NEW YORK (Reuters) - Prices for cancer drugs are likely to fall as much as 40 percent over the next few years as competition in the space heats up, according to Bain & Co. partner Tim van Biesen.
"The risk right now in the industry is that, just like my 5-year-old daughter's soccer team, everybody is chasing that ball," he said on Monday at the Reuters Health Summit in New York.
He said Bain's research shows that almost half of drugs currently under development at pharmaceutical companies are oncology drugs.
Even if only half of them reach the market, there will be "a lot of overlap," he said.
Scientific advances in cancer treatment have encouraged many large drug companies to step up their investment in cancer research in recent years, resulting in a rapidly expanding line-up of targeted therapies.
Oncology is the fastest-growing section of the global pharmaceuticals market, with sales expected to increase by 15 to 16 percent in 2009, against just 4.5 to 5.5 percent for the drugs market as a whole, according to IMS Health.
Van Biesen said he expects cancer drug prices "to come down 35 to 40 percent from where they are now."
In the past, most cancer drugs were cytotoxic agents, designed to kill cancer cells. Such cytotoxic drugs also kill healthy cells that multiply rapidly, resulting in serious side effects such as sickness, hair loss and risk of infection.
By contrast, modern drugs are much more precise weapons because they target specific molecular switches involved in tumor growth, giving rise to fewer side effects.
Well-known examples of targeted cancer drugs include Roche Holding AG's (ROG.VX: Quote, Profile, Research, Stock Buzz) and Genentech Inc's DNA.N Avastin, ImClone's IMCL.O Erbitux and Pfizer's (PFE.N: Quote, Profile, Research, Stock Buzz) Sutent.
(Reporting by Deena Beasley and Ben Hirschler; Editing by Gunna Dickson)
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