Report: Biosimilars and Biobetters: Positioning for a New Market

Abstract

This new and timely report analyzes the emerging market for first- and second-generation biosimilars. The market can best be understood in the context of the established $110 billion biologics business, which is therefore comprehensively reviewed. Currently, biologics worth about $59 billion are susceptible to biosimilar competition because of expired (or near-to-expiration) patents, but actual sales of biosimilars are only around $75 million worldwide. By 2013, biologics sales will have almost doubled to $202 billion, of which $80 billion will be susceptible to biosimilar competition, and biosimilars could generate a global market of $5.6 billion. This is one-third of the potential market, assuming that biosimilars are priced at 70% of the innovator products and achieve a 30% share of units sold.

The imminent expiries of several key biologics patents create not-to-be-missed opportunities for biosimilar development and a chance for new companies to establish themselves as suppliers. Initially companies will need to compete on price with first-generation biosimilars. But longer-term success will require the ability to create products that are differentiated from competing biosimilars.

Next-generation innovator products will increasingly confront first-generation products on the market. These newer products (biobetters) offer benefits over the first-generation products that current biosimilars simply attempt to imitate. Biosimilar companies also now need to formulate strategies to develop biobetters, as these are likely to be accepted more readily by end-users, and could match - or even exceed - originator products in terms of revenue-earning potential.

Biosimilars and Biobetters: Positioning for a New Market thoroughly reviews innovator biologics and biosimilars on the market and in development, the regulatory pathway in the EU and developments in the US, and profiles 40 companies developing biosimilars worldwide. Scientific and sales data on almost 90 biologics (peptides, proteins, monoclonal antibodies and other products) on the market are used to derive country-specific forecasts for biosimilars.

Top-selling biological agents in 2008 facing generic competition during the forecast period (2009-2013) were (ranked in descending order):

erythropoietins
insulins
etanercept
interferon-beta
G-CSFs
coagulation factors
enoxaparin
human growth hormone
interferon-alpha
imiglucerase
goserelin
somatostatin
cyclosporine
dornase alfa
tenecteplase
calcitonin
rHepB vaccine
desmopressin
botulinum toxin type A
GM-CSF
IL-2

Current sales of biosimilars are constrained by the lack of a streamlined regulatory pathway for biosimilars in the US, which is the world' s largest market for biologics, and conservatism among prescribers. If readily available, and supported by adequate clinical trial data, biosimilars should appeal to third-party payers because of their lower cost, but even then might be less attractive to prescribers and patients used to the innovator drugs, e.g. because of concerns over bioequivalence. Hence the freedom of prescribers may need to be circumscribed, e.g. by biosimilar quotas or formularies. Germany is a case in point, and is developing various schemes to incentivize biosimilar usage.

At least half of the North American and European companies surveyed in this report have developed or acquired technologies for producing improved protein and antibody therapeutics and some have began to develop biobetter biosimilar products. Proprietary technologies for producing improved biologics include half-life extension methods, glycoengineering, cell production systems, and drug delivery systems. The first wave of proprietary improved biosimilars in commercial development include long-lasting versions of erythropoietins, human growth hormone, G-CSF, insulins, and interferon-beta.

Some improved biosimilars might be approved through the biosimilar regulatory pathways. For example, Teva Pharmaceutical' s long-acting G-CSF is based on a different technology from the long-acting G-CSF product already on the market, but Teva hopes to have its product approved as a biosimilar drug.

Other improved biosimilar products might be considered second-generation biologics and could obtain patent protection and premium pricing. Most of Merck & Co' s biosimilars in development can be considered second-generation biologics, reformulated or improved versions of branded drugs. The current development period for a first-generation biosimilar ranges from seven to ten years, which is not vastly shorter than that for a biopharmaceutical product. Improved biosimilars which will need to be approved via the same pathways as innovator drugs will not require the same extensive investment as an innovator drug, nor will they carry the same level of risk.

Use this report to:

Understand the existing market for biologic drugs, including production methods, drug characterization techniques, and therapeutic indications;
Examine the EU biosimilar legislation, requirements for comparability and immunogenicity testing, and lessons learned from biosimilar launches to date;
Analyze the proposed US biosimilar legislation under consideration;
Examine strategic implications of the biopharma patent landscape and expiry dates of the first US patents issued on top-selling biologics
Explore technologies for producing improved biologics (biobetters), including drug delivery, half-life extension, cell production, and glycoengineering methods;
Identify the most promising peptide, protein, monoclonal antibody, and glycan targets for biosimilar development;
Establish the nature of the existing and pipeline competition for potential specific peptide, protein, monoclonal antibody, and glycan biosimilars;
Identify the characteristics of companies developing biosimilars, including their strategies, proprietary technologies for developing improved biologics, biosimilar portfolios and collaborations;
Analyze the biosimilar-susceptible segment of the global biologic market and get market forecasts to 2013 for the leading biologics currently susceptible to biosimilar competition.