Chances and Hurdles for Biosimilars
Follow-Up Drugs Hold Potential for Patients, Pharmaceutical Industry
With biosimilars the pharmaceutical industry and health-care business move into a relatively young discipline with high sales potential. The follow-up drugs of biopharmaceuticals are becoming more and more a cost effective alternative for the often expensive but very effective originator medicines. But the way to the market is armed with hurdles.
The age of biosimilars has finally dawned in the US after Zarxio (filgrastim-sndz), a cancer drug, was approved by the US Food and Drug Administration in March. Since September the copy of Amgen’s Neupogen (filgrastim) has been on the market. With this the US, the world’s biggest pharmaceutical market and often at the forefront of medical innovations, is jumping into the biosimilar business 10 years after Europe, Australia and India.
Biosimilars are much more than generics of off-patented originals. They are complex follow-up drugs, approved because they are highly similar to an already-existing biological product, a reference product. The biosimilar also must show it has no clinically meaningful differences in terms of safety and effectiveness from the reference drug.
Revolution In Medicine
Since their introduction in the 1980s, biopharmaceuticals have revolutionized the treatment of serious diseases such as cancer, diabetes, rheumatoid arthritis or multiple sclerosis. As base material drugmakers usually use living species, such as plants, animal cells, bacteria, virus or yeast, which generally have been genetically modified.
Production of biopharmaceuticals is an extensive process, which has to be observed continually. About 250 in-process tests have to be carried out on biopharmaceuticals while small-molecule drugs need around 50 such tests. Because of the biologic origin of the base material, ensuring constant quality, efficacy and consistent results is extremely important. The final products are generally highly complex and consist of several thousand atoms.
As a consequence and in contrast to traditional generic drugs with their small-molecule structure, the development, production and approval process of biosimilars is difficult and requires a lot of expertise. The variability of the molecules makes an exact reproduction nearly impossible. This also refers to the originator products. Different batches of the same product can vary significantly.
Highly Dynamic Class of Drugs
Despite the complexity of the molecule structure and the development and manufacturing process, biosimilars belong to a highly dynamic class of drugs. Today eight of the top 10 drugs are from the biopharmaceutical sector, accounting for 81.9% of sales in that blockbuster field. Biopharma experiences a growth of 7% or 8% annually —double as much as the whole pharmaceutical market. Based on data of IMS Health, the worldwide market share of biopharmaceuticals rose from 11% in 2002 to 18% in 2012 and is expected to further increase to 20% by 2017.
Simultaneously more and more biopharmaceuticals go off patent. In Europe and the US about 12 biosimilars with the highest revenues will lose their patent protection by 2020, the German monitor Versorgungsforschung reported in 2013. Citi Research estimated that manufacturers of biopharmaceuticals would likely lose more than $360 billion in revenues over the next 10 years. In the same period a value of $110 billion will be transferred from innovators to biosimilars. Thomson Reuters, more conservatively, calculates that worldwide biosimilar sales will increase to $35 billion by 2020.
Big Deals and Small Caps
Coming from global sales of $1.3 billion in 2013, the industry thus has a huge growth dynamic.
“We believe that the market materially underestimates the magnitude and the timing of the impact on exposed innovator companies as well as the commercial opportunity for the biosimilar sponsors,” according to Citi Research.
Other analysts call biosimilars one of the fastest growing segments of the pharmaceutical market.
Not surprisingly, Big Pharma extends its tentacles into the biosimilar business. Pfizer completed in September the $17 billion acquisition of Hospira, a global leader in biosimilars. Hexal, the generic unit of Novartis, has already built up a strong presence in biosimilars. And specialized biosimilar companies try to get a piece from the attractive pie, such as Pfenex, Epirus, Coherus or the German Formycon. The small company focuses on biosimilars that will come to market after 2020. It has three biosimilar candidates under development, two of them already licensed to the Santo Holding. One project will be entering clinical phase III trials soon.
Factors of Development for Biosimilars
The rise of biosimilars has several causes. One trigger is our aging society’s need for more and better medical aid. As a consequence general health-care spending is continually rising.
Another important growth factor is cost. Because of their complicated manufacturing, biopharmaceuticals are about 20 to 50 times more expensive than chemical drugs. Depending on the therapy, total costs can amount to $200,000 per patient per year. AbbVie’s rheumatoid arthritis drug Humira, for example, costs more than €5,200 per package in Germany and is one of the most expensive drugs ever.
Here biosimilars offer a significant cost reduction opportunity for the health-care sector.
Biosimilar commercial success is an important and necessary safety valve in allowing US and EU health-care budgets to continue to reimburse premium priced highly innovative therapies, such as cancer immunotherapies, in the wake of an aging population, according to Citi Research analysis. The German research institute IGES calculates with reduced costs between €11.8 billion and €33.4 billion from 2007 until 2020 in eight European countries.
Requirements For Approval
But the road to the market is not a fast-selling item for biosimilars. The hurdles are significant. In Germany, for example, the national pharmaceutical association VFA calls for detailed data on the quality of biosimilars as well as comparing non-clinical and clinical data for approval of biosimilars. The organization also calls for observational studies after approval of biosimilars, no automatic substitution in pharmacies, safeguarding of therapeutic freedom for the doctors and change of therapy based only on medical considerations and inclusion of the patients.
As a core criterion, national drug authorities require proof of similarity of the biosimilar to the reference product in clinical trials. Furthermore the legal approval criteria are an important factor for the development of biosimilars. This is evident in the different approaches in approval processes between the US and Europe. While that process in the US only recently got a legal base, Europe has had corresponding legislation since 2005. Therefore Europe with 19 approved biosimilars is well ahead of the US with just one.
But this picture could change now. “In our view, the market underestimates the willingness of the FDA to approve competitive biosimilar entrants using extrapolation and interchangeability,” according to Citi Research.
Especially the term “interchangeability” could become a challenge for the biosimilar industry. Ultimately, not only drugmakers of original products want to go further than biosimilars and try to achieve interchangeability. When the Affordable Care Act opened up a pathway for the FDA to approve drugs that mimic off-patent biologics, it created two tiers: products that are biosimilar — “highly similar to the original product... (with) no clinically meaningful differences” — and those that are interchangeable, which would be held to even higher standards.
The problem: So far no drug has met the standards for interchangeability. Hans Ebbers, a researcher at Utrecht University in the Netherlands and an expert on biosimilars, addressed whether the challenge of achieving interchangeability was an insurmountable hurdle.
The idea that an interchangeable biosimilar must perform the same in any given patient is part of what makes achieving interchangeability so tricky, because that’s not exactly how studies on new biotech drugs work, Ebbers said.
“Such studies will only be able to address comparability on an aggregated (population) level,” he wrote — not in every individual patient.
Beyond that, rules against exchanging a biosimilar for the original product “could be misinterpreted by prescribers to indicate that switching to a biosimilar might lead to unsafe situations,” Ebbers and colleagues wrote in a Nature Biotechnology commentary.
How Will Physicians Respond?
This leads to the question of if and how doctors and patients will accept biosimilars. Doctor platform and community QuantiaMD surveyed 300 primary care physicians and specialists to find out how much health-care providers knew about the drugs. Of those polled, 78% said they were familiar with the term “biosimilar,” but only 38% could name one under consideration for FDA approval that would be relevant to their patients, the magazine Medical Marketing & Media (MM&M) reports.
Only 17% of the doctors said they were “very likely” to prescribe biologics and, thus, the most likely to prescribe biosimilars in the future.
That’s a problem for the biosimilar companies. Whether biosimilars pick up steam will largely depend on doctors and on their likelihood to order them for patients. At this point experts still see a lot of room for the drug companies to educate their clients.