Biosimilars: Seven Cold Hard Facts

On July 24^th the FDA accepted its first application for a biosimilar drug in the U.S. and put the industry on alert that this new market is fast approaching.   While no one knows exactly when the first approval will come, here are a few facts to bring you up to speed for when it does: 

·      •  Estimates on savings attributed to biosimilars range from $42 - $108 billion over the first ten years of the market.

      •  The value of biologics slated to come off patent by 2017 is about $70 billion.

•  Per the Rheumatology Network, over the span of their lifetime, many drugs approved in the US and EU have eventually become “biosimilars” of themselves.  This is due to a “natural drift” in drug properties caused by changes in production such as using different batches of medium or manufacture at different sites.

        •  Recently, a group of 19 investors representing nearly $430 billion in assets  commended Novartis and Amgen for supporting a set of investor principles to guide boards on activities related to biosimilars. 

    •  A survey conducted among senior’s organization RetireSafe shows that 92% were unaware that the Affordable Care Act potentially allows for biosimilar drugs to be substituted for a biologic.  Furthermore, this could potentially be done without the patient or doctor being aware.

•  Hospira is looking to file its first biosimilar in the US within twelve months and currently has an R&D pipeline valued at around $40 billion.  

•  Amgen is developing a portfolio of biosimilars of which three are slated to launch in 2017.   

We’ll have more on the latest developments in the biosimilars market at the 15^th Annual Business of Biosimilars meeting. Join us October 20-22 in Boston, MA.  Download the agenda to see what’s on tap.

SAVE $100.  Register here and use code XP1986BLOG.

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Biosimilars Can Save Money and Lives. Why the Delay?

Biologic drugs are used to treat a number of serious, life threatening diseases and save countless lives.  They are, however, exceedingly expensive.  The average daily cost of a biological in the U.S. ($45) dwarfs that of chemical drugs ($2).  Annually, some of these drugs can cost patients as much as $400,000.  The question becomes “how do we make these treatments more sustainable?”  The short answer to that question centers around biosimilars as one study estimates they have the potential to save north of $250 billion from 2014 to 2024. 

 

The long answer to that question, however, is not as straight forward.  Manufacturers of biological drugs can continue to charge monopoly prices as long as those drugs remain under patent protection.  Even as these medications begin to come off patent, many over the next few years, the road for biosimilars to enter the market is not exactly paved.  While many other countries (Australia, Canada, and the EU specifically) have had a market for biosimilars since 2006, the US policy for entry of these drugs remains ambiguous. 

A big part of this delay can be attributed to the FDA’s lack of progress in establishing guidelines for the approval of biosimilars.  Although they did accept their first biosimilar application last week, there still lacks a definitive set of regulations.  Tentative guidelines had been provided both in 2012 and 2014 but a final set is still in progress. 

This uncertainty in the regulatory process has caused apprehension among many drug companies and left fewer players vying for a place in the market.  Said one pharmaceutical executive, “I would like absolute clarity before we make a large investment. The quality of the decision is worth more than speed.”

While the FDA wavers in putting a process in place, biologics manufacturers have engaged in stall tactics.  The longer biosimilar drugs stay off the market, the longer these companies can continue to enjoy massive profits—reportedly as much as $100 million a month for some drugs.  The latest strategy employed involves disputing the naming system to be put into place for these drugs.  Biologics manufacturers have lobbied to maintain separate names, and the equity that goes with those names, from competing biosimilars.

While this dispute carries on, patients are missing out on billions of dollars in savings.  Many have called for the FDA to re-calibrate their priorities and fast track a set of guidelines that would allow biosimilars to hit the market sooner.  Other countries have had regulations in place for almost eight years while we wait for officials to perfect ours.  Until then, drug companies will continue to pad their pockets with massive profits from these drugs.   

Biosimilars is projected to be a lucrative industry. Can you afford to miss out? We’ll have the latest industry news and trends at the Business of Biosimilars conference. Join us October 20-22 in Boston, MA. Download the agenda here to see what’s on tap.

SAVE $100. Register here and use code XP1986BLOG.

Follow us on Twitter: @FutureOfBiopharma & @Biosimilars
Join us on LinkedIn

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