US Alzheimer’s Disease Drugs Market Analysis

US Alzheimer’s Disease Drugs Market Executive Summary

The US Alzheimer’s Disease Drugs market was valued at $6.48 Bn in 2022 and is estimated to expand at a compound annual growth rate (CAGR) of 6.42% from 2022 to 2030 and will reach $10.65 Bn in 2030. Alzheimer's disease is a progressive brain ailment that worsens with time. It is characterized by alterations in the brain that result in protein accumulation. Alzheimer's disease causes the brain to shrink and, eventually, brain cells to die. Alzheimer's disease is the most prevalent cause of dementia, which is characterized by a progressive decline in memory, thinking, behavior, and social skills. These alterations have an impact on a person's ability to operate. The disease's early symptoms include forgetting recent events or discussions. It progresses over time to major memory issues and loss of capacity to do daily duties.

Alzheimer's disease affects around 6.5 Mn people in the United States aged 65 and older. More than 70% of them are 75 years old or older. Alzheimer's disease is expected to affect 60% to 70% of the approximately 55 Mn people globally who have dementia.

Market Dynamics

Market Growth Drivers

One of the most significant drivers of growth in the Alzheimer's drugs market is the aging of the population. As the baby boomer generation ages, the number of people living with Alzheimer's disease is expected to increase significantly, which will drive demand for Alzheimer's drugs. According to the United States Census Bureau, there are 54 Mn adults in the United States who are 65 or older, accounting for 16.5% of the overall population. Another growth driver is increasing awareness of Alzheimer's disease and improving diagnosis rates. As more people become aware of the disease and seek medical attention, more cases will be diagnosed, and demand for Alzheimer's drugs will increase. The development of new drugs and therapies is another critical growth driver for the Alzheimer's drugs market. With the recent approval of Aduhelm, there is renewed interest and investment in developing new treatments for Alzheimer's disease. Government support for Alzheimer's research and development can also drive growth in the market. In the US, the National Institute on Aging and the National Institutes of Health fund a significant amount of research on Alzheimer's disease, which can lead to new drug discoveries and advancements in the field

Market Restraints

Developing new Alzheimer's drugs is an expensive and time-consuming process that can take many years and cost billions of dollars. The high development costs can make it challenging for smaller companies to enter the market and compete with larger, established players. The regulatory environment for Alzheimer's drugs is stringent, with the FDA requiring extensive clinical trials and evidence of safety and efficacy before approval. The approval process can be lengthy and unpredictable, which can make it difficult for companies to plan and invest in research and development. While there are drugs available to manage the symptoms of Alzheimer's disease, there is currently no cure. The limited efficacy of current treatments can be a significant challenge for patients and caregivers, as well as for companies trying to develop new and more effective drugs. Patent expiration and the subsequent entry of generic drugs into the market can be a challenge for companies that rely on revenue from branded drugs. Generic competition can lead to price erosion and decreased profits, which can make it difficult for companies to invest in the research and development of new drugs. Alzheimer's drugs can be expensive, and some patients may face challenges in accessing them due to high out-of-pocket costs or reimbursement limitations by insurance providers. This can limit the market potential for new drugs and create challenges for patients and healthcare providers seeking to manage the disease effectively.

Competitive Landscape

Key Players

• AstraZeneca
• Biogen
• Eisai Co.
• Eli Lilly and Company
• H. Lundbeck A/S
• Johnson and Johnson
• F. Hoffmann-La Roche AG
• Merck & Co.
• Novartis AG
• Pfizer

Notable Deals

In May 2020, Allergan was completely acquired by AbbVie. Allergan had been developing a drug called Aducanumab for Alzheimer's disease, which showed promise in clinical trials. Following the acquisition, AbbVie continued to develop Aducanumab and submitted it for FDA approval in 2020.

Latest Trends

1. June 2021, FDA approval of Aduhelm, a drug developed by Biogen for the treatment of Alzheimer's disease. Aduhelm is the first drug to receive FDA approval for the treatment of Alzheimer's disease in nearly two decades
2. In 2021, Alzheimer's Association announced a $5.5 Mn investment in the Accelerating Medicine Partnership-Alzheimer's Disease (AMP-AD) Target Discovery and Preclinical Validation Project. The project aims to identify and validate new drug targets for the treatment of Alzheimer's disease

Healthcare Policies and Regulatory Landscape

The National Alzheimer’s Project Act (NAPA) was signed into law by President Obama in 2011. The goal of NAPA is to improve care and support for individuals living with Alzheimer’s disease and related dementias, as well as their caregivers, and to enhance public awareness and understanding of the disease. NAPA established an Advisory Council on Alzheimer’s Research, Care, and Services, which is responsible for creating and updating a National Plan to Address Alzheimer’s Disease. The National Plan includes five main goals:

• Prevent and effectively treat Alzheimer's disease by 2025
• Optimize care quality and efficiency
• Expand support for people with Alzheimer's disease and their families
• Enhance public awareness and engagement
• Improve data to track progress

The National Institutes of Health (NIH) is an organization comprised of Institutes, Centers, and Offices that perform and fund research on all aspects of human health. The NIA directs the NIH's activities in Alzheimer's and associated dementia research, with the goal of discovering new strategies to prevent and treat these diseases. The NIA works closely with the National Institute of Neurological Disorders and Stroke (NINDS), which oversees a research portfolio focused on Alzheimer's-related dementias. The NIA and NINDS collaborate with other NIH Institutes, Centers, and Offices to finance similar initiatives. The NIH also works with the VA on a number of similar efforts, such as using health data from Mns of elderly veterans to further dementia research.

NAPA and the National Plan have helped to increase awareness and funding for Alzheimer's disease research and support services. Since the enactment of NAPA, annual funding for Alzheimer's disease research at the National Institutes of Health (NIH) has increased from $450 Mn in 2011 to over $3 Bn in 2021. Additionally, NAPA has led to the development of several public-private partnerships and collaborations to advance Alzheimer's disease research and improve care for patients and their families.

Reimbursement Scenario

The majority of Alzheimer's drugs are covered by Medicare Part D, which provides prescription drug coverage for seniors and individuals with disabilities. However, many of these drugs require prior authorization and may have high out-of-pocket costs, particularly for patients who do not qualify for low-income subsidies. In addition, some insurance plans may have restrictions on the use of Alzheimer's drugs, such as requiring step therapy or limiting the duration of treatment. This can make it difficult for patients to access the medications they need or to continue using them over the long term.

Medicare payments for services to beneficiaries 65 and older with Alzheimer's disease or other dementias are more than three times more than payments to beneficiaries without these illnesses, and Medicaid payments are more than 23 times higher. Overall payments for health care, long-term care, and hospice services for adults 65 and older with dementia are expected to total $355 Bn in 2021. While the recent approval of Aduhelm, a new drug for the treatment of Alzheimer's disease, has also raised concerns about the affordability and reimbursement of this medication. The drug is expensive, with an estimated annual cost of $56,000 per patient, and it remains unclear how much of this cost will be covered by insurance or Medicare.