Collaboration: The Name of the Biosimilars Game

The January issue of Eye on Innovation discussed the importance and global growth of biologics and biosimilars. We also pointed out the increase in pace and value of biologic company mergers and acquisitions, partnerships and contract manufacturing worldwide to overcome some of the obstacles to entering the biosimilars market. Digging into Dialog market research, business and news sources, we learn more about the latest mergers, partnerships and alliances and what companies hope to achieve with these collaborations.

2011 is being touted as the year of the biosimilars. A major incentive prompting the continuing number of alliances and partnerships in the biosimilars arena is, of course, money. The biosimilars market is growing rapidly and is expected to swell to more than $5.5 billion by 2013. More than 30 branded biologics with sales of $51 billion are set to lose patent exclusivity between 2011 and 2015, thus providing incentive for creating biosimilars or follow-on biologics.

Although existing biosimilar players such as Sandoz and Teva have the advantage of an established reputation and relationships with key stakeholders, large pharmaceutical companies are increasingly looking to biosimilars as one route to drive sales going forward, using partnership and merger and acquisition deals to achieve their goals. For example, Sandoz, the generics arm of Novartis, which has three approved biosimilar products, has begun a Phase II clinical trial for a biosimilar version of rituximab, a monoclonal antibody to treat non-Hodgkin's lymphoma and rheumatoid arthritis, which is marketed by Roche/Genentech and Biogen Idec. Moreover, emerging market biosimilar players are now looking to expand into global markets too, through partnerships with international pharmaceutical companies. Another biopharmaceutical company Spectrum Pharmaceuticals signed a letter of agreement with Viropro, a company that develops cell lines and manufacturing processes for biosimilars, for the development and clinical production of a biosimilar rituxumab.

Win — win alliances

Alliances and partnerships offer companies a win whether it is money needed for further clinical research, manufacturing and commercialization, regulatory help or a sales arm in another region of the world. Some collaborations illustrate different goals:

• In addition to the U.S.-India, Pfizer-Biocon partnership for diabetes drugs and devices and also for insulin, Biocon will also receive payments linked to Pfizer's sales of biosimilar insulin drugs of Sanofi-Aventis' Lantus, Novo Nordisk's NovoRapid, and Eli Lilly's Humalog, plus a recombinant human insulin product. Biocon remains responsible for the clinical development, manufacture and supply of these biosimilars, as well as for regulatory activities to secure approval. Its recombinant human insulin formulations are approved in 27 countries in developing markets and sold in 23, while its version of Lantus has been launched in India.
• A new partnership between India's Reliance Life Sciences (RLS) and Ireland's GeneMedix will provide new contract opportunities for European contract bio-manufacturers. The two firms will now run clinical trials, manufacture and commercialize the biosimilar drugs that are currently under development within their joint portfolios such as drugs for anemia and hepatitis C.
• Japan's Astellas Pharma and Aveo Pharmaceuticals, a Massachusetts-based company, have joined in a development partnership for a drug for kidney cancer that will challenge competitor products. With initial payments received, Aveo can also accelerate development and testing of the drug for breast and colon cancer.
• Dainippon Sumitomo Pharma in Japan and Intercept Pharmaceuticals, with corporate headquarters in New York, have completed an exclusive licensing agreement for the development and commercialization of Intercept's drug for chronic liver disease. DSP will advance the drug in Japan and China for the treatment of the diseases and has the exclusive option to add several other Asian countries to its territory, including Korea and Taiwan, as well as to pursue additional indications.
• Samsung enters the biosimilars market by creating a new joint venture company with Quintiles, a pharmaceutical services company in North Carolina, to construct a biopharmaceutical manufacturing plant in South Korea.

To partner or not to partner

To partner or not to partner requires making strategic decisions. A non-partnering strategy requires that the company can access resources and capital to develop and launch its product globally. If not, a selective or global partnership may be the next best option — provided the terms are attractive.

Companies most likely to succeed in the developing biosimilars marketplace will be those with ready access to the necessary product development and sales/marketing infrastructure. These could include established pharmaceutical companies with innovator and biosimilar divisions, such as Novartis-Sandoz or strategic alliances between European or U.S. generics specialists and established biosimilar manufacturers from unregulated markets such as the Far East. This is a market where anything can happen. Keep watch!

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