We are entering the age of biosimilars, and the market for these copycat biologics is rapidly expanding – in 2017 alone the EMA approved 16 biosimilars for seven different originator products. Five of those originators – AbbVie’s Humira (adalimumab), Genentech’s Herceptin (trastuzumab), Biogen/Genentech’s Rituxan (rituximab), and Eli Lilly’s Humalog (insulin lispro) and Forsteo (teriparatide) – previously had no biosimilars approved in Europe.
HoUng Kim, head of strategy and operations at Celltrion Healthcare – the company behind the world’s first biosimilar monoclonal antibody (mAb), Remsima (infliximab) and the first biosimilar mAb for the treatment of cancer, Truxima (rituximab) – has witnessed first-hand the kind of success biosimilars can experience.
“Real-world savings data from the NHS, published in the peer-reviewed journal BioDrugs, showed a cumulative cost saving of £38.8 million over two years from the introduction of infliximab and etanercept biosimilars for the treatment of rheumatoid arthritis,” he says, “while a three-year budget impact analysis, published in the Advances in Therapy journal, which factored in the UK, indicated that biosimilar rituximab use when compared to the originator product could result in €570 million in savings.
“Biosimilars provide the NHS with the prospect of saving millions of pounds, whilst also increasing access to important medicines. We also expect that the potential savings associated with biosimilars will drive down the costs of first line biologic treatments, which in turn could improve access to innovative second and third line therapies. This is especially important in oncology.”
This booming market means that what was once a niche area is becoming a highly competitive section of the industry.
HoUng adds that this will be one of the biggest challenges facing companies in the biosimilar space in the near future: “We’re going to have more competitors, not only from biotech but also increasingly big pharma, so we need to continue to focus on these cost savings.”
But Dr Richard Mortimer, managing principal of Analysis Group, says that biosimilar competition is likely to look very different from generic drug competition in the near- to medium-term future. “The technological challenges and development, approval and production costs are likely to limit the number of biosimilars for any given drug,” he says. “Furthermore, biosimilars may adopt some level of branding and promotion. Many of these factors indicate that price competition will be less intense than for generic drugs and that biosimilar adoption will be relatively low.”
Because of this, he wonders if some of the predicted cost savings of biosimilars are slightly unrealistic.
“Many of the predicted savings have provided a fairly wide range of estimates, and I think we are likely to see cost savings on the lower end of those ranges. However, these factors will evolve over time. Certainly generic competition in the US looks different today than it did after Hatch-Waxman was first passed in 1984. In 30 years’ time, we will likely see fairly aggressive biosimilar competition, but it will take time to get there.”
There are several other reasons why biosimilar adoption may take some time to reach its full potential.
“In the EU, some governments are looking to actively encourage greater biosimilar adoption,” says Mortimer. “Despite having a longer history with biosimilar approvals than other regions, many perceive that new measures are needed to boost biosimilars use. For example, in the autumn initiatives were being considered in France aimed at setting a 70 percent target for initial biosimilar prescribing rates and encouraging greater pharmacist substitution of biosimilar for brand biologics. Whether these measures further increase biosimilar share, and whether increased biosimilar share results in substantial price savings is uncertain.”
There’s also the continuing problem that many patients, and even some healthcare professionals, lack a clear understanding of biosimilars and their benefits. Celltrion Healthcare’s HoUng says that the company met a high level of resistance when first presenting their products to patient groups and the medical community.
“If they don’t have the clinical data they are not quite comfortable using a biosimilar, so the key is to generate as much data as possible to soothe them and help explain when and why they could use these drugs,” he says. “We also try to build up as many materials as possible that will help them understand the available data and the key points, and make sure not to use too much medical jargon for patients.”
Mortimer agrees, saying: “I think biosimilar companies still need to adjust to find the right approach for the biosimilar world, which differs substantially from the traditional generic drug world. Generic drugs largely compete against other generic versions of the same drug. In the case of biologics, the brand will maintain a substantial share of sales, and is likely to actively compete against the biosimilars on price, marketing and the development of additional scientific evidence.
“As well as developing scientific evidence sufficient to convince payers, physicians and patients that the biosimilar is equivalent to the brand, biosimilars need to identify pricing and contracting approaches that increase payer access to biosimilars and effectively navigate the legal landscape of patent and potentially antitrust litigation that will emerge. I anticipate that antitrust litigation around biosimilar entry will eventually become a frequent occurrence for biologic drugs, just as it currently is for the timing and extent of generic entry.”
Payers’ role
Payers also have a role to play in encouraging the adoption of biosimilars.
“In the US, payers have a number of approaches they can take to encourage biosimilar adoption,” says Mortimer, “including putting the biosimilar in a preferred formulary position relative to the brand and requiring prior authorisation or step therapy before reimbursing for the brand. Whether payers choose to implement these approaches to encourage greater biosimilar adoption in the future depends on a few key factors.
“The biosimilar manufacturer must offer sufficient price concessions and rebates to provide the financial incentives for payers to actively encourage biosimilar use over the brand. Brand manufacturers are unlikely to be idle in this situation, and may seek their own contracting strategies to maintain use of the brand. This could ultimately lead to lower brand prices as well, even if biosimilar adoption remains weak.
“For biologics administered in hospital or in a physician’s office – and where the hospital or physician’s office purchased the drug (i.e. buy-and-bill drugs) – the method by which the payer determines the reimbursement paid to the hospital or physician for the brand and biosimilar may impact which drug the physician chooses. If the physician believes the brand and biosimilar to be therapeutically equivalent, then they’re likely to choose the one that provides the largest reimbursement relative to the cost of acquiring the drug.
Mortimer concludes: “I think there is a learning and experience process for biosimilar drugs. As there are more biosimilars, treating a wider range of diseases and being used by a wider range of physicians, understanding of how best to use biosimilars and comfort with biosimilars will grow. I’m not sure there is a single good way to accelerate this process. Certainly, additional scientific evidence can help, but I think to some extent it just takes time and experience.”
