1. Analysing the market
CPhI Worldwide Pre-Show Conference
CPhI Paris
4th October 2010
Peter Wittner
Interpharm Consultancy
Biosimilars - will they be worth the effort?
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2. Analysing the market
 Understanding what makes Biosimilars uptake more
difficult than generics
 Interchangeability – the big hurdle
 What is the size of the pie? Analysing growth statistics
and explaining the gap in performance versus potential
 Biotech market is booming but Biosimilars are
lagging behind
 Identifying the key therapeutic areas for Biosimilars
 Do the numbers tell us the whole story?
 Where are the future opportunities for greatest growth?
 US, EU or India?
 Where should you invest?
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3. What makes Biosimilars uptake
more difficult than generics?
Interchangeability – the big hurdle
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4. What is the size of the pie?
i lar
sim ce
io l i
B s
How big will the Biosimilars slice be?
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5. What is the size of the pie?
Leading Biological products 2009
2009 2008
Brand Generic Company
Sales Sales
Enbrel Etanercept Amgen / Wyeth $6,580 $6,490
Remicade Infliximab Centocor / Schering Plough $5,934 $5,335
Avastin Bevacizumab Genenetech / Roche $5,777 $4,484
Genenetech / Roche /
Rituxan / MabThera Rituximab Biogen-IDEC $5,653 $5,099
Humira Pen Adalimumab Abbott / Eisai $5,488 $4,521
Amgen / Ortho / Janssen-
Epogen / Procrit / ESPO Epoetin Alpha Cilag / Kyowa Hakko $5,033 $5,123
Herceptin Trastuzumab Genentech / Roche / Chugai $4,890 $4,384
Lantus Insulin glargine Sanofi-Aventis $4,185 $3,130
Neulasta Pegfilgrastim Amgen $3,355 $3,318
Aranesp Darbopoetin Amgen / Kyowa Hakko $2,871 $3,334
+10%
Source: La Merie report – Top 20 Biologics 2009 $49,766 $45,218
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6. What is the size of the pie?
Biotech market value is mainly concentrated in
Western markets............
Biological products 2009
$5.0 Sales in $b n. Source: IMS Europe
$4.5 US
$4.0 $2.0
$1.4 $1.5
$3.5 $2.0 $1.6 $1.5
$3.0 $1.0
$2.5
$2.0
$1.5 $3.0 $3.0 $2.8 $2.6 $2.5 $2.4
$2.3
$1.0
$0.5
$0.0
Enbrel Remicade Avastin Humira Lovenox Mabthera Lantus
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7. What is the size of the pie?
.... but most of world population and the Biosimilar
consumer base is in low-cost developing markets
W orld population breakdown
14.8% 0.5% 8.7%
5.0%
3.1%
11.9%
56.0%
A frica A sia E uro p e M iddle E ast
N o rt h A m erica L at in A m erica Ocean ia / A ust ralia
/Caribbean
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8. Why is the biological market growing?
 Big Pharma is moving up market
 Biologicals are higher priced than small molecule
medicines
 Biologicals are harder to copy = technological barrier
 Biologicals pricing – some US figures from GPhA
 In the US the lung cancer drug Avastin costs about
$100,000 per patient per year
 The cost for Cerezyme used to treat Gaucher disease,
can run to $300,000 / patient / year
 Projected savings are between $42- $108 bn over the
first 10 years of a US Biosimilar market
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9. What makes Biosimilars uptake
more difficult than generics?
Let’s compare with normal generics
Look at what will certainly happen with Atorvastatin
 The SPC expires November 2011
 Based on precedent, around 20 companies will launch on
the day after the expiry
 All will have been accepted as “essentially similar” to
Lipitor by the regulators
 All can therefore be substituted in place of the original
brand and each other
In other words, there is complete interchangeability
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10. Interchangeability – why is it an issue?
 Marketing biosimilars is not the same as
marketing generics
 The big issue is interchangeability
 Or perhaps the real issue is the lack of it
 Prescribers need to be convinced that A = B or
else they will not substitute when prescribing
 If Biosimilars cannot be prescribed by INN
name, the pharmacist cannot substitute
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11. What makes Biosimilars uptake
more difficult than generics?
Interchangeability – experience in EU markets
shows that prescribers are reluctant to switch
 Most EU countries require prescription of biological
products by brand name
 Prescribers are therefore waiting until they see a
newly diagnosed patient before trying Biosimilar
Result – very slow market penetration by
Biosimilars
Amgen claims it has only lost 3% MS to Filgrastim
(G-CSF) copies
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12. What has happened so far?
Source: Amgen Q1 ’10
Earnings Call 12

13. What has happened so far?
“Bringing a Biosimilar to market takes up
to eight years, with development costs
averaging $100-$150 million.
Last year, sales of biosimilars reached just
$75 million worldwide compared with
$110 billion in sales of biologic drugs”
Greg Perry, EGA, speaking at 8th EGA International Symposium on Biosimilar
Medicines, 2nd September 2010 reported by Pharma Times
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14. Biosimilars marketplace
 Who will be the major players?
 In Western markets.....
 Only companies with deep pockets!
 Biosimilars have to be marketed, not just sold
 That means Teva, Sandoz, Hospira
 In Eastern and emerging markets
 The barriers to entry are lower
 The market is more a classic generic market -
PRICE!
 Ranbaxy, Dr. Reddys, Biocon are already there
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15. Biosimilars marketplace
It is not just the generic companies that are
thinking about entering the market
 2008 – Merck & Co announces plans for unit to
copy biotech medicines. Aim is to sell at least six
biogenerics by 2017
 2009 – Eli Lilly acquires Imclone Systems and
announces initiative to develop biosimilars
 2009 – AstraZeneca says it is considering
participation in biosimilars market
 Jan 2010 – Pfizer says it plans to launch
biosimilars of leading 10–15 biologicals
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16. Biosimilars – Big Pharma
Pfizer wants to enter China using locally made
copy biologicals with Pfizer / Wyeth brand
GSK will buy biosimilars from Biocon (India) for
Pharmerging markets
Sanofi-Aventis is also planning to target
Pharmerging markets with Biosimilars
Bayer-Schering is selling Gensulin from Bioton
(Poland) and Insugen from Biocon in China
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17. Key therapeutic areas for
Biosimilars
This is another area where market figures alone
will not be a good guide
Market data seems to show MAbs taking a
growing market share
But what data will the regulators want to
allow you to register your copy?
 The rate limiting step in regulated markets is going
to be the need for regulators to provide guidelines
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18. Where are the future opportunities
for greatest growth?
US, EU or India?
 US biological prices are under pressure but should
stay high
EU – price competition is growing
 More Biosimilars entering the market and slow
uptake will inevitably push prices down
India – low prices
 But market entry is easier and volumes are huge
Where should you invest?
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19. Asian markets – India
Changes in G-CSF (Filgrastim) prices in
response to competition
6,000
5,000
4,000
R Inno vato r
u Bio similar
p
e 3,000
e
s
2,000
1,000
0
2002 2003 2004 2005 2006 2007 2008
Source: Biocon presentation, Biosimilars India 2009
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20. Asian markets – India
Comparing Indian Biological prices to the rest of the world
Substance Average Average Differential
world price Indian price in %
Human Insulin U$ / 100 IU vial US$6.50 / 100 IU
vial 80%
Anti-EFGR $25,000 per $6,000 per
Monoclonal treatment treatment 75%
Recombinant
streptokinase
$150 / vial $10 / vial 95%
EPO $200 / 2,000 IU $10 / 2,000 IU 95%
Source: Biocon (Biosimilars India 2009)
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21. Where are the future opportunities
for greatest growth?
So where should you invest?
India / Asia / Latin America for quick returns
 Market entry is quicker and cheaper, prices are
lower, but compensation is the high volumes
EU/USA for longer term stability and higher
margins
 Market entry is slower and much more costly, but
the compensation will be long-term stability and
higher prices
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22. Any questions?
Mail me if you think of them later
peter@interpharm-consultancy.co.uk
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