January 19, 2011
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In our original post on biosimilars, Lumira Capital’s Beni Rovinski set out the business opportunities, the technical challenges and the regulatory hurdles facing follow-on biologics in 2009. Since then, as Beni predicted, a series of pharma deals have followed Merck’s Insimed acquisition, and the regulatory framework in North America has been clarified substantially, with final Health Canada guidance having been issued and the the U.S. BCPI Act working its way through the FDA’s rule-making process.
The biosimilars market has also evolved in a couple of unexpected ways:
- Teva decided not to wait for a distinct U.S. biosimilars pathway, and instead submitted a full BLA for Neupoval (which was accepted). Although Neupoval’s approval is now delayed, with the 12-year exclusivity period in the BCPI Act far exceeding similar periods in the EU and Canada, more companies may follow Teva’s approach instead of navigating the U.S. biosimilar regime.
- At the JP Morgan conference last week, the CEO’s of Amgen and Biogen Idec, two companies that have been built on innovator biologics, both openly discussed their own plans to produce biosimilars. Although Amgen’s Sharer said the company “should participate in an intelligent way without disturbing the core business,” and was looking to Asian and Latin American markets, Biogen Idec’s Scangos said flatly that “[t]he next decade will be about access and cost as much as it is about innovation,” and that biosimilars are “a low risk way to generate substantial revenue.”
As the regulatory and business environments continue to evolve, we’ll continue to keep an eye on the latest developments.
This post is the fourth in a series briefly outlining the biotech industry trends we’ve been following on the blog and noting some recent developments, plus directions for 2011.
October 21, 2010
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Two 9-figure announcements this week mark a turning point for the biosimilars market, and one highlights the increasingly important role India plays in innovation.
- Pfizer linked up with India’s Biocon in a deal that will see Biocon take the lead in development of four biosimilar insulin products that gives Biocon $200 million up front. Coverage of the deal in the Business Standard highlights the country’s overall strength in biosimilars, which fall midway between new molecule development and small molecule generics in terms of the R&D and manufacturing sophistication required. Biocon cites the deal as proof that India can move up the value chain, doing for biosimilars what it did for generics. This is especially true if they continue to attract backing and partnerships from the Pfizers of the world.
- Novartis’ generics unit, Sandoz, reported Q3 revenues of $292 million from a single biosimilar product — enoxaparin, a copy of Sanofi-Aventis’ anticoagulant Lovenox — which is not expected to hit blockbuster status in its own right. As we have noted before, the high level of expertise required to make biosimilars creates a high barrier to entry and contributes to the field’s attractiveness to traditional pharmas (e.g., Pfizer, above) as well as to the major generics players. FierceBiotech notes further growth is expected as the first biosimilar antibodies hit the market in 2014-2015.
The Economist picked up the relevant trends in an article today entitled “Attack of the Biosimilars“:
1) “Innovator” pharmas are moving into the biosimilars business, reversing their recent role as the predominant plaintiffs in IP litigation:
“…it is ironic that the next great opportunity for traditional drugs firms is to do to the biotechnology interlopers exactly what the generics firms have done to them: shred their profit margins with cheaper copies…”
2) India in moving up the innovation value chain, increasing that country’s incentive to protect IP more forcefully:
“And as if to remind the world that new ideas don’t all come from America, it is the Indian firm that will design and manufacture the original drugs; Pfizer will only market them.”
Bottom line: biosimilars are at least as big a business as predicted. This success is another challenge to the concept that pharma’s patent cliff challenge will be met by more in-licensing from small biotechs or by increased R&D spending. Revenue is revenue, and biosimilars are poised to generate lots more of it.
October 5, 2010
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Reuters reports that the European Medicines Agency (EMA), which has already approved 13 biosimilars, is expecting to publish guidelines in November on biosimilar antibody therapeutics. EMA Executive Director Thomas Lonngren said that clinical trials will be required for antibody biosimilars (as they are for the products EMA has approved to date), but that requirements were likely to be less onerous than in the United States.
Reuters says that the small number of requests (six) received by EMA so far “reflects the difficulties of making such copycat medicines [antibodies]” but with the earliest therapeutic antibodies coming off patent (in Europe) in 2014, I expect these initial inquiries are just the tip of the iceberg. Of couse, biosimilars are hard (as we’ve noted); but a lucrative opportunity of that scale will not go untapped.
Meanwhile, as expected based on the draft notice leaked in September, the FDA is holding public meetings on the implementation of the Biologics Price Competition and Innovation Act (i.e., the biosimilars legislation). The full Federal Register notice (pdf) is up, and Mark Sernak at eyeonfda.com has extracted the questions posted for comment.
In addition to a long list of scientific and technical questions, there are a couple of inquiries that I’d highlight from a corporate law perspective:
- Which types of related entities may be ineligible for a period of 12-year exclusivity for a subsequent BLA, given the “potential transfer of BLAs from one corporate entity to another and the complexities of corporate and business relationships”; and
- Whether the existing fee structure under the Prescription Drug User Fee Act (PDUFA) should be considered as a model in establishing a user fee structure for biosimilar applications.
Interested in attending or in submitting a comment? The FDA’s meeting information page is here, and it includes webcast access for November 2 and November 3.
September 20, 2010
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Adam Feuerstein at TheStreet.com reported this morning on a draft FDA notice for a planned November meeting on implementation of the Biologics Price Competition and Innovation Act, which was passed as part of the healthcare reform legislation.
The BPCI Act (42 U.S.C. 262(k)(8)) provides for the FDA to author guidance “with respect to the licensure of a biological product” — pretty broad, so we’ll have to stay tuned for the actual meeting notice. However, the legislation provides some hint in permitting “product class-specific guidance” specifying criteria that will be used to determine whether a biological product is highly similar to a reference product in such product class.
If the FDA decides to move ahead with product class guidance, it would likely specify the criteria that will be used to determine whether a biological product meets the standards for “interchangeability”.
In other cases, the FDA may determine that “the science and experience [to date] … with respect to a product or product class … does not allow approval of a [biosimilar] for such product or product class.”
Bottom line: following the FDA’s November meetings, biosimilars will be one step closer in the U.S.
P.S. Adam Feuerstein cites Alec Vachon (@HEALTH_NOTES) on Twitter for breaking the story Friday. Not sure why I haven’t found him before, but Alec is now added to my Biopharma-IT-Health Twitter list.
May 25, 2010
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I often hear how the upcoming loss of patent protection for current blockbusters creates an insatiable demand at pharma companies for new pipeline products from biotechs. Here’s an example from 2007. Here’s one from last week. This is not true. Upcoming loss of patent protection creates a insatiable demand for revenue, but new products are not the only source of new revenue.
Abbott’s $3.7 billion deal for a unit of India’s Piramal Healthcare last week is a perfect case in point. This deal, which follows Abbott’s license of a slew of products from Zydus Cadila, will feed the company’s new “established products division.” Abbott’s purchase of Solvay in February also built its emerging markets revenue, which now accounts for over 20% of the company’s business.
Abbott is far from alone: Sanofi is the biggest generics manufacturer in Latin America, Pfizer also has an established products division, Novartis is diversifying into eyecare and has long sold generics, Merck is into follow-on biologics and GSK tapped South Africa’s Aspen Pharma for emerging markets growth through branded generics. These alternatives look even better as payors worldwide are setting more demanding standards for reimbursement, the placebo effect is mysteriously strong, and personalized medicine makes clinical trials even more expensive.
My bottom line? Emerging markets and generics opportunities create plenty of growth, thank you very much, with a far lower risk profile than most product in-licenses or biotech acquisitions (even the option deals). As big pharma gets more comfortable with “established products” and biosimilars, biotechs are going to have to demonstrate even higher value. Plenty of companies are being built and funded with that in mind; but anyone counting on pharma’s desperation will be disappointed.
April 28, 2010
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As I’m preparing for the BIO conference in Chicago next week, I’m excited to see that several of the biotech trends we’ve been following on the blog are showing up as conference sessions.
- Interested in “A New Kind of Non-Dilutive Financing and Fundraising: Partnering With Not-for-Profits”? Get an early start at our trends page on Commercialization by non-profit foundations!
- Does “Comparative Effectiveness Research and the Government Role” or “Transforming Health Care Through Personalized Medicine” catch your eye? Check out the stories we’ve highlighted on Comparative Effectiveness and Personalized Medicine!
- Of course, with the new regulatory pathway created by Health Reform legislation in the U.S., Follow-on Biologics (aka Biosimilars) are all the rage at BIO this year.
- and the whole thing kicks off with Lilly’s General Counsel speaking on “Leveraging IP to Spur Global Biotechnology Innovation, Investment and Jobs” – emphsizing the link between IP Constituencies and Global Innovation that we have been following for some time.
Stay tuned for news from these and other sessions as we hit the conference next week!
March 16, 2010
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Health Canada released the finalized version of its Guidance Document for ”Subsequent Entry Biologics” (SEBs). The final version is mostly the same as the draft guidance released last March, and actually comes after the approval of Canada’s first SEB last April.
SEBs are a class of drugs that the EU calls “biosimilars” and the U.S. calls “a class of biologics we may recognize one day if health reform passes”“follow-on biologics,” but the gist is that they are copycat versions of existing large-molecule drugs. Because of their complexity, different versions of the same biologic cannot be characterized as identical. Hence “similar”.
Regulators are seeking a balance with respect to how much biosimilars can rely on data from the original (“reference”) drug in applying for their own approval, and with respect to how long to protect the reference drug’s data. Here are some highlights of Health Canada’s approach:
- A full New Drug Submission required for SEBs, (not an abbreviated submission, as for small-moelcule generics).
- The data exclusivity period — the time that must elapse before an SEB can use the data from the reference biologic’s application — is 6 years.
- Studies comparing the reference biologic to the SEB must be conducted in a side-by-side format.
For more information, check out the Ogilvy Renault Pharma in Brief publication, or read the whole Guidance Document.
February 2, 2010
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Teva’s decision last year to submit a full biologic license application (BLA) for Neupoval looks positively prescient today. Teva’s product is already sold in the EU as a biosimilar to Amgen’s Neupogen, but a U.S. biosimilars pathway is stalled along with the rest of health reform and today, the FDA accepted Teva’s BLA, clearing the way for a review of Teva’s clinical data and potentially for approval of the product.
FDA approval isn’t Teva’s only hurdle, though. Amgen’s U.S. patents on Neupogen don’t expire until 2013, and the two companies are currently litigating the issue of whether Teva’s product infringes those patents. Furthermore, the Dow Jones article quotes Credit Suisse analyst Michael Aberman who points out that in the EU Teva’s product only has 5% market share, competing against both the original Neupogen and Amgen’s longer-acting Neulasta.
Investors’ reaction? Teva shares were up 1.4 percent, Amgen shares were off minutely.
My bottom line: If you want to read tea-leaves to predict the approach other biosimilar products will take (and I do), watch the Neupoval BLA closely. The calculus undertaken by other potential market entrants will weigh Teva’s success and costs with this approach against the costs of any Congressional requirement for data exclusivity period and any FDA requirement for clinical trials in an eventual biosimilars regime.
Follow our coverage of North American biosimilars news on this Biotech Trends in 2010 page.
December 31, 2009
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These may not all be consensus picks (and don’t miss the IVB’s year-end deal-centric fun) but I’m sticking with these four trends as the ones that have really shaped the year that was:
- Follow-on Biologics. Call them what you want (we like “biosimilars”, but we’re internationalist like that), there’s no denying that biosimilars were a major force in the industry and in politics this year. Some in the press are calling the 12-year exclusivity period a done deal, but I say don’t count your chickens ’til the fat lady sings.
- Comparative Effectiveness and Personalized Medicine (not a two-fer, a trend of convergence). How much of comparative effectiveness variation will turn out to be an artifact of genetic sub-populations (each with binary responses to the drugs in question)? Nobody knows, but as money pours into both fields, the truth will set us (and drug pricing) free.
- Shifting IP Constituencies. What do you get when you cross generics-hungry pharma companies with innovation-hungry Asian countries? A whole new world of collaboration that will ultimately change the face of TRIPS and pharma R&D.
- Electronic Medical Records. Not really biotech (if you want to be picky), but it will have a massive impact on the way physicians, patients and payors interact with each other and with drug companies over the coming years. Plus, with billions allocated to electronic medical records in Canada and the U.S., the pace of innovation and implementation really took off.
October 15, 2009
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With the Senate Finance Committee voting this week in favour of its health reform bill, the legislative process will now move on to an attempt to reconcile the House bill and the two Senate bills in conference.
What does this mean for a biosimilars pathway? Will there be one? What will the exclusivity period be? The Senate Finance bill is silent on the topic, and the two other bills both include a biosimilars pathway with a 12-year exclusivity period.
Twelve years makes the Biotechnology Industry Association (BIO) and the National Venture Capital Association pretty happy, but the Obama administration and the FTC argue in favo(u)r of a much shorter period.
Today, a new opinion piece in the New England Journal of Medicine generated a lot of buzz, mostly because it argues for a 5-year exclusivity period (but also because it was an odd roll-out for NEJM’s new conflicts disclosure policy).
When the In Vivo Blog polled the question earlier this year, the majority vote was for 10-12 years; but me and some peeps on twitter (hi @InVivoBlogChris and Maureen @FierceBiotech) and in real life (anonymous) thought at the time the number would land under 10 years. I’m sticking to that bet.
July 13, 2009
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The debate over the proper data exclusivity period for innovator biologics (as protection against biosimilars/follow-on biologics/subsequent-entry biologics) had a busy week last week.
A couple of thoughts:
- The exclusivity period in the EU is 8 years (data) +2 years (marketing) +1 year (for new indications), and the current proposal in Canada is 6 years, so a baseline of 12-14 years’ protection would leave the U.S. system paying for exclusive pricing longer than other major markets. I’m fine if the U.S. decides to further subsidize pharma innovation, but I’d prefer a more transparent approach with less market distortion; and
- It’s hard to balance rationally between data exclusivity and patent exclusivity when the patent system is in significant flux. Having patent reform as a moving piece (or as part of biosimilars legislation) only muddies the debate.
Update: The WSJ picks these up this morning too. Here’s the NVCA story, and here’s the one on Kennedy’s efforts and the debate it’s generating in committee.
July 9, 2009
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In our continuing Trends in 2009 series on shifting IP constituencies, we’ve been following increasing innovative activity in the developing world, and innovator pharma’s increasing moves towards generics and biosimilars. This week saw updates on both fronts:
- PerkinElmer announced plans to open a Bio-pharma Center of Excellence in Hyderabad, India, later this year, citing “growth opportunities in environmental monitoring, neonatal and maternal screening, and pharmaceutical research.”
- In other India news, Mylan, a U.S.-based small molecule generics company, did a deal with Biocon for help with biosimilars.
- On the pharma front, a WSJ post this week explains the attractive economics behind big pharma’s growing investment in the developing world’s generics market. Two words: branded generics.
- Finally, China’s budget saw a huge R&D boost: up over 25% from 2008 (although it still lags Japan’s R&D spend by a third and the spending is heavily focused on applied technologies).
July 2, 2009
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The Obama administration offered up a 7-year data exclusivity period for biologics, calling it a “generous compromise” in a letter to Rep. Waxman from Nancy-Ann DeParle, director of the Office of Health Reform, and Peter Orszag, director of the Office of Management and Budget, picked up by Bloomberg this week.
I’ve had my money on an 8-10 year period for a while now as the compromise between the competing Waxman and Eshoo-Barton bills … The InVivo Blog has a funny take on how a 10-year period might be injected into the dialogue.
BIO points to a post by Prof. Holman criticising Waxman’s 5-year period (now clearly an outlier) and also the patent challenge/enforcement provisions of Waxman’s bill.
June 10, 2009
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The FTC released a report today that explores the economics of biosimilars’ market entry and competition. It predicts that biosimilars will be priced only 10 to 30% under their corresponding pioneer biologics; and that pioneer biologics will retain 70-90% of their market share subsequent to biosimilar market entry.
Based on these predictions, the FTC concludes that the proposed 12-14 year exclusivity period (here’s looking at you, Eshoo-Barton) is “too long.” I’m sticking with my guess that we see a compromise from Waxman on the exclusivity period, landing around 8-10 years.
The report also reiterates the FTC’s opposition to pay-for-delay deals and corresponding support for H.R. 1706.
P.S. The InVivo blog says there’s convergence on “biosimilars” over “generic biologics” and ”follow-on biologics” as the nomenclature of choice (presumably “subsequent-entry biologics” loses too), so I’m running with it.
April 22, 2009
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Guest post from Jill Daley, part of our all-star life sciences team at Ogilvy:
Today, Sandoz Canada announced that Health Canada has granted it a market authorization for Omnitrope™.
This announcement marks the approval of the first subsequent entry biologic (SEB, also known as a “follow-on biologic” (FOB) in the U.S. or a “biosimilar” in the EU) of a previously approved recombinant biotechnology drug by Health Canada.
Omnitrope™ has received similar treatment in the United States and in Europe where it has been approved as a “follow-on protein” and a “biosimilar” respectively.
Interestingly, today’s announcement came less than one month following Health Canada’s issuance of the Draft Guidance for Sponsors: Information and Submission Requirements for Subsequent Entry Biologics. The Ogilvy Renault bulletin analyzing the draft guidance is here.
The draft guidance is open to consultation until May 26, 2009. Interested stakeholders are invited to submit written coments via email (BGTD_PPD_DPP@HC-SC.GC.CA), mail or fax (613-952-5364).
March 11, 2009
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Representatives Waxman (D-CA), Pallone (D-NJ) and Deal (R-GA) released the Promoting Innovation and Access to Life Saving Medicine Act today, a.k.a. Follow-On Biologics legislation. The legislation provides a five-year initial exclusivity for products with a unique molecular structure. The Biotechnology Industry Organization is not too happy. In the past BIO has called for a 14-year data exclusivity.
Perhaps actions South of the Border will move the ball forward at Health Canada on its regulatory pathway for biosimilars? It has been almost exactly a year since Health Canada’s draft guidance on biosimilars was published. Health Canada subsequently published a summary of its Consultation on the Regulatory Framework for Subsequent Entry Biologics following a stakeholder meeting in June.
March 11, 2009
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Regulatory Brain Dump…
Regulating Nanotech: The FDA is collaborating with the Houston-based Alliance for NanoHealth (ANH) and its eight member institutions to expand knowledge of how nanoparticles behave and affect biologic systems. Results will be placed in the public domain.
Regulating Natural Health Products: Health Canada launched the first phase of Online Solution, a secure online system for regulating natural health products in Canada.
Not Waiting for Regulation: Like Teva’s decision in February, Momenta Pharmaceuticals doesn’t think it needs to wait for a follow-on biologics pathway. It’s proceeding with its application (presumably still a BLA) for a generic version of Lovenox, and unlike Teva, Momenta doesn’t think the FDA will require human trials for its product.
Commissioning Regulation: A number of reports, including the In Vivo Blog and the WSJ Health Blog have been pointing to the nomination of Margaret Hamburg as FDA Commissioner, with Joshua Sharfstein as deputy.
February 27, 2009
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GTC Biotherapeutics, which recently saw ATryn approved, announced a collaboration agreement with AgResearch Limited, a New Zealand Crown Research Institute.
AgResearch will develop genetically modified animals capable of producing the building blocks for “biosimilar” versions of existing products that will begin coming off U.S. patent in 2014.
The double combo shot: the success of the collaboration depends on
- a continuing trend of GE animal approvals, as well as
- the successful introduction of a biosimilars pathway in the U.S., (which is called for in Obama’s budget).
February 19, 2009
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In Beni’s post earlier this week on Biosimilars, he identified two major challenges to introducing follow-on biologics into the North American market: technical proficiency, and the absence of a regulatory regime.
Based on the approval of Teva’s biosimilar version of Neupogen in the EU last September, Teva has evidently cleared the first hurdle (and their joint venture with Lonza means their technical capabilities will only increase).
Yesterday, Teva announced that they were not waiting for a Biosimilars regime to be enacted before entering the U.S. market, and instead will take on the extra cost of filing a full BLA for their version of the biologic.
Does this mean we don’t need a biosimilars regime to get biosimilars to market? Teva itself takes a different position.