of the 16 “pure biopharma” companies we studied.

  • Directional change in performance ranking: There were significant positive movements in five of the 16 companies’ rankings since we conducted this same study two years ago. These changes show how rapidly and fundamentally some high performers have mobilized to be successful in the new normal, while others are yet to find a path back to growth amid the pharma patent cliff.

  • There is life beyond the patent cliff: The negative impact of the patent cliff hits its peak in 2012, while the ratio of new sales from product launches and the current portfolio compared to sales lost due to patent expiry recovers by 2016.

  • High performers return to profitable growth: The high performers in our study varied widely in terms of their business models, operating structures and product portfolios. Some focus on high margin innovative new drugs, while others focus on a more diversified portfolio of biopharma products. .However, they all had articulated a clear strategy to the market on where and how they were going to dominate the market and quickly mobilized their organizations to build the new capabilities that would be required to deliver their strategy in the new normal.


Success in the new normal requires a robust strategy for growth, and the commitment and discipline to:

  • Articulate a clear, focused strategy on the select areas where the pharma company can dominate and own.

  • Take decisive action in building the new capabilities required to quickly deliver your stated strategy and succeed in the new normal, including

  • Understanding how products contribute to improved health outcomes.

  • Mastering multichannel marketing.

  • Enabling an efficient entry into emerging markets.

  • Managing successful product launches.

  • Developing collaborative R&D models.