Is Pharma Competitiveness Obscuring The Biosimilar Market's Potential?

By Anna Rose Welch, Editorial & Community Director, Advancing RNA

A few weeks ago, Quantia released the results of a recent survey of 300 physicians that gathered their knowledge and perspective on biosimilars. In reading the headlines about the survey, as well as the stats, it would seem that the biosimilar market could fall flat — or at least be more lackluster than a lot of companies are making it out to be. However, considering the pharma industry seems to have erupted into a civil war over whether or not the market will be as successful as predicted, it is difficult to get a sense of where the market is actually headed.  

Perhaps it’s a bit dramatic to say the industry has launched into a civil war. But, I think it’s fair to say biosimilars have stirred up a great deal of drama between brand and generic drugmakers in the past few months as the U.S. biosimilar market has begun taking shape. When Zarxio was approved, the pharma industry (and all the media outlets) erupted — expressing both excitement at the prospect of new cost-effective treatment options for patients and payers, as well as concern. Over the past few weeks, we’ve been privy to the ongoing litigation between Amgen and Novartis’ Sandoz over potential patent infringements. We’ve also been witnessing the new inter partes review (IPR) process taking root in the industry — not just because of Hayman Capital hedge fund mastermind Kyle Bass’s attempts to use them to lower drug costs (or short pharma stocks, depending on whom you talk to). Biosimilar makers are now also turning to the IPR process to start chipping away at patents for brand-name biologics to see if they can’t get their biosimilars to market more quickly. There have also been numerous reports about AbbVie’s attempts to get the FDA to reform its latest specifications for biosimilar labels.

So after all the news — especially the stories pertaining to the approval of Sandoz’s biosimilar in March — you can imagine my surprise to learn from the Quantia survey that only 53 percent of biologics-prescribing specialists had heard about this approval. (Though rest assured — 78 percent are at least familiar with the term “biosimilar.”) I acknowledge that 53 percent is still a majority of those surveyed, and 300 doctors is a fairly small population. However, it still didn’t sit well with me considering these are the people currently responsible for putting biosimilars in patients’ hands (at least until the FDA makes a decision on interchangeability). It leads me to wonder how many doctors are even aware that the first biosimilar has been released for use.

Don’t get me wrong; I’ve come across surveys from physicians’ associations, such as this one from the American Gastroenterologist Association (AGA), announcing that the medical community is waiting with open (though still cautious) arms for biosimilars. But despite the fact 94 percent of Quantia-surveyed physicians believe biosimilars are valuable, only 17 percent are confident in prescribing them. This was the fact that appeared in the subhead for the study’s press release, which was then sourced and blasted out by numerous media sources — including this site.

Beyond this somewhat concerning information on the healthcare side of the equation, we also have what seems to be yet another war brewing between reference and generic makers. So far since Zarxio’s approval in March, we’ve observed battles over naming, interchangeability, and patents. Now it seems drugmakers are starting to release research on whether or not the market is actually going to live up to expectations. For instance, according to BioPharma-Reporter, AbbVie recently commissioned a study carried out by actuarial firm Milliman entitled “Understanding Biosimilars and Projecting the Cost-Savings to Employers.” The report revealed that “savings due to biosimilars in 2014 were zero and projected to be negligible for 2015.” This is to be expected, considering the U.S. only has one on the market currently, and at the time this report was released, Zarxio had been on the market for a little more than a week. However, the report predicts that this market will not bring about the savings many in the industry have been predicting. For instance, the study states, “For a 10,000 lives employer with 2019 commercial healthcare expenditures of $81.5 million, the 2019 total estimated savings is just $635,925 or 0.8 percent of total healthcare spend assuming 30 percent total market penetration and 30 percent lower pricing of biosimilars.” (Keep in mind, Sandoz’s Filgrastim currently only boasts a 15 percent discount in price compared to Amgen’s Neupogen.)

The prediction for smaller savings of course comes down to uncertainties about market popularity, prescription numbers, and the FDA’s decisions on interchangeability. But I’ll admit I was slightly amused to learn that such a report was commissioned by AbbVie, which is no doubt trying to deal with, and perhaps defend itself from, the unknown impact biosimilars will have on its golden child Humira.

It also seems fitting that, in this currently split industry, AbbVie’s report would be met with pushback from the generics industry. Following AbbVie’s report, a Sandoz spokesperson told BioPharma-Reporter, “The fact is that these products will bring much-needed competition. As the first biosimilar nears the market, we have seen an uptick in these kinds of publications.” Indeed, the AbbVie-commissioned study and the Quantia study (at face value) both suggest we’re not facing a particularly promising market. But with all the patent litigation and tensions about what biosimilars could do to reference products, I can’t help but wonder if the doubts over the market aren’t being inspired by the turbulence between generics and reference brand makers.

Indeed, there are some positive takeaways from the Quantia study, though these, of course, were not spelled out in the headlines. Only 13 percent total of those surveyed are not very likely or not at all likely to prescribe biosimilars (and part of that percentage are doctors who don’t even prescribe biologics). Compared to the total 57 percent of respondents who are somewhat likely and very likely to prescribe a biosimilar, 13 percent is pretty minuscule. In fact, 40 percent are simply not sure what to do with biosimilars yet — and I feel that, given more time, this percentage could be swayed. We already know the industry has some work to do to get doctors up to speed about the efficacy and safety of biosimilars, and it’s only a matter of time now that Sandoz’s product is out on the market that doctors and patients are able to start determining their efficacy.

But it’s important to remember as well that we’re following in the footsteps of the EU, which has seen its own market grow steadily over the past 10 years. There are certainly differences between the two markets, but there were most likely the same hesitations following the launch of the EU’s first biosimilar in 2006. When it comes to our industry, we’re constantly being met with differing opinions, some of which could certainly turn out to be legitimate, or at this point in the game might seem like they have an ulterior motive (*cough* AbbVie *cough*). But at the end of the day, we have the start of a market, and the dust will eventually settle as the FDA concludes some of the debates about interchangeability and naming. The biosimilar age is here, and no amount of arguing from reference brand makers and research reports speculating about what isn’t yet known is going to keep the market from growing. What would be nice to see is some of the energy being spent on arguing about the success of the market being directed toward educating the doctors who will ultimately play a major role in making the U.S. biosimilar market a success.