Covid-19 Executive Briefing

Understanding the economic impact of the Covid-19 pandemic and the implications for the healthcare sector

- ECONOMIC IMPACT -

Latest update: 20 April

Many economists have cut their GDP forecasts. The 2020 consensus forecast for GDP growth is currently negative and many predict a recession.

Unemployment rates are expected to rise in all major economies. The International Labour Organization estimates 6.7% of worldwide working hours will be wiped out in Q2 2020.

-3%

IMF forecasts the global economy to contract by 3% in 2020 as the ‘Great Lockdown’ will cause a dramatic drop in economic activity.

$2-3tn

Expected reduction in investments in the commodity-rich exporting nations, according to UNCTAD.

Impact of Covid-19 on asset prices

- SECTOR IMPACT: MEDICAL -

Latest update: 16 April

Clinical trial market impact

608

The overall number of clinical trials that have been disrupted due to the COVID-19 pandemic.

75% - 80%

In a recent GlobalData poll, about 75% and 80% of respondents expressed some level of concern about clinical trial or regulatory delays respectively due to the coronavirus outbreak.

Financing deals may see delays or decline

Biotech companies could face financial constraints and have to lay off employees if clinical trials are delayed and/or cash burn is high. Licensing deal valuations may drop and there could be an increase in distressed assets/companies.

Key mediCal market developments

Preventive and therapeutic interventions

The nearest solutions are antivirals, with Gilead’s remdesivir and Ascletis’s ASC09/ritonavir possibly reaching the market in late 2020 if the results of ongoing late-stage clinical trials are positive, but older drugs such as chloroquine and hydrochloroquine are being touted as potential “game changers.”

Clinical trial disruption

Clinical trials irrespective of indication will likely be impacted, not just in terms of recruitment and immediate patient care but also in terms of data collection and analysis in the months to come. Pharma could see an uptick in virtual trials during and after the pandemic

Marketing activities

Sales of immunosuppressive drugs could decline while sales of anti-hypertensive, respiratory drugs, NSAIDs, anti-pyretics and painkillers, could increase. The FDA has also stated that there was a shortage of the anesthetics, propofol and midazolam, due to increased demand. The US Drug Enforcement Agency also stated that the agency would allow increased production and imports of painkillers and sedatives such as fentanyl, ketamine, and diazepam

Embracing technology

The COVID-19 outbreak will push pharma and healthcare overall to adopt virtual approaches not only in the short term but as part of their long-term strategy. These include virtual conferences, meetings and medical appointments via phone or video.

02/24/2024 09:50:03