Concerning the levers a originators producer can put in place to face the biosimilars competition and maintain his position, benchmarking on biosimilars, generics (13 companies from 2000 to 2015) and the results of our interview allow us to observe 10 levers:  Price  Prescription  Patent  Market saturation  Legal action  New market  Cooperation  Environmental strategy  Product  Brand strategy

1. 1
Originators OR Princeps
--------------------
How to face Biosimilars
and Generics
Joseph Pategou
International Strategy and Influence
joseph.pategou@skema.edu

2. 23/05/2016 Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
2
SUMMARY
I. How to face GENERICS
II. How to face BIOSIMILARS
Conclusion
Information about the Author
Appendix

3. 23/05/2016 3
How to face
Generics
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

4. 23/05/2016 4
Context
This wave of patent loss has allowed the development of new generic drugs. A
Global analysis finds that the market earned revenues is $123.85 billion in 2010 and
will reach $231.00 billion in 2017 at a compound annual growth rate of 9.29 % from
2011-2018.
The entry of generics has had huge impact in particular on the price of medecine
or the turnover of some pharmaceuticals companies. For example, in Germany the
prices of generic drugs are on average 71% lower than those of their originators and
in France it’s about 75% to 80%. To face this upheaval of the landscape of the
medicine, producers of originators have set up various strategies.
For our benchmark we observe action of 11 companies from 2000 to 2015
(See table 14)
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

5. 23/05/2016 5
Context
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
Company Product
Glaxosmithkline Augmentin, Paxil, Amoxicilline
Lilly Prozac
Hoechst Cardizem
Servier Périndopril
Merck & Co Claritin
Fournier Lipanthyl
Astrazeneca oméprazole
Merck-Lipha Glucophage
MSD Inegy, Zocor
Pfizer Gabapentine
Bristoll Myers Squibb Buspirone
Teva Simvastatine
Table 14: Sample of the benchmark in US and EU

6. 23/05/2016 6
How to face Generics
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

7. 23/05/2016 7
How to face Generics: Price
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
The price reduction of the originators at the level of the price of the generic medicines
can allow to keep the advantage acquired by the brand and to preserve a part of his
market. This policy is only relevant when demand is price sensitive.
The impact of the strategies of companies differs according to market conditions. We
thus notice a particular evolution of markets upon the arrival of the generic medicines.
 A originators would have many generics when his sales and price are high.
 The evolution of the price of the originators depends on the sensitivity of demand
to the price of the product.
 The falling price of the originators or the production of generic by the producer of
originators limits the penetration of generic competitors on the market.

8. 23/05/2016 8
How to face Generics: Patent
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
Early in the life cycle of the drug, patent protection is the major tool to counter
the entry of generic. To increase its protection, the laboratory puts down, after
the discovery of the molecule, a whole series of patents: patent on the
molecule, on indications etc.
The multiplicities of patents, as well as their spreading in time, allow the
laboratory to make more complex the identification of the valid patents by the
potential producers of generics and to lengthen the period of exclusivity
covered by patents. GlaxoSmithKline (GSK), for example, filed four new
patents for Augmentin in 2000 in the United States, two years before the
expiration of the first patents.

9. 23/05/2016 9
How to face Generics: Legal Action
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
The legal battles between producers of originators and manufacturers of
generics are the most media. The first ones accused the second of violating
unexpired patents or dispute the bio-equivalence claimed by generic
companies.
The action of justice for violation of the patent has for consequence the
suspension of the marketing of the generics medicines. It allows big
laboratories to win some invaluable weeks of exclusivity on the market. For
example: GSK has filed several lawsuits for violation of patents of Paxil in the
US and Lilly sued generic makers of Prozac for the same reasons.
Source: Les laboratoires pharmaceutiques face à l’arrivée des génériques : quelles stratégies
pour quels effets ?- Bulletin d’information en économie de la santé-n° 84 - Octobre 2004

10. 23/05/2016 10
How to face Generics: Cooperation
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
Some pharmaceutical companies have reached financial agreements with
producers of generic to postpone competitors launch on the market.
For the European Commission, Servier had work with 5 generics
companies (Niche/Unichem, Matrix ( Mylan), Teva, Krka and Lupin.) to slow
down the entrance on the market of generic versions of his medicine, marketed
under the name of Coversyl, to handle the high blood pressure and the cardiac
insufficiency. The European Commission heavily sanctioned the laboratory
Servier with a 331 million euro fine to have hindered the launch on the market
of generic versions of its product
Source: http://www.bloomberg.com/news/articles/2014-07-09/servier-to-teva-fined-582-2-
million-on-generic-delays

11. 23/05/2016 11
How to face Generics: Production
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
Creation of new formulations and new methods of administration possibly
patentable. The laboratory intensely promotes these innovations before patent expiry of
the original formulation, so that they supplant in the prescriptions or the consumer
habits (eg dispersible Prozac, Prozac Weekly)
They developed new dosages containing for example less active ingredient for a
similar efficiency (Lipanthyl® 160 mg was placed on the market to replace the
Lipanthyl® micronized 200 mg).
They make associations of a molecule with another one. For example, in Germany
Inegy® combines the active ingredients of Zocor ® (simvastatin) and Ezetrol®
(ezetimibe).
They developed new products, very close to the initial product and could be
replaced. For example: In the case of the oméprazole, the isomeric molecule was
launched on the market in the United States two years before the arrival of the generic
medicines and allowed AstraZeneca to keep about three quarters of the market which
he had in this indication.

12. 23/05/2016 12
How to face Generics: Market Saturation
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
The laboratory can produce itself the generic medicine of one of its
originators; like that the company will have many products on the
market and would increase its opportunity to sell one product of the
portfolio.
For example, Merck-Lipha continues to market Glucophage
whereas Merck Generics launched on the market a Metformine Merck.

13. 23/05/2016 13
How to face Generics: Prescription
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
The new European regulations promote this strategy by granting
one year additional exclusivity for products that laboratories decided to
switch to OTC . Pharmaceutical laboratory make the drug available
without a prescription and bet on attachment to the brand.
The Claritin (loratadine ) medicine of the laboratory MSD became
OTC in the United States in November, 2002. Generic version entered
on the market in the end of December, 2002.

14. 23/05/2016 14
How to face
BIOSIMILARS
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

15. 23/05/2016 15
Context
The EMA has approved 20 biosimilars within the product classes of human growth hormone, granulocyte
colony-stimulating factor, erythtropoesis stimulating agent, insulin and tumour necrosis factor (TNF)-inhibitor,
for use in the EU . The first biosimilar launch in the EU (Omnitrope/Somatropin) occurred in Germany in 2006.
This introduction of the biosimilars on the market has many impacts. For example, biosimilars of
filgastrim are used more than the reference product (Neupogen), allowing more patients to benefit at lower
costs. The savings achieved through the use of filgrastim biosimilar is estimated at € 318M since 2009.
In this part we will study how the laboratory Amgen, producer of Neupogen responds to the arrival of
biosimilars.
Amgen is an American company world leader in medical biotechnology industry. It has over 18 000
employees for a turnover of $ 20 billion in 2014 and his headquarter is in California.
Amgen has 14 products on different type’s diseases and Neupogen is one of them.
The first commercialization of Neupogen in Europe was in 1991 with the collaboration of Roche . In
2008, this blockbuster represented 1,4 billion dollars and according to Symphony Health Solutions, Neupogen
had approximately $1,2 billion in sales in calendar year 2014.
The time of total exclusivity enjoyed by Amgen for the Neupogen depend on the country
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

16. 23/05/2016 16
How to face Biosimilars: Prescription
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

17. 23/05/2016 17
How to face Biosimilars: Price
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
When the filgrastim biosimilars enter into the market they provide an
average discount of 10.8% in 2008 and 35.0% in 2009. Amgen needs to
adapt his price to face this situation. We clearly see that we have a
difference in terms of price between biosimilar and originators. Amgen has
tried to adapt his price to remain competitive, but we still have differences.
(See graph 23). The price of the two types of drugs decrease over time,
biosimilar and originators follow each other.
Source:
http://www.codage.ext.cnamts.fr/codif/bdm_it//fiche/index_fic_medisoc.php?p_code_cip=3400935395214&p_site=ameli
http://www.codage.ext.cnamts.fr/codif/bdm_it//fiche/index_fic_medisoc.php?p_code_cip=3400935395214&p_site=ameli

18. 23/05/2016 18
How to face Biosimilars: Patent
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
Over time Amgen has developed 5 indications for his product
(incremental patenting).

19. 23/05/2016 19
How to face Biosimilars: Legal Action
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
Novartis' Sandoz is the first drug maker to win U.S. approval of a biosimilar product. But the
United States court of appeals for the federal circuit gave an injunction against Sandoz, preventing
that company from marketing, selling, offering for sale, or importing into the United States its
FDA-approved ZARXIO® biosimilar product until the court resolves the appeal . This give more
time to Amgen to sell his product.
Amgen based his action on the fact that the pre-litigation information-exchange provisions of
the Biologics Price Competition and Innovation Act of 2009 (BPCIA) are mandatory and for
Sandoz this is optional. The BPCIA states that a biosimilar applicant "shall provide" a copy of its
FDA application and manufacturing information to the Reference Product Sponsor (RPS) here,
Amgen. The statute further states that in the event that a biosimilar applicant fails to provide its
application and manufacturing information, the RPS may file a declaratory judgment action
against the applicant .

20. 23/05/2016 20
How to face Biosimilars: Cooperation
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
The company’s CEO Kevin Sharer stated in January 2011 that in order to drive growth, the
company was going to consider entering the biosimilars sector but “in a controlled way,” (Beasley,
2011).
In December 2011, Amgen announced it had signed a deal with Watson to develop and
commercialize a number of oncology biosimilar monoclonal antibodies (MAbs) . Under the
agreement, Amgen will be primarily responsible for developing, manufacturing and initially
commercializing the products, while Watson will put in up to $400m in co-development costs and
will share product development risks. Biosimilars from the collaboration are expected to be sold
jointly by both companies.
Amgen has secured a clause which prevents the collaboration from making biosimilar
versions of its drugs including Enbrel (etancercept), Aranesp (darbepoetin alfa) and Epogen
(epoetin alfa).
This deal gives the opportunity to Amgen to enter the biosimilars arena, to develop his
know how and to know more how his can protect his product, Neupogen.

21. 23/05/2016 21
How to face Biosimilars: Production
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
Neulasta (pegfilgrastim) can be considered as a new version of Neupogen.
They are both made of a natural protein known as granulocyte-colony
stimulating factor (or "G-CSF"). Pegfilgrastim (Neulasta) has a polyethylene
glycol, "PEG," unit added to it, which makes the molecule larger, so that it
stays in your system longer than filgrastim (Neupogen). Two forms of G-CSF
are approved for use in pediatric cancer patients.
The needs for fewer injections with Neulasta (pegfilgrastim) improve quality
of life for pediatric oncology patients and their families .

22. 23/05/2016 22
How to face Biosimilars: New Market
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
Amgen bought the rights of Neupogen and Neulasta in more than 100
emerging markets where the drugs were sold by Roche .
Amgen believes it can drive growth of Neupogen (filgrastim) and Neulasta
(pegfilgrastim) more effectively in the Roche territories, which cover the
world's emerging economies including Eastern Europe, Latin America, Asia,
the Middle East and Africa.
For Robert Bradway the chief executive of Amgen "This agreement will
enable Amgen to reach more patients around the world with two of its
innovative medicines."
All this 6 levers help Amgen to maintain a high level of sell for his product
Neupogen: 1.2 billion in 2014 dollars.

23. 23/05/2016 23
How to face Biosimilars: New Market
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou
Amgen bought the rights of Neupogen and Neulasta in more than 100
emerging markets where the drugs were sold by Roche .
Amgen believes it can drive growth of Neupogen (filgrastim) and Neulasta
(pegfilgrastim) more effectively in the Roche territories, which cover the
world's emerging economies including Eastern Europe, Latin America, Asia,
the Middle East and Africa.
For Robert Bradway the chief executive of Amgen "This agreement will
enable Amgen to reach more patients around the world with two of its
innovative medicines."
All this 6 levers help Amgen to maintain a high level of sell for his product
Neupogen: 1.2 billion in 2014 dollars.

24. 23/05/2016 24
How to face Biosimilars: Environmental Strategy
3 Actions:
 Promote the obligation of the four-letter code (BQ) at the end of the
name of Biosimilars
 Promote for the Biosimilar a different Summary of Product
Characteristics (SmPC) from the Generics and Originators
 Promote the substitution of Biosimilars by physicians
All this will contribute to highlight that biosimilars unlike generics
are not identical to originators, but different products
BQ: Biological QualifierSource: Interview
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

25. 2 Actions:
 Create more adhesion of patients and healthcare professionals to their
drugs (adhesion to the brand)
 Bring more services to patients and healthcare professionals on their drugs
(For example monitoring)
 Example: Amgen’s Evaluation of personalized patient counseling for
Enbrel
 Phase IV trial with 300 patients with RA
 Patient adherence and persistence to therapy in chronic disease
 Justify a premium price for Enbrel over Biosimilars
23/05/2016 25
How to face Biosimilars: Brand Strategy
Source: InterviewRA: Rheumatoid Arthritis
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

26. Price
Patent
Legal Action
Cooperation
Product
Prescription
Market
Saturation
New Market
Environmental
Strategy
Brand
Strategy
23/05/2016 26
Conclusion
10 Levers
1
4
3
2
8
7
6
5
10
9
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

27. 23/05/2016 27
Conclusion
Regulatory issues on the development of Biosimilars – Joseph Pategou
Source: Interview
 No Single but Combination of Strategy
 No Global but Glocal Strategy

28. 23/05/2016 28
Information about the author
I am fascinated by healthcare and the experience of many
companies to develop new types of drug with the aim of saving
lives around the world.
Main topics of passion in the healthcare:
- Strategy
- Digital
- Innovation
- Biosimilars
If you want to know more, please contact me:
joseph.pategou@skema.edu
M. Joseph Pategou
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

29. 23/05/2016 29
THANK YOU FOR YOUR
ATTENTION
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

30. 23/05/2016 30
APPENDIX
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

31. 23/05/2016 31
COMPARISON OF DIFFERENCE AND COMMON POINTS BETWEEN
BIOSIMILARS AND GENERICS-STRUCTURE
KEY POINTS BIOSIMILARS Generics
Nature
Drug extracted from a biological
environment
Chemical drug
Molecular size Up to 270,000 Da 100 to 200 Da
Development Comparative studies Bioequivalence studies
Duration of development 5-7 years(500 patients) 2-3 years (20-50 patients)
Cost of the development 200-300 million dollars 2-4 million dollars
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

32. 23/05/2016 32
REFERENCE
1. http://www.sante.gouv.fr/qu-est-ce-qu-un-generique.html
2. Where the opportunities are and what role will they play? EGA Lisbon 2011-IMS
3. http://www.ema.europa.eu/ema/index.jsp?curl=pages/special_topics/document_listing/document_listing_000318.jsp
4. http://www.gabionline.net/Biosimilars/General/Biosimilars-approved-in-Europe
5. http://www.gabionline.net/Biosimilars/General/Biosimilars-approved-in-Europe
6. Shaping the biosimilars opportunity-december 2011
7. http://www.sante.gouv.fr/qu-est-ce-qu-un-generique.html
8. Rapport 2012 sur les médicaments génériques-Mutualité Française
9. EMA Procedural advice for users of the centralized procedure for generic/hybrid applications
10. Lessons learned from the review of the labelling of 5 centrally authorised pandemic vaccines- 10 February 2014 EMA
11. Rapport 2012 sur les médicaments génériques- Mutualité Française
12. http://gabionline.net/Biosimilars/General/Germany-wants-to-increase-biosimilars-penetration
13. http://ec.europa.eu/health/authorisation-procedures_en.htm
14. Guideline on the investigation of bioequivalence- London, 20 January 2010- European Medicines Agency
15. http://www.australianprescriber.com/magazine/26/4/article/712.pdf
16. Directive 2001/83/EC, as amended by Directive 2003/63/EC and Directive 2004/27/EC
17. Biosimilars Marketing Authorisation status as of January 2013: 22 Marketing Authorisation Applications
18. http://www.ema.europa.eu/ema/index.jsp?curl=pages/special_topics/document_listing/document_listing_000318.jsp
19. Individual case safety report: Article 28 of Commission Implementing Regulation (EU) No 520/2012 of 19 June 2012
20. Biological Qualifier An INN Proposal-July 2014- World Health Organization, Geneva
21. http://www.gabionline.net/Biosimilars/Research/Improved-labelling-sought-for-biosimilar-acceptance
22. EC consensus paper 2013- What you need to know about Biosimilar Medicines
23. European Commission consensus paper 2013 : What you need to know about biosimilar medicines
24. http://gabionline.net/Biosimilars/General/Germany-wants-to-increase-biosimilars-penetration
25. http://gabionline.net/Biosimilars/Research/Extrapolation-for-biosimilars
26. Directive 2001/83/CE du parlement européen et du Conseil du 6 novembre 2001 instituant un code communautaire relatif aux
médicaments à usage humain
27. Where the opportunities are and what role will they play? EGA Lisbon 2011-IMS
28. http://healthcare.blogs.ihs.com/2012/01/06/generic-drug-price-trends-france-germany-italy-spain-uk/
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

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REFERENCE
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou

34. 23/05/2016 34
REFERENCE
Originators and Princeps - How to face Biosimilars and Generics –
Joseph Pategou