Following the introduction in South Korea last year of a regulatory pathway for generic versions of biologic drugs, the country is set to emerge as a global leader in biosimilar R&D, according to new forecasts.
Last July, shortly after the regulatory pathway for biosimilars (also known as “follow-on biologics”) was established, South Korean electronics giant Samsung announced that it would invest US$389 million in biosimilars over the next five years, reports Business Monitor International (BMI). At the time, Samsung described biosimilars as a business in which it aimed to grow strategically and would participate “aggressively.”
Other significant developments, both announced late last October, include the successful completion of a South Korean clinical trial of TuNEX, a biosimilar version of Amgen and Wyeth’s rheumatoid arthritis and psoriasis drug Enbrel (etanercept) produced by Taiwanese drug development company Mycenax Biotech, and an agreement between US-based Hospira and South Korea’s Celltrion to develop and market eight biosimilars, notes BMI.
Another recent study, from Espicom, also points to South Korea’s long history in manufacturing biologics, and says the number of local companies manufacturing generic versions of Roche’s Tamiflu (oseltamivir) – including SK Chemicals and Chon Kun Dang – indicates strong performance by some firms and that larger companies in the biosimilar sector have made considerable strides recently in R&D, manufacturing and distribution.
SK Chemicals, for example, says it could have its version of oseltamivir for sale within less than a month after marketing approval is given. This is arguably the result of massive investment in this sector from both government agencies and multinational companies, says Espicom; the latter includes Novartis’ declaration last October that it would be investing US$100 million in South Korea over the next five years, plus other large commitments from Otsuka, AstraZeneca and Pfizer.
Another significant development is the recent launch of an $80 million biomedical fund managed by Burrill & Co and leading local private equity firm KB Investment, “which could help promising Korean biotechnology companies step forward to [become] significant global players,” says Dr Jeong-Sun Seo, president of the biotechnology industry group KoreaBIO. “We believe that one of the most promising sectors in 2010 is biosimilars,” and success in this business could “set the ground for the development of innovative drugs,” he adds.
Moreover, with many other Asia-Pacific (AP) nations also “striving to develop bioindustry as their key industry… we believe that there will be plenty of room for complementary cooperations between AP countries in 2010 and KoreaBIO will be open to discussions for such co-operations,” adds Dr Jeong-Sun Seo.
Meantime, BMI is also forecasting that South Korea’s healthcare market will expand significantly over the next five years, with spending rising an average 17.3% a year in US$ terms, from $58.9 billion in 2009 to $130.8 billion in 2014.
The impact of the Free Trade Agreements (FTAs) signed with the US in 2007 and initialed with the European Union (EU) on October 15 last year have not been welcomed by the country’s predominantly generic drugmakers, which are already challenged by regular government price cuts. However, there is a trend among those which can afford it towards investing profits from generics sales into the development of “supergenerics” – generics brought to market at the same time as patent expiry, and BMI points out that many major South Korean pharmaceutical companies are forecasting sales growth of around 10% for this year.
