Around 70 PM Society members and guests came together in the excellent lecture theatre at the Royal Society of Medicine in London on 20th September to take part in the latest Hot Topic event, which addressed the challenges and opportunities presented by biosimilars.
The ever-changing health regulations and policies in Europe offer tremendous challenges for pharmaceutical and biotechnology companies when bringing new therapies to patients. The scenario becomes further complicated with the emergence of biosimilars as a growing competitor to existing and future products.
Understanding the current market needs in a world driven by pharmacoeconomics is vital. There is a clear need to redesign the traditional approach to key stakeholders and sculpt new market access strategies to enable companies to succeed.
Introducing the topic, event chairman Jamie Denison-Pender, of Prescient Life Sciences, said that it was vital that pharma marketers understand the biosimilars market, and how global policies and local options are evolving. He outlined the importance of examining business models and clinical development strategies for biosimilars, as well as identifying efficient market entry strategies.
Adapting current market access initiatives would be the key to remaining successful, and Jamie hoped that the event would allow those attending to gain insights to allow them to keep ahead of the market.
(From left to right) Back Row: Steve Mackenzie-Lawrie, PM Society; Jamie Denison-Pender , CEO Prescient Life Sciences; Loree Gourley, Director Business Development Prescient Life Sciences. Front Row: Dr Rakesh Verma, Senior VP Prescient Life Sciences; Paul Tredwell, Head of Biopharmaceuticals, Sandoz Limited; Dr Anthony Grosso, Principal Pharmacist UCL Hospital
Dr Rakesh Verma
The impact of evolving regulatory environments and business models on biosimilar access
Starting his presentation by asserting that monoclonal biosimilar antibodies is 'where the future lies', he pointed out that around 40% of global biologics sales are likely to go off patent by 2015. Whereas a decade ago there were only two mAbs on the market, there are now 30 FDA-approved mAb therapeutic modalities.
The biologics market is large but concentrated; the top 30% of products constitute 80% of sales, with 93% of sales coming from only just over half the products. The market is growing, though, considerably faster than the small molecule sector. mAbs constitute the fastest-growing segment within the pharma industry – and this growth is set to continue.
But despite this growth, current biotechnology drugs have limited market access, even in the western world. For example, only 20-30% of eligible patients in the US can access them – so what must it be like in the developing world? Therefore there is a huge opportunity for biosimilar mAbs to expand the market, and access to biological products.
Price is the main reason for this: 90% of cancer-fighting drugs or biologics approved by the FDA over the past four years cost more than $20,000 for a 12-week course of therapy, with many offering a survival benefit of only two months or less. As a result, one in five affected families in the US used up all of their savings paying for cancer treatment.
There are lots of terms used to describe biosimilars, such as Biogenerics, Comparable Biologics, Follow-on Biologics, Subsequent Entry Biologics and so on, but the term Biosimilar is a legal term with a legal definition (it must have 'no clinically meaningful differences' from the reference product in terms of the 'safety, purity and potency' of the product); the World Health Organisation uses the term 'Similar Biotherapeutic Products, or SPBs).The term Biobetter has also entered the lexicon. Also known by terms such as Biosuperior and Enhanced Biosimilar, a biobetter could be seen as a follow on to a biosimilar.
The Regulatory Question
The stringency of the regulatory environment, the level of global harmonisation, and the extent to which factors such as substitutability, interchangeability and extrapolation are allowed will have an impact on the cost of development of biosimilars, and hence their affordability.
Europe is taking a lead in developing a regulatory framework for biosimilars, and many others are following the European guidelines. Other countries, such as India and China, do not yet have a regulatory framework for biosimilars; the WHO has come up with a framework, and some of these emerging market countries will probably follow their lead.
However, the WHO framework is merely guidance, for these guidelines to be important in any evaluation process, they will need to gain traction in many of the big emerging markets. Unlike in Europe, the WHO guidelines state that cell lines must be the same as originator cell lines; there are set clinical trial requirements, and the biosimilar – SPB in WHO parlance – has to be identifiable by a unique brand name.
In the EU, guidance for the development of biosimilars is already available, including class-specific guidance. But whilst this appears to provide sufficient guidance in conjunction with existing mAb guidelines on the quality of biosimilar mAbs, there are several issues pertinent to non-clinical and clinical development that are not sufficiently covered.
Draft guidelines have been under consultation, and should be published in the next few months; meanwhile, the EMA has been giving guidance on a case-by-case basis.
The draft guidelines are based on good science:
- Pre-clinical studies are recommended, but comparative toxicological studies in non-human primates are not recommended.
- A comparative PK study is essential. In addition, PK criteria might need to be measured in the Phase III study.
- If possible, PD studies can be combined with the PK studies.
- Importantly, similar clinical efficiency must be demonstrated in adequately powered, randomised, parallel group comparative clinical trial(s).
- 'Hard' endpoints like OS/PFS are not recommended, as absolute endpoints. ORR and other surrogate endpoints are allowed.
- PV and risk management activities are considered essential, possibly exceeding those for the reference product.
- Extrapolation is allowed, but this is more difficult if a reference mAb is licensed both as an immunomodulator and as an anti-cancer antibody.
The EMA has so far approved five independent dossiers as biosimilars; two for first-generation erythropoietin, and three for first-generation G-CSF. The overall penetration of biosimilar EPO and G-CSF has been moderate on average, but this hides the fact that in certain countries, notably the UK and Germany, penetration has been very good. Interestingly, countries such as Australia and Singapore are either accepting the EU dossier, or indicating that they may.
The conclusion according to Rakesh is "if you want to be a global player, you are a big company who is in it for the long haul, you need to do global development, and because doing development within individual regions will be very expensive."
The US Pathway
As for the US, a new pathway is under development, but it remains to be seen if all US biosimilar manufacturers will follow this pathway. For example, Teva filed a conventional BLA for its filgrastim in the US.
The proposed new pathway could look similar to that in the EU. A biosimilar has to be highly similar to the reference product, notwithstanding minor differences in clinically inactive substances. The biosimilar and the reference product must utilise, to the extent known, the same MoA, and the biosimilar must have the same condition of use as the reference product.
As well as all this, an interchangeable biosimilar is a biological product 'that may be substituted for the reference product without any impact on safety and efficacy, and without the intervention of the health care provider who prescribed the reference product' – something that will impact on how many patients are able to access the biosimilar.
The FDA has taken submissions, and guidelines are expected by the end of the year, and they are expected to be based on four pillars – totality of the evidence; a 'one size does not fit all' attitude, with a case by case approach; immunogenicity will remain a critical concern, so a small difference could have a big impact; and interchangeability, provided safety and efficacy are proven in clinical trials and switching studies.
What all this means is that the biosimilar route to licensure might not be the best route to market for certain biosimilars in the US. Biosimilar mAbs will be a high stakes game, and therefore we can expect to see data exclusivity being tested in the courts, and patent disputes will be complicated
There is a big range of regulatory progress being made across emerging markets, from countries such as India, China and Russia, which have no biosimilar guidelines, through nations like Mexico, South Korea and Brazil with 'enforcement light', to countries such as Turkey, which are aligning themselves with EMA regulatory guidelines.
In India, for example, biosimilars are approved through the originator path – an extremely complex and time-consuming process, although the new Biotechnology Regulatory Authority of India Bill (2011) aims to streamline the process.
Meanwhile, in South Korea, regulators are likely to be very encouraging towards biosimilar products, something that has resulted in new players in the market – and not necessarily traditional pharma companies, such as Samsung. "Next time you buy a biosimilar you'll probably get a free TV!" joked Rakesh.
Meanwhile in China, the biotech industry is dominated by players with strong links to the state. The government there is continuing to encourage the development of biosimilars through the implementation of specific policies and programmes.
How does all this impact on Europe? Certainly, global biosimilar developments will have an impact on the EU biosimilar space, through geographic expansion, M&A activity, companies from emerging markets and elsewhere entering the EU market, and pricing pressures. All of which is good news for patients and hospital procurement departments, if not for pharma companies.
The Business of Biosimilars
Whilst patent expiry dates for existing biologics do to a certain extent depend on which lawyer you talk to, there is little dispute that the next five to eight years will see many of the major products come off patent. Rakesh outlined eight such products with global sales of more than $1 billon which fall into this category.
Different biosimilar business models have been adopted, for very different reasons. Early entrants are aimed squarely at regulated markets, and have seen significant investment. Next has come an ambition to develop enhanced products compared with the originators, the 'biobetters' – again requiring significant investment.
Late entrants to the market are getting involved via partnering; leveraging each other's strengths. This is likely to be where most activity will take place, as it is the quickest way into the market. Finally, there are the early entrants into less regulated markets, with products, which are compliant to local regulation – although there may be a later ambition to enter western markets as well.
Rakesh listed six types of players:
- Biosimilars companies
- Diversifying traditional generics companies
- Diversifying traditional large bio/pharma companies
- Large conglomerates, not necessarily existing players in the pharma market (e.g. LG)
- Biotechnology companies
There are essentially three hurdles that each of these players needs to get over to enter the market. The first is the product hurdle, with factors such as quality, similarity, potency, safety and efficacy coming into play. Next comes the capability hurdle, whereby entrants need to show they have the financial, manufacturing, sales and marketing, clinical development and human resource capabilities. Finally comes the regulatory hurdle, where experience in working with theEMA/FDA, in biologics regulatory affairs and in pricing and reimbursement will be important.
Depending on which side of the pharma fence you sit, there is a need to mitigate the risk of biosimilars, or maximise the opportunity they present. Monitoring manufacturing and technological developments will be important, given that engineering, expression and manufacturing technologies will have evolved since the approval of the originator product.
There is a need to track markets globally, as much of the early biosimilars development has been in emerging markets. Equally important will be tracking the regulatory environment, which is still evolving across the globe, with new guidelines under consultation.
As with any business, tracking competitors – biosimilars developers – is a must, particularly as new types of business models and non-traditional players are entering the field. Likewise monitoring partnerships is important, especially non-traditional partnership models.
With the current economic climate and uncertain outlook, tracking the political and HTA environment, as well as the reimbursement environment, will be a key to success.
Rakesh's final advice was to prepare early. "Preparation is everything, whether one is looking to defend or enter into the business of biosimilars – especially mAbs."
Biosimilars by Sandoz – Pioneering the Future
The second speaker was Paul Tredwell, who promised to follow Rakesh's useful global overview with a more local, UK-focussed view.
Introducing his company Sandoz, Paul said that knowing a little more about how it operates might change the audience's view of biosimilar companies: "we don't just put in a low price and hope for the best!"
Part of the Novartis Group, Sandoz has celebrated its 125th birthday – certainly no fly-by-night latecomer – and its sales account for $8.5 billion worldwide – around 15% of the Novartis Group's total. The group has seen the potential to position Sandoz as a platform from which to launch into the biosimilars market. The company operates in 130 countries across the globe.
"The perception out there that it will be small companies which are going to launch biosimilars without much knowledge of the market is probably incorrect," said Paul.
Another perception is that biosimilar companies' manufacturing techniques and facilities are somehow not up to standard. Paul pointed out that his company is part of one of the largest biologics manufacturing group in the world. This kind of statistic is starting to change the perception that biosimilars companies are somehow there to provide a 'cheap' alternative.
Biologics have revolutionised medicine – and will continue to do so, according to Paul. They have dramatically altered patients' lives, improving survival rates, longevity and quality of life. They offer real hope for many unmet medical needs, particularly in complex diseases, and by binding to specific targets in the body, achieve results, which are simply not possible with other medicines.
But, many of the current biologics are nearing patent expiry, and if there were no biosimilars entering the market, then it is unclear what will then drive innovation in the future. Paul pointed out that monocloncal antibodies in particularly are very complex and difficult to manufacture, limited companies will have the ability to manufacture these to the high standards required by regulatory authorities.
Entering the definition debate, Paul pointed out that the word biosimilar is not in fact a scientific definition of a product, but rather a regulatory term introduced by the EMA. The term is used to denote a biopharmaceutical approved under the biosimilar regulatory pathway – and hence it follows that products not approved by this pathway are not biosimilars. These biosimilar products have therefore demonstrated comparability.
Similarly, so-called 'Alternative Biologics', which are not approved in highly regulated markets, are not biosimilars.
The fact is that the development of biosimilars requires a substantial investment as well as lots of time. Whereas a generic might typically require an investment of $2-3 million and take two to three years to get to market, a typical biosimilar will require anywhere between $75-250 million, and take seven to eight years – not far short of the $800 million and eight to ten years the originator takes during its own development process.
The pipelines that exist out there for companies moving forward are already pretty set, so the development work has already begun on these molecules.
"Due to development costs and complexity, you are going to see a limited number of companies moving forward into this space.
The Market Opportunity
But that space does offer up some big opportunities: Of the $108 billion in biologics sales in 2010, just $17 billion was off patent; Paul estimated that in 2016 the market will be worth $152 billion, with $63 billion – over 40% - off patent. By 2020 the figure for off patent biologics sales could be as much as $100 billion.
By 2016, seven of the top ten pharmaceuticals worldwide will be biologics. That is an opportunity not only for the pharmaceutical industry, but also for health care systems to reduce their costs and increase patient access.
"We have seen a big mindset change in terms of clinicians,"" said Paul. "They are seeing the benefit of using a lower cost product in this area, specifically in oncology, because they get the opportunity to reinvest that money into more cancer therapy, which will potentially improve patient outcomes."
Paul cited the example of biosimilar filgrastim, where the price came down following the introduction of a biosimilar, more patients were being treated, and earlier. But, as he pointed out, if biosimilars have the effect of expanding the market, is the healthcare system going to be able to save anything? He showed an example from Yorkshire which proved that the introduction of biosimilar filgrastim actually reduced G-CSF spend by approximately £1 million in the region in the first 12 months, principally because the use of pegfilgrastim reduced dramatically.
It is important to realise that biosimilars is not a single market: each individual disease area is different, and a more branded approach to sales and marketing is required to access complex products and disease areas.
Generics companies don't as a rule go and talk to broad stakeholder groups, but biosimilars typically need the same structure as a standard branded product – effectively a fully-branded sales team.
"Cost is not the differentiating factor in this market – it's a point, but not the differentiator," said Paul, adding that there will be an expectation of a price discount, albeit probably only around 20-25%. Whilst this cost reduction is significant it's the increase of patient access to vital medication that drives us forwards.
Dr Anthony Grosso answers one of the many questions put to the panel relating to the impact of Biosimilars on market access strategies for the NHS.
The two speakers were joined for the panel discussion by Anthony Grosso, Principal Pharmacist at University College London Hospitals.
Asked what emerging market companies have to prove about themselves and their product, Anthony pointed out that biosimilars are very product specific, and with no blanket policy on them, a case by case approach was likely.
He also agreed that there is a large regional difference in uptake in the UK, saying that London was trying to follow the lead of Yorkshire, which is seen as a pioneer in this field. Generally the NHS is buying into the concept of using new entrants, he said.
Interestingly, he thought that clinicians are sometimes the major hurdle to buy-in, with committees generally accepting the concept. Lack of information – and data underpinning it – coupled with lots of misinformation and established relationships between clinicians and originator companies meant that biosimilar companies would need to tailor their approach to overcome these specific hurdles.
There needs to be some form of carrot, and that carrot is not cost per se – although it could be the opportunity to put money saved back into the budget, as well as better patient access and benefit. It is likely, though, that savings will currently go back into the Primary Care budget, so some form of 'gainshare' is needed to convince clinicians of the financial benefit.
Asked about current perceptions of biosimilars, the panel agreed that established companies have lots of expertise, but that a hybrid model somewhere between generics and branded was needed, with clear positioning and differentiation vital.
What about the patient reaction to being moved to a biosimilar? Generally it has been positive, but it does depend on how the message is communicated. Patients are generally aware about the need to use cost-effective medicine, and Paul Tredwell argued that the patient support package in the G-CSF example he had presented was extremely well received
For the PM Society, Steve Mackenzie-Lawrie thanked both speakers, as well Anthony Grosso for joining the lively discussion panel. He also thanked Jamie Denison-Pender for chairing the meeting, and his company Prescient Life Sciences for sponsoring it.