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.
January 28, 2010
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One of the biotech trends we’re following in 2010 is the increasing innovative activity in India and China. Both are booming not only as low cost manufacturing centers but also as innovative hubs adding R&D expertise and specialized know-how.
This week, the Indian company Jubilant and Endo Pharmaceuticals announced that they are expanding thier partnership following early and rapid success by Jubliant’s team. Jubilant has been developing pre-clinical candidates for Endo’s oncology pipeline. As Endo’s R&D VP says, they are executing on a “strategy of building Endo’s pipeline using a virtual discovery approach” as a complement to their in-licensing strategy.
Jubilant has been running with these types of “virtual discovery” deals, including its collaboration with AstraZeneca that we noted at the time (even as AZ is shedding in-house capacity today), a successful partnership with Lilly and tie-ups with academic institutions including Duke University and UAB.
FierceBiotech reports that Biocon’s Kiran Mazumdar-Shaw predicts a $5 billion Indian biotech business in 2011 that will “double to $10 billion by 2015” based on “opportunities in clinical trials, manufacturing and more.”
The greater the contribution R&D makes to India’s growth, the better positioned the country (and the region) will be in the coming years to lead the global industry forward.
September 15, 2009
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Following up on Sunday’s post noting the new survey of Canadian biotech collaborations with companies in the developing world, it’s worth paying attention to two U.S. deals from last week that emphasize the growing role of India and China in the drug development process:
- Amylin Pharmaceuticals, Inc. (Nasdaq: AMLN) and Biocon Limited (NSE: BIOCON) agreed to jointly develop, commercialize and manufacture a novel peptide therapeutic for the potential treatment of diabetes, and will share development costs; and
- PerkinElmer did one deal each in China and India:
- In China, they paid over $60 million for SYM-BIO Lifescience, a Shanghai, China-based diagnostics firm that will double its access to hospitals in China and provide it with “substantial” manufacturing plant capacity
- In India, they picked up the genetic screening business of Surendra Genetic Labs, a lab in Chennai, India, that provides fetal, maternal, and newborn screening.
The McLaughlin-Rotman survey distinguishes (usefully) between R&D collaborations and marketing and distribution activities. Although Ellen Licking wonders whether “cheaper off-shore manufacturing [is] a reason for the deal,” Amylin is clearly focused on Biocon’s R&D capabilities. The press release quotes Amylin CEO Daniel M. Bradbury praising Biocon as a “biologics innovator.”
Even if not all transactions in India and China are innovation-centric (cf the PerkinElmer deals), all involvement by innovative companies shifts the incentives of China, India and other participating countries towards a more innovation-friendly IP regime.
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).