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The Pound’s Future In A Dollar Collapse

The Pound’s Future In A Dollar Collapse



The Pound's Future In A Dollar Collapse Tyler Durden Sat, 07/18/2020 - 07:00

Authored by Alasdair Macleod via,

In recent articles for Goldmoney I have pointed out the dollar’s vulnerability to a final collapse in its purchasing power. This article focuses on the factors that will determine the future for sterling.

Sterling is exceptionally vulnerable to a systemic banking crisis, with European banks being the most highly geared of the GSIBs. The UK Government, in opting to side with America and cut ties with China, has probably thrown away the one significant chance it has of not seeing sterling collapse with the dollar.

A possible salvation might be to hang onto Germany’s coattails if it leaves a sinking euro to form a hard currency bloc of its own, given her substantial gold reserves. But for now, that has to be a long shot.

And lastly, in common with the Fed and ECB, the Bank of England has taken for itself more power in monetary matters than the politicians are truly aware of, being generally clueless about money.

Conclusion: the pound is unlikely to survive a dollar collapse, which for any serious student of money, is becoming a certainty.


In recent articles I have made a case for the dollar’s demise. Accelerated money-printing is being used to support everything through the coronavirus crisis, which comes on top of a potentially devastating turn in the credit cycle, made worse by the suppression of international trade through tariffs. Only the blind cannot see that with everyone calling for the end of globalisation, it is now actually happening with consequences to follow. Being the grease for global trade the dollar is required by foreigners in fewer quantities and will be sold down by them; they own some $27 trillion in securities, bills and cash, approximately 125% of US GDP in 2019.

It makes the dollar doubly vulnerable to two developing events impacting the domestic front: a global banking crisis and a full-blown depression. The former guarantees an expensive rescue attempt as the Fed has no option but to attempt to underwrite all banking obligations, and the latter will provoke a response of Keynesian inflationism on steroids. Furthermore, such a crisis is bound to lead to dollar long positions being unwound in the foreign exchanges for reasons detailed above, only leaving those required for immediate liquidity needs.

The emerging economic crisis is different from Lehman because it is a collapse of non-financial businesses worldwide undermining the widest extent of banking collateral, while the Lehman Crisis was broadly confined to the unwinding of residential property speculation, predominantly in America. It is therefore a more fundamental liquidation problem, involving considerably greater quantities of debt. Excessive speculation is far easier to wash out of the system than real businesses going bust in large numbers.

A new systemic crisis is imminent because the policy of supporting financial asset values by money-printing will sooner or later fail. Already, it has become impossible for independent observers to reconcile rising stock markets with collapsing businesses, the latter getting irretrievably worse by the day. The commercial banks are stuck in the middle of this crisis, expected to extend credit while their bad debts escalate at a record pace.

The tensions being created by the authorities’ manipulation of markets in defiance of fundamental factors can only result in a systemic crisis coupled with a crash in financial asset values. By binding their future to an inflation of asset prices, a collapse of fiat currencies will prove impossible to avoid. At least, that is the lesson from John Law when in 1720 his Mississippi scheme collapsed in about six months and his livres currency became entirely worthless.

The reason is not hard to discern. An event such as a banking crisis disrupts investor complacency. A banking crisis is always resolved in the short term by an opening of the money spigot by the lenders of last resort. The Fed can attempt to deal with liquidity, but it cannot stop insolvency. The consequences are that risk assets, starting with equities, are sold as insolvencies rise. And as the asset inflation support scheme of the central banks unwinds, bond yields are reassessed. Defaults become commonplace. Junk becomes junk squared and investment grade descends into junk. Next is the reassessment of government funding requirements, and with the costs required to save the non-financial economy laid bare, even government bond yields escape from the central bank’s manipulative control.

Money and debt are like matter and antimatter: when they come together in a financial black hole they cease to exist. A financial cytokine storm is bound to hit the over-owned US dollar first, being everyone’s international fiat currency. Its purchasing power measured initially against other currencies declines, and then against commodities, energy and the values of life’s essentials. The marker for this outcome is the price of gold, rising strongly and increasingly likely to cause its own crisis for bullion banks, which are currently committed to losses of $38bn on the Comex gold futures contract alone. The only solution for the US is to accept a return to gold. But that is wholly against the DNA of the Fed and US Treasury, and it would hand unacceptable power to the Chinese, who have cornered the physical gold market.

We stand therefore on the threshold of a global fiat money destruction, starting with the US dollar, being expressions of faith in our governments, which are descending into bankruptcy. And when a nation’s population realises that the reason for rising prices is not, as their government is likely to aver, the greed of capitalists but the loss of its unbacked currency’s credibility, it will prove impossible to stabilise it.

While the dollar’s fate increasingly appears to be sealed, the question arises over the fate of other currencies. To greater or lesser degrees, the same underlying factors affect all fiat currencies and the dollar’s demise will require survivors to have introduced at least an element of soundness in their backing. In this article, we focus on how sterling might fare in this outcome, and whether the UK’s monetary authorities can rescue it from the dollar’s fate.

Delusions in Westminster and Whitehall

For an international audience it is worth outlining the difference between these two expressions of the same location: Westminster is associated with Parliament and the politicians while Whitehall is associated with the great offices of state, the bureaucratic civil service whose offices are in the Westminster street of that name. The civil service advises the politicians, so both these arms of government must understand and accept the solution to any crisis. With respect to money issues they have been delegated lock stock and barrel to Threadneedle Street, the location of the Bank of England in the City.

The physical separation between Westminster and the City matters. Not only have monetary affairs been fully delegated to the Bank of England but different cultures have evolved, with Westminster and the Treasury in Whitehall assuming monetary policies are competently managed. But, as they say, power corrupts, and absolute power corrupts absolutely. There are no meaningful checks and balances on the Bank of England and its monetary policy. And you cannot sack the Governor without creating a monetary crisis.

The BoE is culturally closer to the ECB, the Fed, and the Bank for International Settlements than Westminster. Monetary policy is no longer focussed on the national interest, but a cadre of unelected central bankers, with more power than the political class, have been cooking up their own objectives. A long time ago, Mayer Amschel Rothschild put it succinctly; “Let me issue and control a nation’s money and I care not who writes the laws”.

The situation in Britain echoes that of America in the 1920s. Calvin Coolidge was the last laissez-faire president. But he did not realise what Benjamin Strong was doing at the relatively new Fed. Strong oversaw manipulation of gold in conjunction with Norman Montague at the Bank of England, the rapid expansion of bank credit and the establishment of a discounted bill market, aiming to copy the success of London’s discount houses. The unwinding of this unbacked credit led to the Wall Street crash and the 1930s depression.

Similarly, a British quasi-libertarian government was elected last year, determined to deal with an overly bureaucratic Whitehall, focused on process instead of objectives. Except, and like Coolidge they don’t realise it, the real power lies with today’s Montague Norman in cahoots with today’s Benjamin Strong — Andrew Bailey and Jay Powell.

We must understand the importance of the relationship between the BoE and the politicians. It makes it virtually impossible for the government to control monetary events. Let us assume that key ministers in the government actually understand the importance of returning to a metallic standard and are willing to give up the facility of financing government spending by inflationary means. It will cut no ice with civil service advisors, who are all committed neo-Keynesians. And the BoE will fight strongly to resist, because a gold standard removes the Bank’s power. It makes it extremely unlikely Britain’s free-market government can ween itself away from inflationary financing, even in a monetary collapse. And the current situation is deteriorating rapidly, too rapidly for a disputing combination of Westminster, Whitehall and the BoE between them to regain control over a collapsing currency.

One possible escape route has been closed off in recent weeks, with the British siding with America and therefore her dollar against China and her inherently more promising economic situation. China’s economic policies are far from ideal in the free market sense. China is like all other major nations, relying on inflationary finance to develop her own infrastructure as well as pan-Asian communications and transport facilities. But at least her currency is backed by a high savings rate of some 45%[ii], which as well as reducing the tendency towards price inflation emanating from monetary inflation, provides needed capital for investment in production.

A propensity to save was the defining characteristic of post-war Germany’s mark and Japan’s yen, which is now shared by China’s yuan. And unlike Britain and her allies China’s welfare commitments are minimal, so future government costs are easier to control.

The UK has decided to side with yesterday’s declining power for democratic and cultural reasons as well as the lure of the “special relationship”. It has rejected an alliance with the most dynamic of the major powers, which with Russia as its sidekick is rapidly becoming the world’s superpower, dominating Eurasia and Africa. When the history of our era is written, be in no doubt that we will see that current events, instigated by America, has given China what she really wants: freedom from American hegemony and from her overvalued currency at a crucial time. She can now progress her economy, thanks to its savers, while America continues to destroy hers through maxed-out consumption and monetary inflation.

Furthermore, China has effectively cornered the physical gold market; checkmate for fiat currencies. And not only will America find it intellectually difficult to return to gold, and virtually impossible to return to the necessary balanced budgets, but anything that promotes gold as money plays to China’s strength and America then loses all hope in the financial war waged against China.

Britain’s banks are especially vulnerable

Based on its pre-eminent role in the financing of trade, for some 200 years the City of London has been a major centre in Europe for international finance. Half that time was spent on a gold standard between the Napoleonic Wars and the First World War. Following the latter, New York became increasingly powerful while London declined. After the Second World War and Britain’s descent into socialism and exchange controls, London became less relevant until the Thatcher era, when the removal of exchange controls and the City’s big-bang restructuring made London fully relevant to global finance once again.

The massive expansion of financial business since the mid-eighties reflected the generally non-nationalistic British approach to business. In the European context this is why the nationalists in Frankfurt and Paris by giving preference to national champions could never compete, and the reason why European banks chose London to base their non-domestic lending and investment banking activities.

A general fiat currency collapse will wipe out virtually all London’s existing financial business: over-the-counter derivatives, trade finance, bonds and eurobonds, equities — these will be only some of the casualties. So far as the UK Government is concerned, tax revenue from these activities are over 10% of its total income and their failure will immediately throw up a matching budget deficit — virtually impossible to finance in these conditions. The other side of the coin is what happens to the UK’s banking system in a global systemic collapse, to which the UK is much exposed because of its financing pre-eminence.

According to the Bank of England’s database, total outstanding financial institutions’ sterling and foreign currency assets at 31 May stood at £8.12 trillion ($10.2 trillion), 3.6 times UK GDP. In a banking crisis the government would have no option but to take these assets on board or to alternatively underwrite loan losses in their entirety. Furthermore, without the continuing support of stable financial asset values — which is inconceivable following a systemic crisis of any magnitude — then net liabilities will be uncovered, and losses will accumulate. In other words, if in this inflationary environment stock markets crash and bond yields rise, the government will be exposed to further catastrophic losses.

The Bank of England’s database does not include assets and liabilities of the foreign subsidiaries of financial institutions which are a further substantial sum. Do not expect their automatic inclusion in any rescue package. These losses will have to be addressed in other financial centres and given that offshore centres do not have safety nets for depositors the losses and consequences will be considerable. Nor do they include shadow banking, estimated by the Office for National Statistics in 2018 to be a further £2.2 trillion, though this figure fluctuates wildly.

There is a further complication, and that is the divorce of Chinese activities from the Anglosphere, affecting both HSBC and Standard Chartered, two major British banks with substantial Chinese and Far Eastern businesses. The politics of the situation are at odds with financial reality, and criticism of China’s non-democratic regime risks ending up in a rescue attempt of these banks by the BoE and the Treasury, while rapidly disappearing business leaves the British holding the remaining liabilities.

The context of Brexit

The UK is negotiating trade terms with the EU to apply following the implementation period which expires at the end of this year. The promise of a golden future, which certainly chimes with the Prime Minister, is embodied in free trade. Free ports are proposed. With members of the Commonwealth free trade agreements can be easily negotiated with good will on both sides, and agreements with Japan and South Korea can be simply novated from existing EU agreements. But the prospect of a fast-tracked agreement with the US may be receding, with President Trump increasingly distracted by domestic concerns in this his election year.

The lack of a trade agreement with the EU is less of a threat to the UK than commonly argued, the greater losers by far being the EU. However, the UK is still financially obligated for EU economic programmes. According to Brexit Central, under the current Multiannual Financial Framework Britain could be on the hook for financial claims up to €478bn, though this is disputed. More important is the UK banking system’s counterparty risk in the event of an EU banking crisis.

In Figure 1, global systemically important banks (GSIBs) in Europe and the UK are highlighted in yellow. The most highly geared banks are in the Eurozone, when total balance sheet assets are compared with the market capitalisation of banks’ equity. Of the fifteen most highly geared, only three banks are not European, and all three UK GSIBs are in this category.

The most extreme of the GSIBs is Société Generale, currently with assets over 100 times its market capitalisation. The difficulties of the major German private banks, Deutsche and Commerzbank (not a GSIB) have been widely publicised, as have those of Italian, Spanish and Greek banks. When a systemic crisis hits global markets, there’s a good chance it will start in the European time zone, for which London remains the financial centre.

It’s not just about COVID-19

So far, planned spending in connection with the coronavirus amounts to an estimated £190bn — about 7% of M1 money. The hope is that once the crisis passes, the economy will revert to normal – the so-called V-shaped recovery. As this prospect recedes, businessmen will review their forecasts, and the majority will either close or downsize their operations.

The purpose of the furlough scheme was to bridge a V-shaped recovery and prevent massive unemployment, but that ends in October, having kept over nine million people out of the unemployment statistics. Unless there is some sort of miracle, many of these will be unemployed when, or even before the furlough scheme ends.

The extra spending on the furlough and other schemes has been covered by the Bank of England’s £200bn quantitative easing programme on a one-off basis. Doubtless, as the situation evolves there will have to be further funding by this route, otherwise funding costs will rise sharply.

Having gone nap on a V-shaped recovery it is not clear how the government plans its exit. Governments almost always make the mistake of thinking there is an economic normal to which a previous situation can return. This is the underlying assumption behind statistical measuring and economic modelling. Instead, economies are dynamic except in a totalitarian regime where everything is rationed by a central committee. But we know that doesn’t work, as demonstrated when the Berlin Wall fell.

There is therefore no “normal” to which to return. Subsidising existing businesses and furloughing staff is an encumbrance to necessary changes in production in order to satisfy consumers, who will have changed their needs and wants. For example, if the coronavirus is conquered and all social interaction returns, it is reasonable to assume that consumers won’t be in the market in large numbers for luxury SUVs to the same extent, yet manufacturers have been investing their production heavily in this direction for the last twenty years. Before the lockdown, retailers deemed it necessary to have branches in every city and every shopping mall, in order to secure and maintain market share. Their priorities have now changed from these strategic objectives to conserving capital.

To be fair to Rishi Sunak, the Chancellor, he appears to understand this point and has made available interest-free finance to small and medium size businesses. Partly, that will be used by businesses to stabilise their finances, but it does give the opportunity for entrepreneurs to fund new ventures. But even then, subsidised capital is usually taken up solely for the opportunity rather than to fund a properly considered venture, leading to malinvestments exposed at the turn of the next credit cycle.

But there is one thing clear: even with a government dominated by ministers more libertarian than any since the Thatcher era and therefore sympathetic to free market solutions, there is no exit plan that fully recognises the role of free markets. Government spending as a proportion of GDP has increased, will increase further and is unlikely to decline. Nor is there any recognition of the global bank credit cycle and its consequences. Forgotten is the downturn in global trade, which for an entrepôt nation is vitally important. For different reasons, the developing crisis for the dollar is also developing for sterling.

Can sterling avoid the dollar’s fate?

The economic solution to preserve the currency can be easily described. The problem is whether those in charge understand it after decades of Keynesian intervention and inflationism. Not only must Keynes’s theories be jettisoned, but the whole macroeconomic paradigm as well. And there must be an unequivocal acceptance that the role of the state must be rolled back to only the defence of the nation, the provision of law and order and to maintain clear, simple contract law. Taxes must be substantially reduced but balanced budgets maintained as well. Socialism must be ditched, and the people be permitted to build and maintain their own wealth.

That it can be achieved without going onto a gold standard was shown in Germany following the collapse of the paper mark in 1923, and again in Germany in 1948 when Ludwig Erhard piloted the nation from post-war destruction to becoming the wealthiest European nation by the time of its reunification. His recipe was simple: remove control of the economy from the Allied military administrations and hand it back to the people.

Germany had monetary stability without gold, but under the Bretton Woods agreement the dollar was a sheet anchor, directly (or indirectly in the case of Britain and France’s colonies). Germany used this breathing space to build her own gold reserves. Low government spending, a growing savings culture and growing exports allowed the foreign exchanges to set a rate for the mark confidently, giving it added credibility for the German people who welcomed the opportunity to save appreciating marks. But today, no such exchange stability will exist when the dollar collapses, except for those nations which take appropriate monetary action.

Therefore, a precondition for stabilising the currency without gold is that there are other stable currencies. After this crisis wipes out purely fiat currencies it will therefore require a return to gold backing for the few survivors. Britain foolishly sold most of her gold when Gordon Brown was Chancellor of the Exchequer and has only 310 tonnes left. As a rule of thumb that works out as £8,600 of M-zero money supply to one ounce of gold, comparing badly with Britain’s European neighbours.

It is worth noting that Germany, France and Italy do have significant gold reserves. A sub-optimal solution for them would be to transfer these reserves to the ECB and the ECB to use them to stabilise the euro. Better solutions can be had. The ECB has shown with its monetary policies to be entirely reliant on unsound money, with which it is destroying the eurozone’s banking system. Its management is incapable of being re-educated. As an institution it should be dismantled before it does any more harm.

Meanwhile, the Bundesbank has been forced into silence on the matter, retaining at its core a few influential sound money men, despairing of a solution. But for them to take over control of ECB policy would be politically divisive, making it virtually impossible to deliver monetary stability.

The practical and political choice would be to withdraw. German politics, informed by two currency collapses in the last hundred years, strongly suggests Germany would choose to go it alone with its own gold-backed currency. Far better for Germany to abandon the money side of the European project. This would be a major development, leading to the destruction of the euro. But with the collapse of the dollar and the current ECB management in charge, this would be seen as an increasingly likely outcome for the euro anyway.

If a new German mark had gold backing, the Netherlands would probably join to form the nucleus of a gold-backed bloc. France and Italy have the gold reserves but lack budgetary control. Whichever way it pans out sound money could emerge in Europe, in which case the right economic policies in the UK might have a chance of stabilising the pound, because there would be a basis of comparative valuation for it on the foreign exchanges and a complete monetary collapse might be avoided. But compared with having and deploying credible gold reserves it would be rather like playing league-level football with your shoelaces tied together.


Despite having the most libertarian government for the last forty years, there is little sign any senior ministers really understand monetary affairs. Furthermore, by giving over responsibility for money to the Bank of England, there is a feeling in Westminster and Whitehall that there is no need to worry about how the Bank achieves agreed targets on unemployment and price inflation. The result is the Bank is now arguably more powerful than the executive, planning monetary policies with other central banks instead of for the direct benefit of the British Isles.

Britain faces a difficult time in the next few months. A global banking crisis can be taken as read, requiring the government and the BoE to backstop all banking obligations. The destructive monetary policies of the ECB, with which the BoE has been complicit, should drive Germany to re-establish the mark, hopefully backing it with gold to form the nucleus of a new European sound money regime, but there is no guarantee of this outcome.

Furthermore, by submitting to America’s anti-China policy, Britain has done away with the one possible economic and monetary lifeline at its disposal. Clearly, no one in government thinks this really matters, showing a lack of strategic vision.

It will be a brave Britton who relies on the survival of his currency through these extraordinary times.

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Over the top

The biopharma industry’s response to the global pandemic has propelled some COVID-19 vaccines into the leading ranks of the world’s best-selling products,…



Over the top

The biopharma industry’s response to the global pandemic has propelled some COVID-19 vaccines into the leading ranks of the world’s best-selling products, with Pfizer/BioNTech’s Comirnaty surpassing AbbVie’s Humira for the No. 1 spot.

By Andrew Humphreys •

The ripple effects of the worldwide COVID-19 pandemic continue to be felt throughout the biopharmaceutical realm, from allocation of business resources to the revenue impact of new vaccines and treatments for the industry’s main players. No biopharma company has thrived more during the pandemic’s reign than Pfizer, which experienced the largest increase in market capitalization during 2021 at $127 billion, rising to $331 billion. 

Comirnaty became the first COVID-19 vaccine to gain full approval.

Pfizer has collaborated with BioNTech to jointly develop the mRNA-based coronavirus vaccine Comirnaty/BNT162b2 to help prevent COVID-19. Comirnaty/BNT162b2 accounted for 45 percent of Pfizer’s total revenue during 2021, coming in at $36.78 billion. For the first six months of 2022, Pfizer reported Comirnaty direct sales and alliance revenue of $22.08 billion. As of July 28, Pfizer forecasted $32 billion in revenue for Comirnaty for full-year 2022, with gross profit to be split evenly with BioNTech, which includes doses expected to be delivered throughout the fiscal year. 

Comirnaty is based on Bi­oN­Tech’s proprietary messenger RNA technology. As the first-ever approved mRNA therapy, Comirnaty additionally represents BioNTech’s first commercial product. Through the vaccine, BioNTech’s revenue grew from €482.3 million ($571 million) in 2020 to €18.98 billion ($22.45 billion) for 2021. In reporting first-quarter 2022 results, BioNTech reiterated the company’s prior full-year 2022 financial year outlook of €13 billion ($15.4 billion) to €17 billion ($20.11 billion).

Pfizer-BioNTech’s COVID-19 vaccine is authorized by the U.S. Food and Drug Administration under Emergency Use Authorization (EUA) for active immunization to prevent coronavirus disease 2019 caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) in individuals 6 months of age and older. Comirnaty (approved under a Biologics License Application)/BNT162b2 (authorized under EUA) in July 2022 became the first COVID-19 vaccine to be granted FDA approval for adolescents 12 years and older, following U.S. emergency use authorization in May 2021. Comirnaty became the first FDA-approved COVID-19 vaccine for individuals 16 years and older during August 2021. 

The impact of the worldwide pandemic led to the unseating of Humira (adalimumab) as the world’s top-selling pharmaceutical product in 2021, which was the medicine’s best-performing year ever. Humira has annually been the best seller among prescription medicines dating back to 2012. The drug’s combined revenue for 2021 between AbbVie and Japan’s Eisai topped $21.18 billion. AbbVie reported $20.69 billion of that total, the first time Humira broke the $20 billion barrier in one year for the North Chicago-based company. For first-half 2022, AbbVie reported Humira worldwide revenue of $10.1 billion.Humira

Humira is administered as a subcutaneous injection. The biologic therapy is approved for treating various autoimmune diseases in North America and in the European Union: rheumatoid arthritis (moderate to severe), psoriatic arthritis, ankylosing spondylitis, adult Crohn’s disease (moderate to severe), plaque psoriasis (moderate to severe chronic), juvenile idiopathic arthritis (moderate to severe polyarticular), ulcerative colitis (moderate to severe), axial spondyloarthropathy, pediatric Crohn’s disease (moderate to severe), hidradenitis suppurativa (moderate to severe), pediatric enthesitis-related arthritis, non-infectious intermediate, posterior and panuveitis, pediatric ulcerative colitis (moderate to severe), and pediatric uveitis. Humira is approved in Japan for treating intestinal Behçet’s disease and pyoderma gangrenosum.

Humira is sold in other markets around the globe, including Japan, China, Brazil, and Australia. The medication accounted for 37 percent of AbbVie’s total net revenue during 2021 and nearly 36 percent during the first six months of 2022.

Moderna’s COVID-19 vaccine Spikevax (mRNA-1273) has been authorized for use or approved in more than 70 countries. The FDA fully approved the BLA for Spikevax for individuals 18 years of age and older in January 2022. Moderna’s COVID-19 vaccine was made available under EUA in the United States on Dec. 18, 2020. The full licensure of Spikevax in the United States joined that in Canada, Japan, the European Union, the UK, Israel, and other countries where the adolescent indication is additionally approved. 

During June 2022, Moderna gained EUA from the FDA for the company’s COVID-19 vaccine mRNA-1273 in young children ages 6 months through 5 years of age at a dose level of 25 µg. Moderna has additionally received emergency use authorization for a 50 µg two-dose regimen of mRNA-1273 for children ages 6 through 11 years old and a 100 µg two-dose regimen for adolescents aged 12 through 17 years old. 

Spikevax marks Moderna’s first commercial product. Sales amounted to nearly $17.68 billion during full-year 2021. For the first six months of 2022, Moderna reported product sales of about $10.46 billion.

Keytruda ranks as the world’s top-selling cancer therapeutic. Global sales for Merck’s checkpoint inhibitor grew from $11.08 billion during 2019 to $14.38 billion for 2020 and $17.19 billion in 2021. For first-half 2022, Merck reported Keytruda global sales of $10.06 billion. The anti-PD-1 (programmed death receptor-1) therapy contains the active chemical pembrolizumab.


Keytruda works by increasing the ability of the body’s immune system to help detect and fight tumor cells. The humanized monoclonal antibody blocks the interaction between PD-1 and its ligands, PD-L1 and PD-L2, thereby activating T lymphocytes that may affect both tumor cells and healthy cells.

Outside the COVID-19 vaccine domain, Keytruda is expected to overtake Humira as the top-selling prescription medicine in 2023 when the latter’s U.S. market exclusivity is set to expire. AbbVie has entered into settlement and license deals with several adalimumab biosimilar manufacturers. The licenses in the United States will start during 2023 and the licenses in Europe began in 2018. “The inevitable arrival of Humira biosimilars in the U.S. next year means that AbbVie is hurtling towards biopharma’s biggest-ever patent cliff,” according to Evaluate Pharma analysis.

Meanwhile, Keytruda is anticipated to continue thriving as the product’s compound patent is protected from expiration in all majors markets until at least 2028 (the United States and China) and into the following decade in the EU and Japan. 

According to analysts from Evaluate Pharma, come 2028, Keytruda will remain the top-selling non-Covid treatment with estimated sales of $30.9 billion. By that year, the top-selling pharmaceutical of all-time, Humira, will no longer be a member of the top 10 sellers (see graphic on this page). 

Per Evaluate Pharma, the No. 2 seller in 2028 is projected to be Bristol Myers Squibb and Ono Pharmaceutical’s Opdivo (nivolumab), predicted to trail Keytruda by nearly half in revenue at $15.7 billion. A fully human monoclonal antibody that binds to the PD-1 on T and NKT cells, the biological product Opdivo has received approvals for various anti-cancer indications including bladder, blood, colon, head and neck, kidney, liver, lung, melanoma, mesothelioma and stomach.

Biggest Selling Drugs, Evaluate Pharma

Download the listing of the top 200 medicines based on global sales during 2021

Andrew Humphreys is contributing editor of Med Ad News and

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Breaking the tape

The top performers among drugs launched in 2020 were each the first of their kind.



Breaking the tape

The top performers among drugs launched in 2020 were each the first of their kind.

By Joshua Slatko •

The leaders in pharma’s Class of 2020 were all firsts. Veklury, for COVID, and Tepezza, for thyroid eye disease, were each the first drug of any kind to be approved by FDA for their respective disease targets. And while other treatments for migraine exist, Ubrelvy was the first orally administered calcitonin gene-related peptide (CGRP) receptor antagonist (gepant) for the treatment of migraine attacks once they start. The era of follow-ons in pharma may not entirely be over; but surely the industry’s researchers are still breaking barriers. 

Earning nearly $5.57 billion in sales during the product’s first full calendar year on the market, Veklury was the first drug approved by FDA for the treatment of COVID-19.


The very first drug to be approved in the United States for the treatment of COVID-19, Gilead’s Veklury received emergency use authorization from FDA during May 2020, an expanded EUA three months later, and full approval for treating patients with COVID requiring hospitalization during October 2020. Veklury had originally been developed for the treatment of hepatitis C and had been studied in Ebola and Marburg virus, without success. 

FDA approval was based on three randomized controlled trials including final results of the National Institute of Allergy and Infectious Diseases’ double blind, placebo-controlled Phase III ACTT-1 trial, which showed that treatment with Veklury resulted in clinically meaningful improvements across multiple outcome assessments compared with placebo in hospitalized patients with COVID-19. Based on the strength of these data, Veklury became a standard of care for the treatment of COVID-19 in hospitalized patients.

In the randomized, double-blind, placebo-controlled ACTT-1 trial, Veklury significantly improved time to recovery as compared to placebo – by five days in the overall study population (10 versus 15 days) and seven days in patients who required oxygen support at baseline (11 versus 18 days). As a secondary endpoint, Veklury also reduced disease progression in patients needing oxygen, resulting in a significantly lower incidence of new mechanical ventilation or ECMO (13 percent versus 23 percent). In the overall patient population, there was a trend toward reduced mortality with Veklury compared with placebo at Day 29.

In June 2021, Gilead announced positive data from three retrospective studies of the real-world treatment of patients hospitalized with COVID-19, adding to the body of mortality and hospital discharge data for patients treated with Veklury. All three of the real-world analyses observed that, in the overall patient populations, patients who received Veklury treatment had significantly lower risk for mortality compared with matched controls. A reduction in mortality was observed across a spectrum of baseline oxygen requirements. The results were consistently observed at different time frames over the course of the pandemic and across geographies. Two of the studies also observed that patients who received Veklury had a significantly increased likelihood of discharge from the hospital by Day 28.

In January 2022, FDA granted expedited approval of a supplemental new drug application for Veklury for the treatment of non-hospitalized adult and adolescent patients who are at high risk of progression to severe COVID-19, including hospitalization or death. The expanded indication allowed for Veklury to be administered in qualified outpatient settings that can administer daily intravenous infusions over three consecutive days. FDA also expanded the pediatric EUA of Veklury to include non-hospitalized pediatric patients younger than 12 years of age who are at high risk of disease progression.

These actions by FDA came amidst a surge in COVID-19 cases and the reduced susceptibility to several anti-SARS-CoV-2 monoclonal antibodies (mAbs) due to the Omicron variant. In contrast, Veklury targets the highly conserved viral RNA polymerase, thereby retaining activity against existing SARS-CoV-2 variants of concern. In vitro laboratory testing has shown that Veklury retains activity against the Omicron variant. 

Quarterly sales, VekluryThe FDA sNDA approval, pediatric EUA expansion, and updated National Institutes of Health Treatment Guidelines for COVID-19 that additionally recommend Veklury for treatment in non-hospitalized settings were based on results from the PINETREE Phase III randomized, double-blind, placebo-controlled trial. The study evaluated the efficacy and safety of a three-day course of Veklury for intravenous use for the treatment of COVID-19 in non-hospitalized patients at high risk for disease progression. An analysis of 562 participants randomly assigned in a 1:1 ratio to receive Veklury or placebo, demonstrated that treatment with Veklury resulted in a statistically significant 87 percent reduction in risk for the composite primary endpoint of COVID-19 related hospitalization or all-cause death by Day 28 (0.7 percent, 2/279) compared with placebo (5.3 percent, 15/283). In the study, no deaths were observed in either arm by Day 28.

In February, Gilead released data demonstrating the in vitro activity of Veklury against 10 SARS-CoV-2 variants, including Omicron. Results of Gilead’s studies were consistent with other in vitro studies independently conducted by researchers from institutions in other countries, including Belgium, the Czech Republic, Germany, Poland and the United States, which confirmed Veklury’s antiviral activity against multiple previously identified variants of SARS-CoV-2, including Alpha, Beta, Gamma, Delta and Omicron.

The study analyzed in vitro antiviral activity by two methods to understand the susceptibility of 10 major SARS-CoV-2 variants to Veklury. The study results showed similar activity of Veklury against the variants and an early ancestral A lineage isolate detected in Seattle, Wash. (WA1 strain). Specifically, Delta and Omicron variants both remained fully susceptible to Veklury, and these laboratory results demonstrated that Veklury has remained active against all major variants isolated over the past two years.

In April, FDA approved a supplemental new drug application for Veklury for the treatment of pediatric patients who are older than 28 days, weighing at least 3 kg, and are either hospitalized with COVID-19 or have mild-to-moderate COVID-19 and are considered high risk for progression to severe COVID-19, including hospitalization or death. This approval made Veklury the first and only approved treatment for pediatric COVID patients in the United States. Under the expanded indication, a three-day Veklury treatment regimen is recommended to help prevent hospitalization in non-hospitalized COVID-19 pediatric patients who are at high risk for COVID-19 disease progression. For hospitalized pediatric patients who do not require invasive mechanical ventilation and/or ECMO, a five-day treatment course is recommended. The approval was supported by results from the CARAVAN Phase II/III single arm, open-label study, which demonstrated that Veklury was generally well-tolerated among pediatric patients hospitalized with COVID-19 with a high proportion of participants showing clinical improvement and recovery, as well as data from trials in adults.



Tepezza was the first drug ever approved by FDA for the treatment of thyroid eye disease.

When it earned approval in January 2020, Horizon Therapeutics’ Tepezza became the first and only FDA-approved medicine for thyroid eye disease, a serious, progressive and vision-threatening rare autoimmune disease that is associated with proptosis (eye bulging), diplopia (double vision), blurred vision, pain, inflammation, and facial disfigurement. Tepezza is a fully human monoclonal antibody (mAb) and a targeted inhibitor of the insulin-like growth factor-1 receptor (IGF-1R) that is administered to patients once every three weeks for a total of eight infusions.

The FDA approval of Tepezza was supported by a robust body of clinical evidence, including statistically significant, positive results from the Phase II clinical study, as well as the Phase III confirmatory clinical study OPTIC. The OPTIC study found that significantly more patients treated with Tepezza (82.9 percent) had a meaningful improvement in proptosis (≥ 2 mm) as compared with placebo patients (9.5 percent) without deterioration in the fellow eye at Week 24. Additional secondary endpoints were also met, including a change from baseline of at least one grade in diplopia (double vision) in 67.9 percent of patients receiving Tepezza compared to 28.6 percent of patients receiving placebo at Week 24. In a related analysis of the Phase II and Phase III clinical studies, there were more patients with complete resolution of diplopia among those treated with Tepezza (53 percent) compared with those treated with placebo (25 percent).

In October 2020, Horizon announced new long-term follow-up data from the Phase II clinical trial of Tepezza, which showed a sustained response up to one year following completion of treatment for thyroid eye disease. All patients with Week 72 data (37/37) reported some improvement in at least one of the study outcomes from baseline. 97 percent (36/37) of study participants had an improvement in clinical activity score (decrease of at least 1 point). 86 percent (31/36) had any decrease in proptosis. One patient chose elective TED surgery at Week 70 and did not have proptosis measurements at Week 72. Of patients with baseline diplopia, 70 percent (23/33) had an improvement of at least one grade. 70 percent (26/37) had disease inactivation (CAS of 0 or 1 point).

During December 2020, Horizon announced that the company expected a short-term disruption in Tepezza supply as a result of government-mandated COVID-19 vaccine production orders related to Operation Warp Speed that dramatically restricted capacity available for the production of Tepezza at its drug product contract manufacturer, Catalent. In March 2021, FDA cleared a prior approval supplement to the previously approved Biologics Licensing Application giving Horizon authorization to manufacture more Tepezza drug product resulting in an increased number of vials with each manufacturing slot. The company began to resupply the market in April, which ended the supply disruption.

Tepezza Quarterly SalesIn April 2021, new pooled data from the Tepezza Phase II and III trials was published in The Lancet Diabetes & Endocrinology. This data further reinforced that Tepezza significantly improves proptosis and diplopia for TED patients in different subgroups, with most maintaining a long-term response. There was no evidence for acute disease rebound (increase in percentage of patients no longer meeting proptosis, diplopia or ophthalmic composite outcome) seven weeks after the last dose of Tepezza. Proptosis (87 percent; 62/71), diplopia (66 percent; 38/58) and ophthalmic composite outcome (92 percent; 66/72) responses were observed seven weeks after the last dose of Tepezza. A post-hoc analysis of the composite ophthalmic outcome indicated that 81 percent (68/84) of Tepezza patients versus 44 percent (38/87) of placebo patients were responders at Week 24. Proptosis (67 percent; 38/57), diplopia (69 percent; 33/48) and composite outcome response (83 percent; 48/58) were observed 51 weeks after the last dose of Tepezza for those who had long-term off-treatment data available.

Additionally, in a post-hoc analysis, Tepezza-treated patients with more severe disease (those with ≥3 mm of proptosis and/or inconstant or constant diplopia) and those with less severe disease at baseline both experienced significant improvements in proptosis and diplopia. In patients with more severe disease, those treated with Tepezza had a proptosis response of 79 percent (50/63) compared to 17 percent (11/65) of those who received placebo, and a diplopia response of 68 percent (38/56) compared to 31 percent of those who received placebo (15/49). In patients with less severe disease, those treated with Tepezza had a proptosis response of 71 percent (15/21) compared to 9 percent in those who received placebo (2/22), and a diplopia response of 80 percent (8/10) compared to 30 percent in placebo (3/10).

In post-hoc analyses, patients who received Tepezza in both the lower baseline CAS subgroup (4 or 5) and the higher CAS subgroup (6 or 7) demonstrated statistically significant improvements compared with placebo in proptosis and diplopia. Overall response and CAS of 0 or 1 response also improved.

Post-hoc analysis from the Phase III study also demonstrated that in patients treated with Tepezza, those with higher (≥10 IU/L) or lower (<10 IU/L) serum thyrotropin-binding inhibitory immunoglobulin (TBII) baseline levels both had a proptosis response (mean reduction of -3.65 mm and -3.01 mm, respectively) with no treatment difference between the two groups. In patients with higher baseline TBII, 71 percent (10/14) of patients who received Tepezza experienced an improvement in diplopia compared to 23 percent (3/13) of patients who received placebo.

In November 2021, Horizon announced findings of a real-world adherence analysis of Tepezza for the treatment of TED. The analysis found that more than 90 percent (n=995) of people who were prescribed Tepezza for TED went on to complete all eight infusions, indicating a high level of adherence to the medicine in clinical practice. The study evaluated 1,101 people living with TED (71 percent female, mean age 58 years) who started treatment with Tepezza prior to July 2020. Non-compliance was low at approximately 1 percent (n=15). Only 8 percent (n=84) reported that they discontinued because of adverse events.

In June 2022, Horizon announced results of a new analysis examining rates of hyperglycemia among patients treated with Tepezza for TED compared to placebo in the Phase II and OPTIC Phase III clinical trials. The analysis found a total of nine adverse event reports of hyperglycemia in eight patients (8/84, 10 percent) who received Tepezza, and one patient (1/86; 1.2 percent) who received placebo. The majority (5/8, 63 percent) of patients who experienced hyperglycemia while taking Tepezza had pre-existing diabetes. Of the hyperglycemic AEs reported in the Tepezza-treated patients, all were controlled with medicine. All reported AEs were grade 1 (>ULN-160mg/dl) or grade 2 (161 – 250mg/dl), and none led to study discontinuation. HbA1c levels increased by 0.22 percent in those treated with Tepezza compared to 0.04 percent among placebo patients.



Ubrelvy was the first orally administered calcitonin gene-related peptide receptor antagonist (gepant) to be approved by FDA for the treatment of migraine attacks once they start.

Approved by FDA in late December of 2019, Ubrelvy was the first orally administered calcitonin gene-related peptide (CGRP) receptor antagonist (gepant) for the treatment of migraine attacks once they start. Ubrelvy works by blocking CGRP, a protein that is released during a migraine attack, from binding to its receptors. It works without constricting blood vessels, which some older treatments were known to do. FDA’s approval was based on four clinical studies (ACHIEVE I, ACHIEVE II, UBR-MD-04, and 3110-105-002), which demonstrated efficacy, safety, and tolerability of orally administered Ubrelvy in the acute treatment of migraine. Both 50 mg and100 mg dose strengths demonstrated significantly greater rates of pain freedom and freedom from the most bothersome migraine-associated symptom at two hours, compared with placebo. Ubrelvy joined AbbVie’s portfolio when that company completed its acquisition of Allergan in May 2020. 

In August 2020, AbbVie announced Serena Williams as the spokesperson for Ubrelvy to raise awareness of an effective acute treatment option for people living with migraine. The multichannel marketing campaign featuring Williams highlighted how Ubrelvy works for people with different lifestyles by helping individuals treat their migraine attacks anytime, anywhere. As spokesperson, she was featured in a video, available on social media, talking with neurologist and paid AbbVie consultant Dr. Jennifer McVige about her experience with migraine and Ubrelvy. Williams was also included in print and digital advertising and other marketing initiatives.

In September 2021, FDA approved Abb­Vie’s Qulipta, another drug from the gepant family, for the preventive treatment of episodic migraine in adults. Qulipta is the first and only oral calcitonin gene-related peptide receptor antagonist specifically developed for the preventive treatment of migraine. The approval was supported by data from a robust clinical program evaluating the efficacy, safety, and tolerability of Qulipta in nearly 2,000 patients who experienced 4 to 14 migraine days per month, including the pivotal Phase III ADVANCE study, the pivotal Phase IIb/III trial, and the Phase III long-term safety study.

Ubrevly quarterly salesIn the pivotal Phase III, multicenter, randomized, double-blind, placebo-controlled, parallel-group ADVANCE trial, the primary endpoint was change from baseline in mean monthly migraine days across the 12-week treatment period. All Qulipta dose groups met the primary endpoint and demonstrated statistically significant reductions in mean monthly migraine days compared to placebo. Patients treated with 60 mg of Qulipta across 12 weeks experienced a 4.2-day reduction from baseline of 7.8. A key secondary endpoint in the ADVANCE trial measured the proportion of patients that achieved a ≥50 percent reduction in monthly migraine days across the 12-week treatment period. The trial demonstrated that 56 percent/59 percent/61 percent of patients in the 10 mg/30 mg/60 mg Qulipta arms, respectively, achieved a 50-100 percent reduction, compared to 29 percent of patients in the placebo arm.

During June, AbbVie submitted a supplemental NDA to FDA for Qulipta to support the preventive treatment of chronic migraine in adults. If approved, Qulipta would be the first gepant cleared for the broad indication of the preventive treatment of migraine, including episodic and chronic. The supplemental NDA submission includes data from the pivotal Phase III PROGRESS trial in patients with chronic migraine, which supplements the existing data in episodic migraine. People living with chronic migraine experience headaches for 15 or more days per month, which, on at least eight of those days per month, have the features of migraine.

The Phase III PROGRESS trial met its primary endpoint of statistically significant reduction from baseline in mean monthly migraine days compared to placebo across the 12-week treatment period in adults with chronic migraine. The trial also demonstrated that treatment with Qulipta 60 mg once daily (QD) and 30 mg daily (BID) resulted in statistically significant improvements in all six secondary endpoints. This includes a key secondary endpoint that measured the proportion of patients that achieved at least a 50 percent reduction in mean monthly migraine days across the 12-week treatment period. 

Josh Slatko, Med Ad News Josh Slatko is contributing editor of Med Ad News and

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Braxia and KetaMD, CEOs McIntyre and Gumpel Speak on Acquisition

Last week, the Canadian company Braxia Scientific acquired 100% of the issued and outstanding stock of KetaMD, Inc. This is an exciting acquisition, and…



Last week, the Canadian company Braxia Scientific acquired 100% of the issued and outstanding stock of KetaMD, Inc. This is an exciting acquisition, and in today’s interview, The Dales Report’s Nicole Hodges talks with CEOs Dr. Roger McIntyre and Warren Gumpel of Braxia Scientific and KetaMD respectively.

For some background information, KetaMD is a U.S. based, privately-held, innovative telemedicine company, with a mission to address mental health challenges via access to technology-facilitated ketamine-based treatments. Braxia Scientific is Canada’s first clinic specializing in ketamine treatments for mood disorders. They recorded revenue of $1.49m for 2022 fiscal year, ended March 31. On a year-over-year basis, revenue increased 47.5%.

Here’s some highlights from the interview.

KetaMD gives Braxia a presence in the US

Dr. McIntyre says that KetaMD gives Braxia what they’ve had as their vision from the beginning: a US presence. KetaMD is a living program. It’s already running, has infrastructure, and patients. McIntyre believes that a program like KetaMD is something Braxia’s needed to scale and obtain commercial success.

With telemedicine, Braxia has a potential to serve a gap in access. The zeitgeist of “patient going to medicine” has flipped, McIntyre says. “Now it’s medicine goes to the patient, and that is long overdue.”

COVID speeding a trend that was already happening

In 2020, 80% of physicians indicated they had virtual visits. That’s a number up from 22% the year before. But this is something that many doctors, McIntyre included, believe always should have happened. The pandemic only was the catalyst for innovation and making the option viable.

While some treatments will always need a clinic or a hospital, McIntyre believes some treatments can be done safely at home. And they are, for many chronic diseases. He feels implementing ketamine and psychedelics would be among these treatments where service could be expanded into the home. It would require careful SOPs in place, best practices, and surveillance. But he believes Braxia Scientific could deliver this with KetaMD.

Gumpel to stay as CEO of KetaMD

Gumpel says that KetaMD benefits in this acquisition from being part of the world’s most prominent researchers in depression, psychedelics, and ketamine. In the acquisition, he’ll stay on as CEO. He admits that Dr. McIntyre has been a huge part of collecting the data on the safety of ketamine treatment, and has a strong motivation to “see this thing through until most of society can access that – or at least the people that need it and want it.”

Gumpel admits he has a personal connection to ketamine treatment. As a person who has experienced bouts of depression for years, it saved his life, he says. He is grateful he was living within walking distance of ketamine treatment in Manhattan. It made him extremely aware of the accessibility gap, which in part inspired KetaMD.

Be sure to tune in for the full interview regarding Braxia and KetaMD, right here on The Dales Report!

The post Braxia and KetaMD, CEOs McIntyre and Gumpel Speak on Acquisition appeared first on The Dales Report.

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