Subsequent entry biologics (SEBs), or biosimilars, have been making a lot of news in Canada lately. While the discussion has been happening for years already, we’ve started to see how regulatory and payer decisions are shaping this new market. We’ve recently seen payers implement coverage inconsistently (such as the “limited use” code in Ontario, mandatory substitution for new starts in British Columbia and preferential listing in some private payers), regulatory bodies update indications (Inflectra now includes Crohn’s disease and ulcerative colitis), and new products launched (etanercept and insulin glargine).
These actions have helped provide clarity and insight into how future SEBs will be able to launch and compete in the Canadian market, but we’re seeing a number of manufacturers struggle to maintain a relevant brand strategy in the wake of these rapid market changes and increase in competition. And it’s not just manufacturers with direct SEB competitors that are impacted by these changes; it’s all manufacturers that compete in a market with SEB entrants.
With the insight and perspective garnered from business, regulatory and payer decisions made in 2016, now is a good time to assess the health of your go-to-market approach. There are six major environmental themes that will impact how you compete within a therapeutic area:
1. Dynamics of the therapeutic area: for example, chronic vs. acute, disease severity or number of competitors
2. Regulatory decisions: extrapolation of indications, or multiple versions of the same molecule
3. Payer influence: the level of influence by private plans, government plans, hospitals or cancer boards
4. Physician: a physician’s specialty and previous experience with SEBs
5. Product: for example, the drug, or additional services such as patient support, evidence and legacy
6. Company decisions and strategy: existing decisions and the “heritage” areas—previous areas of focus—for a manufacturer
Most manufacturers have considered the first five themes in their strategies, and a simple review of their go-to-market plans should quickly identify elements that need to be adjusted based on their business, regulatory and payer decisions in 2016. However, we haven’t seen companies consider their “heritage” areas when designing their strategies, and that will have a substantial impact on the success of their go-to-market strategies. By considering these heritage areas, manufacturers will be able to leverage their experience, relationships and processes in ways that their competitors might not be able to. Here are a few examples of how a previous area of focus could affect different companies in today’s evolving marketplace:
- Pharmacy and contracting experience: For “biosimilar-only” companies, previous pharmacy and contracting experience will be a key differentiator. The ability to contract and distribute product more efficiently will allow for larger concessions on price and may also influence product selection (by having more availability than a competitor). The companies that benefit from this area of focus typically have substantial experience in generics, existing relationships with pharmacies and leaner operations. Oftentimes, these companies have limited experience engaging healthcare providers.
- Commercial experience with healthcare providers: This area of focus is critical for “originator-only” companies. Originator companies have the ability to educate, support and interact with healthcare providers, which could lead to more effective (and appropriate) use of their product. These are typically branded manufacturers with a significant legacy of commercial investment, especially among HCPs. These manufacturers typically have less flexibility to take substantial reductions in price.
- Differentiation and positioning: For companies that don’t have a direct SEB competitor but that are in markets that are responding to biosimilar-driven change, positioning will be challenging. These companies are often promoting (or launching) a product in an environment that is increasingly more constrained due to payer criteria, regulatory changes and competitive tactics that now include cost. Historically, “generic” entrants have typically only impacted the branded version of the same drug. In a biosimilar world, companies will need to consider how an SEB will impact other products in the same market.
SEBs have already created substantial change within Canada. In 2017, we’re likely to see markets with multiple SEBs for the same drug, and with that, even tighter constraints on pricing and payer access. The most successful manufacturers will continuously evaluate and refine their go-to-market approach as change happens.