Pfizer, Amgen Leading Pharma Into 'Golden Age' of Biosimilars
Two members of Big Pharma are ushering in the "golden age" of biologics in the United States, according to Bernstein analyst Ronny Gal.
FiercePharma reported that in a note to clients this week, Gal wrote that Pfizer Inc. (NYSE:PFE) and Amgen Inc. (NASDAQ:AMGN) are gaining dominant positions in the sale of this category of drugs.
All in all, Pfizer's biosimilar sales are running at an annualized rate of $2.1 billion, and the company is set to eventually bring in close to $3 billion a year in biosimilar revenues, Gal predicted.
Meanwhile, sales of Amgen's biosimilars were $357 million in the second quarter. If demand keeps up at that pace, the California-based company would sell more than $1.4 billion in biologics in 2020, Gal estimated. Amgen controls several U.S. markets, including those for biosimilar Herceptin, where its Kanjinti holds 32% share, and Avastin, for which it claims 39% share with Mvasi. "Here the addition of [biosimilar] Remicade and later this year the launch of Rituxan should push the business toward $2 billion," Gal wrote.
A biosimilar is a biologic medical product highly similar to another already approved biological medicine. Biosimilars are green-lighted by regulators according to the same standards of pharmaceutical quality, safety and efficacy that apply to all biological medicines.
People often lump biosimilar and generic drugs together, but they differ. Generics are identical to the original in chemical make-up. Biosimilar drugs are close, but achieve the same therapeutic and clinical objectives as the original.
A biologic can be made from living cells or tissues, like a vaccine. Or it can be made by living cells or tissues, like many of the newest cancer therapies. Starting with insulin over six decades ago, biologics have become the fastest-growing class of therapeutic compounds, according to an article in Alta Sciences. These drugs have been treated some of the most serious medical conditions.
Obviously, biosimilars are going to eat into sales of the originals. This was illustrated in the second quarter, when copycats to Roche's (RHHBY) three best-selling cancer medications, Avastin, Rituxan and Herceptin, chopped some $2.3 billion off the Swiss pharma's revenues. As a result, Roche reported its first three-month sales decline in nine years. The guilty parties were three monoclonal antibody biosimilars from Pfizer. The Roche drugs are forecast to suffer more pain. For the full year, the company expects the impact of biosimilars and Covid-19 will shave $5 billion off its top line.
Proving that what comes around goes around, Amgen faces competition from other biologicals for Kanjint and Mvasi, but the company isn't worried about losing market share, at least for the near term. During Amgen's second-quarter earnings call, Murdo Gordon, the company's head of global commercial operations, said, "We're less challenged on share but you may see some net price effects of multiple competitors entering."
Bernstein's Gal said the golden age for biosimilars should last until at least 2025, when prices may suffer due to discounting.
Disclosure: The author has positions in Pfizer and Amgen.
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