It takes several years of hard work to become an overnight success. Or so they say.
Everything around the breast cancer biotech drug trastuzumab smacks of this. After 19 years on the market, it is still one of the top-selling drugs for Roche, adding more than $30 billion in sales in just last five years. It will earn handsome revenues for Biocon in about a year from now. The final door to that market opened on 1 December when the Food and Drug Administration approved Biocon and its marketing partner Mylan’s Ogivri, trastuzumab biosimilar to Roche’s drug, for sale in the US market.
With this, Mylan-Biocon will become the first company to sell copies of this drug which has annual sales of $2 billion in the US. Worldwide, the drug, which Roche sells under the brand Herceptin, has three times bigger opportunity at the current price. It sells for $70,000 for a course in the US and is highly effective against a common breast cancer (where HER-2 gene is overexpressed) and metastatic stomach cancer.
It’s fair to say that the FDA approval is a big deal for Biocon-Mylan because snapping at their heels are drug giants like Amgen-Allergan, Pfizer, Samsung Bioepis and Celltrion developing biosimilars of trastuzumab and preparing to launch. Once the patent expires in 2019 in the US, only after which biosimilars could be sold, discounting will kick in. The trend shows it’s to the tune of 25-30%. And yet, there’s a huge market left and that explains why a complex patent dance ensues after every biotech drug goes off patent.
In this context, Mylan’s decision earlier in the year to secure global licenses for its trastuzumab product from Roche paves a clear pathway to commercialise Ogivri in various markets globally. “It is not clear if any of the other trastuzumab [biosimilar] developers have secured such a deal with Roche,” says a beaming Kiran Mazumdar-Shaw, chairperson and managing director of Biocon. The FDA stamp on biosimilars manufactured in India is a solid endorsement of quality when, today, Indian products, manufacturing plants and pharma data are all under heightened scrutiny of drug regulators worldwide.
Ring-fencing is the order of the (biologics’) day
The financial details of Mylan’s patent settlement with Roche have not been disclosed yet, but it sure looks like a masterstroke given how aggressively the innovator is guarding its turf as it gets closer to the patent cliff.
Roche’s strategy can be summed up in three words: Innovate. Protect. Expand. Innovate it does; just three of its products earned nearly $21 billion in 2016. Then it fiercely protects its innovation. In late November, it sued Pfizer for its proposed biosimilar of trastuzumab which “would infringe 40 patents”, it said in its complaint. Roche also wants compensation for lost sales if Pfizer launches its product before Herceptin patents expire, and some will start to in 2019.