Pharma Innovation: Risk & Reward part 2 of 2 Table 7: Clinical Development Spend vs Risk Adjusted FDA Approvals ® by Therapy Area of Current US Pipeline Source: EvaluatePharma Vision, May 2019 Percentage of Total Clinical Clinical Risk Total Clinical Development Development Adjusted FDA NPV Development Risk Adjusted Spend per Rank Therapeutic Category Spend ($bn) Approvals ($bn) Spend FDA Approvals NPV Approval ($bn) 1. Oncology 91.1 126 78.2 40.0% 29.1% 30.6% 0.7 2. Central Nervous System 31.0 42 16.7 13.6% 9.7% 6.6% 0.7 3. Musculoskeletal 19.9 24 21.2 8.8% 5.6% 8.3% 0.8 4. Cardiovascular 19.7 19 5.6 8.7% 4.4% 2.2% 1.0 5. Immunomodulators 15.0 27 29.3 6.6% 6.2% 11.5% 0.6 6. Respiratory 9.2 16 32.1 4.0% 3.7% 12.6% 0.6 7. Gastro-Intestinal 8.4 24 17.0 3.7% 5.5% 6.7% 0.4 8. Systemic Anti-infectives 8.2 51 8.3 3.6% 11.9% 3.2% 0.2 9. Blood 6.4 21 20.4 2.8% 4.9% 8.0% 0.3 10. Sensory Organs 4.9 15 11.9 2.1% 3.4% 4.7% 0.3 11. Dermatology 3.9 19 5.9 1.7% 4.4% 2.3% 0.2 12. Endocrine 3.9 11 4.5 1.7% 2.5% 1.8% 0.4 13. Genito-Urinary 2.0 8 0.3 0.9% 1.8% 0.1% 0.3 Various 4.1 29 3.6 1.8% 6.8% 1.4% 0.1 Total 227.5 431 255.2 100% 100% 100% Inclusion criteria: Analysis refers to products which are in US clinical development (Phase 1-3), or 昀椀led with the FDA. Only NMEs with no prior global approval are included, with risk adjustments applied to approval of US lead indication only, follow-on indications are excluded. Methodology: ‘Clinical Development Spend’ by Therapeutic Category is calculated using EvaluatePharma Vision’s proprietary R&D Cost model and represents the sum of the costs of all commercial clinical trials currently listed on ClinicalTrials.gov for products currently in active clinical development (PI-Filed) – clinical development spend is typically 50% of total R&D expenditure. ‘Risk Adjusted FDA Approvals’ represents the total number of approvals expected from the industry’s current pipeline by Therapeutic Category after applying EvaluatePharma Vision’s proprietary product-speci昀椀c PTRS (Probability of Technical & Regulatory Success) to adjust for the level of risk associated with each pipeline candidate. NPV sourced from EvaluatePharma Vision on May 14th, 2019. Colour coding: The colour applied to ‘Risk Adjusted FDA Approvals’ and ‘WW 2024 Sales’ percentages refer to being above (green) or below (red) the ‘Clinical Development Spend’ percentage. The blue colour scale re昀氀ects the range within that column, with the darker shade representing a higher number. Curious about the data in the table above? With EvaluatePharma Vision you can drill deeper into EvaluatePharma Vision 昀椀lls in the gaps, so you can go each therapy area to quickly discover which companies beyond top-level trends to understand what they really and products are best positioned for success. mean for you and your R&D pipeline. The only single view of the risk and reward of the R&D landscape. Click to schedule a demo 15 ® World Preview 2019 Copyright © 2019 Evaluate Ltd. All rights reserved. EvaluatePharma