Roche, Novartis lead 2024’s top 50 pharma in oncology (YTD)

Swiss pharma giants Novartis and Roche consistently rank among the top pharma companies in terms of revenue. In 2024, the two companies are also leading in total international patent volume. Meanwhile, smaller firms like Incyte and Vertex Pharma are punching above their weight in market impact. For instance, Incyte, with a market cap of just $14.7B, achieved the highest market impact score among the top 50 public firms in the dataset, nearly twice that of Johnson & Johnson.

Despite significant progress in oncology over the past decade, substantial unmet needs remain alongside high drug prices. When filtering pharma patents to oncology, Roche led the way at 54 international oncology patents in the analysis period, while Novartis had 46 cancer patents in the same time frame. J&J and Regeneron secured 30 and 25 patents, respectively, in the therapeutic area.

Accounting factors, oncology patents and patent jurisdiction correlated with stock performance

While patent strategy is important, financial health was the strongest predictor of market impact, accounting for about 21% of a company’s score in a random forest model. How many countries a company filed patents in (15%) and its cancer-related patents (10%) were the next most important factors. Share price volatility and operating margins also played significant roles albeit less so than the aforementioned factors.

Looking at R&D efficiency, which measures how effectively companies convert their R&D spending into patents, Novartis leads with a score of 154, followed by Roche (131) and Janssen/J&J (111). The data reveals striking contrasts between company size and innovation output. While Eli Lilly dominates in market capitalization at $777.4 billion, its patent value per patent of nearly $11.8B reflects an outsized market premium. A substantial portion of its current revenue is a result of the success of the metabolic therapies Mounjaro and Zepbound, which together generated $4.3 billion in combined Q2 2024 revenue.

Universities continue to be indispensable for drug discovery

Beyond public companies, the University of California system led with 81 pharma-related patents. The group of universities, which includes UC Berkeley, UCLA, UCSF and others, was especially strong in gene therapy and antibody development with six patents in each area. Johns Hopkins University was up next with 34 pharma patents, while Harvard, despite fewer patents (23), had one of the highest citation impacts among academic institutions at 77.52 citations per patent.

Here too, cancer therapeutics dominated university research, with universities like Duke (just under 30% of its drug patents were in oncology) and Memorial Sloan Kettering (66.67% oncology patents) showing strong focus on cancer treatment.

Where the data came from

The analysis draws on the Google Cloud’s BigQuery patent database, using data from January 2024 to late October/early November. Patent applications were identified using key CPC classification codes for biopharma relevance. Examples include A61K31/00 for small molecules, A61K38/00 for peptides, A61K39/00 for antibodies/vaccines, A61K48/00 for gene therapy, and A61P35/00 for cancer therapeutics. Financial metrics were derived from yfinance, a free source that offers good data quality but it is not as accurate as professional paid financial sources.

Key metrics in the analysis included:

• Patent Value (USD): Market cap divided by total patents.
• R&D Efficiency: Ratio of total patents to R&D-to-revenue ratio.
• Market Impact: Here, defined as a composite score combining citation impact, geographic reach (jurisdictional coverage), and innovation breadth, which here involved a count of how many patents were spread across small molecule, peptide, antibody/vaccine, gene therapy, oncology, and anti-inflammatory areas.

The ML model described in the article was a random forest model with 1,500 trees and a maximum depth of 10 nodes, achieving moderate predictive power (R² = 0.6821). Cross-validation using 5 folds yielded R² scores ranging from 0.29 to 0.56. Key predictors included financial impact score (20.8%, p < 2.23e-97), jurisdiction count (15.1%, p < 2.70e-68), cancer patents (10.2%, p < 2.54e-52), price volatility (8.2%, p < 1.68e-07), and operating margins (6.5%, p < 0.019). The model used square root feature sampling at each split and required a minimum of 2 samples per leaf node to prevent overfitting. All reported relationships were statistically significant at the p < 0.05 level.

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Filed Under: Drug Discovery and Development, machine learning and AI, Oncology, Pharma 50
Tagged With: 2024, Anti-inflammatory, Antibody, BigQuery, cancer research, Cancer treatment, drug development, drug discovery, Eli Lilly, gene therapy, Incyte, innovation, J&J, Johnson & Johnson, Market Capitalization, Market Impact, Novartis, oncology, Patent Analysis, patents, peptide, pharma, pharmaceutical industry, pharmaceuticals, R&D, R&D Efficiency, research and development, Roche, small molecule, Top 50 Pharma Companies, University of California, vaccine, Year-to-Date, YTD
 

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