[Ip-health] News: FT.com- Drug groups face new generics threat

Terri Beswick Terri at haieurope.org
Thu Dec 2 06:06:45 PST 2010



Drug groups face new generics threat

By Andrew Jack in London 


Published: November 29 2010 19:17 | Last updated: November 29 2010 19:17


Drug companies could face competition on their complex biological
medicines as soon as 2012, following the release of draft generic
guidelines from the European medicines regulator.


Analysts expect Roche of Switzerland to be among the first to be hit
with cut-price alternatives for its cancer drugs. Other producers,
including Merck of Germany, Johnson & Johnson, and Abbott are also set
to be targeted soon by rival versions of some of their most lucrative
biological medicines.


The long-awaited guidelines, released last Friday by the European
Medicines Agency, lay out requirements for companies seeking to produce
generic versions of monoclonal antibodies (MABs), one of the most
profitable and important therapy areas in pharmaceuticals, currently
estimated to generate about $40bn in annual sales.

GlaxoSmithKline and AstraZeneca, which are developing MABs, will also be
affected, although they will initially be shielded because the new
"biosimilar" rules only apply once patents on products expire, as is the
case with existing generic versions of "small molecule" or chemically
based drugs.


In a research note, Bernstein, the US research house, said generic
companies led by Novartis, Teva and Hospira were most likely to gain
from the rules, and it singled out Roche, with sales heavily driven by
its antibodies Rituxan, Herceptin and Avastin, as among the companies
most vulnerable.


Roche cautioned: "We believe that patient safety must be of highest
concern when evaluating the development, approval and marketing of
biosimilar products."

With generic producers required in the guidelines to ensure that their
products are equivalent to the original therapy, they will still require
costly clinical trials.

Collins Stewart, the research house, estimated such trials would
typically cost $100m each, limiting competition and resulting in annual
sales reductions of 10-15 per cent on drugs coming off patent. 


However, it highlighted that Celltrion, a South Korean company in
partnership with Hospira, already has a biosimilar Herceptin for cancer
under test, which it estimated could be launched in emerging markets in
2012, and in Europe by 2014.


Jefferies International argued that the guidelines were a "damp squib",
with the impact on originator companies "modest" because of the high
entry barriers.

The European Medicines Agency has already approved 14 less complex types
of biological generics since it introduced general guidelines in 2006,
including a variety of human growth hormones. It has rejected one and
three others have been withdrawn.


The draft MAB guidelines are open for consultation until the end of next


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