Global Biosimilars Outlook 2011

Pharma IQ

“I think it’s fair to say that we expect in the 2015 to 2020 period, biosimilars will see a high rate of growth and share of the market.” Murray Aitken, Executive Director, IMS Institute for Healthcare Informatics.

Biosimilars hold the promise of being the next big thing in the pharmaceutical industry. Figures from the Global Biosimilars Market Analysis report from RNCOS suggest that between 2010 and 2015 the global biosimilars market will experience a compound annual growth rate of 52 percent.

Yet it is fair to say that the market across the globe is developing at different levels.

Among the factors driving growth are an ageing population, rising healthcare costs and rising pharmaceutical expenditure, the RNCOS report identified. But the different stages of maturity in the regulatory environments are impacting the success of individual markets.

When it comes to approvals, Europe is leading the way, with the most approvals to date, having approved its first in 2006. However, India's relatively deregulated market makes it a prime target for biosimilar developers.

The RNCOS study indicated that over 40 biologics are marketed in India and more than half of these – 25 in total – are biosimilars. A further 25 biosimilars are in their final stages of development.

Dr Reddy’s, Cipla and Lupin are among the companies looking to expand their Indian biosimilar offerings.

Dipta Chaudhury, senior consultant for pharma and biotech, South Asia and Middle East, at Frost & Sullivan, told the Business Standard: "Improvising skills through biosimilar launches in regional market is a [better] strategy for Indian companies than entering tough markets such as the United States and Europe directly, where risk is higher."

Certainly there is a general consensus that the United States is lagging behind in the development of its regulatory environment and this is impeding the market.

The United States Food and Drug Administration said a process should be in place by the end of the year, six years after the European Medicines Agency released its guidance, and officials recently offered a glimpse of what the regulatory pathway will look like in an article in New England Journal of Medicine.

Officials made it clear that a more rigorous review process will be put into place to establish the similarity between the new drug and the original biopharmaceutical.

"Given the complex nature of biologics, it's unlikely that a 'one size fits all' systematic assessment of biosimilarity can be developed," they explained.

Even with this in place, however, industry players believe it will be sometime before the United States biosimilar market begins to see significant levels of activity.

Bino Pathiparampil, an analyst with IIFL, told DNA India: "At least for the EU there is some clarity on guidelines."

"It is unrealistic to expect Biocon with Mylan to enter these territories. A timeline like FY15 and FY16 looks like the earliest opportunity for entering these markets, especially the United States, with biosimilars," the analyst added

With the success such companies are already seeing in other markets, they can also afford to wait. In its results for the first fiscal quarter of 2012, Dr Reddy's revealed a 69 percent year-on-year increase in revenues from its biosimilars portfolio in India, with the segment now representing 7 percent of overall sales.

A recent report from IMARC Group predicted the United States biosimilars market will have a value of $11.4 billion (£6.9 billion) by 2020, although warned growth "unlike small molecule generics, is expected to be a marathon and not a sprint".

Between 2011 and 2020, 18 biopharmaceuticals are expected to face competition from biosimilars in the United States. It warned the historical performance of Sandoz' growth hormone deficiency treatment Omnitrope – the first biosimilar approved by European regulators and the first to be recommended for use by the NHS by the UK's National Institute for Health  and Clinical Excellence – should not be used to benchmark future growth.

It went on to suggest the competition experienced  in the biosimilars market will be unlike that seen between brands and generics, but rather like that currently witnessed between brands and said "market acceptance for each biosimilar class is expected to significantly vary from one another."

"The high costs involved in the development and launch of biosimilars is expected to limit the number of players in this market and create a significantly lower price and volume erosion compared to small molecule generics," the report concludes.