COVER STORY ENTREE Eastern European biotech firms are giving generic companies expertise in biopharmaceuticals. the innovator," says Richard L. DiCicco, president ofTechnology Catalysts, an industry consulting company based in Falls Church, Va. "And it almost seems that what a generic company must prove has to be negotiated with FDA on a case-by-case basis." If the generic company has to go through the same hoops as the innovator, the cost savings typical of generic drugs cannot be realized.
GENERICS NEXT WAVE: BIOPHARMACEUTICALS With major biotech drugs coming off patent, generic drug makers are looking to compete A. M A U R E E N R O U H I , C & E N W A S H I N G T O N
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with combined global sales in 2001 of $ 13.5 billion are slated to lose patent protection by 2006, according to a study by the business information company Datamonitor. If these were small-molecule drugs, several applications for generic versions almost certainly would have been filed by now with the Food & Drug Administration. Generic drug companies consider generic biopharmaceuticals—or biogenerics—to be the next big wave in their industry, but it's a wave they can't ride without legislative action. In many parts of the world, especially in Eastern Europe, biogenerics are already in the market. But in the U.S. and European Union, the absence ofspecific regulations for biogenerics is shutting off access to low-cost versions of biopharmaceuticals. On both sides ofthe Atlantic Ocean, the generics industry is clamoring for clear guidelines for approval of biogenerics. In the U.S., generic versions of smallmolecule drugs are approved through an Abbreviated New Drug Application, or A N D A (see page 57). With an ANDA, generic manufacturers use the safety and efficacy data of the already-approved HTTP://PUBS.ACS.ORG/CEN
brand-name product and only have to conduct limited studies to prove that their product is biologically equivalent. An abbreviated process for generic biopharmaceuticals does not exist. 'Anyone who has to make a biogeneric seems to have to go through the same process as
MORE AND MORE of the new chemical entities being approved by FDA are biopharmaceuticals. Some of these products are coming off patent, but they aren't facing any generic competition, even though it's not unusual for them to cost $100 per dose, says Jake Hansen, vice president of government affairs for Barr Laboratories. "There's no monopoly like a regulatory monopoly It can't be broken." The generics industry believes that FDA has the authority to make regulations for biogenerics, but FDA believes otherwise. So the generics industry is looking to Congress to force FDA to establish clear guidelines for generic competition in biopharmaceuticals. "The fight will be horrendous," Hansen says. "The biotech companies will throw a lot ofmoney to make sure they don't get competition." However, generic drug companies may have unexpected allies in this fight, Hansen says. "Large pharmaceutical companies with biological production capacity that
TIME'S UK
Eleven products face patent e:•cpiration by 2006
BRAND NAME
GENERIC NAME
SOURCES
Epogen or Procrit Novolin Neupogen Humulin Avonex Intron A Cerezyme or Ceredase Humatrope Activase
Epoetin alfa
Amgen, Johnson & Johnson, and Sankyo Novo Nordisk Amgen and Roche Eli Lilly Biogen Schering-Plough Genzyme
Human insulin Filgrastim Human insulin Interferon beta-1a Interferon alpha-2b Alglucerase
2001 GLOBAL SALES, $ MILLION $5,772 1,829 1,533 1,061
972 700a
570
311 a Eli Lilly Genentech, Boehringer 276 Ingelheim, Mitsubishi, and Kyowa Hakko Kogyo Genentech Nutropin 250 Somatropin Genentech 250 Protropin Somatrem $13,524 TOTAL (susceptible to generic conn petition] Somatropin Alteplase
U.S. PATENT EXPIRATION 2004 2005 2006 2001 2003 2002 2001 2003 2005
2003 2005
a Estimate. SOURCE: Datamonitor
C&EN / SEPTEMBER 23, 2002
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COVER STORY don't have a pipeline may be as interested in making biogenetics as small generic companies like us," he explains. "I wouldn't be surprised if some ofthe major pharma companies will outright join us in the battle or support us behind the scenes." UNDER CURRENT LAW, generic smallmolecule drugs are approved on the basis of essential similarity of the active ingredient and the bioequivalence of the drug to the brand-name product. For chemical products, proving these characteristics is straightforward. A small molecule can be precisely characterized. Bioequivalence can be established with lab and limited clinical studies. The same assumptions do not apply to biopharmaceuticals, which are proteins. Proteins are more difficult to characterize exactly than small molecules, because their activity depends not only on composition but also on conformation. In addition, a clear understanding of how process changes affect structure and biological activity does not exist, according to Enrico T. Polastro, a vice president and senior industry analyst at Arthur D. Little Benelux.
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"There is a belief that a minor change in process might trigger changes in biological activity," he explains. Hence, using the innovator product's data to support a marketing application—as is done with smallmolecule drugs —is untenable with biopharmaceuticals. ic We will have to do limited clinical studies comparing our product to the refer-
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cal versions are not exactly the same." Many believe that a pathway for approving biogenerics will be in place in the U.S. sooner or later. "These drugs are very expensive and very effective," Samson notes. "Those paying for these products are going to do whatever they can to help develop a generic bio tech line. It's something this country needs." "It is only sensible for the various regulatory authorities to set up some pathway" says Neal Hansen, an analyst at Datamonitor. "Our estimate is that by 2006 a pathway will be in place and that by 2007 the first biogeneric will be launched."
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BUT BIOGENERICS ARE not likely to gain an entry into the market without stiff resistance from current patent holders, he suggests. "If you think patent litigation is bad now, wait until Amgen begins suing over the different ways its patents are being infringed. That will go on forever." Meanwhile, generic companies are preparing for the coming of biogenerics in the U.S. and Western Europe. At Sicor, for example, "biotech will be a very important part of our future," Samson says. The company just recently acquired Biotechna U.A.B., in Vilnius, Lithuania, as its entree to biogenerics. Biotechna makes and sells recombinant proteins such as interferon alpha-2b and human growth hormone in Eastern Europe, parts ofAfrica, and the Middle East. "The next part of our strategy is to enter Western Europe, probably in 2 0 0 4 or 2 0 0 5 . Eventually we will bring these products into the U.S. in 2006 or 2007," Samson says. Last year, Ivax Corp., headquartered in Miami, bought the part of Indiana Protein Technologies Inc., that it didn't already own. I P T specializes in using recombinant protein technology and gives Ivax biological production capability In 1999, Teva Pharmaceutical Industries Ltd., the world's biggest generic drug firm and Israel's largest pharmaceutical company, formed an alliance with BioTechnology General Corp., based in Iselin, N J., to develop and commercialize generic recombinant therapeutic products. In Europe, the German company StadaArzneimittel AG is leading generic drug makers into biogenerics through a cooperative arrangement with DSM Biologies that began last year. Stada expects to market biogenerics in mid-2005 and estimates sales to reach $100 million by mid-2008. Arthur D. Little's Polastro, however, is cautious about biogenerics. Compounding the current complex and ill-defined HTTP://PUBS.ACS.ORG/CEN
COVER STORY regulatory environments in the U.S. and Western Europe is the fact that the field of biopharmaceuticals is young, he says. "New products are being introduced that are making the first-generation products obsolete," he explains. For example, interferons are being superseded by so-called PEGylated interferons, in which the protein is anchored to a polyethylene glycol support. "These products are cannibalizing the market share of the first-generation products, leaving biogenerics with little space. There is no sense in making generic versions of older products. Companies that have tried have been bitterly disappointed." In the meantime, because the shortage in biomanufacturing capacity has not been relieved, enormous opportunities await fine chemicals companies. If they have the capacity, clients will flock to them, according to DiCicco. "We have lists of potential customers looking for fine chemicals companies to
manufacture both brand-name and generic biopharmaceuticals," DiCicco says. This maybe the route through which some exclusive-synthesis-only fine chemicals companies—such as Lonza—can be involved in multisource active pharmaceutical ingredients, he notes. Because of the current shortage in biopharmaceutical capacity, companies like Lonza could well be manufacturing biogenerics withinfiveyears, he adds. Potentially exacerbating t h e capacity crunch—and enhancing opportunities for fine chemicals companies with biomanufacturing capacity—is the development of new delivery systems for biopharmaceuticals. Innovator companies are working with drugdelivery firms to make oral formulations of biopharmaceuticals, according to DiCicco. "If a biopharmaceutical is delivered anyway other than injection, you'll need more active ingredient, and that's good for the active-ingredient manufacturers, if they have the capacity."
"There's no monopoly like a regulatory monopoly. It can't be broken."
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