Gearing up for the biosimilar boom

India joined a select but growing club of nations when Dr MK Bhan, Secretary of the Department of Biotechnology (DBT), Government of India, released the draft guidelines for manufacturing and marketing of biosimilar drugs in India this July.

Initially slated to come into effect from this Independence Day, August 15, the regulators postponed the implementation date to September 15, to give stakeholders more time to send their comments and suggestions on the draft guidelines to the DBT.

Will India be able to position itself as a manufacturing hub for biosimilars, in the same way that it has done with generic drugs? Clearly, small-molecule generics are losing their sheen. The wafer thin margins, thanks to low entry barriers, make it a high volume, low margin business. In contrast, the biosimilar opportunity promises to give better margins, even after patent expiry, as the cost and complexity of biosimilar development and manufacturing prevents the entry of too many players. Thus it is no wonder that the share of biologics in the global biopharma market is projected to rise to 28.9 per cent in 2015, from a base of 4.5 per cent in 1990. Similarly, the share of biosimilars among biologics is projected to rise from 0.1 per cent in 2009 to 6.4 per cent in 2017. (See chart: Growth rate of biologics and biosimilars versus traditional drugs).

Remicade (i&i’s infliximab) serves a good example of the biosimilar boom around the corner. Reportedly the top selling biologic and monoclonal branded antibody with $8.5 billion in sales in 2011, analysts predict that the brand could well turn out to be the top selling branded drug in 2012. It would be fair to say that many biosimilar manufacturers are waiting for Remicade to fall off the patent cliff in 2013.

And Remicade is not alone on this path. In fact, various reports predict that biologic patent expiries worth more than $40 billion are expected by 2016. (See table: The allure of biologics: Patent expiries from 2012 – 2019)

Going by the (rule) book

With such a huge market opportunity opening up, it is no wonder that regulation for biosimilars across the world is keeping pace. (See box: History of biosimilar guidelines)

Upto now, the regulatory process for biosimilars in India was on a case by case basis, using an abbreviated version of the pathway followed for small molecule drugs, involving the Drug Controller General (India)’s office under the Central Drugs Standard Control Organization (CDSCO) and DBT. While the CDSCO evaluated the safety, efficacy and quality aspect, the DBT through the Review Committee on Genetic Manipulation (RCGM) was responsible for overseeing the development and preclinical evaluation of recombinant biologics.

“The long awaited draft ‘biosimilar guidelines’ of India, though a belated move by the Government, are certainly a step in the right direction.” Tapan J Ray Director General, OPPI

This system, seen as an ad hoc approach, was fraught with flaws. Tapan Ray, Director General, Organisation of Pharmaceutical Producers of India (OPPI) says that there have been instances of so called ‘biosimilar drugs’ being approved for marketing, reportedly with sub-optimal testing and dossiers, thereby putting into question product quality, comparability and patient safety. Thus he is firmly of the opinion that the long awaited draft ‘biosimilar guidelines’ of India, demonstrating an overall similarity in the philosophy and approach with the those in the US and Europe, though a belated move by the Government, are certainly a step in the right direction.

“The new guidelines have made the pathway much clearer … provided Government infrastructure is in place to support the requisite approval processes.” Shoibal Mukherjee Chief Medical Officer, Quintiles India & Head, Asia Medical Sciences Group

The ad hoc process also meant inherent delays, points out Shoibal Mukherjee, Chief Medical Officer, Quintiles India & Head, Asia Medical Sciences Group. According to him, India’s new draft guidelines have made the pathway much clearer which he believes will lead to a reduction in approval timelines, but he adds an important caveat: “provided the Government infrastructure is in place to support the requisite approval processes.”

The ad hoc process may have had its flaws, but it got the job done: more than 20 biologics have been approved in India by this process. But now with more biologics going off patent, the Indian regulators clearly felt the need for a more formalised approach, in line with global norms.

“Post-implementation of the guidelines, India will be placed at least somewhere in the global biosimilar regulated market.” Priyank Gupta Patent Attorney, Legasis Services

Priyank Gupta and Aditi Gehlot, patent attorneys, Legasis Services point out that most of these biologics and the process to make them, were invented between 1990-2005 and were never patented in India. They opine that the draft guidelines thus open prospects to bring more biosimilar brands in the market at perhaps the lowest costs on this planet.

Similar but not same

Going by initial reactions to India’s biosimilar guidelines, they seem to be along expected lines, given that industry representatives were part of the Task Force which drafted the guidelines.

“The Indian biosimilar guidelines factor (in) the Indian context of affordability and accessibility.” K V Subramaniam President & CEO, Reliance Life Sciences

KV Subramaniam, President and CEO, Reliance Life Sciences, one of the representatives from industry on this task force, believes that the Indian biosimilar guidelines factor (in) the “Indian context of affordability and accessibility”. While ensuring product safety, quality and efficacy, he points out that “extremely onerous clinical trials are obviated, thereby enabling biosimilars to be launched in a faster time frame at competitive costs in relation to other country context.”

“The major challenge would be implementation of the policy.” Dr Ajay Kumar Sharma Practice Head-Pharma, Healthcare Practice South Asia & Middle East Frost & Sullivan

Dr Ajay Kumar Sharma, Practice Head – Pharma, Healthcare Practice, Frost & Sullivan, South Asia & Middle East too opines that while they seem to be based on current global guidances like that of the European Union, they are tailored to the needs of the local Indian market and the players in the Indian market.

Attempting to read the Indian regulator’s philosophy, William Lee, Head of Regulatory Strategy, Quintiles Asia opines that it is very clear that the Government is creating a level playing field for Indian biosimilar players to compete globally. These draft guidelines “define an approach and provide a framework” for the development of biosimilars. Once implemented, he believes they will evolve further with feedback from the industry. The guidelines already seem to be evolving, given the delayed implementation deadline.

“The Indian guidelines make no mention of data exclusivity but that does not mean that there is no protection of intellectual property.” William Lee Head of Regulatory Strategy, Quintiles Asia

Lee says the guidelines are similar to those developed by the US FDA, EMEA and WHO. The areas of similarity with global guidelines are that they focus on quality characterisation, on the sequential development of the compound starting from quality characterisation and the silence on the interchangeability of compounds. The Indian guidelines also provide guidance on the type of post-marketing data required for similar biologics.

Tailor-made for India

“An excellent attempt to streamline the regulation of biosimilars, but we should not blindly ape what they are following, we should have our own identity.” Ankit Suri Associate Vice-President, Tecnova India

Ankit Suri, Associate Vice-President of Tecnova India terms the draft guidelines as an excellent attempt to streamline the regulation of the bio similars, but while we keep pace with other regulatory bodies like the US FDA and EMEA, “we should not blindly ape what they are following, we should have our own identity.” The Indian biosimilar draft guidelines do reflect their own identity, going by the key differences from global biosimilar guidelines.

Firstly, in addition to the DCGI/CDSCO and RCGM/DBT, the draft biosimilar guidelines have added a third: the Genetic Engineering Appraisal Committee (GEAC) which functions under the Ministry of Environment and Forests (MoEF) as a statutory body for review and approval of activities involving large scale use of genetically engineered organisms (GMOs, also referred as living modified organisms, LMOs).

“A single-window procedure of obtaining marketing approval would have made the process similar to the developed world’s approval framework.” Ajit Mahadevan Partner, Ernst & Young

The involvement of three authorities, under three ministries is the most obvious differentiating factor. Ajit Mahadevan, Partner, and Suvajit Mahapatro, Manager, Ernst & Young (EY) point out that a single-window procedure of obtaining marketing approval would have made the process similar to the developed world’s approval framework.

In fact, in addition to being dependent on multiple regulatory agencies, the draft biosimilar guidelines lean on other guidelines (like the Recombinant DNA Safety Guidelines, 1990; CDSCO guidance for industry, 2008; Guidelines and handbook for institutional biosafety committees, 2011 etc.) and other Acts. The Legasis team cautions that this situation may cause procedural delays for approval.

Another key difference is that India’s draft regulations have not defined the timelines in the approval process, unlike the biosimilar guidelines in the EMEA, while have well defined timelines for each part of the approval process.

Sharma of Frost also points out that there will be instances where use of logical interpretations would be helpful to rationalise the policy from case to case basis.

Charting the challenges

Mahadevan and Mahapatro of EY presume that although few pharma manufacturers currently market biosimilars in India, there will be challenges for them to compete with the multinationals once they get marketing approval in India. But India’s draft biosimilar guidelines pose challenges for both groups on these fronts.

Firstly, as the EY team points out, proving similar bio-equivalence, as compared to the reference molecule, is a complex process.

Suri of Technova too zeroes in on this point, pointing out that in case the reference biologic is used for more than one indication, the efficacy and safety of the similar biologic has to be justified and if necessary demonstrated separately for each of the claimed indications. Justification will depend on clinical experience, available literature data and whether or not the same mechanism of action is involved in specific indications.

Secondly, timelines for the approval process will be the key parameter and Government funding will play an important role to establish infrastructure to support clinical testing laboratories. A third barrier is that manufacturing or replicating similar cell lines will require expertise, which will eliminate inexperienced players from the competition. Cost is the fourth hurdle and will definitely play a key role in the case of substantial investments made on biosimilars. And finally, comparability testing of biosimilar medicines with reference products (requiring non-clinical and clinical trials including PK (Pharmaco kinetic)/ PD (Pharmaco dynamic) testing and trials for safety/immunogenicity and efficacy) will be needed, therefore, efficient and effective testing labs will be key infrastructure requirements.

Subramaniam of Reliance Life Sciences also alludes to these factors, when he says companies with stakes in biosimilar business have to gear up to follow these guidelines. He shortlists three areas where these companies will need to invest in: people, analytics and clinical trials.

Further, he warns that as preclinical animal toxicological studies and clinical trials involve comparison to the innovator product, these activities may escalate the costs and extend the timelines for approval of a biosimilar in relation to what they are now.

In fact, it’s not just industry applicants who will have to gear up; the regulators too will need staffing, human resource and infrastructure to expedite the approval process, points out Sharma of Frost & Sullivan. Shortages on this front could hamper the implementation of the policy.

“(It) … suggests a global biosimilar strategy for both Indian manufacturers and the big multinational players that begins in India.” K Vijayaraghavan Chairman, Sathguru Management Consultants & Regional Coordinator, IPCALS, Cornell University

K Vijayaraghavan, Chairman, Sathguru Management Consultants & Regional coordinator, IPCALS, Cornell University pinpoints another provision of the guidelines that will delay market entry for biosimilars in some cases: The Indian (draft) guidelines provide that where “the reference biologic is not authorised in India, it should have been licensed and marketed for at least four years with significant safety and efficacy data.” His analysis is that since for the foreseeable future, new biologics will be predominantly pioneered in the US and Europe, there will be a number of recently-developed products that fall into this category, and will await either the approval of the reference drug in India, or the passage of four years after approval elsewhere.

An India-first strategy?

Vijayaraghavan points out another major difference between the Indian regulatory regime and that of the US and Europe: the lack of regulatory market exclusivity for first-approved products. In the US and Europe, biosimilars cannot be approved until 10 or more years after approval of the reference product. Without this limitation, sales of biosimilars in India are only restricted by patent exclusivity. And even patent exclusivity is not so much of a barrier, given their less well-developed patent regime for biologics.

According to him, the combination of an established biosimilar regulatory pathway which is similar to the major markets plus the lack of market exclusivity suggests a global biosimilar strategy for both Indian manufacturers and the big multinational players that begins in India.

In other words, as he spells out, in order to hasten approval worldwide, companies will first seek approval in India, which may be possible long before other jurisdictions, then use the same data package, plus long-term pharmacovigilance data gathered from sales in India and required post-marketing studies as the basis for approval elsewhere at the first moment possible.

In this way, as per Vijayaraghavan’s analysis, the regulatory package for other markets will be “paid-for” by sales in India, plus the likelihood of worldwide approval will be enhanced by a long history of safety in India.’

According to Vijayaraghavan,“The opportunity for small and medium enterprises to take part in this with the support of DBT funded initiatives such as the Biotechnology Industry Partnership Programme is enormous”. He anticipates that it could also serve to “converge competencies in evaluation and pre-market assessment, thereby opening avenues for inclusive engagement of corporate sector in market access.”

A case for data exclusivity?

The Legasis attorneys feel that though the draft guidelines are an initiative to streamline the approval process, they only emphasise regulatory requirements and lack provisions like biosimilar interchangeability and exclusivity for first (mover) interchangeable product as under the US laws which could further boost the biosimilar industry in India.

Ananda Chakrabarty, Co Founder, Amrita Therapeutics and Professor–Microbiology, University of Illinois, sincerely hopes that the Indian Government, when formulating the final guidelines, will take into consideration the position that his company espouses, namely, that the Government of India should promote and develop new types of drugs, and should encourage innovations rather than just copying or formulate guidelines that just encourage copying.

Chakrabarty reasons that while India’s thriving generics industry is “adored and admired” by many nations for bringing cheap medicines for the general population, the generics industry does not make a whole lot of money and therefore contributes little to bolster the country’s economy.

“Given the fact that the Indian Government spends a sizeable amount of money in promoting academic research, I don’t think it gets any real economic return from such academic investments. That needs to change. The pharma industry needs to pay some attention to bringing innovative products to the global market and the Government should encourage such activities for the academic sector as well,” he affirms.

Growth rate of biologics and biosimilars versus traditional drugs
Sources: IMS, Reuters, Business Insights, Evaluate Pharma, Vision Gain, DataMonitor Feb 2011, Quintiles

Taking forward his argument, Susan Finston, CEO and MD, Amrita Therapeutics, points out that especially for smaller companies like Amrita, who do not have a phalanx of patent attorneys to litigate against patent infringers, data exclusivity/patent linkage or at least a minimal time period for Return on Investment (ROI) prior to eligibility to submit the FOB application and/or gain final regulatory approval, is required to make back the considerable investment that seed funders and the co-founders, promoters, friends and family have put in.

Finston alludes to the irony that in Amrita’s case, such features, currently absent in India, will help the DBT itself, as well as Amrita’s other funding agencies like the Gujarat Venture Finance Limited (GVFL), get faster and better RoI on their investment in Amrita’s product development efforts. Early research on some of Amrita’s priority candidates was initiated in January 2010 at Ahmedabad’s BV Patel Pharmaceutical Education and Research Development (PERD) Centre.

India’s draft biosimilar guidelines spark a series of queries from Finston for the regulators, all reflecting the long way ahead. For starters, she asks if the Government of India will provide sufficient well-trained personnel to review and evaluate biosimilar data packages? Secondly, how much data will be required on a case by case basis, e.g., how long a time period will be required for toxicity and related safety/effectiveness tests in animals and in humans? Her third query is how will human clinical studies for biosimilars be compared to phase I, II or III studies for the comparator biologic? How many patients will be enrolled and over what time periods?

Possible legal loopholes

The Legasis team points out that as India’s draft biosimilar guidelines do not link regulatory approval with patents issued by the Indian Patent office (IPO) in order to address any possible complications arising from the infringement issues related to manufacturing, import or marketing of the biosimilar, it is likely to bring hurdles relating dishonouring patents. Whereas, the US guidelines on biosimilars clearly discusses any patent infringement issues which may arise and pre-approval negotiation proceedings between reference product owners and interchangeable biosimilar biologic applicant to minimise patent litigation.

The lack of provision for data exclusivity to the reference biologic product owners means that the biosimilar manufacturer will be able to ride on data supplied by the prior approved reference biologic. The Legasis patent attorneys predict that such a situation may also prompt the innovator company to adopt a different IP strategy and cite the ‘trade secret’ option to avoid submitting the data of new biologics.

Lee of Quintiles too opines that multinational biopharma companies may be more hesitant to develop innovator products in India as they may well perceive that that there is no protection of intellectual property, although this is not the case with the IPR in place. Though the Indian guidelines make no mention of data exclusivity, Lee points out that that does not mean that there is no protection of intellectual property. The IPR is in place so one can always refer to the data as the patent is still in force, he opines.

Product specific guidelines

Another suggestion from the Legasis patent attorneys is to have product specific guidelines, as done in the EU. With EU being the pioneer in implementing laws for biosimilar, it felt that product specific guidelines for complex biosimilars would present clear guidelines in terms of data requirements and evaluation. They point out that a similar approach for the Indian biosimilar guidelines would avoid any case to case discretion by regulatory agencies.

The Legasis team also points to some possible loopholes like the provision that as per the Indian draft biosimilar guidelines, confirmatory clinical safety and efficacy study can be waived if certain conditions are met by the similar biologic. So also in another provision, clinical trials should have sufficient number of patients for acceptable period of time to measure any significant difference on safety between similar biologic and reference biologic. Such provisions are open ended to allow and be a matter of discrepancy in certain cases.

A good first step …

Notwithstanding the many queries and challenges of adhering to the biosimilar guidelines, there is broad recognition that not having them will cast a shadow of doubt on biosimilars approved in India. For instance, Dr Reddy’s Laboratories’ Reditux is not considered the world’s first biosimilar antibody even though it got the nod in 2007. That honour goes to Celltrion’s Remsima because South Korea’s biosimilar guidelines are in line with global guidelines.

Ray of OPPI points out that “a science-driven ‘biosimilar guidelines’ will provide a regulatory framework or pathway to ensure that ‘biosimilar drugs’ approved in India are of good quality and demonstrably similar in efficacy, safety and immunogenicity to the original reference products.”

He believes that India has the potential to become one of the key players in the development and manufacture of biosimilar drugs, not only to serve the needs of the local population, but also for export to large developed markets needs. “The need for such a regulatory framework and comprehensive guidelines is even greater in the light of currently sub-optimal pharmacovigilance system in India,” reasons Ray.

“Better late than never”, is the stance of the Legasis team as well, maintaining that post-implementation of the guidelines, India will be placed at least somewhere in the global biosimilar regulated market.

… towards a global play

Given India’s status as a generics major, can it apply the same formula to biosimilars? Not so apparently.

“The approach to developing and marketing biosimilars is very different and necessitates a new way of thinking.” Amar Kureishi Chief Medical Officer & Head of Drug Development Quintiles Asia

“The success of Indian companies in generics could be an inherent stumbling block as it prevents these companies from thinking in the broader context of biosimilars,” cautions Amar Kureishi, Chief Medical Officer and Head of Drug Development, Quintiles Asia. He believes that the approach to developing and marketing biosimilars is very different and necessitates a new way of thinking.

The issues and challenges of developing biosimilars vary according to regions, points out Kureishi. For instance, in the US, biologics are paid for by third parties and are very expensive. Physicians have litigation challenges, patients do not necessarily want cheaper drugs and there are pressures on third party payers and influences from originators to slow down the market. In Europe, most countries have national health services and are running significant debt. They are looking at ways to reduce their healthcare budgets through lower cost solutions, while balancing safety.

Coming to countries like India, South East Asia and Latin America, Kureishi points out that the major problem is access and affordability. Often the choice is between a biosimilar or nothing and so one has to consider practical solutions of affordability and availability of drugs, reasons Kureishi.

Regulators will put into place laws to cope with such issues and challenges and evolving regulations will in turn trigger off different market strategies. Kureishi points out how some Indian companies have approved drugs in India and then launched in select small Asian markets. Chinese biosimilar companies are doing the same. This would be a ‘local plus’ strategy, as opposed to a true local, global or emerging market strategy. ‘Cheaper’ in biologics cannot be equalled to ‘not as good’, he advises.

All in all, given that the Indian biosimilars market is not yet as mature as in regulated nations, it will take some time for the regulatory process to evolve and stabilise. Biosimilar companies in India have no choice but to gear up to these benchmarks as they evolve. The saying ‘No pain, No gain’, though a trifle trite, fits the bill to the T.

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