The Big Red Biotech Blog

Samuel Johnson paraphrased

"Your Big Red Biotech Blog is both good and original; but the part that is good is not original, and the part that is original is not good."

VC Funding Down in Qtr 1 a Problem?

An analysis of venture capital funding for biotechs in Qtr 1 showed it dropped by 43%.   PricewaterhouseCoopers did further work to show that companies who received their first round of funding dropped by 53% and dollars invested in deals dropped 38%.

This has been taken by some as an indication that the biotech arena is starving for cash to support the growth of new companies.  Of course, the movement of VCs out of this area has also been a hot topic the past few years. 

However, Bruce Booth of Atlas Venture is less worried. And......he actually makes his living in VC.  Booth says that one shouldn't get too upset over quarter to quarter variations in investments.  He notes that Qtr 1 2012 is still within 10% of Qtr 1 2011 -- which turned out to be a good VC year in life sciences.  Finally, he says that VC investing in biotech as a percentage of total VC capital has remained pretty stable over the last decade at approximately 25%. See Fierce Biotech. Not to worry.

 

 

 

 

 

Posted by Bruce Lehr May 10th 2012

FDA Tilts Positively Toward Accelerated Approval of "Breakthrough" Drugs

From Fierce Biotech (via Reuters), a new law is expected this year to allow the FDA to approve breakthrough drugs more quickly by allowing applicants to conduct speedier trials with fewer patients. The system would be modeled on the speedy approval process used for HIV treatments decades ago.

The FDA has approved several drugs recently in accelerated fashion, including Vertex' Kalydeco for CF, Pfizer's Xalkori and Roche's Zelboraf for skin cancer. Dr. Woodcock, the FDA's director, has been vocal in her advocacy for giving the agency the latitude to make fast approvals for drugs that show breakthrough promise in the clinic -- particularly for serious diseases with few treatment options.  The drugs, of course, would have to pass safety muster as well.

Posted by Bruce Lehr May 9th 2012.

 

Indian minister rails against anti-generics smear campaign

The Indian government says multinational companies are running "a concerted campaign" against its generics industry!

Indian minister rails against anti-generics smear campaign.

"A concerted campaign against Indian pharma industry has been launched by MNC's whose interests are getting adversely impacted due to increasing global presence of Indian pharma companies", said Shri Anand Sharma, Indian Minister of of Industry and Commerce.

India is now billing itself as the "Pharmacy for the World" in response.  A central theme in this campaign is to show generic drugs produced in India meet the quality standards of drugs produced in Western countries or by Western competitors.

India is not going to take it anymore.

 

 Posted by Bruce Lehr May 9th 2012.

Biosimilars Not Only Threat Facing Biopharma

As this piece from BioProcess Blog points out, biosimilar competition is only one hazard faced by biopharma producers of the world's top bio drugs. In addition to increased price competition, there are the unscrupulous drug counterfeiters (see recent Avastin issues).  There is also the possibility of compulsory licenses being invoked in places like India (see recent Nexavar case). 

Biosimilar Competition is Only One of Several Threats Facing Biopharma Blockbuster Drugs.

These type of developments led PhRMA President and CEO John Castellani recently to comment, "If countries begin to routinely use complusory licenses, we could see a 'race to the bottom' in which governments in the developing world walk awayfrom their responsibility to support research and innovation in public health. In the absence of investment made by our members, and the resulting research and development, there would be no generic medicines for the world's patients."

As we say in Oz, "Biosimilars, Counterfeits and Compulsory Licenses, Oh My!"

 

Posted by Bruce Lehr May 8th 2012.

Bayer Challenges Compulsory License In India

To no one's surprise Bayer has gone back to court to challenge the India Patents Office decision to award a compulsory license to the generic manufacturer Natco to make Bayer's patented anti cancer drug Nexavar.  The IPO invoked compulsory license rules citing Bayer's high selling price ($5500 per patient/month) as preventing most India patients from using the drug. Natco will sell its version for $175 or a 97% decrease.

Bayer Challenges Compulsory License In India // Pharmalot.

“We will rigorously continue to defend our intellectual property rights which are a prerequisite for bringing innovative medicines to patients,” a Bayer spokesman writes us. “The challenges faced by the Indian healthcare system have little or nothing to do with patents on pharmaceutical products as all products on India’s essential drug list are not patented.  Rather, the order of the Patent Controller of India damages the international patent system and endangers pharmaceutical research."

“This is the trivial argument Big Pharma has been making for years to cover the impact of its monopoly pricing policies,” writes Brook Baker, a professor in the Program on Human Rights and the Global Economy at the Northeastern University School of Law, and a member of Health Gap, Global Access Project. “Of course, there are other barriers to access, but does Bayer want to seriously argue that medicine priced 60 times more than the newly announced Cipla price doesn’t adversely impact access?"

Bayer unmoved, appears ready for an all out legal fight, you could say "they are going to the Madras" on this one.

 

Posted by Bruce Lehr May 7th 2012

Biotech Markets and Funding

Here's a good article by Bruce Booth of the Life Sci VC blog discussing the heyday of IPOs in the 1991-1994 span versus, the history of these deals to date, and the current investment environment.  What's the story?

IPOs of that era paid handsomely to the VC backers of the time.  The average step-up in valuation over the private invested capital was -- 4x.   There was a very low cost-of-capital provided by public equity investors in that period. Much lower than today.  For most of the past decade, step-ups on total invested capital have typically been only 1.5x or so.  Sadly, high capital intensity has been the signature of many of the past decade’s IPO stories.

The playing field has changed since then as investors realized over that time span that only a subset of the 1991-1994 IPO window have accrued real value over time.  Gilead, MedImmune and Vertex might be considered notable exceptions.  Most of the other IPOs have underperformed all the major indices.

 Booth instructs that there is a major flaw in the former IPO model that 3 main features:

• high capital intensity funding large portfolios, requiring serial public equity, with little focus on capital efficiency
• endless cycles of “rinse and repeat” anti-shareholder behaviors where new investors are recruited to fund the promise at the expense of existing shareholder dilution
• management teams too focused on “built-to-last” company survival vs shareholder value maximization, even when the best outcome for existing shareholders, and often patients, is to sell now and access the balance sheet resources of a bigger company

These flaws have led to IPOs a less attractive means of fudning.  As Booth says, if most IPOs trade down after their IPOs, why bother buying at the offering.  Seems rational.  So in the current environment, private backers are becoming more activist and push for strategies that maximize their return in these companies -- which includes the proposition of selling the company "realtively early" to big pharma players. This avoids the dilution problem described above if trying to go the long haul.  The old IPO model is gone.

In the current situation, one of the big change drivers is Big Pharma R&D productivity issues and their increasingly active M&A interests.  Big Pharma in recent weeks has tried to make deals for Human Genome Sciences, Amylin and Illumina -- but were thwarted by big shareholder interests. As described above, activist big shareholders are playing a larger role in trying to maximize their investments and have resisted these perceived "low ball" offers. With more buyers crowding into the market, the pressure to pay a premium is just going to go higher. That's a trend with which biotech investors are well attuned.  See Fierce Biotech. 

Posted by Bruce Lehr May 5th 2012

 

 

Good Article on Security of Virtual Biotechs

Here is a good article from Stewart Lyman at Xconomy (I find I like a lot of Stewart's articles) regarding the solidity and security of virtual biotechs. The article questions whether this is a model that we'd want to perpetuate as a dominant form. Why not?

The basic argument against this type of company has two main prongs.  The more serious of the two in my view is that these companies are often built on a research idea or premise that they acquired somewhere else (often academia) and don't have the wherewithal to confirm whether the science is sound. If these companies embark on a development program with the underlying science being bad, they are doomed to fail.  Stewart cites many cases where the literature is either flawed (retractions) or non-reproducible. See the Amgen and  Bayer studies on this issue.  Reproducibility was less than 11% for "landmark" cancer papers for example.

The second argument is because the companies are virtual, they don't contribute to the development of vibrant biotech clusters. Clusters help sustain an ecosystem by providing a steady labor pool and a critical mass of intellectual power and innovation. Leading biotech clusters continue to draw investment in places like Boston, San Francisco and San Diego. Virtual companies -- are well -- virtual. They don't provide a lot of infrastructure and contribution to clusters.

The main reason virtual biotechs are popular of course is that they reduce the capital needs of the company.  The company really then focuses on a good management team and hopefully a good molecule/technology. But if the quality of the latter is compromised, that's where the idea falls apart. And of course, these companies are really just building a project to be sold.

Posted by Bruce Lehr May 4th 2012.

New Drug Development Financing Tool?

Andrew Lo, an MIT finance engineering professor, when he floated idea of funding new drug development with CDOs -- collateralized drug obligations.  The CDOs would be able to invest in a series of drug development projects that would pay returns if they resulted in successful treatments reaching the market.

The idea would be for investors to put up $50 B to $100 B to fund 150 drug projects over 10 years.  Hopefully, this would be another funding mechanism and would relieve pressure on getting all the funding from government sources, weakened VC networks and Big Pharma itself.

Naysayers may point out that the CDO concept didn't work out too well for housing and mortgages -- but Lo counters that he forsees a big funding gap for drugs in the coming years and that this would mean a drop in new treatments. 

Lo says, "If there's a cancer bubble, I can live with that."  I don't know if CDOs are viable but I like the novel thinking to bring an idea like that to the table for consideration. See Fierce Biotech.

Posted by Bruce Lehr May 4th 2012.  

NIH Cuts First Translational Science Deal

Yesterday, Francis Collins announced that the NIH has secured a deal with Pfizer, AZ and Eli Lilly to collaborate on existing compounds to look for new uses (disease treatments) for them. The four-way partnership will be led by the NIH's new National Center for Advancing Translational Sciences (NCATS).  Collins of course has been a major proponent of the center and the need to speed up the pace at which discoveries are turned to medicines.

This pilot program has legal templates established among the players which should clear IP hurdles that could bog things down. The rationale for looking at exisiting drugs is that sometimes a drug developed for one disease does work for another -- e.g. AZT developed for cance rbut was ultimately applied to AIDS.  These existing drugs have many times also undergone previous safety testing so not having to redo safety work can also speed the development process.

Collins is excited to get started. He notes that researchers have identified the causes of 4500 diseases but only 250 have developed treatments.  Collins says, "The future has never looked brighter in terms of the promise of biomedical research, but we have to be smarter than ever, and we have to look for new partnerships."

It is expected that other members of Big Pharma will join the party when the pilot program gets underway and especially if it bears some early fruit.  See Xconomy and Fierce Biotech.

Posted by Bruce Lehr May 4th 2012.

First mAb Submitted to EMA for Biosimilar Approval

A biosimilar version of Remicade (anti-TNF drug) is the first mAb to be submitted to the EMA for review.  Celltrion is believed to be the company making the submission, although this has not been formally revealed.  Celltrion has conducted clinical trials with its version of the drug in 19 countries over the past 2 years. There are 16 -- yes 16 -- approved indications for Remicade.  It is not known if Celltrion is seeking approval for only the RA indication (matching trials) or going for additional indications as well.  Extrapolation of safety and efficacy data from one indication to others is allowed potentially so it is a pertinent question.

First Monoclonal Antibody Submitted to EMA for Biosimilar Approval.

 The anti-TNF market is estimated to be worth $21 B. Analysts are torn as to whether a biosimilar version is a bigger threat to J&J's Remicade or whether a (humanized) biobetter version of the antibody will more likely prevail.  J&J has its own humanized replacment called Simponi. Celltrion is betting on gettig share however and is submitting its application well ahead of Remicade's 2014 patent expiration date. Celltrion will also go to Korea and other emerging markets in Asia and Central/South America where Remicade is not under patent.

Now, we all wait to see how Celltrion's application does at EMA.  More mAb biosimilar applications are expected to be submitted to EMA this year.  Whether these have a huge impact on the market, depends upon how easily they are approved and whether companies like Celltrion (or Samsung) can make good on their promise to drop prices by 40-50% over the reference product. The race has begun in earnest now.

Posted by Bruce Lehr May 2nd 2012.

India to Invest cGMP Compliance for Vaccines

Four years ago, Indian regulators suspended licenses on 3 vaccine manufacturing facilities due to quality issues.  The suspensions resulted in vaccine shortages to great hue and outcry by the populace.  The government will now invest $37 M in plant upgrades to cGMP.

India plans $37m investment in vaccine cGMP compliance.

The DPT vaccine facility in Coonoor and BCG vaccine facility in Chennai will receive the bulk of the new investment.  Upgrades are nearly complete now at the third facility in Kasauli.  The government wants to see the improvement in quality and to boost vaccine output. 

HLL, a company best known for producing condoms, is responsible for making the upgrades.  Now, that's what I call real prophylaxis.

Posted by Bruce Lehr May 2nd 2012.

First Drug With $1 Million Price?

Here's an article from Matthew Herper's column in Forbes that discusses whether the first drug that costs more than $1 million annually is already on the market -- and we just don't realize it yet.  Interesting to ponder for sure -- and perhaps horrifying.

I wonder if this is a reason that many people back the concept of biosimilars down the road.  Seems clear [to me] that governments won't sustain this type of pricing for long.

Posted by Bruce Lehr May 1st 2012.

Berwick: Cost Effectiveness is Permanent Condition

Here is an Xconomy post from yesterday that highlights remarks made by Dr. Donald Berwick, the former administrator of the Center for Medicare and Medicaid Services.  He spoke last week in California at an invitation-only conference of healthcare executives and investors sponsored by the private equity firm Health Evolution Partners. He spoke about our health care system and health care reform. 

Dr. Berwick said that it would be a tragedy for America should the Supreme Court strike down the Obama Administration’s Affordable Care Act. Yet his primary theme was that it was getting very late in the game to slow the aggregate cost of health care as the baby boomers come into retirement. Citing his recent article in JAMA, Berwick noted that the sum of the lowest available estimates indicate that in excess of 20 percent of total health care expenditures is wasted. Berwick suspects we are really wasting one of every three dollars that we spend. This seems consistent with the oft-cited disparity between total US health care spending and outcomes in this country. 

The urgency of cost control is now such that, he said, there will be big reductions. The only question is whether we will do it in a good way or a bad way.  As to the future impact of all this on innovative life sciences companies, Berwick sounded an unmistakable warning. “If your products are expensive, it will be challenging; if yours is a firm focused on controlling costs, then your time has come.” In other words, biotech and medical device companies had better develop their case for cost effectiveness as their products enter into clinical development, because mere efficacy and safety may not get you paid in this brave new world.

What do you think his position would be relative to Abbott's strategy below to challenge the validity of biosimilars?

Posted by Bruce Lehr May 1st 2012.

 

 

More on Abbott Anti-Biosimilar Petition to FDA

I posted a few days ago on Abbott's letter to the FDA urging it to reconsider its policy on reviewing biosimilars.  Abbott argues that to approve any biosimilar that is challenging a reference product filed prior to the law's enactment in March 2010 will necessarily cause the FDA to use innovator company trade secrets in their analysis -- and thereby violate provisions in the 5th amendment.  Provocative, yes?

If Abbott's argument is correct or at least has good chance of being found so in the federal courts, this would seem to completely undermine the intent in geting biosimilars approved, and certainly would hamer any positive healthcare budgetary effects (i.e. saving drug costs) that Congress may have been seeking in passing this legislation.

Read more here in today's Pharmalot blog.

Posted by Bruce Lehr May 1st 2012.

Tufts Report on Academic-Biopharm Partnerships

A new Tufts Center for the Study of Drug Development study shows academic medical center (AMC) and biotech partnerships are increasingly important to basic research and developing new medicines. The study looked at 3000 grants to AMCs from 450 biopharm sponsors through 22 medical schools. Their conclusion is that the nature of these partnerships is continuing to evolve and that they have not yet reached their full potential.

The report looks at 12 primary partnership models of AMC-biopharm collaboration. There is a shift occuring toward more risk- and resource-sharing models rather than the more traditional unrestricted research or fee for service models of the recent past.  Rather a range of partnership models is arising from corporate venture funds to pre-competitive research centers to academic drug discovery centers.

The report concludes that in the face of an increasingly challenging R&D environment (often discussd here) and overall global competition, we are likely to see the continued proliferation of AMC-biopharm partnerships.

See full report. Download Tufts AMC-biopharm R&D study

Posted by Bruce Lehr Apr 30th 2012.  

Supreme Court Sets AMP v. USPTO (Myriad) Schedule

According to the Patent Docs blog, the Supreme court has asked the all participants in "Myriad case" to submit  briefs addressing "the applicability of the Court's recent decision in Mayo" to Myriad's isolated DNA claims. If you are so inclined, the Court also invited the submission of amici briefs by June 15th.

Oral arguments will then follow on July 20th for those who want to have their hot popcorn ready in front row seats.

Posted by Bruce Lehr Apr 30th 2012.

Big Pharma Revenue Holes: How Low Can You Go?

Derek Lowe reminds us that some of the Big Pharma companies out there have BIG BIG BIG revenue holes to fill between now and 2020.  Take a look at both Lilly and AZ's challenges ahead. Though Pfizer ain't far behind itself. Looks like AZ's whether by his choice or the board's go out while the getting's good.

See here for yourself!  The graph shows Big Pharma's expected revenues through 2020 on its existing product portfolio.  Lilly and AZ?  All we can say is "OUCH".

Posted by Bruce Lehr Apr 30th 2012.

PhRMA Criticizes Biosimilar Flexibility

PhRMA has weighed in with its comments to the FDA guidelines on biosimilars.  In those, the trade group says that the FDA should not allow biosimilar manufacturers potential flexibility in delivery devices and formulations -- and still regulate it as a biosimilar.

PhRMA speaks out against FDA biosimilar flexibility.

A spokesman for PhRMA said, "Intentionally introducing differences to the molecule or the finished product will increase the level of uncertainty regarding the proposed biosimilar's similarity to the reference product. The statute imposes a scientifically rigorous standard that each product must be highly similar to its reference product.  Statutory considerations therefore cousel that FDA guidance should recommend that applicants minimize controllable process and design differences."

Several Big Pharma and BIO have weighed in with similar comments. 

Posted by Bruce Lehr Apr 30th 2012

Merck Less Bullish on Biosimilars?

Merck BioVentures, the biosimilars endeavor set up by Merck & Co. in late 2008, is being subsumed into the biologics and vaccines division of Merck Research Laboratories. Mike Kamarck, who has led BioVentures since 2010, has left the company.

The IN VIVO Blog: Merck Says Goodbye to Independent Biosimilars Unit.

Biosimilars may indeed be a new kind of innovation, one that brand-focused biologics companies would be foolish to discount and one that many seem to be tripping over themselves to embrace (see Amgen/Watson, Baxter/Momenta, Biogen/Samsung).

Merck's move to reduce its BioVentures group at least in stature seems to raise doubts on its attitudes toward biosimilars and is at odds with the bullish attitude of groups like Novartis' Sandoz unit, which just this week predicted incredible growth for its own biosimilars business. That said, it’s hard to say whether this retrenchment will be part of the long-term learning process or bigger strategic shift, as the whole field is in the midst of an evolution and successful business models have yet to fully materialize.

Posted by Bruce Lehr Apr 27th 2012.

BIO Voices its Comments on Biosimilars to FDA

BIO's response to proposed FDA guidelines is covered nicely in the Patent Docs blog. 

BIO asks FDA to publish specific statistics and/or ranges acceptable  for a determination of biosimilarity following the European model. BIO advocates for a more extensive clinical trial requirement to establish biosimilarity, including animal toxicity and human clinical trials. BIO also suggests a "cautious approach" to the extrapolation of data to other indications and patient populations without trials. BIO also asks for prominent labeling of the biosimilar to highight differences in route of adminsitration, presentations and conditions of use (presumably will inhibit switching) between biosimilar and reference product.

BIO also had comments related to quality and access to confidential information. On the quality front, BIO aks that any intentional differences from the biosimilar in host cell type, primary structure, formulation, or immediate package from the reference product result in immediate need to follow the BLA pathway and not ABLA.  BIO cites patient safety as the reason for this standard.

BIO requested explicit acknowledgement from the FDA that certain information within the reference BLA, including manufacturing facilities, be treated as confidential (see Abbott response to FDA in earlier blog post).  BIO disfavors comparison of a biosimilar to a non-US licensed product but wants to be particularly protective of manufacturing information in this instance. Trade secrets from all BLA must be protected from disclosure in biosimilar application process. The ABLA must stand on its own merit, supplemented with only public information.

In general, BIO suggests changes that will make it more difficult to gain ABLA (abbreviated biosimilar) approval.  These would appear to enhance patient safety and to also protect the competitive advantage of its BLA holder members.

Posted by Bruce Lehr Apr 26th 2012

New Drugs -- If You Can't Make 'Em, Buy 'Em

That seems to be the current motto of many big pharma companies and describes their relationship to biotechs.  But if you go that route, you will pay handsomely.  Fierce Biotech reports (via Bloomberg) that pharma companies are forking over on average a 71% premium in picking up new biotechs (worth > $500 M) for their pipelines.  This is reportdly the highest premium since 2000. 

So if you read the previous post about "bad culture" in Big Pharma, another cost (beyond poor R&D productivity) seems to be having to pay the piper when it comes to buying from the biotechs. Cutting the R&D budget likely won't help rectify that -- although it may help fund it a bit. 

Supply and demand is taking over and the acquisition prices will keep rising as a result in the short term.

Posted by Bruce Lehr Apr 25th 2012.

Pharma R&D Follies

Here's a couple of links to blog posts outlining possible reasons that Big Pharma R&D is experiencing such a low return in bringing new products to market --- especially over the last 10 years.  One factor that is discussed is -- CULTURE (see Life Sci VC and In the Pipeline). 

The basic premise?  

Fundamentally, I think the bulk of the last decade’s productivity decline is attributable to a culture problem. The Big Pharma culture has been homogenized, purified, sterilized, whipped, stirred, filtered, etc and lost its ability to ferment the good stuff required to innovate. This isn’t covered in most reviews of the productivity challenge facing our industry, because its nearly impossible to quantify, but it’s well known and a huge issue.

These effects are variously attributed to a multitude of large cross functional committes, with all their associated bureacracy, making all the decisions very s-l-o-w-l-y......, risk aversion (i.e. ass covering) and unwillingness to kill bad projects before they've dragged on past their due date, and mega-mergers or internal reorgs that constantly stall projects while all the new players and pieces get assembled and reassembled. All of this plays havoc on continuity, quick decision making, empowerment of development teams, nimbleness, innovation, blah blah blah --basically all the positive characteristics organizations say they are striving for.

But the basic conclusion, for now, is that Big Pharma's culture is its own worst enemy when it comes to R&D productivity.  There seems to be a need to simplify and empower teams if you really want to see any results in an acceptable time frame.

The stakes are high too. If you doubt that, just look at this article from Fierce Biotech that details the R&D spending of the Top 10 Big Pharma -- which is topping $70 B per annum now.  Then look at the productivity of many of these same organizations as judged by new drug introductions in the last 10 years........not very pretty.

Posted by Bruce Lehr Apr 25th 2012.

 

Amgen warns biosimilar draft a threat to production innovation

The FDA is currently soliciting feedback to its recently published biosimilar guidelines.  Understandably, many among innovator pharma have comments to provide.  In its recent comments, Amgen asks the FDA if manufacturers are going to have to "maintain biosimilarity after approval."  If so, Amgen warns this requirement over time would stifle upgrades in manufacturing and quality improvements -- which would be bad for patients and a burden to the industry.  This could apply equally to innovators and biogenerics producers post-approval.

Amgen warns biosimilar draft a threat to production innovation.

Amgen suggests that a biosimilar applicant make its comparisons to the innovator product during a limited period of time and then establish a reference standard. Amgen then wants the FDA to treat the innovator product and the biosimilar as separae drugs from that point forward. Then each can make changes to their manufacturing or quality based on the mertis of their own data.

Industry commentators note however this would have implications on interchangeability -- likely the above approach would prevent these products from ever being considered interchangeable. Of course, Big Pharma and BIO have their reasons for not wanting to see interchangeability adopted anytime soon.

Posted by Bruce Lehr Apr 25th 2012.

 

 

 

 

Abbott Moves to Block Many Biosimilar Applications

The Biologics Price Competition and Innovation Act (BPCIA) was signed into law on March 23, 2010.  It is the basis for establishing an approval pathway for biosimilars.  In early April this year, Abbott petitioned the FDA to disallow any biosimilar applications that cited a reference drug's BLA that was submitted prior to the March 23rd date.  Abbott's legal representatives contend that the FDA's consideration of such materials would violate the Fifth Amendment. See Patent Docs blog.

It seems the Fifth Amendment, in addition to protecting one's right against self-incrimination, also "prohibits the taking of private property for public use without just compensation."  Abbott says the FDA would be dong just that if they use data from a BLA (filed before March 23, 2010) to allow a biosimilar drug on the market.  Prior to March 23rd, Abbott contends that it and other similar BLA filers had the expectation that the information in their filing would remain guarded as a trade secret, and the FDA is now about to reverse that policy.  Abbott specifically mentions BLA 125057 for Humira® (adalimumab) as one BLA to be protected in its FDA petition.  The drug is a known target of biosimilar "producers to be".  Even as I type, it is earning its way to becoming the TOP SELLING drug in the world in 2012 with more than $9.3 B in projected revenues.

Abbott's argument in a nutshell. 

Reference product sponsors invested massively in bringing products to market, taking great risk to develop, test, and seek a license to market the reference product.   Abbott argues that an innovator's  license application typically reflects more than a decade of research and contains analytical, preclinical, and clinical data, as well as detailed manufacturing information, most of which qualifies as trade secrets.  It further contends that these trade secrets are the private property of the reference product sponsor and are therefore protected by the Fifth Amendment to the U.S. Constitution.  And [the coup de grace] according to Abbott's Petition, when the FDA approves a biosimilar biological product on the grounds that the reference product has been shown safe, pure, and potent, it uses these trade secrets. Abbott says only biosimilar applications citing data filed after March 23, 2010 should be allowed.

Abbott finishes its Petition by requesting that the FDA interpret the BPCIA as applying only to post-enactment reference products, thereby avoiding both significant constitutional questions and significant governmental liability. 

 Abbott even cited a Supreme Court case -- Ruckelshaus v. Monsanto Co.  (1984) -- involving a somewhat analogous situation where Monsanto submitted a trade secret to the EPA in support of a pesticide license application.  The Supreme court did rule in this instance that trade secrets were protected under the 5th amendment and that Monsanto had an expectation that the goverment would not use the information to benefit a competitor in their license application -- instead their data "would remain inviolate."

Wow...this completely undermines the intent of the biosimilars legislation does it not?  Sounds eerily similar to me. I think it would be bad public policy to block biosimilars but I think Abbott's argument is ingenious to say the least.  Right now, this is just a petition to the FDA to influence how it chooses to set policy, now we'll have to wait anxiously to hear the agency response. You can see this argument potentially going to some court however.

Posted by Bruce Lehr Apr 24th 2012.

 

 

Biosimilars: If You Can't Beat 'Em Block 'Em

The Alliance for Safe Biologic Medicines urges the FDA to adopt "steps to ensure patient safety is at the forefront of the biosimilars pathway."  Further, the FDA needs to "make clear that clinical studies will be necessary for the foreseeable future due to the complexity and diversity of human biology and the limits of scientific knowledge today."  The Alliance is a trade organization composed of biopharma companies and individuals that has set up to advise the FDA on biosimilars policy while it is under discussion (i.e. a trade lobby).  Company's like Novo Nordisk and Roche (Genentech) are members.  See in-Pharma Technologist and Fierce Biotech here and here.

They appear to be asking the FDA to make its proposed regulations less flexible than they are currently written and to impose more strict guidelines requiring clinical trials, as well as sterner traceability measures and a pharmacovigilance system that "distinguishes a biologic reference product from its biosimilar."

I've written before that I think delay tactics to make it harder to get biosimilars to the market (and at a higher cost) are so much whistling past the graveyard (see blog post).  To me, the economic and government forces favoring the implementation of biosimilar guidelines and subsequent approval of these products is a given.  Governments want to save on healthcare costs, it's that simple.  Will they compromise safety to do so?  No.  But, I think they will try to set up flexible approval systems that give the regulatory bodies some latitude to approve some biosimilar applications faster than others with more or less clinical data support needed depending on the situation. The FDA seems to be giving itself some flexibility.

I don't see innovators trying to delay implementation and market competition as a very effective strategy.  It's ironic that many of the innovators themselves are likely to be among the first biosimilar applicants (with a competitor's drug of course).  I'm further amused that many of these same companies are simultaneously in favor of other legislative efforts underway (FAST, TREAT, etc.) to speed the drug approval process.  In that instance, they've suggested only safety data is needed and a "case by case" consideration of drug licenses -- particularly for diseases without other good treatment options -- is just the way to go (see blog posts here and here).

I think we should get on with it.  Get biosimilar guidelines in place and get the process toward approval started. Biosimilars ARE coming.  If innovators want to be innovators, then innovate. If they want to be biosimilar competitors, then compete -- but don't block or slow the process down.

Posted by Bruce Lehr Apr 18th 2012.