Despite looming patent expirations, exact-copy “generics” are out of reach for breakthrough oncology drugs such as Rituxan, Herceptin, Avastin and Erbitux given the molecular complexity of biologic medicines. The closest achievable replications are called “biosimilars” because they have demonstrated bioequivalence and non-inferiority. While a few biosimilars have been on the market in Europe for a decade, significant skepticism remains, especially in the space of oncology therapeutics, which represents a $25 billion opportunity in annual revenue.
The market is still evolving in how it perceives and adopts biosimilars. For example, in September 2015, Zarxio, a Neupogen (filgrastim) biosimilar used as supportive care in oncology, was the first to launch in the U.S. By February 2016, with a 15% discount to the originator, Zarxio gained a 3% share of the filgrastim market. Perhaps underwhelmed by the discount, most payers haven’t aggressively encouraged other stakeholders to adopt this biosimilar. This is telling, as supportive care carries lower risk.
Therapeutic oncology biosimilars may have even greater hurdles to adoption and uptake for a few key reasons:
- Recruitment challenges for clinical trials exist given the life-threatening nature of the disease.
- Comments about biosimilars from the American Society of Clinical Oncology (ASCO) have been lukewarm. Most notably, they’ve opposed mandatory substitution of biosimilars as this would limit physician choice.
- The high aversion to switching patients already on therapy will lead to delayed uptake.
- Historically, payers have had less control regarding oncologists’ treatment decisions.
While overall, biosimilars are expected to offer 15 to 50% discounts, there’s much uncertainty regarding what discounting therapeutic oncology biosimilars will offer as price pressures cut in both directions: On one side, it will be more expensive to develop a biosimilar for an oncology therapeutic given larger molecular complexity and hurdles to approval; on the other side, deeper discounts may be needed to win over skeptical stakeholders. These conflicting price pressures could lead to slower uptake among therapeutic oncology biosimilars when compared to biosimilars as a whole.
For developers of biosimilars, the opportunity is realizable but requires careful navigation—partially treating launch as a late-to-market branded product while truly understanding the stakeholders and nuances of oncology. For originators of the oncology therapeutics that are being targeted, the threat is real, and these entrants need to be treated like a competitive brand with scenarios in hand for how uptake evolves.