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Generic Country Markets & Biosimilars

Chesapeake

Dr. Brian W Tempest

www.briantempest.com

brian.tempest@clara.co.uk

UK

March 2014

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7. Generic Country Markets

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Europesource: EGA

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Reference Pricing Globally Endemic

Source : Istanbul September 2012

Pharma purchases reduced from 1.7% of GDP to 1.0% of GDP in Turkey

Russia, South Korea & Saudi Arabia health ministries requested Turkish prices

Everybody is referencing everybody else on Pharma prices in Europe

Bulgaria is referencing prices in 17 other countries

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Europe – generics take half the volume but a fraction of value sales

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EU Chemical Sales

source: Chemistry World September 2013

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Open letter to Barroso from the Chairman of INEOS on 7 March 2014

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Generic Global Volume Share Source: Sandoz

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30 generic packs, >2 years treatment £69200 king size cigarettes £68Source: Generics Bulletin 15 Feb 2013

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European Generic Prices Source Ranbaxy

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Indian Pharma penetration of the UKsource: FT January 13 2014

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Security of Power Supplies in Europesource: Economist 15 April 2014

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France Generic Market Source: Generics Bulletin 15 February 2013

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US DMFs from Indiasource: Citi Research 2013

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Number of USA Para IVs source: Generics Bulletin 14 September 2012, quarter indian

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USA Generic Market - Latest Challengessource: Jefferies 10 March 2014

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Africa Management source Ranbaxy

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Nigeria, South Africa & Angolasource: Economist 12 April 2014

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African Factories

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Japan Generic Market

source: Citi Research August 2013

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Japan Generic Opportunity

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Japanese Generic Marketsource: Mint 28 January 2014

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Brazil Generic Packs

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Brazil Top 10 Generic Cos

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Russia 2020 Strategy for Public Health

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Russian Market Evolutionsource: Frost & Sullivan 2011

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Vaccine Plant to take 1/3 Russian Market source: St Petersburg Times, 16 April 2014

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USA Generic Market - Latest Challengessource: Jefferies 10 March 2014

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Russia VLS List

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Russia 2020 Strategy 90% local manufacture of VLS list

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Russia 2020 Strategy 50% local manufacture of all products

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New Novartis Plant in St Petersburgsource: Top Emerging Pharmaceutical Markets by Kathlyn Stone

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Russia & India – Big Picturesource: ET March 26 2014

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Russia & India – Big Picturesource: ET March 26 2014

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Indian Pharma in Russia - DRLsource: website, 20 years

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Indian Pharma in Russia - Ranbaxysource: RUR, 20 years, 15% MS IMS May 2013, across 56 Regions

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Chinese Debt 200% of GDP in 2013source: FT 2 April 2014

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Chinese NGOssource: Economist 12 April 2014

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China Pharma Industry Capex PlansSource: Stravencom

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China Price Cutssource: Jefferies

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China API Exports decline by -9%source: Pharmatiimes February 21 2014

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Hisun Pfizer Pharmaceuticals Ltdsource: Launch Announcement September 12 2013

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Hisun USAsource: website

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Hisun USA acquires FDA approved DPIsource: Press Release January 17 2012

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Hisun USA acquires FDA approved DPIsource: Press Release January 17 2012

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China: Optimistic view of Domestic Marketsource: Jefferies 17 March 2014

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China Provincial Tenderssource: Jefferies 17 March 2014

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Sino Biopharm strongest domestic pipeline source: Jefferies March 17 2014

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Zhejiang Huahai(Novast also received an ANDA for an OC in 2010)

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China - Actavis Withdrawssource: Bloomberg January 15 2014

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South Africa Generics

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Middle East & North Africa

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Jordan punches above its Weight

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Canada Generic Market Source: Generics Bulletin 15 Feb2013

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Myanmar – a new market

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8. Biosimilars

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Which Way?

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Biologics & Small Molecules source: Kozlowski et al., N England J Med, 365:5, 2011

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Estimated 2016 sales of Top 20 products Source: Cowen

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Biosimilar Share to 2018 source: EvaluatePharma 2012

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Monoclonal antibodies $m Source: Synthon

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New Biosimilar Company (with Merck)

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Korean Pharma in Biosimilars

source: Citi Research August 2013

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Biosimilars from China/India Source: New York Times 20 Sep 2011

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Biotech Drugs where India has no DMF Source: JGM Volume 6 p333 sep 2009

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Biosimilars from IndiaSource: Citi 25 September 2013

•Market opportunity of $1.5b to $2b for US & EU

•More clarity now on regulatory pathways

•OECD -$100m for R&D development of a MAB, $300m-$400m to set up manufacturing capacity of 100,000L with annual R&D at $100m

•Developing Countries - $200m sales potential, $20m R&D per year, manufacturing capacity of 1,000L planned

•India companies will enter emerging markets but use partnerships and alliances for OECD eg DRL

•Developing Countries limited by affordability issues

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Biosimilars Key Issue - Interchangeabilitysource: GaBi Journal Biologics & Biosimilars 28 December 2013

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Biosimilar Market SizesSource: IMS, FT February 9 2014

•Global Biologics including Big Pharma blockbusters in 2012 is $170 b

•Biosimilars market size in 2012 is $2.5b and in 2020 is estimated at $25b

•VERSUS•cost of manufacturing plant, •cost of clinical trials, •lower hospital tender prices, •no interchangeability, cost of reps, •patient-innovator relationship, •competition from South Korea, •authorised generics

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First Herceptin Trastuzumab Biosimilarsource: ET January 14 2014 Rs 40,000 per 440mg vial, Roche halved price at Rs 55,000

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Sandoz Biosimilars – an 12 years ROI source: Pharmacloud June 2012

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India Pharma in Biosimilars

source: Citi Research August 2013

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BiosimiIar Challenges for CEOs Do I enter or keep out?

Rituximab >100 patient CT for Roche, >600 patient CT for Generic companies

Interchangeability (AB rating) unlikely Cabilly patents may delay US mAbs EU mAb in 2013 from Hospira/Celltrion EPO biosimilar side effects in Thailand Many biosimilar manufacturers in China but

few will reach EU/USA Scientifically challenging - Amgen Biobetters need a full dossier with health

economic data

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Biosimilar Alliances – to share the risk

Cipla & Biomab, China $165m 12 products Richter & Stada – mABs Celltrion, Korea -Hospira, Egis, Hikma, BB, etc Biocon & Mylan, USA, mABs: Xbiotech Teva & Lonza, EU – dissolved July 2013 Biocon Idec & Samsung, Japan – now Merck Watson & Amgen, USA Fuji Film & Kyowa Hakko Kirin DRL & Merck-Serono, Germany – mABs Bionovis (Brazil) & Merck Serono - 6

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NIBS (tyrosine kinase inhibitors)Will these small molecules replace mAbs?

Axitinib, Pfizer, cancer Cediranib, AZ, cancer Pazopanib, GSK, cancer Regorafenib, Bayer, cancer Semaxanib, Sugen, cancer Sorafenib, Bayer(Nexavar),cancer Sunitinib, Pfizer, cancer Toceranib, Pfizer, cancer Vandetanib, AZ, cancer

Tofactinib, Pfizer, RA

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BTD : Breakthrough Therapy Designationsource: Evaluate,FDA Jan 2014 31 products in 2013 6 ibs & 3 mabs J&J 4, GSK 3, Nov 3, smaller cos 12

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Thank Youbrian.tempest@clara.co.uk

www.briantempest.com