In September 2018, we were involved in a potential infringement litigation in Europe ahead of a launch of a biosimilar of a blockbuster medicine, where the ‘fill and finish’ was outsourced to an Indian company by the EU biosimilar licence holder. The matter got resolved through a global settlement, but it got me thinking about the potential of developing true biosimilars by the Indian biopharma industry, leapfrogging into a value-added business model (rather than just ‘fill and finish”) with a focus on expanding access for patients not only in India but also in other countries.
There is increased activity and growth in the biosimilars market globally with some of the best-selling biologics going off-patent. It is estimated that the global biosimilars market will touch $15 billion by 2020. In December 2018, NHS England, which oversees Britain’s health services, saved 300 million pounds by switching to biosimilar of Adalimumab after the patent expired.
According to a 2018 McKinsey report, the biosimilar market in EU is under pressure from the dual and related impacts of price discounting and competition. With the prolonged slow growth in the US, companies are struggling with offsetting the significant development costs ranging from $100-300 million with 75 percent of the cost going to conducting therapeutic equivalence trials. Companies are exploring new approaches to clinical trials, forming joint ventures, and employing CROs. In October 2018, Imraldi (adalimumab) became the third anti-TNF biosimilar developed by Samsung Bioepis to be commercialised by Biogen across Europe, following BENEPALI (etanercept) and FLIXABI (infliximab).
What Are Biosimilars?
A biosimilar product is a biologic product that is approved based on demonstrating that it is highly similar to an already approved biologic product, reference product (RP), and has no clinically meaningful differences in terms of quality characteristics, biological activity, safety and effectiveness from the RP.
The principle of interchangeability of small-molecule drugs does not apply to biosimilars because the active ingredients of biosimilars are huge molecules with complex, heterogeneous structures, and these are difficult to replicate in every detail. Therefore, regulatory agencies of the EU (EMA) and the US (USFDA) have introduced unique regulatory biosimilar pathway to establish therapeutic equivalence.
The EU biosimilars market is the most mature in the world. As of March 31, 2018, there are more than 40 EMA approved biosimilar products. In 2003, the EMA was the first to establish a legal framework for approving biosimilars within the EU. It approved the first biosimilar, Omnitrope (somatropin), in 2006.
In 2010, the US put in place a still evolving Biologics Price Competition and Innovation Act (BPCIA). Since approving the first biosimilar medicine in March 2015, the USFDA has approved 15 biosimilars until December 2018. In January 2017, the FDA released its first draft guidance on demonstrating interchangeability of biosimilars. In April 2018, the USFDA said that it is contemplating revised guidance — lowering the bar for demonstrating interchangeability, reducing the size of studies necessary to demonstrate biosimilarity and so on. And in May 2018, the HHS issued a policy statement in support of switching to biosimilars.
The Indian Story
In India, all biological/recombinant DNA drug products, including biosimilars, are regulated as “New Drugs” under the Drugs and Cosmetics Act, 1940 and Rules (DCA/DCR). On September 15, 2012, India issued the “Guidelines on Similar Biologic”. The guidelines were on a par with the WHO’s international guidelines and provided a detailed and structured regulatory pathway for comparison of biosimilar with RP to test the safety, efficacy, quality and immunogenicity at each stage of development.
However, the CDSCO’s official stand, submitted in an affidavit dated April 30, 2014 in a pending litigation before the Delhi High Court, is that the guidelines are not mandatory and that the DCA/DCR shall apply.
The 2012 guidelines were amended in 2016, with several requirements watered down. To begin with, it now categorically states that it’s not mandatory.It implicitly allows for abbreviated safety and efficacy studies and lacks sufficient safeguards to ensure patient safety. Sequential development is compromised as trial phases can potentially be combined.
It is possible to waive safety and efficacy studies or be conducted on non-significant sample sizes of 100 evaluable patients. In developed markets, such abbreviated pathway may not be considered adequate for proving biosimilarity. Biosimilars continue to be approved with modest patient population studies which may not be statistically significant.
Meanwhile in China, a host of policies from the Chinese FDA (CFDA) between 2015 and 2018 has underscored its government’s support for biologics/biosimilars and commitment to consistency of assessment/approval of biosimilars and improving the quality of biosimilars. With more Chinese talent returning from overseas, and several joint ventures between Chinese and foreign pharma companies, China’s biologics R&D is being rapidly pushed to maturity. This is also evident from the number of biologic p atents being filed by Chinese companies. There is also a sharp increase in China-based biotech companies with global aspirations.
To find new cures for unmet medical needs in priority areas like cancer, it is essential to provide sustainable and competitive marketplace for originator biologics while creating an abbreviated approval pathway for true biosimilars. An E&Y study finds with the proposed IP and regulatory changes, China is well placed to attract most private equity and venture capital investments after the US and EU.
What Needs To Be Done
To meet its global aspirations as a vital supplier of biosimilars, India must address some of the fundamental concerns that investors have about the Indian legal and regulatory framework for biopharmaceuticals. First, India should provide for regulatory data protection (RDP) as per TRIPS Article 39.3. The US, China and EU provide biopharmaceutical innovators with 12 years, 8 years and 11 years RDP, respectively. Second, it must augment and implement a guideline for biosimilars to ensure the Indian patient gets true biosimilars so that the public is not put at risk with regards to safety and efficacy. This will also help hone the capabilities of Indian biosimilars companies for global markets. Third, an enabling environment should be created for clinical trials which has witnessed a worrying decline since 2013.
Krishna Sarma is managing partner at Corporate Law Group