Market Report Source

Overview

Although Europe is leading the way, the biosimilar industry is very much in its infancy, with the perception of key decision makers critical to the initial rate of uptake. The opinion of key stakeholders, and the influence they wield, will therefore inform the strategy of both the branded and biosimilar contingents, in what is likely to become a battle to gain trust.

Scope of this report:

• An overview of the key drivers and resistors to biosimilar use.
• An outline of the key stakeholders in Europe and the US, and relative influence they have.
• An insight into the opinion of payers, physicians and hospital pharmacists, regarding biosimilar use.
• An understanding of how the industry will develop, and the strategies to be employed by the pro and anti biosimilar factions.

Research and analysis highlights:

Biologics use is set to grow, at a rate that far outstrips that of small molecule drugs. The considerably greater cost of biologics will therefore combine with increased utilization to put payers under pressure to promote biosimilar use.

Due to the complexity of biologic drugs, there are greater concerns regarding biosimilar safety and efficacy compared with standard generics, which are likely to only be alleviated following time on the market. Consequently, initial uptake will be greatly influenced by the perceptions of key stakeholders.

The opinion of physicians is considered important by both branded and biosimilar companies, and in Europe this group currently holds the most power. Although motivated to promote generics, payers and pharmacists to an extent, often defer to physicians in Europe, although there is evidence this is not the case in the US.

Key reasons to read this report:

• Understand which drugs are subject to biosimilar erosion in Europe now, and going forward.
• Understand who the key stakeholders are and the influence they have on biosimilar uptake.
• Gain an insight into how the biosimilar industry will develop, and the strategies companies will employ to promote or resist uptake

Table of Contents

CHAPTER 1 EXECUTIVE SUMMARY 4
Scope of the report 4
Key findings 4

CHAPTER 2 OVERVIEW OF THE BIOSIMILARS MARKET LANDSCAPE 10
Who are likely to be the key players in the biosimilar industry? 11
Large generics players to be at forefront of biosimilar wave 11
Sandoz as the biosimilars pioneer 11
Teva to establish itself as a major biosimilar company 12
Larger companies pairing up with small specialist biotech 12
Branded biologic companies and the biosimilar market 14
The fragmented nature of the European market may hinder uptake 14
The price of biosimilars 16
Will branded manufacturers compete on price? 17
Second wave of biosimilars likely to be more profitable 19
Confidence in the EMEA’s approval pathway for biosimilars 20
Hospital versus retail setting for European biosimilar uptake 21
Automatic substitution versus interchangeability 23
Potential UK black triangle warning has implications for interchangeability 24
The stakeholder view 25
Payers and pharmacists to drive biosimilar uptake 26
Physicians must be on board 27
Patients unlikely to have a voice on the biosimilar issue 29

CHAPTER 3 ISSUES IMPACTING BIOSIMILARS UPTAKE 30
Drivers of biosimilar uptake 31
Demographic trends point to a need to cut costs 31
Some biologic drugs treat rare conditions 32
Biologic drug use is on the increase 32
High cost of biologics should promote biosimilar uptake 33
Rising cost of healthcare in the US and growing use of tier four 36
Resistors to biosimilar uptake 37
The ‘product is the process’ dogma will hinder biosimilar uptake 37
Biologic drug production can be an issue for both branded and generic players 38
Subtle structural differences in biologic drugs can have clinical consequences 39
Updated black-box warning in US for entire ESA class 40
CHMP recommends against epoetin use to treat oncology related anemia 40
Heparin contamination issues 41
Specialty drug distribution agreements 43

CHAPTER 4 US PAYER INSIGHTS 44
Were a biosimilar approved, would US payers include it in their formularies? 45
How much clinical data do payers require? 45
Stimulation of biosimilar uptake 47
Step edits and more favorable reimbursement to promote uptake 47
Switching patients from branded to biosimilar drugs is a distinct possibility 48
The level of biosimilar discount 50
Rebates as the tool of choice for branded manufacturers 51

CHAPTER 5 BIOSIMILAR TEST CASE: HUMAN GROWTH HORMONE 52
Testing the water with Omnitrope 53
Omnitrope established Sandoz as a key biosimilar player 53
The human growth hormone market is difficult to penetrate 55
Tev-Tropin’s market presence, prior to Omnitrope launch, may have contributed to poor uptake in the US 56
Branded manufacturers likely to have responded aggressively 57

CHAPTER 6 BIOSIMILAR TEST CASE: EPOETIN 60
Biosimilar epoetin in Europe, a large lucrative market? 60
The epoetin market is a closely held one 61
The epoetin market is a difficult one to penetrate, as the experience of Dynepo shows 62
Dynepo made little impact in Europe 62
Several biosimilar epoetins have entered the European market 64
Biosimilar epoetin makes first showing in cost-conscious Germany 65
Physicians guardedly positive about biosimilar epoetin 67
Retail sector dominates German epoetin market 68
Italian epoetin dispensed in hospital pharmacies 69
Biosimilars could struggle in the UK epoetin market 70
PASA guarantees price stability, making it difficult for biosimilar epoetins to enter the market 72
Biosimilar epoetin lost a London hospital tender 73
Patient resistance is unlikely to sway the decision to switch 75
Epoetin buying becoming more centralized, making the retail sector a better option for biosimilars 75

CHAPTER 7 THE FUTURE FOR BIOSIMILARS 76
Biosimilar G-CSF market launch imminent 76
G-CSF brand choice in Europe 80
Biosimilar insulin – a difficult market to enter 82
Analogs limit growth opportunities in more developed markets 84
US payer stance on biosimilar insulin 85
Product loyalty is a factor any insulin biosimilar maker must overcome 86

CHAPTER 8 BIBLIOGRAPHY 88
Publications and online articles 88
Conference literature 93
Datamonitor resources 93

APPENDIX 95

List of Tables

Table 1: Indian companies manufacturing biosimilars in India, 2008 13

Table 2: Epoetin market size in US and 5EU, 2006-07 15

Table 3: High cost of biologic drugs in the US, 2008 34

Table 4: Estimated savings following the use of biosimilar drugs 35

Table 5: Omnitrope sales in the US and 5EU, 2007 56

Table 6: Development and marketing of epoetin US and Europe, 2008 61

Table 7: Dynepo market share in the US and 5EU, 2007 63

Table 8: The retail-hospital split for epoetins in the 5EU, 2007 68

List of Figures
Figure 1: The emerging biosimilar landscape, 2008 10

Figure 2: The hospital versus retail divide 21

Figure 3: Influence of the key stakeholders in the US and EU to promote biosimilar uptake, 2008 26

Figure 4: Drivers and resistors of biosimilar uptake 31

Figure 5: Key stakeholders in the US, and their influence on biosimilar uptake 44

Figure 6: Key drivers and resistors of biosimilar growth hormone uptake 53

Figure 7: Price of lyophilized somatropin per gram in Germany and the US in 2007, relative to that of Omnitrope 58

Figure 8: Key drivers and resistors of biosimilar growth hormone uptake, 2008 60

Figure 9: Epoetin use in the 5EU, 2007 62

Figure 10: Effect of biosimilar epoetin on market share in Germany, September 2006-January 2008 66

Figure 11: Hospital epoetin use in the UK, 2008 71

Figure 12: Key drivers and resistors of biosimilar granulocyte-colony stimulating factor (G-CSF)uptake, 2008 76

Figure 13: Neulasta versus Neupogen use in the US and Europe, 2003-07 78

Figure 14: Granulocyte-colony stimulating factor (G-CSF) use in the 5EU, 2007 79

Figure 15: Drivers and resistors for recombinant insulin uptake, 2008 83