Biosimilars: The Time Has Come

Biosimilars' time has come--in Europe, at least. The European regulators asserted during a workshop in Paris at the beginning of December that biosimilars guidelines will be finalized before mid-2006. This will open up a market which could be worth $8 billion within five years in the EU, according to the European Generic Association (EGA).

In Europe, at least. This was the subtext of a joint workshop organized by the European Medicines Agency, EMEA, and the Drug Information Association in Paris at the beginning of December. The event brought together all stakeholders in the biosimilars debate—innovators, generic firms, regulators, physicians and patient groups--to discuss remaining areas of uncertainty in the draft guidelines on the development and approval of biosimilars, which EMEA issued last year. (See "Biosimilars: EMEA Wants Approvals," IN VIVO, September 2005 (Also see "Biosimilars: EMEA Wants Approvals" - In Vivo, 1 Sep, 2005.).)

There was plenty to discuss. Well before the exchanges were complete, however, EMEA asserted that the guidelines will be finalized before mid-2006. Decisions on the three pending biosimilar applications will probably follow soon thereafter, opening up a market which could be worth $8 billion within five years in the EU, according to the European Generic Association (EGA).

Unlike in the US, where regulators appear to be dragging their feet since there aren't any laws allowing biogenerics, in Europe the legislative backdrop for approving such products already exists within the latest EU pharmaceuticals directive. (See "Biogenerics Are Happening: Slowly, Product-By-Product," The RPM Report, January 2006 (Also see "Biogenerics Are Happening: Slowly, Product-By-Product" - Pink Sheet, 1 Jan, 2006.).) And the political will is there too; perhaps not surprising given potential savings to governments and patients worth an estimated €2 billion ($2.4 billion) annually.

The crux of the debate in Paris was around the nature and extent of clinical trials required by biosimilar applicants in order to prove the comparability of their drug to the originator. The broad positions taken weren't a surprise: Innovators, eager to defend billion-dollar franchises, sought to raise the hurdles for biosimilar firms, pointing to the complexity of biologicals, and the difficulties of reliable reproduction. "A comparability approach is not applicable to products made by independently-developed processes," asserted Stephan Fischer, head of pharma research at Roche , speaking on behalf of innovator associations Emerging Biopharmaceutical Enterprises (EBE) and EuropaBio. Fischer used data showing in theory over a billion possible molecular variants of large and complex biologics such as tissue-plasminogen activator (TPA) (Alteplase/Activase). "Even we [innovators] are still finding new things, new surprises," he emphasized.

Biosimilars groups were arguing that the clinical trial burden—already, they say, relatively high in the guidelines--should be reduced. "Under some conditions, comparative pharmacokinetic and/or pharmacodynamic studies may be sufficient to demonstrate comparability and no further clinical studies may be warranted," opined Yafit Stark, PhD, senior director of global clinical research at Teva Pharmaceutical Industries Ltd. Cecil Nick, director of drug development at Parexel Consulting and speaking on behalf of the EGA, went further. "When two biological products are shown to be comparable in all respects there should be no need for clinical and immunogenicity data," he stated.

What was surprising, however, was the extent to which the biosimilar camp appeared to be winning the debate, both scientific and moral. Current analytical techniques are sufficiently sophisticated to allow good characterization in vitro, with only limited clinical trials necessary to show efficacy and safety in man, argued, among others, Joerg Windisch, PhD, head of global technical development, biopharmaceuticals, at Novartis AG 's Sandoz generics unit. No one could dispute that characterization techniques have advanced significantly since the first biologics were approved. Today's production methods, too, are often superior to those used by innovators, in terms of traceability of components, and purity, for example. Plus it wouldn't be ethical to use patients in superfluous, repetitive trials which amounted to reinventing the wheel. "Unnecessary or unethical duplication of preclinical and clinical trials wastes resources that are needed for continuous innovation," said Windisch.

The generic firms also played the cost and access cards, which resonate well among today's regulators and payors. Tim Oldham, VP business planning and operations effectiveness at Mayne Pharma Pty. Ltd. , outlined the economic imperatives for biosimilars. Biologics' share of overall drugs is growing fast, he points out, and so is the share of over-60s most likely to suffer from many of the diseases that these drugs treat. But since they're at least twice as expensive per treatment as small molecules, many patients simply aren't getting treatment. If biosimilar insulin came to market at, say, 30% cheaper, this would release $2 billion of additional health care funds, potentially treating 74% more diabetics per annum. (See Exhibit 1.) There's already a precedent in Poland, where biosimilar insulin (Gensulin) was launched in 2001 by local firm Bioton SA . The launch prompted a 28% price drop that year, according to the EGA, and led to €90 million savings to the Polish health care system over four years.

The innovators' strongest card was patient safety which can't be adequately guaranteed, each speaker reiterated, without large clinical trials. "Comments [in the guidelines] that imply extrapolation of safety and efficacy from quality data should be deleted," asserted Roche's Fischer. Innovators also strongly resisted suggestions in the guidelines that biosimilar applicants can extrapolate data for one product across a number of indications—a crucial point if biosimilars are to become commercially viable.

Yet even debating the most widely-covered safety issue, immunogenicity, the biosimilar firms looked strong. Both sides agree that immunogenicity testing is necessary. But they disagree whether it should occur before or after marketing. The wording of the current guidelines is ambiguous, leaving open the possibility that in some cases there may not be a formal requirement for such studies pre-authorization, although it's clear that post-marketing, at least a year of antibody monitoring is necessary. Adrian Thomas, MD, VP benefit risk management at Johnson & Johnson , argued in favor of extensive pre-marketing immunogenicity testing, highlighting the many variables that need controlling and understanding. The story of J&J's epoietin alpha (Eprex) arose several times as an example of how a tiny change in manufacturing—such as a new stabilizer substance--can lead to serious immunogenic disease. It's now widely believed that leachates released when the stabilizer polysorbate-80 reacted with uncoated rubber syringe stoppers behaved as an adjuvant to the formation of anti-EPO antibodies, leading to the red cell aplasia seen among some tens of patients taking the subcutaneous formulation of the drug.

The Eprex case backfired somewhat on the innovators, though. Such a low incidence of immunogenicity would not have been picked up in pre-marketing immunogenicity trials anyway, argued Sandy Eisen, PhD, VP portfolio and scientific affairs at Teva. In fact the Eprex case illustrates that innovators' products are as vulnerable to process-linked safety risk as any biosimilar might be, thus breaking down the long-held "product equals process" defence that originators have used to try to deny even the theoretical possibility of biosimilars. Twisting the sword in further, Eisen suggested that full analytical comparability testing after the process change—which J&J apparently didn't do--might have picked up the problem sooner. What's needed, Eisen concluded, are improvements in post-marketing surveillance.

As such the "we can't know everything, so we need plenty of testing" argument from the innovator camp proved a double-edged sword. Presenters attempting to quantify the billions of possible sources of heterogeneity in a biological (a tactic scorned by some members of the audience as scare mongering) were challenged with the question as to whether they could correlate each variant of their product with a clinical outcome, and if not, weren't they taking risks, too?

All of which brought on the question of risk-benefit assessment—another hot topic across the industry in general. "Do we want to deny access to patients based on theoretical risk?" asked Oldham. The guidelines are a good start, he continued, but let's not allow the science of risk elimination to override public need." No medicine, branded or generic, is 100% safe, as the rofecoxib (Vioxx) withdrawal and other safety scares have amply shown. That said, any question as to the relative safety of biosimilars would indeed undermine the opportunity.

Amid occasionally heated debate, there was consensus, too. All sides agreed that tight pharmacovigilance was necessary, and that each application should be considered on a case-by-case basis. The simpler, smaller biologicals like insulin and growth hormone, more easily characterized, may follow a faster route to market than a more complex interferon or antibody. Hence companies like Roche or J&J, each selling lucrative EPOs, and Novo Nordisk AS , much of whose business comprises insulin and insulin-related products, have the most to lose—and loudly voiced their concerns.

It would be an exaggeration to describe the innovators as deer in the headlights, though. After all, they've known this vehicle was coming and most have softened their stand over the last year or so to acknowledge this and engage in the debate. And the fact remains that, notwithstanding Oldham's statistics, biosimilars won't repeat the generic onslaught seen in small molecules, certainly not in terms of speed of uptake. The economics won't be as compelling, at least initially, since not only do all sides agree that some clinical trials will be necessary—more in some cases than others—but issues of substitutability, labelling and access still need to be resolved. How will such products be perceived by physicians; will they be encouraged to substitute them as with regular generics, and how will biosimilars be described and explained?

As approval guidelines are finalized (see Sidebar), the biosimilars battlefield is shifting from the regulatory arena towards the marketplace. Substitution and reimbursement are the purview of national authorities in Europe, but even so, "it's important that EMEA says our products are therapeutically equivalent," stressed the EGA, in order that physicians prescribe them without hesitation in the place of more expensive originator drugs. Moreover, as with small-molecule generics, EGA wants the same product labelling for biosimilars as for the reference product to which biosimilarity is proven, even if the generic company hasn't performed all trials in all indications.

Innovators won't have any of it. Their associations called for "adequate naming and labelling to allow physicians to make informed decisions and promote pharmacovigilance." In other words, doctors should be made fully aware that they may be prescribing a biologic which has been approved through an abbreviated pathway and is certainly not equivalent to the originator drug.

Generics groups still have a steep hill to climb before they can realize their most ambitious visions. But they're confident of penetrating some European markets more convincingly than even small molecules have done. That's because the same percentage price erosion will save considerably more money in the biologics space. Moreover, Europe now includes a new set of generic-friendly countries in the east for whom the economic argument will be even more compelling. And the distribution channels for biologics—hospitals and specialist treatment centers--are far more concentrated and hence simpler to cover than thousands of pharmacies.

Biosimilars will likely expand the overall market, not simply drive down prices. When the first generic statins arrived, the market value shrunk by a third, but expanded by almost as much over two years. That, argue generics firms, will in turn create more future value for those innovators that go on to develop innovative products which work even better.

We're a far cry from such a cozy win-win--though certainly, follow-on products with clear advantages, like pegylated interferon alpha and, potentially, inhaled insulin will hold their own against generics. But it is conceivable, in this new part generic, part novel industry space, that biosimilars firms may form science and technology collaborations with small and mid-sized biotechs in Europe, and some may also present cheaper alternative manufacturing specialists for innovator companies. Schering AG , for example, whose manufacturing contract for lead drug interferon beta-1b (Betaseron) has come up for re-negotiation following the proposed acquisition of Chiron Corp. by Novartis, is allegedly looking into "alternative" opportunities. [See Deal]

It's too early to tell the shape and size of the biosimilar phenomenon. But its location is clear. Europe, the global center for biosimilar R&D and production, is paving the way in this new industry—for a change. <<s1)Sidebar

EMEA working parties on biologics and biosimilars reconvened in December to discuss comments received through the written consultation process and raised at the workshop. Final drafts will likely be discussed at the agency's March 2006 meeting, according to EMEA's Marisa Papaluca Amati, MD, deputy head of sector, Safety and Efficacy of Medicines pre-authorization evaluation unit.

That meeting should result in final guidelines on similar biologicals generally, plus on quality issues, clinical and nonclinical issues, and, at the product level, on insulin, granulocyte-colony stimulating factor (Amgen Inc. 's filgrastim (Neupogen)), somatropin and erythropoietin. Further EMEA guidelines are likely on immunogenicity issues (across all biologicals) and on further individual products, including interferon-alpha.