November 2011

Biosimilar Drugs in Europe threat or opportunity to innovationA FirstWord ExpertViews Report

Biosimilar Drugs in Europe threat or opportunity to innovation

Biosimilar Drugs in Europe threat or opportunity to innovation

Published November 2011copy Copyright 2011 Doctorrsquos Guide Publishing Limited

All rights reserved No part of this publication may be reproduced or used in any form or by any means graphic electronic or mechanical including photocopying recording taping or storage in information retrieval systems without the express permission of the publisher

This report contains information from numerous sources that Doctorrsquos Guide Publishing Limited believes to be reliable but for which accuracy cannot be guaranteed Doctorrsquos Guide Publishing Limited does not accept responsibility for any loss incurred by any person who acts or who fails to act as a result of information published in this document Any views and opinions expressed by third parties and reproduced in this document are not necessarily the views and opinions of Doctorrsquos Guide Publishing Limited Any views and opinions expressed by individuals and reproduced in this document are not necessarily the views and opinions of their employers

Biosimilar Drugs in Europe threat or opportunity to innovation

Biosimilar Drugs in Europe threat or opportunity to innovation

Published November 2011copy Copyright 2011 Doctorrsquos Guide Publishing Limited

All rights reserved No part of this publication may be reproduced or used in any form or by any means graphic electronic or mechanical including photocopying recording taping or storage in information retrieval systems without the express permission of the publisher

This report contains information from numerous sources that Doctorrsquos Guide Publishing Limited believes to be reliable but for which accuracy cannot be guaranteed Doctorrsquos Guide Publishing Limited does not accept responsibility for any loss incurred by any person who acts or who fails to act as a result of information published in this document Any views and opinions expressed by third parties and reproduced in this document are not necessarily the views and opinions of Doctorrsquos Guide Publishing Limited Any views and opinions expressed by individuals and reproduced in this document are not necessarily the views and opinions of their employers

Biosimilar Drugs in Europe threat or opportunity to innovation

All Contents Copyright copy 2011 Doctorrsquos Guide Publishing Limited All Rights Reserved

November 2011i wwwfwreportscom

ContentsExecutive summary 1

Biosimilar drugs in Europe 2

What are biosimilars 2Generics and biosimilars ndash similarities and differences 3Biosimilars available so far in Europe 5

The market opportunities for biosimilars in Europe 7The biologics patent cliff will have an impact on the market 7Market types for biosimilars will differ across Europe 9

Geographic markets for biosimilars will vary across Europe 9In Italy prescriptions are fulfilled by brand 10In France and Spain drugs are discounted to targets 10In the UK biosimilar uptake is driven by NICE 10In Germany biosimilars uptake is good but varies by drug type 11

Biosimilar uptake will vary by molecule and indication across Europe 11Epoetin uptake may have been slowed by immunogenicity issues 11Filgrastim uptake has been faster in Europe 12

Biosimilar use is likely to vary between chronic and episodic treatment 12There may be a resistance to switching patients on established treatments 12Hospital physicians may be more likely to use biosimilars than primary care physicians 13Biosimilars will have an impact in cost-sensitive markets 13The paediatric population may be reluctant to take up biosimilars 14

The challenges for biosimilars in Europe 15The biosimilars challenge Gaining approval in Europe 15

The EU regulatory process for biosimilars 15Biosimilar regulations will be a steep learning curve 16Will regulations be fair and balanced on all points 17

The biosimilars challenge Overcoming development and manufacturing hurdles 18Biologics are highly variable by nature 19Variations can cause issues with immunogenicity 19

The biosimilars challenge Overcoming patent hurdles 21The biosimilars challenge Gaining stakeholder trust 21

Payers can be a major driver for biosimilars uptake 21Physicians will be key gatekeepers for biologics and biosimilars22Patients may be cautious about biosimilars 22

The defensive position Originator companies will try to limit biosimilar uptake 23Lifecycle management can maintain market share 23Lack of automatic substitution will protect originator drugs 23Exclusivity provisions and patents will protect originator drugs 25Originator companies can exploit loyalty to maintain market share 25

Biosimilar Drugs in Europe threat or opportunity to innovation

All Contents Copyright copy 2011 Doctorrsquos Guide Publishing Limited All Rights Reserved

November 2011ii wwwfwreportscom

Focusing on quality safety and efficacy claims can maintain loyalty 26Using marketing sales and healthcare professional training to attract and keep market share 27

Protecting the market through degree of similarity ndash is a biosimilar really similar 27Competitive pricing and rebate agreements will keep cost-sensitive customers 27

The offensive position breaking into a new market 28Pricing is the key differentiator for biosimilars 28Knowing the market will help gain market share 29Information and education defending biosimilars against the naysayers 30

Sales marketing and account management Market share through talking to the payers 30Education for healthcare professionals Market share through talking to the physicians 31

Gaining market share by adding value Devices and formulations 31Making the biosimilar easier to use Devices 32Making the biosimilar easier to handle formulations 32

Protecting biosimilars through patents 32

The company landscape Opportunities for companies in biosimilars 33Generics companies will be key players 34

Collaboration and licensing in the biosimilars market 35Collaborations between generics companies ndash bringing together development and marketing 35Collaborations between generic and originator companies combines know-how and manufacturing capabilities 35Geographic collaborations allows access to wider markets 36Looking into biosimilars deal data 36

Biosimilar deals by volume 36Biosimilar deals by value 38Biosimilar deals by type38Biosimilar deals by indication 38

Biosimilar deals Deal case studies 39Biopharma company signs agreement to access biosimilars39Generics company signs agreement to fill pipeline 40

Whatrsquos next for biosimilars in Europe 41Monoclonal antibodies will be a dramatic entry to the biosimilars market 41Biobetters could lsquofollow-onrsquo from biosimilars 41

Biobetters will follow a different route of approval 42The US Changing the biosimilars environment 42

Conclusion 44

Acknowledgments 45

Bibliography 46

Biosimilar Drugs in Europe threat or opportunity to innovation

All Contents Copyright copy 2011 Doctorrsquos Guide Publishing Limited All Rights Reserved

November 20111 wwwfwreportscom

Executive summaryn Biosimilars are therapeutically similar copies

of biological therapeutic reference drugs (therapeutics derived from living organisms) developed after the patent on the originator drug (reference product) has expired

o A range of blockbuster biologic patents are due to expire between now and 2019

n Biosimilars have been available in Europe since 2006 and 14 have been approved to date

n The biosimilars market could be worth $225-48 billion by 2015 and this is a major opportunity for companies entering this arena

n Biosimilar markets will vary across Europe ndash Germany is already a major European biosimilars market ndash and pricing and reimbursement will vary in different countries and even across individual countries

n Biosimilar markets will also vary by molecule and indication with filgrastim already having a faster uptake than epoetin

n Biosimilar uptake will also vary by setting - hospital or primary care ndash but this may change as cost-cutting continues in healthcare

n Biosimilars companies will face challenges particularly because biologics are variable by nature ndash gaining approval managing the potential risk posed by new biosimilars post-approval and creating new manufacturing processes around the barriers posed by the originatorsrsquo patents

n Biosimilars companies need to gain stakeholder trust because the stakeholders will drive biosimilars uptake

n The originator companies will want to retain market share and they may take a number of different approaches such as using lifecycle management building on physician loyalty through focussing on existing quality safety

and efficacy data using marketing sales and healthcare professional training and looking at new pricing models

n The lack of automatic substitution has potential to limit biosimilar market share

n Biosimilar companies will work hard to break into this new market through using pricing as a key differentiator They will need to learn the market and work with physicians to create loyalty to the new biosimilar brand exploiting physiciansrsquo familiarity with small molecule generics as well as adding value by creating new delivery devices formulations and sizes

n The biosimilars market will be an opportunity for existing generics companies and originator companies looking to move into new markets

nMonoclonal antibodies and biobetters will be the next step for the biosimilars market

nWhen the US route of approval is clarified this will mean a major expansion for the biosimilars market

Generic Substitution Taking a Narrow View examines the trend towards generic substitution in major marketsmdashand why a similar practice with narrow therapeutic index drugs is drawing fire

Biosimilar Drugs in Europe threat or opportunity to innovation

All Contents Copyright copy 2011 Doctorrsquos Guide Publishing Limited All Rights Reserved

November 20113 wwwfwreportscom

In order to clarify things the Biosimilar Medicinal Products Working Party (BMWP) at the EMA created some proposed terminology Published in Nature in 2011 this defined a biosimilar as ldquoa copy version of an already authorized biological medicinal product with demonstrated similarity in physicochemical characteristics efficacy and safety based on a comprehensive comparability exerciserdquo2 See Table 1 for further proposed definitions

2 Weise Bielsky De Smet Ehmann Ekman Narayanan Heim Heinonen Ho Thorpe Vleminckx Wadhwa and Schneider Biosimilars - why terminology matters

Source Based on Weise et al3

Generics and biosimilars ndash similarities and differencesThe term lsquogenericrsquo is generally used to refer to a small molecule generic medicinal product reference drug The UK Medicines Amendment Regulations 2005 define a generic medicinal product as one that ldquohas the same qualitative and quantitative composition in active substances and the same pharmaceutical form as the reference medicinal product and whose bioequivalencehelliphas been demonstratedrdquo4

Small molecule generics can be approved for the market in Europe based on pharmacokinetic and

3 Weise Bielsky De Smet Ehmann Ekman Narayanan Heim Heinonen Ho Thorpe Vleminckx Wadhwa and Schneider Biosimilars - why terminology matters

4 WilmerHale (December 1 2005) UK Medicines Legislation Assists Generic Competition httpwwwwilmerhalecompublicationswhPubsDetailaspxpublication=2976

Table 1 Proposed definitions

Term(s) Definition Implications

Biosimilar Copy version of an authorized biologic with demonstrated similarity in physicochemical characteristics efficacy and safety

Only very small differences with no clinical relevance

Extrapolation of clinical indications acceptable if scientifically justified

Me-too or non-innovator biologic

Biologic developed independently and not directly compared to or analyzed against a licensed reference biologicMay or may not have been compared clinically

May have physicochemical differences compared with other biologics in same product class

Clinical comparison may not pick up potentially relevant differences

Extrapolation of clinical indications may be difficult

Second-generation or next-generation biologic or biobetter

Structurally andor functionally altered biologic to improve or change clinical performance

Usually stand-alone development with a full development programme

Clear differences in structure

Likely to have different clinical behaviour

Claims would have to be supported with data showing a clinically relevant advantage

There are significant

differences between biosimilars and

small molecule generics

(and their reference molecules)

Biosimilar Drugs in Europe threat or opportunity to innovation

All Contents Copyright copy 2011 Doctorrsquos Guide Publishing Limited All Rights Reserved

November 201111 wwwfwreportscom

In Germany biosimilars uptake is good but varies by drug typeThe uptake of some biosimilars in Germany has been good with 60 percent of the epoetin market share being filled by biosimilars However the biosimilar share of the growth hormone market in Germany is only four percent which highlights that the uptake of biosimilars will be highly variable across product types24 One of the drivers is the German government which has encouraged the use of biosimilars and has quota requirements25 These differ between drugs and across Germany ndash the quotas for biosimilar epoetin as a percentage of all prescriptions of epoetin for example range from 20 percent in Hamburg to 40 percent in Berlin26

ldquoThe German government has been pro-biosimilar since biosimilars reached the market back in 2006 The biosimilar epoetins and G-CSF have done well in this marketrdquo says Emerton

ldquoGermany is one of the leading countries in terms of penetration for the epoetins This has been driven by regional biosimilar quotas at the local level in Germany ndash of all the epoetins that are used in certain regions a certain proportion is required to be biosimilarsrdquo says Greenland ldquoAs a result the penetration of biosimilar epoetins in Germany has been quicker and higher than for most other European countries Now that biosimilars have been used for nearly four years in Germany physicians are much more comfortable with using biosimilars in patients in the same way that they would use the originatorsrdquo

24 Senior M (April 18 2011) The IN VIVO Blog Biosimilars Dead Before They Really Got Started httpinvivoblogblogspotcom201104biosimilars-dead-before-they-really-gothtml

25 GaBI The market for biosimilars

26 Rovira Espiacuten Garciacutea and Labry The impact of biosimilarsrsquo entry in the EU market

Another of the drivers is the reputation of the companies within Germany The companies behind biosimilars are well known and trusted for example Ratiopharm

ldquoRatiopharm as a corporate brand is one of the most trusted brands in Germany up there with BMW and Mercedes with both the general public and physicians and has been providing generic products to the German health service for a number of years The reputation and the ability to convince key stakeholders have translated over to the biosimilar space and this was one of the key drivers of Tevarsquos acquisition of Ratiopharmrdquo says Emerton

Biosimilar uptake will vary by molecule and indication across EuropeSince the launch of the first biosimilar in 2006 there has been variation in the uptake of different biosimilars across Europe

Epoetin uptake may have been slowed by immunogenicity issuesImmunogenicity concerns associated with an originator epoetin following a manufacturing change (see lsquoVariations can cause issues with immunogenicityrsquo) may have slowed the uptake of biosimilars in this molecule type and indication The initial biosimilar epoetins approvals were also not licensed for subcutaneous use ndash associated with immunogenicity ndash limiting their use across indications

ldquoWhen the first two biosimilar epoetins were approved in 2007 they did not have a licence for subcutaneous use because this licence had been taken away from the reference product Eprex following the manufacturing change and immunogenicity concernsrdquo says Greenland ldquoThis slowed uptake and although the caution from physicians was understandable the problems had

ldquoThe German government has been pro-biosimilar since biosimilars

reached the marketrdquoDuncan Emerton Head of Biosimilars Datamonitor Healthcare Consulting

Epoetin uptake may have been slowed by immunogenicity issues

Biosimilar Drugs in Europe threat or opportunity to innovation

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November 201139 wwwfwreportscom

Biosimilar deals Deal case studiesBiopharma company signs agreement to access biosimilarsChina and India have long had reputations for illegal copying but both are moving into the mainstream of approved generics and biogenerics In October 2010 Pfizer signed an agreement with Bangalore-based biotech company Biocon64

Pfizer will pay an upfront payment of $200 million and RampD and milestone payments of $150 million to have exclusive global rights to commercialize a number of Bioconrsquos biosimilar insulins and insulin analogues Biocon will also receive royalty payments Pfizer will have exclusive rights to commercialize Bioconrsquos drugs globally with certain exceptions such as Germany India and Malaysia where Biocon will have coexclusive rights

64 Attack of the biosimilars Attack of the biosimilars

Biocon will carry out the clinical development manufacture and supply of the biosimilar insulin products Pfizer will secure regulatory approval in Europe and the US and launch the insulin products onto emerging markets by 2011 and Europe and the US in 2012 and 2015 respectively

Bioconrsquos recombinant or genetically engineered insulin products are already approved in 27 countries in developing markets65

ldquoPlaces like India and South Korea have been manufacturing biological products for some time whether in a contract capacity or as manufacturing sites of international companies So they certainly have some of the expertise thererdquo says Coney

65 Krauskopf L and Nagaraju B (2010 October 18) Krauskopf L and Nagaraju B (2010 October 18) Pfizer to sell biosimilar insulins in Biocon deal Reuters Retrieved from httpinreuterscomarticle20101018idINIndia-52267720101018

29

27

15

8

8

6

2 2 2 Cancer

Haematological disease

Endocrine disorders

Infectious disease

Musculoskeletal disease

Genitourinary disorders

Disease of the nervous system

Gastrointestinal disease

Respiratory diseaseFigure 3 Biosimilar deals 2002-2011 ndash deal indicationSource PharmaVenturesrsquo PharmaDeals database

Biosimilar Drugs in Europe threat or opportunity to innovation

All Contents Copyright copy 2011 Doctorrsquos Guide Publishing Limited All Rights Reserved

November 201141 wwwfwreportscom

Whatrsquos next for biosimilars in EuropeThe European biosimilars market is still very new and is changing as it is growing particularly as the biologics patent cliff approaches and biosimilar monoclonal antibodies hit the market

ldquoThe biosimilars market is only five or six years old Itrsquos still a nascent market especially compared with the small molecule generics market which has been around in a formal capacity since the mid-rsquo80s and it still has a long way to gordquo says Emerton ldquoI think the next three to five years are going to be critical and will shape how the biosimilars market evolves into the future driven by the next phase of biologics coming off patent particularly the monoclonal antibodiesrdquo

ldquoI would expect that every biologic on the market will at some point be the target of a biosimilar manufacturerrdquo says Greenland

Monoclonal antibodies will be a dramatic entry to the biosimilars marketA number of European monoclonal antibody patents are due to expire including Rituxan (rituximab) and Remicade (infliximab) both in 2014 Companies are already looking at monoclonal antibodies (mAbs) as biosimilars ndash for example Teva is developing a biosimilar version of Rochersquos Rituxan as are Sandoz and Spectrum Laboratories66

The EMA adopted guidelines for mAbs early in 2011 but only expects two to three applications a year67

ldquoMost of the interest at the moment seems to focus on the monoclonal antibodies particularly trastuzumab and rituximabrdquo says Cox ldquoThey are high value drugs

66 GaBI (April 29 2011) Generics manufacturers and biosimilars httpwwwgabionlinenetBiosimilarsNewsGenerics-manufacturers-and-biosimilars

67 GaBI (February 11 2011) EMA adopts guideline on biosimilar monoclonal antibodies httpwwwgabionlinenetGuidelinesEMA-adopts-guideline-on-biosimilar-monoclonal-antibodies

internationally ndash while the development costs will be high the rewards will be significantrdquo

Coney supports this ldquoEven a comparatively small share of the monoclonal antibody market would be worth hundreds of millions of dollars ndash even blockbuster-type salesrdquo

Biobetters could lsquofollow-onrsquo from biosimilarsBiobetters can be defined as improved versions of currently available biologics and may have a better side effect profile lower toxicity longer half-life reduced immunogenicity improved efficacy or a different route of administration

These can be as a result of simple changes such as more homogenous glycosylation which improves the heterogeneity within a batch or differences in formulation which could improve cold chain supply issues

An example of a biobetter is Neulasta (pegfilgrastim) a pegylated version of Neupogen (filgrastim) used to treat chemotherapy-induced neutropaenia It has a longer half-life and improved dosing regimen though the clinical outcomes are the same

Innovator companies can use biobetters as part of their lifecycle management for example by creating patentable forms of drugs that have come off patent Because biobetters are actually new molecules they are patentable provided they

The European biosimilars market is still very new and is changing

as it is growing particularly as the biologics patent cliff approaches and biosimilar monoclonal antibodies hit

the market