Recent big conglomerate entrants into the global biosimilars race reminds me of the diversification moves by conglomerates into biotechs in the 1970's. Everyone wants a piece of the action in a market that is exepcted to grow rapidly over the next 10 years -- but one that will also require big bucks to play on a global scale. On average, biosimilars will require about $100 million and five to six years to develop, reflecting the need for clinical trials to prove safety and efficacy in regulated markets such as Europe and the United States.
Reuters reports that major companies (and up to now NON biotech players) like Korea's Samsung and Hanwha, India's Reliance and Japan's Fuji (say cheese) are entering the race to develop biosimilars by partnering with companies in the biotech sphere. These companies see biosimilars as a next-generation business that will help them to diversify and provide a hedge against the possible decline in their mainstream operations. But, few companies have all the manufacturing, development and marketing skills needed to produce and sell such products, so the hunt is on for smart partnerships.
Merck and Hanwha have hooked up on a copy of Amgen's Enbrel. Samsung set up a biosimilar venture in partnership with Quintiles. Celltrion and LG Life Sciences are other South Korean players with global ambitions in biosimilars, while Dr Reddy's has been selling a copycat version of Roche's Rituxan cancer drug in India since 2007. The global heavyweights are likely to include top makers of traditional generic drugs, such as Israel's Teva and Sandoz, the generics unit of Switzerland's Novartis, as well as Big Pharma interlopers like Merck and Pfizer, which inked a deal with India's Biocon last year.
The prize is huge. Over the next decade, patents on biotech drugs with global sales of 90 billion euros ($127.5 billion) are set to expire, according to the European Generic Medicines Association (EGA), opening the door to copycat products.
Posted by Bruce Lehr June 26th 2011.
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