Biosimilars Series: Strategic issues - Potential remains uncertain

Biosimilars Series: Strategic issues - Potential remains uncertain

Introduction

Significant barriers to entry into the biosimilars market exist. High up-front investment and the need for specific expertise favor big players. Understanding of the marketplace is critical for success acceptance by key stakeholders is crucial for market uptake of biosimilars and achieving preferential reimbursement status through constant review of the pricing strategy is desirable.

Scope

CHAPTER 1 EXECUTIVE SUMMARY 4
Scope of the report 4
Key findings 4
Key definitions 7
CHAPTER 2 INTRODUCTION TO THE BIOSIMILARS MARKET 11
Drivers and resistors of growth in the biosimilars market 11
Drivers of biosimilars market growth 11
Biologics market growth 11
Advances in analytical techniques used to characterize biologics 12
Cost-containment pressures are driving the need for biosimilars 12
Resistors of biosimilars market growth 12
Lack of a regulatory pathway in the US 12
Opposition from the innovators 14
Cost and complexity of development 14
Europe as a testing ground 14
Five biosimilars have been approved in Europe so far 15
Outcome of US legislation - market exclusivity and difficulty 15
CHAPTER 3 FACTORS INFLUENCING MARKET UPTAKE OF BIOSIMILARS 17
Uptake is critical for market success 17
Patient switching is harder than with small molecule generics 17
Automatic substitution may be governed by legislation 18
Multiple stakeholders need to be targeted to ensure high uptake 19
Pharmacists have a role in the uptake of biosimilars 24
Patients' role in uptake 28
Physician uptake is critical 30
Informing physicians about biosimilars 31
CHAPTER 4 PRICING AND REIMBURSEMENT OF BIOSIMILARS 33
Pricing of biosimilars 33
Reimbursement of biosimilars 35
Payers perspective 35
EU payers are influenced by physicians and pharmacists 36
Retail biosimilars can lead to modest savings 36
Standard strategies for promoting generic uptake may not work for biosimilars dispensed in hospitals 37
US payers may introduce reimbursement incentives 40
Tiered formularies are used by MCOs and PBMs 40
MCOs and PBMs are stressing the need for biosimilars 41
Discounts, rebates and patient co-pay will influence the use of biosimilars 42
Product class analysis 44
HGH market is hard to penetrate 44
Price may be the key factor affecting biosimilar epoetin uptake 45
Restrictions on epoetin use in the US will impact the overall market size 47
Launch of first biosimilar epoetin alpha in Europe is imminent 47
Interferon alpha market is dominated by second-generation products 48
Interferon beta market is growing but competition from improved products exists 49
Insulin market is not an attractive target for biosimilars 50
Granulocyte colony-stimulating factor has attracted many biosimilar companies 51
Biosimilar Enbrel presents a very lucrative opportunity 52
Monoclonal antibodies will not be targets for biosimilars in the near future 52
CHAPTER 5 BIOSIMILARS MARKET ENTRY 54
Barriers to entry are high but not insurmountable 54
The development of biosimilars is more complex and costly than that of small molecule generics 55
Lack of specific expertise 58
Complex patent protection of biologics is another barrier 59
High promotional costs 59
Expensive to exit 60
Competitive landscape less crowded than for small molecule drug generics 61
Smaller number of entrants 61
Early entry brings advantage but is risky 61
Contract manufacturing organizations will enter the biosimilars market 63
Big players will remain 63
Biosimilars manufacturers in the emerging markets 64
Low cost base is an advantage... 65
...but gaining regulatory approval is difficult 66
Confidence is important for acceptance 66
Case Study: Omnitrope - the story so far 67
Omnitrope's EU approval was not smooth 67
US approval for Omnitrope was granted only after a law suit 67
Pricing and launch strategy for Omnitrope 68
Omnitrope's branding strategy 68
Omnitrope sales to date 69
Line extension - liquid Omnitrope formulation 70
Case Study: Sandoz's biosimilar epoetin alpha 70
CHAPTER 6 KEY RECOMMENDATIONS FOR SUCCESS 72
Making biosimilar products 73
Acquire biopharmaceutical expertise, facilities or pipelines 73
Marketing of biosimilar products 74
Achieving profitability in the biosimilars market 77
Low-cost manufacturing 77
Choice of reference product is important 78
Early entrants are rewarded 78
Enter strategic partnerships 79
Positioning of biosimilars - biosimilar or full submission route 80
Second-generation biosimilars 81
SWOT analysis of biosimilars manufacturers 82
CHAPTER 7 ORIGINATORS' STRATEGIES FOR MARKET SHARE PROTECTION 83
Communication with decision makers is crucial 83
Lobbying regulatory bodies 83
Automatic substitution should not be allowed for biosimilars 84
Labels should clearly state if a product is a biosimilar 85
Biosimilars should have different names 85
Informing physicians and patients about proven safety 86
Informing payers about quality and cost of service 87
Patent protection 87
Pricing strategies 88
Lifecycle management strategies for biologics 89
Authorized biosimilars 89
Licensing agreements with biosimilar manufacturers 90
Line extension 90
Innovative delivery systems 91
Innovation, innovation, innovation 91
Will branded pharma and biotech enter the biosimilars market? 92
CHAPTER 8 BIBLIOGRAPHY 94
Publications and online articles 94
Conference literature 97
Datamonitor resources 97
Suggested reading 98
GLOSSARY 99
List of Tables
Table 1: Aspects of biosimilars that influence acceptance by pharmacists 26
Table 2: Companies taking part in the South London epoetin tender 39
Table 3: Development and approval processes of biosimilars and small molecule generics 56
Table 4: Omnitrope sales by country, H2 2006-H1 2007 in USD 69
List of Figures
Figure 1: Multiple stakeholders need to be targeted 20
Figure 2: Stakeholder influence on the final dispensing decision depends on the setting 22
Figure 3: Adoption process is different for hospital and retail biosimilars 23
Figure 4: Tiered formularies are used in the US 41
Figure 5: Competencies required for the development and marketing of biosimilars 54
Figure 6: Barriers to biosimilars market entry 55
Figure 7: Biosimilars development and marketing is a long and costly process 56
Figure 8: Key challenges and strategies for success in the biosimilars market 72
Figure 9: The 4Ps of marketing biosimilars 75
Figure 10: Characteristics of a successful biosimilars company 79
Figure 11: SWOT analysis of biosimilars manufacturers 82