When biosimilars go bad

Teva, Lonza terminate biosimilars co-development agreement; other companies look to exit fast-growing market

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MOUNTAIN VIEW, Calif.—Noting that Teva and Lonza have recently terminated their2009 joint venture agreement to co-develop biosimilars based upon therealization that the development costs and time to market were beyondinitial estimations, Frost & Sullivan Senior Industry AnalystDeborah Toscano observes: "When biosimilars were first a hot topic, itwas a common perception that the scenario would parallel producinggeneric copies of conventional small-molecule drugs, which can typicallysteal up to 90 percent of the originator drug's sales with minisculedevelopment costs, by comparison. When you combine this erosionpotential with the high price tags of biologic drugs, you get aseemingly easy path to billion dollar revenues. However, as manycompanies are realizing, copying a biologic drug close enough to passregulatory standards is proving to be more technologically andeconomically challenging than originally thought."

Case inpoint: In Europe, where biosimilars are marketed, they have garnered ameager 11-percent market share. Toscano notes that many U.S. companiesare still awaiting final U.S. Food and Drug Administration (FDA)guidance. She cites a case where a patient died after taking abiosimilar.

"There are many issues at stake, most importantlypatient safety," she says. "One amino acid can throw the immune systemoff. Successful biosimilars will not only have to pass regulatorymuster, but will also have to earn the confidence of the prescribingphysicians who will rely on strong clinical data and not necessarilyonly on FDA approval, since they will not be, by definition, identicalto the originator biologic drug."

Safety issues are ofsufficient concern that Genentech has issued a formal statement, whichsays in part that switching between an innovator biologic and abiosimilar "should only be done following demonstration through clinicalstudies that switching back and forth ... causes no greater harm thanusing the innovator alone." The statement adds another cautionary noteby stating that "each claimed indication for a biosimilar should beestablished by indication specific clinical trials, unless there is asolid scientific rationale to justify extrapolation of the clinicalsafety and efficacy data from one indication to another."

If thissort of scenario prevails, the required costs and expertise behind theadvanced technology, clinical trials, regulatory negotiations andmarketing efforts may be beyond the capabilities of many would-bebiosimilar players. Additionally, as Toscano points out, others maydecide that application through the full Biologics License Application(BLA) pathway or development of biobetters rather than biosimilars makesbetter financial sense because the overall development costs may not besignificantly different in the long run-and a BLA provides 12-yearpatent protection.

In Europe, two companies have recently beengranted marketing authorization for a biosimilar monoclonal antibody:Celltrion for Remsina, and Hospira for Inflectra. Both are biosimilarversions of Remicade (infliximab) marketed by Merck and Johnson &Johnson. While some are exiting the playing field, other larger, moreexperienced companies such as Sandoz (Novartis), Hospira and Pfizer areforging ahead.

"Sandoz and Hospira already have vast experiencelaunching biosimilars in Europe and elsewhere, giving them a significantadvantage over less experienced players," Toscano says. "Sandoz isrunning several late-stage clinical trials ahead of the FDA's finalguidance, and Pfizer has initiated several early-stage clinical trialsfor their versions of blockbuster monoclonal antibodies such asHerceptin, Rituxan, Remicade and Humira. Likewise, Eli Lilly, nostranger to insulin therapy for diabetes, has initiated two late-stagetrials of their version of Lantus, the blockbuster long-acting insulinfrom Sanofi."

As of June, the FDA had received no applications,but has received requests to meet with various biosimilar developers,stressing the need to meet early and often. The agency has still notruled out dealing with biosimilar issues on a case-by-case basis andcontinues to emphasize that they will weigh analytical data very highlyand maybe back off on the requirements for clinical trials to someextent. Yet another unknown: once biosimilars are introduced, willthird-party payers in effect force physicians to prescribe them?

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