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1. November 2011
Biosimilar Drugs in Europe:
threat or opportunity to innovation?
A FirstWord ExpertViews Report

2. Biosimilar Drugs in Europe:
threat or opportunity to innovation?
Biosimilar Drugs in Europe:
threat or opportunity to innovation?
Published November 2011
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3. Biosimilar Drugs in Europe:
threat or opportunity to innovation?
Contents
Executive summary .................................................................................................................................. 1
Biosimilar drugs in Europe ................................................................................................................... 2
What are biosimilars?.............................................................................................................................. 2
Generics and biosimilars – similarities and differences ................................................................................ 3
Biosimilars available so far in Europe .......................................................................................................... 5
The market opportunities for biosimilars in Europe................................................................... 7
The biologics patent cliff will have an impact on the market ........................................................................ 7
Market types for biosimilars will differ across Europe ................................................................................. 9
Geographic markets for biosimilars will vary across Europe ................................................................... 9
In Italy, prescriptions are fulfilled by brand ....................................................................................... 10
In France and Spain, drugs are discounted to targets ..................................................................... 10
In the UK, biosimilar uptake is driven by NICE ................................................................................ 10
In Germany, biosimilars uptake is good but varies by drug type ...................................................... 11
Biosimilar uptake will vary by molecule and indication across Europe.................................................. 11
Epoetin uptake may have been slowed by immunogenicity issues ................................................. 11
Filgrastim uptake has been faster in Europe.................................................................................... 12
Biosimilar use is likely to vary between chronic and episodic treatment ............................................... 12
There may be a resistance to switching patients on established treatments ........................................ 12
Hospital physicians may be more likely to use biosimilars than primary care physicians ..................... 13
Biosimilars will have an impact in cost-sensitive markets ..................................................................... 13
The paediatric population may be reluctant to take up biosimilars ....................................................... 14
The challenges for biosimilars in Europe ..................................................................................... 15
The biosimilars challenge: Gaining approval in Europe ............................................................................. 15
The EU regulatory process for biosimilars ............................................................................................ 15
Biosimilar regulations will be a steep learning curve ............................................................................. 16
Will regulations be fair and balanced on all points? .............................................................................. 17
The biosimilars challenge: Overcoming development and manufacturing hurdles .................................... 18
Biologics are highly variable by nature .................................................................................................. 19
Variations can cause issues with immunogenicity................................................................................. 19
The biosimilars challenge: Overcoming patent hurdles.............................................................................. 21
The biosimilars challenge: Gaining stakeholder trust ................................................................................. 21
Payers can be a major driver for biosimilars uptake ............................................................................. 21
Physicians will be key gatekeepers for biologics and biosimilars.......................................................... 22
Patients may be cautious about biosimilars .......................................................................................... 22
The defensive position: Originator companies will try to limit biosimilar uptake ....... 23
Lifecycle management can maintain market share .................................................................................... 23
Lack of automatic substitution will protect originator drugs ........................................................................ 23
Exclusivity provisions and patents will protect originator drugs.................................................................. 25
Originator companies can exploit loyalty to maintain market share ........................................................... 25
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4. Biosimilar Drugs in Europe:
threat or opportunity to innovation?
Focusing on quality, safety and efficacy claims can maintain loyalty .................................................... 26
Using marketing, sales and healthcare professional training to attract and keep market share ........... 27
Protecting the market through degree of similarity – is a biosimilar really similar? .................................... 27
Competitive pricing and rebate agreements will keep cost-sensitive customers ....................................... 27
The offensive position: breaking into a new market ................................................................ 28
Pricing is the key differentiator for biosimilars ............................................................................................ 28
Knowing the market will help gain market share ........................................................................................ 29
Information and education: defending biosimilars against the naysayers .................................................. 30
Sales, marketing and account management: Market share through talking to the payers ................... 30
Education for healthcare professionals: Market share through talking to the physicians ...................... 31
Gaining market share by adding value: Devices and formulations ............................................................ 31
Making the biosimilar easier to use: Devices ........................................................................................ 32
Making the biosimilar easier to handle: formulations ............................................................................ 32
Protecting biosimilars through patents ....................................................................................................... 32
The company landscape: Opportunities for companies in biosimilars............................ 33
Generics companies will be key players .................................................................................................... 34
Collaboration and licensing in the biosimilars market ............................................................ 35
Collaborations between generics companies – bringing together development and marketing ................ 35
Collaborations between generic and originator companies combines know-how and manufacturing
capabilities.................................................................................................................................................. 35
Geographic collaborations allows access to wider markets ....................................................................... 36
Looking into biosimilars deal data .............................................................................................................. 36
Biosimilar deals by volume .................................................................................................................... 36
Biosimilar deals by value ....................................................................................................................... 38
Biosimilar deals by type......................................................................................................................... 38
Biosimilar deals by indication ................................................................................................................ 38
Biosimilar deals: Deal case studies ............................................................................................................ 39
Biopharma company signs agreement to access biosimilars................................................................ 39
Generics company signs agreement to fill pipeline ............................................................................... 40
What’s next for biosimilars in Europe? .......................................................................................... 41
Monoclonal antibodies will be a dramatic entry to the biosimilars market .................................................. 41
Biobetters could ‘follow-on’ from biosimilars............................................................................................... 41
Biobetters will follow a different route of approval ................................................................................. 42
The US: Changing the biosimilars environment ......................................................................................... 42
Conclusion ................................................................................................................................................44
Acknowledgments .................................................................................................................................. 45
Bibliography ..............................................................................................................................................46
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All Rights Reserved

5. Biosimilar Drugs in Europe:
threat or opportunity to innovation?
Executive summary and efficacy data, using marketing, sales and
healthcare professional training, and looking at
n Biosimilars are therapeutically similar copies new pricing models.
of biological therapeutic reference drugs
n The lack of automatic substitution has potential
(therapeutics derived from living organisms),
to limit biosimilar market share.
developed after the patent on the originator
drug (reference product) has expired. n Biosimilar companies will work hard to break
into this new market, through using pricing
o A range of blockbuster biologic patents are
as a key differentiator. They will need to learn
due to expire between now and 2019.
the market and work with physicians to create
n Biosimilars have been available in Europe loyalty to the new biosimilar brand, exploiting
since 2006, and 14 have been approved to physicians’ familiarity with small molecule
date. generics, as well as adding value by creating
new delivery devices, formulations and sizes.
n The biosimilars market could be worth
$2.25-4.8 billion by 2015, and this is a major n The biosimilars market will be an opportunity
opportunity for companies entering this arena. for existing generics companies and originator
companies looking to move into new markets.
n Biosimilar markets will vary across Europe
– Germany is already a major European n Monoclonal antibodies and biobetters will be
biosimilars market – and pricing and the next step for the biosimilars market.
reimbursement will vary in different countries,
n When the US route of approval is clarified, this
and even across individual countries.
will mean a major expansion for the biosimilars
n Biosimilar markets will also vary by molecule market.
and indication, with filgrastim already having a
faster uptake than epoetin.
n Biosimilar uptake will also vary by setting -
Generic Substitution: Taking a
hospital or primary care – but this may change Narrow View? examines the trend
as cost-cutting continues in healthcare. towards generic substitution in major
n Biosimilars companies will face challenges, markets—and why a similar practice
particularly because biologics are variable with narrow therapeutic index drugs is
by nature – gaining approval, managing the
drawing fire
potential risk posed by new biosimilars post-
approval, and creating new manufacturing
processes around the barriers posed by the
originators’ patents.
n Biosimilars companies need to gain
stakeholder trust, because the stakeholders will
drive biosimilars uptake.
n The originator companies will want to retain
market share, and they may take a number of
different approaches, such as using lifecycle
management, building on physician loyalty
through focussing on existing quality, safety
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6. Biosimilar Drugs in Europe:
threat or opportunity to innovation?
Table 1: Proposed definitions
Term(s) Definition Implications
Biosimilar Copy version of an authorized Only very small differences with no
biologic with demonstrated similarity clinical relevance
in physicochemical characteristics, Extrapolation of clinical indications
efficacy and safety acceptable if scientifically justified
Me-too or non- Biologic developed independently and May have physicochemical differences
innovator biologic not directly compared to or analyzed compared with other biologics in same
against a licensed reference biologic product class
May or may not have been compared Clinical comparison may not pick up
clinically potentially relevant differences
Extrapolation of clinical indications may
be difficult
Second-generation Structurally and/or functionally altered Usually stand-alone development with a
or next-generation biologic to improve or change clinical full development programme
biologic or biobetter performance Clear differences in structure
Likely to have different clinical behaviour
Claims would have to be supported
with data showing a clinically relevant
advantage
Source: Based on Weise et al.3
In order to clarify things, the Biosimilar Generics and biosimilars –
Medicinal Products Working Party (BMWP) at similarities and differences
the EMA created some proposed terminology.
Published in Nature in 2011, this defined a The term ‘generic’ is generally used to refer to a
biosimilar as “a copy version of an already small molecule generic medicinal product reference
authorized biological medicinal product with drug. The UK Medicines Amendment Regulations
demonstrated similarity in physicochemical 2005 define a generic medicinal product as one
characteristics, efficacy and safety, based on a that “has the same qualitative and quantitative
comprehensive comparability exercise.” 2 See composition in active substances and the same
Table 1 for further proposed definitions. pharmaceutical form as the reference medicinal
product and whose bioequivalence…has been
demonstrated.”4
There are significant
Small molecule generics can be approved for the
differences between biosimilars and market in Europe based on pharmacokinetic and
small molecule generics
(and their reference molecules) 3 Weise, Bielsky, De Smet, Ehmann, Ekman, Narayanan,
Heim, Heinonen, Ho, Thorpe, Vleminckx, Wadhwa and
Schneider Biosimilars - why terminology matters.
2 Weise, Bielsky, De Smet, Ehmann, Ekman, Narayanan, 4 WilmerHale. (December 1, 2005). UK Medicines Legislation
Heim, Heinonen, Ho, Thorpe, Vleminckx, Wadhwa and Assists Generic Competition. http://www.wilmerhale.com/
Schneider Biosimilars - why terminology matters. publications/whPubsDetail.aspx?publication=2976.
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All Rights Reserved

7. Biosimilar Drugs in Europe:
threat or opportunity to innovation?
Another of the drivers is the reputation of the
“The German government has companies within Germany. The companies
been pro-biosimilar since biosimilars behind biosimilars are well known and trusted, for
reached the market” example Ratiopharm.
Duncan Emerton, Head of Biosimilars, “Ratiopharm as a corporate brand is one of the
Datamonitor Healthcare Consulting most trusted brands in Germany, up there with
BMW and Mercedes, with both the general public
In Germany, biosimilars uptake is good but and physicians, and has been providing generic
varies by drug type products to the German health service for a
number of years. The reputation and the ability to
The uptake of some biosimilars in Germany has
convince key stakeholders have translated over
been good, with 60 percent of the epoetin market
to the biosimilar space, and this was one of the
share being filled by biosimilars. However, the
key drivers of Teva’s acquisition of Ratiopharm,”
biosimilar share of the growth hormone market
says Emerton.
in Germany is only four percent, which highlights
that the uptake of biosimilars will be highly variable
Biosimilar uptake will vary by molecule
across product types24. One of the drivers is the
and indication across Europe
German government, which has encouraged the use
Since the launch of the first biosimilar in 2006,
of biosimilars, and has quota requirements25. These
there has been variation in the uptake of different
differ between drugs and across Germany – the
biosimilars across Europe.
quotas for biosimilar epoetin as a percentage of all
prescriptions of epoetin, for example, range from 20
percent in Hamburg to 40 percent in Berlin26. Epoetin uptake may have been slowed by
immunogenicity issues
“The German government has been pro-biosimilar
Immunogenicity concerns associated with an
since biosimilars reached the market back in 2006.
originator epoetin following a manufacturing
The biosimilar epoetins and G-CSF have done well
change (see ‘Variations can cause issues with
in this market,” says Emerton.
immunogenicity’) may have slowed the uptake of
“Germany is one of the leading countries in terms of biosimilars in this molecule type and indication.
penetration for the epoetins. This has been driven by The initial biosimilar epoetins approvals were
regional biosimilar quotas at the local level in Germany also not licensed for subcutaneous use –
– of all the epoetins that are used in certain regions, associated with immunogenicity – limiting their
a certain proportion is required to be biosimilars” says use across indications.
Greenland. “As a result, the penetration of biosimilar
“When the first two biosimilar epoetins were
epoetins in Germany has been quicker and higher
approved in 2007, they did not have a licence
than for most other European countries. Now that
for subcutaneous use, because this licence had
biosimilars have been used for nearly four years in
been taken away from the reference product,
Germany, physicians are much more comfortable with
Eprex, following the manufacturing change and
using biosimilars in patients in the same way that they
immunogenicity concerns,” says Greenland. “This
would use the originators.”
slowed uptake and although the caution from
physicians was understandable the problems had
24 Senior, M. (April 18, 2011). The IN VIVO Blog: Biosimilars:
Dead Before They Really Got Started? http://invivoblog.blogspot.
com/2011/04/biosimilars-dead-before-they-really-got.html.
25 GaBI. The market for biosimilars. Epoetin uptake may have been
26 Rovira, Espín, García and Labry The impact of biosimilars’ slowed by immunogenicity issues
entry in the EU market.
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8. Biosimilar Drugs in Europe:
threat or opportunity to innovation?
Cancer
2% 2%
2%
Haematological disease
6%
29% Endocrine disorders
8%
Infectious disease
8%
Musculoskeletal disease
Genitourinary disorders
15%
Disease of the nervous system
27%
Gastrointestinal disease
Figure 3: Biosimilar deals 2002-2011 – deal indication
Source: PharmaVentures’ PharmaDeals database Respiratory disease
Biosimilar deals: Deal case studies
Biopharma company signs agreement Biocon will carry out the clinical development,
to access biosimilars manufacture and supply of the biosimilar insulin
China and India have long had reputations for products. Pfizer will secure regulatory approval
illegal copying, but both are moving into the in Europe and the US and launch the insulin
mainstream of approved generics and biogenerics. products onto emerging markets by 2011, and
In October 2010, Pfizer signed an agreement with Europe and the US in 2012 and 2015 respectively.
Bangalore-based biotech company Biocon64.
Biocon’s recombinant, or genetically engineered,
Pfizer will pay an upfront payment of $200 million, insulin products are already approved in 27
and R&D and milestone payments of $150 million, countries in developing markets65.
to have exclusive global rights to commercialize
“Places like India and South Korea have been
a number of Biocon’s biosimilar insulins and
manufacturing biological products for some time,
insulin analogues. Biocon will also receive royalty
whether in a contract capacity or as manufacturing
payments. Pfizer will have exclusive rights to
sites of international companies. So they certainly
commercialize Biocon’s drugs globally with certain
have some of the expertise there,” says Coney.
exceptions, such as Germany, India and Malaysia,
where Biocon will have coexclusive rights.
65 Krauskopf, L. and Nagaraju, B. (2010, October 18).
Pfizer to sell biosimilar insulins in Biocon deal. Reuters.
Retrieved from http://in.reuters.com/article/2010/10/18/
64 Attack of the biosimilars. idINIndia-52267720101018
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9. Biosimilar Drugs in Europe:
threat or opportunity to innovation?
What’s next for biosimilars in Europe?
The European biosimilars market is still very new
and is changing as it is growing, particularly as the The European biosimilars market
biologics patent cliff approaches and biosimilar is still very new and is changing
monoclonal antibodies hit the market.
as it is growing, particularly as the
“The biosimilars market is only five or six
biologics patent cliff approaches and
years old. It’s still a nascent market, especially
compared with the small molecule generics biosimilar monoclonal antibodies hit
market, which has been around in a formal
the market
capacity since the mid-’80s, and it still has a
long way to go,” says Emerton. “I think the next
three to five years are going to be critical, and internationally – while the development costs will be
will shape how the biosimilars market evolves high, the rewards will be significant.”
into the future, driven by the next phase of
biologics coming off patent, particularly the Coney supports this: “Even a comparatively small
monoclonal antibodies.” share of the monoclonal antibody market would
be worth hundreds of millions of dollars – even
“I would expect that every biologic on the market blockbuster-type sales.”
will at some point be the target of a biosimilar
manufacturer,” says Greenland.
Biobetters could ‘follow-on’ from
biosimilars
Monoclonal antibodies will be
Biobetters can be defined as improved versions
a dramatic entry to the
of currently available biologics, and may have
biosimilars market
a better side effect profile, lower toxicity, longer
A number of European monoclonal antibody patents half-life, reduced immunogenicity, improved
are due to expire, including Rituxan (rituximab) and efficacy or a different route of administration.
Remicade (infliximab), both in 2014. Companies are
already looking at monoclonal antibodies (mAbs) These can be as a result of simple changes,
as biosimilars – for example, Teva is developing such as more homogenous glycosylation, which
a biosimilar version of Roche’s Rituxan, as are improves the heterogeneity within a batch, or
Sandoz and Spectrum Laboratories66. differences in formulation, which could improve
cold chain supply issues.
The EMA adopted guidelines for mAbs early in 2011,
but only expects two to three applications a year67. An example of a biobetter is Neulasta
(pegfilgrastim), a pegylated version of Neupogen
“Most of the interest at the moment seems to focus on (filgrastim), used to treat chemotherapy-induced
the monoclonal antibodies, particularly trastuzumab neutropaenia. It has a longer half-life and
and rituximab,” says Cox. “They are high value drugs improved dosing regimen, though the clinical
outcomes are the same.
66 GaBI. (April 29, 2011). Generics manufacturers and
biosimilars. http://www.gabionline.net/Biosimilars/News/Generics- Innovator companies can use biobetters as part
manufacturers-and-biosimilars. of their lifecycle management, for example by
67 GaBI. (February 11, 2011). EMA adopts guideline on creating patentable forms of drugs that have
biosimilar monoclonal antibodies. http://www.gabionline.net/
Guidelines/EMA-adopts-guideline-on-biosimilar-monoclonal-
come off patent. Because biobetters are actually
antibodies. new molecules, they are patentable provided they
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