PRODUCTION OF BIOGENERICSPRODUCTION OF BIOGENERICS

Key IssuesKey Issues

BIOTEC INDIA INTERNATIONAL 2003

1) The Vision

2) Market Drivers

5)Strategy

4) Indian Scenario

AGENDA:AGENDA:

3) Obstacles

6)Future of biogenerics

BIOGENERICS ARE:

2. Similar to an original biopharmaceutical whose substance patent expired

3. Could be approved through a simplified abbreviated registration process

1. Biopharmaceutical preparations involving a biologically active substance stemming from modern biotech tools.

4. Are sold under the generic substance name as opposed to brand name

(eg. EPO as opposed to Epogen)

The term off-patent biotechnological products (OPBPs) as an alternative to biogenerics when

describing such products.

Let’s review the reasons behind the interest they have sparked……..

MARKET DRIVERS

MONEY

• The US market now for biopharmaceuticals is approximately $20 billion.

• If biogenerics achieve the same, 10-15% medium to long-term penetration rate of rest of the market,it means there is a potential biogeneric market of $2 billion in US alone.

• The two main segments of biogenerics are The two main segments of biogenerics are recombinant protein technology and monoclonal antibodies. recombinant protein technology and monoclonal antibodies. The global sales of recombinant therapeutics are expected to be The global sales of recombinant therapeutics are expected to be in the region of $4,610 billion by 2005in the region of $4,610 billion by 2005..

Manufacturers of biogenerics ……. Do not have to recover the hefty outlay of

research and development

Can charge significantly less for their biogeneric version than the brand-name product and still make a handsome profit.

Biogenerics offer large profit margins, with

relatively low impact of cost of bulk biopharmaceutical on overall price.

Less expensive clearances

In most countries, when the initial patent for a small-molecule drug expires, other companies are free to manufacture the compound and market it (may be) without having to repeat the expensive development and (complete) clinical trials process.

Opportunities During next five years, top 15 biopharmaceutical will

come off-patent. More opportunities for generic formulators. Few of biogenerics are already under manufacturing or

development including EPO, hepatitis B vaccines and CSFs by circumventing the patent issues.

Some have lost their patent protection( Insulin and human growth hormones) and therefore open to generic competition.

Brand Active

substance

Marketer Year of approval

Generics under development

1999 sales in millions$

EPOGEN Epoetin

alfaAmgen Inc. 1989 Yes 1760.0

Humulin 50% human insulin isophane suspension, 50% human insulin

(rDNA)

Eli Lilly & Co. 1992 Yes 1088.0

Betaseron Interferon

Beta – 1bEli Lilly & Co. 1993 Yes 413.0

Engerix - B Hepatitis-B vaccine

Biogen Inc. 1989 Yes 540.0

Statistics….

MARKET EXISTS….

• Manufacturers can be confident that a market exists for the product.

• Biogenerics satisfy large market size qualification. Most biotech products expected to come off-patent comprise several biologics still showing double digit growth.

• Most health care insurers will now insist that prescriptions be filled by biogenerics whenever possible.

1. Availability of bulk active biopharmaceutical through non-patent infringing routes.

2. Patent coverage for biopharmaceuticals represents a thorny path for biogenerics.

3. Biogenerics must clear more regulatory hurdles than traditional small- molecule generics.

4. Bioequivalence for therapeutic proteins : To produce a protein identical to a branded drug and to comply with the regulations , a generic manufacturer must use the same protein expression system, purification protocol and delivery technology as in original patent.

OBSTACLES….

6. Need to demonstrate essential similarity to original product.7. Even minor modifications in a bioprocess such as changes in

agitation or aeration systems, reactor size, operating conditions or culture media, not to mention changes in the cell line or microbial system applied can result in variations in quality or properties of the biopharmaceutical.

8. A protein can be folded, glycosylated and methylated in quite different ways if expressed in different systems (for example, mammalian versus bacterial cultures)and these differences can radically alter its characteristics.

OBSTACLES…..

9. Lack of clear regulatory framework. Biogeneric developers need regulatory standards so that they may avoid undertaking massive investments to develop the product.

OBSTACLES …..

Existing Regulations worldwide:• Bio-equivalence standard: United States , Canada and the European

Union- requires that the generic drug has a pharmacokinetic profile similar to brand name drug.

• USA: Manufacturers of generic drugs must file for abbreviated new drug application(ANDA)-may take 2-5 years to demonstrate bioequivalence and manufacturing facility certified.

• US FDA: Companies seeking to market biogenerics in US have to file “process-improvement” application and carry out limited clinical trials to get approval.

• Health Canada: Preliminary guidelines for approval of generic biopharmaceuticals and clinical trials to demonstrate safety and efficacy.

• In Europe, it is not clear :• whether a biogeneric should be registered through the

abbreviated procedure applicable for well-defined traditional generics requiring "that the generic is essentially similar to a reference product;

• if not, the generic should undergo a full registration process logged with the European Medicines Agency" (EMEA Committee for proprietary medicinal products).

Existing Regulations worldwide:

Big fish Strikes Back• Biopharmaceutical innovators are expected to fiercely defend

their franchise, engaging in a wide array of tactics, including proactive efforts to influence and shape the regulatory framework and stress to the medical community the value and safety of the original product, compared to biogenerics.

• The unique aspects of biotechnology patent law and its complexities certainly represent a fertile ground for biopharmaceutical innovators to hinder the development of biogenerics, providing a nightmare for potential generic producers.

• Amgen defending EPO’s position against Genetic Institutes and now against Transkaryotic Therapies;

• Repositioning the molecule through new enhanced formulations offering tangible   benefits in terms of patient compliance, sustained release forms, lower adverse   effects.

• Accelerating the introduction of a second generation product, and possibly phasing   out the original molecule:

Amgen’s strategy with NESP, the novel   erythropoiesis stimulating protein currently under registration.

• An additional hurdle for the development of biogenerics whilst providing an additional period of exclusivity for the originators, is the provision that the generic company would not be able to start any substantial development work on the biopharmaceutical before the effective patent expiry date.

INDIAN SCENARIO

No price war….

Indian companies are attracted not only by the size of biologicals going off-patent but also because there is no price war as in formulations market.

Companies could price biological product at five percent less than multinationals and still grab substantial market.

• The cost of process for R & D is also relatively low

( cost-effective)• Many companies have manufacturing facilities that

satisfy the economies of scale and adhere to WHO norms.

• Spate of tie-ups, partnerships and acquisitions for marketing internationally by Indian companies

• Lack of marketing muscles for biologicals.

STRATEGY

• The dogma that the "process makes the product" has been increasingly challenged. It appears that—if not strictly identical—at least comparable biologics can be obtained through different processes.

• This is the case for most well-characterized proteins.

CLEARING HURDLES

HGH is being produced in Europe in a variety of expression systems , with identical results, a 191-amino acid sequence copying the human pituitary growth hormone. All of these products appear to show the same profiles in terms of amino acid sequence, potency and safety and efficacy, undermining the belief that "the process makes the product."

Producer Expression system Product

Pharmacia Standard 191 amino acid

Ferring E.coli sequence

“identical” to the

Lilly Special strains human

Novo of E.coli pituitary growth

hormone

Serono Transformed mouse

Cell line

Pharming for profits

• Some companies subcontract their protein production capabilities.

Ex. Genzyme Transgenics has developed mammalian mammary gland expression systems, primarily in goats, for over 60 therapeutic proteins.

• Some companies may compromise by selling proteins as generics.

• Some may compromise by collaborating with current manufacturers to improve production processes, depending on which route is more feasible for a given drug.

• Small start up companies have partnered with brand-name biogeneric manufacturers which may offer good short term insurance against regulatory hurdles and litigation.

• Existing players in the small molecule generics market are also moving into biogenerics.

Ex. In 1999, generics giants Ivax (Miami,FL) and Teva (Jeruselam,Israel) bought biognerics capabilities in-house through partnerships with Indiana Protein Technologies (Indianapolis, IN) and Biotechnology General ( Iselin,NJ) respectively.

Ex. Biotecnol (Lisbon, Portugal) has cloned and expressed a large number of proteins coming off-patent between 2001-2007, and plans to commercialize both the proteins and the company’s improved bacterial systems.

• The demand for contract expression facilities have increased.

Ex. Two companies, TranXenoGen (London,UK) and Viragen (Edinburgh,UK and Plantation.FL,in collaboration with the Roslin Institute in Edinburgh) intend to express therapeutic proteins in the albumin of the eggs of transgenic chickens.

Branded for life?• Several human growth hormones have now been manufactured

which has led to extensive litigation.

ex. Pharmacia (Peapack,NJ) stopped producing plasminogen activator streptokinase because of competition from biogenerics.

• Some companies have managed to protect their market share from biogenerics,sometimes unintentionally.

Ex.The original patent for Schering’s recombinant interferon-α(Intron) have expired in 2002,but because of a dispute over the initial discovery of the protein, a competing patent claim was filed by Roche (Basel,Switzerland) and Genentech (S. San Francisco, CA).

3.Availab

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4. Policies of g

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BIOGENERICS

Future development depends on interrelated variables

• First, the biogeneric market requires the development of a favorable regulatory and patent framework.

• The availability of bulk material and bulk biogenerics suppliers is also a must for the development of a biogeneric market. Several reliable contract biopharmaceutical producers are starting to emerge (Boehringer-Ingelheim, Cambrex-

BSCP, Diosynth-Covance, DSM-Biologics, Lonza).

Advances in analytical technologies

New technologies in this field may allow a more accurate characterization of macromolecules, opening new frontiers in terms of demonstration of equivalence or even essential similarity

Policies and approaches• Many are still waiting on the sidelines, hoping the biogenerics

situation will become clear. Undoubtedly, once the first biogeneric hits the market, many companies will step up their efforts in this field.

• The receptivity of the customer base, including patients and health care providers, to generic formulations also represents a potential barrier. Most of the biopharmaceuticals on the market target serious diseases in which the risk of switching patients to new formulations could be viewed by health providers as unwarranted and dangerous, given fears about biogeneric quality.

Hope for the best……..

• Major hurdles are still hindering the development of biogenerics, but the overall field is rapidly evolving.

• Breakthroughs in the regulatory environment must not be ruled out.

• Perspective participants, eager to capitalize on this potential opportunity, must carefully monitor the field, keeping in mind that timing is of the essence.

THANK YOUTHANK YOU

PANACEA BIOTEC LTD.

In support of Life