Winning with biosimilars
Opportunities in global markets
While biosimilars’ growth potential appears bright, winning with biosimilars in emerging markets is not a simple undertaking. Companies seeking entry or expansion should craft a strategy to address the specific challenges in the emerging markets and incorporate the lessons learned from developed markets.
Over the past several years, biologics have gained significant traction in the pharmaceutical industry, representing more than $150 billion in global sales in 2013. By 2020 they are predicted to generate $290 billion in revenue and comprise 27 percent of the pharmaceutical market. Forty-eight percent of sales come from 11 biologics that face loss of exclusivity over the next seven years. This, along with the increasing worldwide focus on improving health care access and the cost of care, presents an attractive opportunity for biosimilars manufacturers.
Analysts expect the worldwide biosimilars market to reach $25-$35 billion by 2020. Since the first biosimilar approval in the European Union (EU) in 2006, there are now more than 700 biosimilars approved (~450) or in the pipeline (~250) globally. In major markets like the EU, regulators and payers have recognized the potential financial benefit of biosimilars and are driving their uptake. For example, France has initiated automatic substitution of select biosimilars over the reference products.
In the United States alone, the cost savings from switching to biosimilars are projected to be between $40 and $250 billion over the next 10 years, with the first biosimilar to hit the US market expected to contribute about $5-7 billion in savings.
What are biosimilars?
Biosimilars are biologic products that are similar but not identical to reference/originator biologic products. Although described differently by various global health agencies, biosimilars generally are large-molecular-weight, complex molecules that are produced in living cells through genetic engineering. The recent recommendation by the United States Food and Drug Administration (FDA) to approve an oncology supportive care drug developed by Sandoz represents a landmark for the United States launch and commercialization of biosimilars.
Early biologics, such as insulin, erythropoietin (EPO), and growth hormones, have been invaluable in the treatment of serious illnesses such as diabetes, anemia, and renal diseases. More complex biologics, such as monoclonal antibodies (mAbs), cytokines, and therapeutic vaccines, are helping to revolutionize treatment of cancer, autoimmune disorders, and other difficult-to-treat diseases. For such higher-cost disease areas, biosimilars should be instrumental in expanding access to populations who need these therapies but are unable to access them today.