The Wall Street Journal reported apparent reduced “momentum” on the part of some key players on track to produce biosimilars. [© Jess Yu - Fotolia.com]
Until very recently, biosimilars were expected to become an increasingly large part of the world market for global pharmaceuticals, potentially reaching up to a 50% market share. By 2020 twelve of the top-selling biologicals will have lost patent protection, opening up an estimated $24 billion in E.U. sales and $30 billion in U.S. sales. But despite a spate of deals and several potential market entrants the WSJ reported apparent reduced “momentum” on the part of some key players on track to produce biosimilars.
Biosimilar development is not for the faint-hearted, as barriers to introducing these large and complex biomolecules range from significant technical difficulties, potential regulatory issues, surfacing submarine patents, halted clinical trials, and particularly, potential product pricing. Recent activity among pharma companies and biosimilar production enterprises indicates the potential volatility in the field, with clear commercialization successes yet to emerge.
Key cautionary drivers may include the cost of bringing a biosimilar to market, estimated to be about $10 million to $40 million (some estimates put costs at between $75–250 million per molecule) with a time frame of six to nine years, compared with $1 to $2 million and three years for generics. And since biosimilars are produced in living systems and inherently far more complex than generic small molecule drugs, regulators require concomitantly rigorous steps, product testing, and approval.
As the industry awaits a range of biologics U.S. patents to expire including Amgen’s Neupogen in 2013, Biogen Idec’s Avonex in 2013, and Genentech’s Herceptin in 2014, remaining uncertainties about how regulatory agencies will ultimately regulate biosimilar commercializations persist.
Regulatory uncertainty may be reflected in Teva’s and Lonza’s October 2012 discontinuation of their planned 544-patient, Phase III clinical trial of a Rituxan biosimilar, saying they wanted to get input from regulators on how to design the trial program. At the time, Teva said it remained firmly committed to the development of biosimilars. However, the company said, given the changes in the regulatory and competitive environment, “Teva (through its joint venture with Lonza) is evaluating the path forward for rituximab.”
According to the story originally reported in the Israeli newspaper Haaretz, Teva halted the trial while it ponders the best path to a regulatory approval in Europe, where patent protection lapses this year and in the U.S. in 2018.
Samsung bailed on its Rituxan program in October 2012, with an unnamed source telling a Korean newspaper that the company stopped clinical development of SAIT101—the biosimilar version of the Rituxan because of "some internal reasons," with speculation that recent regulatory guidelines from U.S. regulators could be partly to blame for the delay.
Its patent due to expire in 2013 in Europe and 2018 in the U.S, Rituxan (MabThera) was an early target of biosimilar manufacturers, and several companies began scrambling to produce their own versions of the biologic. With estimated 2012 revenues totaling $6.94 billion worldwide, Rituxan 2011 revenues grew by 7% year over year excluding currency fluctuations, accounting for 15% of Roche's overall sales for the year.
Companies still in the Rituxan race include Sandoz (Novartis’ generic unit), which is currently conducting a Phase I/II trial testing its biosimilar GP2013 in rheumatoid arthritis and a Phase III trial in patients with advanced folicular lymphoma.
Others include Pfizer with its PF-o5280586 for rheumatoid arthritis and NHL, Merck with MK8808 in RA patients, as well as South Korean Celltrion in a joint venture with Hospira, testing CT-P10 in a Phase I trial for RA and another Phase I for lymphoma.
Merck pulled the plug on its dedicated biosimilar unit last December, backing off its plans to copy arthritis treatment Enbrel after maker Amgen gained a new patent. In late 2011, Amgen reported that the patent for Enbrel had been extended by 17 years, creating a significant barrier to biosimilar development.
Merck had created its business unit, Merck BioVentures (MBV) in 2008 aimed at launching six or more follow-on biologics between 2012 and 2017. The company expected to spend $1.5 billion on biosimilar R&D through 2015 in order to meet its goal of putting at least five candidates into the clinic by the end of 2012. But Merck BioVentures was subsumed into the biologics and vaccines division of Merck Research Laboratories.
Merck announced this February that it had entered into an agreement with Samsung Bioepis to develop and commercialize “multiple pre-specified and undisclosed biosimilar candidates.”
“The combination of Merck’s global commercial presence with Samsung Bioepis’ biologic development and manufacturing capabilities positions the two companies well to increase access to biosimilars to improve human health,” said Rich Murray, Ph.D., svp, biologics and vaccines research at Merck Research Laboratories. “We look forward to this collaboration and its potential to complement our expanding internal biologics portfolio.”
In a masterpiece of understatement, “there has been a little bit of volatility” in biosimilar efforts, noted Dr. Murray, as Merck abandoned its initial effort and restructured around a marketing pact with Samsung and its biotech partner Biogen Idec.
And makers of originator drugs seem to have concluded that the arrival of a biosimilar competitor remains a ways off. As quoted in The Wall Street Journal, Roche’s Severin Schwan noted that the company has consistently been forced to revise its anticipated entry point for biosimilar competition, suggesting biosimilar rituximab could enter the market in 2016. This March in London, however, he appeared to revise this estimate again, suggesting that Roche's key franchises should avoid such competition until the end of this decade.
Regulatory and development cost considerations aside, some have predicted that the profit margins for generic biologics will be substantially less than similar margins for generic pharmaceutical products.
According to a PricewaterhouseCoopers survey conducted among generic biologic product manufacturers in Europe, biosimilars generally offered only a 10% increase in profit margin as compared to the innovator version of the identical product, a fact that may be hard to square with ultimate development costs.
The proverbial “canary in the coal mine” for biosimilars may be Celltrion’s CT-P13 (Remsima). The South Korean company filed for approval for the infliximab biosimilar with the EMA, having received approval in Korea on last July 23rd. The patent for the original product, Remicade, expires in the E.U. in 2014. Celltrion has Korean approval for the product for treatment of rheumatoid arthritis, ulcerative colitis, Crohn’s disease, ankylosing spondylitis, and psoriasis.
These recent actions and reactions to unpredictable paths and rewards attest to perseverance by pharma and biotech companies invested in biosimilars, and point toward a long haul toward return on investment.