A reinvigorated interest in radiopharmaceuticals has brought nuclear medicine to the foreground with deals over 2024 further exemplifying this trend.
As revenues rose for Novartis’ radiopharmaceutical blockbuster Pluvicto, competitors are packing their pipelines with radiopharmaceuticals through acquisitions and licencing deals, hoping to emulate its success. At the same time, the uptick in interest in radiopharmaceuticals has left supply chains struggling to meet demand with isotope producers scrambling to upscale capacity. Attempts to increase patient access to these drugs is also exerting pressure on policy makers to revise the reimbursement and regulation of radiopharmaceuticals.
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Novartis’s leading radioconjugates—Pluvicto (lu-177 vipivotide tetraxetan) and Lutathera (lu-177 dotatate)— are both peptide–lu-177 conjugates. While Pluvicto is marketed for metastatic castration-resistant prostate cancer (mCRPC), Lutathera is indicated for treating neuroendocrine gastroenteropancreatic tumours. Both are also in ongoing studies in other cancer settings.
The appetite for radiopharmaceuticals has been reflected in moves made by some of the largest pharmaceutical companies in recent months. In September 2024, Sanofi signed a $100 million licensing deal with Houston, Texas-based RadioMedix and Plano, Texas-based Orano Med to develop radiopharmaceuticals for neuroendocrine tumours, after Eli Lilly signed its own deal with Durham, North Carolina-based Aktis Oncology worth a potential $1.1 billion in May. Meanwhile, AstraZeneca acquired the radioconjugate developer Hamilton, Canada-based Fusion Pharmaceuticals for around $2 billion in June.
Optimism and concerns among drug developers
As interest in radiopharmaceuticals has soared, supply chains have struggled to keep up. The alpha-emitter actinium-225, for example, has been in short supply for much of the year as developers like Novartis, Eli Lilly, and Johnson & Johnson seek to use the isotope in candidates to treat mCRPC.
Isotope producers have responded well, says Dr. Ken Herrmann, professor of nuclear medicine at the Essen University Hospital, Germany. He notes how Belgian producer PanTera, for example, secured €134 million ($140 million) from investors in September to greatly expand actinium-225 production.
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By GlobalDataThese shortages are an expected feature of sector growth according to Dr. Jack Hoppin, CEO of Boston-based Ratio Therapeutics. One among a growing number of radiopharmaceutical developers, Ratio’s lead candidate FAP-Rx is in a Phase I study, directing an actinium-225-lined drug against soft tissue sarcoma.
Hoppin notes there was “massive anxiety around scale adoption” of isotope production at the beginning of 2024. However, as per Hermann, rather than isotope supply, patient access could prove the bottleneck for growth in this sector. Hinging largely on regulator and government attitudes, he notes regulatory heterogeneity around radiopharmaceuticals as a potential roadblock to further development.
But there is reason for optimism, says Hoppin, pointing to a proposal made in July 2024 by the US Centers for Medicare & Medicaid Services (CMS) to expand reimbursement for certain nuclear medicines.
A year of radiopharmaceutical deals
“Very clearly, there’s a lot of investment in deal activity that picked up in the last year,” says Betty Pio, partner at the Chicago-based consulting firm Kearney. As per data from GlobalData’s Pharmaceutical Intelligence Centre, the highest number of deals made in radiopharmaceuticals space for the past decade took place in 2024.
Pio argues that this trend is likely to continue for companies currently invested in the space who can leverage radiopharmaceutical capabilities to expand their nuclear medicine portfolios. Conversely, large companies that haven’t invested in the sector, like Pfizer or GSK, could struggle to now establish a presence, lacking the necessary infrastructure and expertise.
“These are very technically sophisticated products that are hard to copy……a built-in protection against generic competition,” says Pio. She adds that given commercialisation expenses like the need to train physicians to administer radiopharmaceuticals for new entrants, Novartis and other radiopharma leaders can expect a period of comfortable security.
As any drug class garners interest, supply is liable to lag behind the demand for a period, says Tonny Huang, a consultant at Kearney. Looking to 2025, Huang says deal-making will persist while the sector is “pressure tested”, as isotope production, supply chains, and hospitals adjust to increased interest in radiopharmaceuticals.
Rather than isotope production capacity, regulation around transport and containment of radioactive material could prove more restrictive for the sector, according to Eric Blazic, also a consultant at Kearney. He highlights the fact that production of many medical isotopes relies on rare earth elements extracted from regions like Russia and the South China Sea, for which trade may prove uncertain under a US Trump administration.
Radioisotope supply chains play catch up
Increased interest in 2024 is just the beginning for radiopharmaceuticals, says Jason van Wart, CEO of isotope producer Laurentis Energy Partners based in Ontario, Canada. Laurentis has been inundated with requests for reliable production of radioisotopes for pharmaceutical use according to van Wart, as the industry anticipates further growth.
From a producer’s perspective, van Wart expressed stronger concerns over supply chain issues than others, stating that to say 2024 saw an isotope supply crisis would be “a fair characterisation”. However, he also noted an encouraging reaction from producers working to upscale their operations to meet demand.
Laurentis, a subsidiary of Ontario Power Generation under the Ontario government in Canada, runs a four-unit heavy water reactor at the Darlington nuclear power station in Bowmanville. The company focusses on producing the isotopes molybdenum-99 and yttrium-90 for medical applications, but van Wart says the system has flexibility that could allow any isotope requiring neutron capture to be produced. He states Laurentis has applied for the right to produce lutetium-177, the isotope in Novartis’s Pluvicto and Lutethera.
Van Wart estimates that medical isotope production, currently around a quarter of Laurentis’ business alongside power production, could grow to 60% of its business by 2028–2029. For van Wart, the progress of radiopharmaceuticals in 2025 centres on the adoption of treatments into public health plans. “The pan-Canadian Pharma Alliance, which negotiates on behalf of the provincial health plans, recently approved Pluvicto…. [and] that release, to us, sets the stage for radiopharmaceuticals to be offered in Canada.”
Reimbursement and regulation remain uncertain
On 10 July 2024, the CMS proposed to overhaul the way in which Medicare reimburses radiopharmaceutical diagnostics. Currently, these services are ‘packaged’, meaning Medicare does not reimburse their costs individually, but rather as part of a broader package including associated procedures and pharmaceuticals.
The revision to this rule, CMS-1809-P, would mean that above the cost threshold of $630 per day, Medicare would separately reimburse radiodiagnostic procedures. While intended to go into effect in 2025, no decision has yet been finalised on CMS-1809-P.
Increased reimbursement such as this will encourage greater investment in R&D and manufacture of radiopharmaceuticals, says Stephen Forster, partner at the Philadelphia-based law firm Morgan Lewis. This sort of regulatory attitude will improve patient access to diagnostics and therapeutics and, while this ruling would only apply to Medicare, those rulings are often mirrored by Medicaid and private insurers, says Tesch West, associate at Morgan Lewis .
But regulation and reimbursement of radiopharmaceuticals remain somewhat unknown, especially in the US. With drug prices up for debate under the Inflation Reduction Act, increased scrutiny on pharmacy benefit managers, and a resurgent Trump administration, Forster says there might be some uncertainty for radiopharmaceuticals in 2025 and beyond.
With data analysis and visualisation by Irena Maragkou.
