Biosimilars: Where Do We Stand and

Where Are We Headed?

Timothy J. Shea, Jr. 2008 LESI Annual MeetingVincent L. Capuano Chicago, IL � May 7, 2008

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Overview

� I. Legislation and Investment

� II. Technical Issues

� III. Immunogenicity and Interchangeability

� IV. Data Exclusivity and Patent Scheme

� V. EP Experience

� VI. Predicting the U.S. Market

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Overview

� Where Do We Stand?� The Political Climate� The Legislative Climate

� Analysis of H.R. 5629

� The Regulatory Climate� Technical issues� Immunogenicity and Interchangeability� Data exclusivity and patent scheme

� Where Are We Headed?� Predicting the U.S. Regulatory Framework

� Insights from the EU experience

� Predicting the U.S. Market� The likely players� Risk/reward analysis� Conflict issues

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The Political Climate � A Perfect Storm

� The Biopharmaceutical market is rapidly growing� Currently $40B market� Predicted to be 30% of entire therapeutic market within 5 years� Growth rate is 4x that of small molecule market

� $10B in biotech products off patent by 2010� Some estimates as high as $18B

� Currently no legislative or regulatory framework for approving biosimilarsin U.S.

� Pressure from Consumer Advocacy Groups� Biopharmaceuticals are increasing component of Medicare/Medicaid costs� Top 5 Medicare expenditures are biologicals (Waxman)� EPO alone = $2B� Cost comparison:

� Traditional small molecule drug = $2/day� Typical biologic = $44/day

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The Political Climate � A Perfect Storm

� Pressure from Congress

� Cost of healthcare, particularly for seniors, is hot issue

� Under �pay-go� rule, lower drug expenditures can offset costs of other new legislative programs

� Pressure from Industry:

� BIO now recognizes biosimilars are a matter of when, not If

� wants �right� legislation now (before new Congress)

� GPhA wants legislation soon (but concerned about data exclusivity)

� Bush 2009 Budget � incentives to FDA establish biosimilar regulatory framework

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I. Legislation and Investment

� BLA for Biosimilar Requirements (House bill)

� Applicant must demonstrate that:

� Product is �biosimilar� to a reference product

� Product and reference product utilize the same mechanism of action for the condition of use

� Condition of use has been previously approved for reference product

� Route of administration, dosage form and strength are same as reference product

� Facility meets standards to assure safety, purity and potency

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I. Legislation and Investment

� �Biosimilarity� Data Requirements (FDA discretion to waive)� 1. Analytical studies

� demonstrating that product is �highly similar� to reference product

� 2. Animal studies� including toxicity

� 3. Clinical study (or studies) � to assess immunogenicity and pharmacokinetics or

pharmacodynamics to demonstrate safety, purity and potency for each use

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I. Legislation and Investment

� House bill (continued)

� Biosimilarity, Interchangeability and Immunogenicity criteria all determined by FDA guidance proceeding for each product class.

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I. Legislation and Investment

� Submission of Application for Biosimilar(House bill)

� Application may not be submitted until the later of:

1. Commencement of guidance process for product class, or

2. 4 years from approval of reference product

No FDA approval until guidance process is completed.

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I. Legislation and Investment

� Additional BLA Information

� Shall include publicly-available information regarding previous FDA determination of safety, purity and toxicity

� May include other information, including publicly-available information regarding the reference product or another biological product

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I. Legislation and Investment

� Need for clinical, manufacturing, regulatory and sales expertise suggests that few generic companies will compete with Big Pharma/Biotech

� Estimated $40M investment required for biosimilar approval

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I. Legislation and Investment

� Two factors driving the debate over biosimilars:

1.Hatch-Waxman experience with small molecules

2.Complexity of biological products compared to small molecules

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I. Legislation and Investment

� Hatch-Waxman Impact:

� U.S. Sales (2007):

� Brand ($228B)

� Generic ($58.5B)

� 8,730 of 11,487 drugs with Orange Book listings have generic counterparts

Source: FDA, MedAd News

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I. Legislation and Investment

� By 2010 biopharmaceuticals will represent 50% of the pharmaceutical market

� was 20% in 2004 (PhRMA 2006 survey)

� 120 biopharmaceuticals existed in July 2007, with 418 new biopharmaceuticals in development, mostly oncology, infectious and autoimmune diseases, respiratory disorders (PhRMA 2006)

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II. Technical Issues

� Important Considerations for Biosimilars:

� Size/complexity

� Protein folding

� Variants/Impurities

� Cell line

� Purification process

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II. Technical Issues

� High complexity + Little knowledge = Need for clinical data

� Example: Recombinant interferon interacts with nearly 100 genes � exact mode of action difficult to predict and explore

� Example: Recombinant erythropoetinsdifferences in carbohydrate structure and sialicacid residues

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II. Technical Issues

� Importance of manufacturing process control

� Each manufacturer�s unique cell line is constructed with a unique proprietary DNA expression vector

� Cell line must be evaluated for product integrity, activity and overall quality

� Minor variations can lead to important product differences that impact safety and potency

� Experience will lead to predictability

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II. Technical Issues

� Myozyme (alglucosidase alpha) � FDA rejected Genzyme�s request to add a manufacturing site

� FDA is concerned about slight differences in carbohydrate structure and requires more human data for product made at requested site.

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III. Immunogenicity and Interchangeability

� Immunogenicity (House bill)

� FDA may waive assessment of immunogenicity as unnecessary only if final guidance is published after receipt and consideration of public comment:

� (1) advising that it is feasible to make immunogenicitydetermination for the product in the product class, and

� (2) explaining the data required to support such a determination

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III. Immunogenicity and Interchangeability

� Potential consequences of immunogenicity:� Loss (or enhancement) of efficacy

� Neutralization of a native protein

� General immune effects (allergy, anaphylaxis, serum sickness)

� Example: production of neutralizing antibodies against recombinant eythropoetin caused severe epoetin-resistant anemia requiring blood transfusions, immunosuppressive treatment and kidney transplantation

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III. Immunogenicity and Interchangeability

� Interchangeability (House bill)

� FDA may determine that biological product is interchangeable with reference product if information is sufficient to show that biological product:

� is biosimilar to the reference product (or any product found to be interchangeable with reference product);

� can be expected to produce the same clinical result as referenceproduct in any given patient for each use prescribed, recommended or suggested in referenced product labeling; and

� For product administered more than once, the risk in terms of safety or diminished efficacy of alternating or switching is notgreater than the risk without alternating or switching

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III. Immunogenicity and Interchangeability

� Inappropriate substitution occurs when

� Pharmacist overrides prescription and chooses a product from the same class, or

� Prescription lists product class but doesn�t specify product and pharmacist chooses (based on price or personal experience)

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III. Immunogenicity and Interchangeability

� Exclusivity for First Interchangeable Product (House bill)

� Not same as first �biosimilar�

� No subsequent determination of interchangeability until 24 months from later of

� First commercial marketing of interchangeable product, or

� Date of interchangeability determination for product previously marketed.

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IV. Data Exclusivity and Patent Scheme

� House Bill � up to 14.5 years

� 12 year exclusivity for reference product

� two additional years of exclusivity if subsequent approval for new indication within first 8 years, if new approval is a �significant improvement� compared to marketed products

� 6 months PED exclusivity

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IV. Data Exclusivity and Patent Scheme

� Patents - Exchange of Information (House Bill)

� Exchange with Reference Product Sponsor (RPS)

� Biosimilar license applicant must provide copy of application and information concerning product (manufacturing details etc.) to RPS within 30 days of FDA acceptance of application;

� RPS provides applicant with list of relevant patents owned by sponsor within 60 days of receipt of application and information;

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IV. Data Exclusivity and Patent Scheme

� Patents - Exchange of Information (House Bill)

� Exchange with Interested Third Parties (ITP)

� Any time after FDA publishes notice of application, any ITP may notify applicant that ITP has 1 or more patents that may be relevant

� Within 30 days of receipt, applicant shall send ITP application and information concerning product (including manufacturing information etc.)

� Within 90 days of receiving information, ITP shall provide list of relevant patents.

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IV. Data Exclusivity and Patent Scheme

� Patents � Identification for basis of infringement (House Bill)

� For any patent identified, RFP or ITP

� Shall explain in writing why the relevant patent would be infringed by the biosimilar product, or its use in the indicated treatment

� May specify whether the patent is available for licensing; and

� Shall specify the number and expiration date of the relevant patent

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IV. Data Exclusivity and Patent Scheme

� Patents � Patent certification by applicant (House Bill)� Not later than 45 days after receiving basis for

infringement, applicant shall send a written statement to the RPS or ITP either:

� a. stating that applicant will not commence marketing and not seek FDA approval before the expiration date of the noticed patent; or

� b. providing a detailed written explanation of the reasons why the patent would not be infringed, is invalid or is unenforceable.

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IV. Data Exclusivity and Patent Scheme

� Patents � Action for Infringement (House Bill)

� If infringement action brought within 60 days of receipt of written statement, and patent found to be infringed, then FDA may not approve application until after patent expiration

� DJ action may not be filed more than 3 years before expiration of FDA exclusivity

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V. The European Perspective

� �Similar biological medicinal products�

� Legal framework exists; regulatory framework is developing

� 5 �biosimilars� approved to date by EMEA� Omnitrope (Sandoz)(2006)(first biosimilar

approved by EMEA)

� Valtropin (Biopartners)(2006)

� Binocrit (Sandoz)(2007)

� Epoetin alfa (Hexal)(2007)

� Abseamed (Medice Arzneimittel Pütter)(2007)

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V. The European Perspective

� Core Principles

� Biological medicinal products are much more

difficult to characterize than small molecules

� Broad spectrum of complexity across biological products

� The standard generic approach normally applied to small molecules is �scientifically not

appropriate� for biologicals

� Patient safety is paramount in EMEA decision

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V. The European Perspective

� Core principles� Decisions should be made on case-by-case basis

and dictated by the science

� The toxological and clinical profile of the biosimilar�shall be provided�

� A well-defined regulatory framework can only be developed over time based on experience and increased scientific knowledge

� Patients and physicians must be informed in the event of the substitution of an original product by a similar biological product

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V. The European Perspective

� Legislative Authority

� Commission Directive 2003/63/EC

� Regulatory Authority

� Overarching Guideline (CHMP/437/04)� Defines core principles

� General Guidelines for Biotechnology-Derived Proteins

� Quality

� Nonclinical

� Clinical

� Annex guidelines �product specific

� Insulin, Somatropin, GCSF, Epoetin, INF-alpha, Others

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VI. Predicting the U.S. Biosimilars Market

� FDA Policy (in development)

� Focus on public health

� Science based

� Recognize what can and can�t be done

� Data driven

� Flexible to reflect changing technologies

� Sounds a lot like EMEA core principles

� Genzyme experience with Myozyme

� Suggest careful approach by FDA regarding manufacturing for biosimilars

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VI. Predicting the U.S. Biosimilars Market

� Regulatory framework will be very different than that for generic drugs

� Key differences:

� Likely requirement for clinical trials (at least initially)

� High threshold for �interchangeability� designation, resulting in fewer products being deemed substitutable for reference product

� Some commentators estimate $40M per biosimilar to meet regulatory requirements

� Potential for post-marketing monitoring

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VI. Predicting the U.S. Biosimilars Market

� Impact on Market:

� Generic drug companies will be involved

� Teva acquisitions

� CoGenesys, Sicor, Tianjin Hualida

� Sandoz

� Deal with Momenta

� Barr acquired Pliva

� However, Big Pharma and Biotech will be players too� Existing expertise with biologic formulation and manufacturing

� Expertise with clinical trials

� Sales force capability (key if biosimilar is alternative treatment)

� Capital to invest

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VI. Predicting the U.S. Biosimilars Market

� Biosimilars will have different risk:reward ratio than small molecule generics

� Higher investment

� One estimate is $40M per biosimilar product

� Predicted lower market penetration rates compared to typical small molecule drugs

� Small molecules Pup to 90% penetration rate

� Biosimilars P optimistic estimates of 20-50%

� �interchangeability� is key to substitution (but more difficult to obtain)

� Examples:

� Omnitrope/Tev-Tropin = 3.4% of HGH market (still early)

� Dynepo P 10% market penetration expected by Shire

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VI. Predicting the U.S. Biosimilars Market

� Conflict Issues

� Technical and regulatory differences between biosimilarsand small molecule generics will present new challenges in resolving conflicts of interest

� For small molecule generics, advisors and consultants are typically split into two camps: NDA holders vs. generics

� For biosimilars, brand companies will be playing both sides P thus advisors and consultants must also

� Conflict resolution will be technology driven � Advisors and consultants chosen for technical/legal expertise

� Exclusive allegiance to brand vs. generic less important

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Conclusions

� Biosimilars are coming (sooner rather than later)

� Complex nature of biologicals will require significantly different regulatory scheme than small molecules

� European experience will inform FDA policy

� Clinical trials presumed (at least initially)

� Higher barrier to entry and greater risk to reward

� Fewer, more sophisticated players, including big pharma and biotech

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Thank You

Timothy J. Shea, Jr., Director

Vincent L. Capuano, Director

Sterne, Kessler, Goldstein & Fox P.L.L.C.

(202) 371-2600

www.sternekessler.com