SAN DIEGO – An analysis of the future of prescription drug sales will no doubt be music to the ears of innovative drug developers who have experienced a period of slow growth during the past couple of years as the impact of patent expirations have taken their toll.

All signs, according to a new report released Tuesday at the BIO 2014 International Convention by Evaluate, World Preview 2014, Outlook to 2020, are pointing to the fact that the industry is on a trajectory of 5.1 percent growth per year. By the year 2020, world prescription drug sales are predicted to exceed $1 trillion.

Helping drive that positive outlook, the report said, are a record-breaking number of new drug approvals, a very healthy and expanding product pipeline and dramatically improved research and development productivity where, thanks to significant improvements in cost containment, R&D expenditures are forecast to grow at only 2.4 percent annually over the next several years to reach a total of $162 billion by 2020.

Last year was also an exceptional one in terms of the quality of drugs approved, and their sales post-approval are expected to add more than $24.4 billion to total U.S. prescription drug sales in five years, the report estimated. There is also more to come with excitement swirling around clinical projects targeting the programmed death-1 (PD-1) pathway. The collective value of those projects is estimated at a whopping $63.2 billion, with Bristol-Myers Squibb Co.'s PD-1 checkpoint inhibitor nivolumab commanding about $24.4 billion of that projected total.

The expected industry performance is based on the consensus forecast for the leading 500 pharmaceutical and biotech companies as well as the expectations of equity analysts. From those data the impact of the impending introduction of biosimilars and future patent expirations will be softer on industry sales, Anthony Raeside, Evaluate's head of research, told BioWorld Today.

For the period 2014 to 2020, $259 billion of worldwide drug sales are at risk from blockbuster drugs that are due to go off patent. Strikingly, only 46 percent of that potential "loss" is expected to materialize. That compares with the 64 percent that occurred from 2007 to 2013.

It appears that "future patent cliffs are being transformed into much more manageable rolling hills," Raeside noted in his presentation of the findings from the report.

Other notable findings include the fact that biologics will make up 52 percent of top 100 prescription and over-the-counter drug sales in 2020. At that time, Humira (adalimumab, Abbvie Inc.) is projected to be world's largest selling product with forecasted worldwide sales to be $12.7 billion.