Biosimilars pioneers did not think they were signing on for an easy way to make a quick buck when they entered the field, and recent strategy adjustments by some players confirm the challenges. But so far, no company has signaled that it plans to back off, indicating the beguiling, long-term potential.

A case in point is Pfizer Inc.’s seemingly abrupt breakup in March with Indian biotech Biocon Ltd. over a deal around insulin biosimilars. The announcement startled many and led to speculation that the Big Pharma is stumbling in a field for which it – and other Big Pharmas with similar ambitions – is ill equipped.

A month later, in another signal of the uncertainty of existing business models, Merck & Co. Inc.confirmed that it was folding Merck Bioventures, one of the first dedicated biosimilars business units, into the biologics and vaccines division of Merck Research Laboratories.

At the same time, Merck Bioventures President Michael Kamarck, one of the industry’s most visible proponents of biosimilars development, left the company. Merck has not said much beyond an official statement about the change, which noted that "as our pipeline of biosimilars and novel biologics continues to progress, we decided to combine development and align under one leader to facilitate decision making and prioritization of resources across the portfolio." That leader is Rich Murray, who is Merck's senior VP biologics and vaccines research.

For Pfizer, however, the takeaways from its experiences with Biocon were clearer: The rite of passage was a learning experience that reaffirmed its commitment to leadership in biosimilars across multiple therapeutic areas and highlighted what it needs to succeed, general manager of the biosimilars business unit Diem Nguyen said in a recent interview at the company’s New York headquarters.

Pfizer has the flexibility and determination to provide value to patients and stakeholders, decades of experience in biologics development – much of it gleaned from its acquisition of Wyeth in 2009 – and creative clinical development strategies, which she argued are crucial for success in the field. Nguyen and a colleague, Michael Corbo, VP and chief development officer of Pfizer’s Bioenhancement Development Unit, which is part of the company’s worldwide R&D organization, emphasized that the Big Pharma acted quickly once it realized the Biocon deal would not bring it enough value.

More to the point, the company is moving ahead with development of five monoclonal antibodies. The furthest along thus far is a molecule biologically similar to Roche’s Rituxan (rituximab), sold in Europe under the brand name MabThera. Rituxan/MabThera will be the first major monoclonal antibody to go off patent in Europe, beginning, in some countries in late 2013; in the U.S., the date is in 2015. Initially launched in the late 1990s for follicular lymphoma, it is the fourth best-selling biologic in the world, with total sales across all indications of $5.7 billion in 2011 and $5.2 billion in 2010, according to IMS Health.

Enrollment for Pfizer’s Phase I-II trial started in the U.S. in March as part of a global registration program that is progressing “on label.“ That is, the trial is geared for the same indication as Rituxan¸ which is approved for patients who respond inadequately to existing treatment with moderate to severe rheumatoid arthritis. Rituxan is used more widely for certain hematological cancers, but Pfizer’s plans to develop it as a biosimilar for oncology will depend on how FDA and European extrapolation requirements proceed Also see "Biosimilar Interchangeability: Stakeholders Want More FDA Guidance, Fewer Hurdles" - Pink Sheet, 30 April, 2012..

Because they are tough to make, all of the monoclonals in Pfizer’s program are being developed internally rather than through partners, based on expertise derived both from legacy Pfizer and the Wyeth acquisition, Corbo said. The business unit relies on Pfizer’s biologics manufacturing capabilities, which “can make anything,” when it comes to MABs, he added.

That’s not to say Pfizer won’t partner on parts of its biosimilars business, but external collaborators will have to prove they have an advantage over internal sourcing. To evaluate opportunities, the biosimilars unit relies on both its own business development group and Pfizer’s broader business development organization.

Similar Molecule, But Multi-Faceted Innovation

Key, of course, will be Pfizer’s ability to maximize its advantages and differentiate its strategy and product offerings in what is likely to become a highly competitive field Also see "Biosimilars: A New Kind Of Innovation" - In Vivo, 30 November, 2011.. But unlike innovative products, in which positioning depends on molecule innovation based on scientific breakthroughs, as well as clinical trial data, the distinctions among biosimilars cut across several levels, ranging from the manufacturing process to clinical trial designs and wrap-around services related to commercial activities.

In this regard, Pfizer has taken several steps to de-risk the process. Among them is an up-front investment in manufacturing rituximab to commercial quantities beginning early in the development process, rather than starting with small batches and gradually increasing capacity. The plan is to take this approach with all of its MAB programs. The result is a bigger spend early on, but the payoff, hopefully, will be more certainty around the product’s consistency. That is traditionally a key element for regulators, and will ensure Pfizer’s ability to meet a very specific drug profile, as required by FDA.

Companies that choose to scale up later in the development process risk encountering variability and potentially process shift, which affects a drug’s profile and ultimately FDA-mandated clinical trial requirements, Nguyen said.

Also key to Pfizer’s strategy is innovative clinical trial design, particularly aimed at best practices for proving similarity. A lot of the innovative work is being done in statistics, with a variety of schools of thought on equivalence designs, said Corbo. Another example is the use of innovative endpoints, which may differ from those used by the innovator in its original trials.

That’s partly because biosimilars trials are geared to demonstrate similarity, while innovator trials typically must show efficacy. The rituximab trial for rheumatoid arthritis, for example, is based on Disease Activity Scoring (DAS), a metric that is commonly used by European regulators and which provides both relative and absolute measures of joint condition on a continuous basis. Providing the information over time enables more precise assessment of equivalence.

In contrast, most U.S.-directed trials for new rheumatoid arthritis drugs rely on American College of Rheumatology (ACR) scores, which are absolute, as their primary endpoints. Unlike ACR scores, the continuous measure doesn’t have a hard cut off, said Corbo, adding that Pfizer also plans to include ACR data in its submissions.

Nyugen and Corbo refused to divulge Pfizer’s timeframe for developing rituximab or any of its other monoclonals, except to say that the company is “confident it will be able to commercialize in a timely manner” and on a global scale, that is, in the U.S., Europe and Asia.

If so, that program better hurry. At least half a dozen other companies have rituximab biosimilars in development, with some, notably Novartis AG’s Sandoz International GMBHsubsidiary, in Phase III trials. Teva Pharmaceutical Industries Ltd. and Sandoz could complete their development programs by 2014, while CelltrionInc. and Samsung BioLogics, which also are in the game, could have an estimated completion date in 2015, according to a May 14 biosimilars report by Barclays Equity Research (see chart).

Pfizer’s Post-Biocon World

Pfizer currently is not rebuilding an insulin portfolio to replace the drugs it let go of when it dropped Biocon, but it is leaving the door open to re-visit the prospects down the road. On the positive side, insulin isn’t as complex to develop as monoclonals, and patient need is high. Moreover, the company has three innovative Type 2 diabetes drugs in Phase II clinical trials and several more in Phase I, according to a pipeline chart on its website dated May 10.

While the ability to blend innovative and generic drugs in a therapeutic area isn’t mandatory for gaining the attention of payers and physicians, it gives the company a competitive advantage, Nguyen said. Indeed, the innovative and biosimilar pipeline projects are reviewed jointly and periodically by committee, so that Pfizer can look at patients and providers holistically, she added.

On the downside, the biosimilars insulin market is becoming highly competitive, and is complicated by the need to be innovative around delivery devices, marketing techniques, and managing costs, she pointed out.

Pfizer has not publically stated its reasons for pulling out of the Biocon deal a year and a half after it announced the alliance in October 2010, but analysts have cited the pharma’s reduced expectations for generic insulin in what is likely to become a heavily competitive market ([A#28120314006]). Nguyen said both external and internal factors played a role in the decision. Initially, the strategic fit seemed promising, but Pfizer’s perceptions changed over time as it reviewed its ability to meet patient needs with high quality products and maintain a competitive cost structure.

Pfizer made an up-front payment of $100 million to Biocon and pledged another $100 million to its partner based on milestones in exchange for global rights to four insulin analogs including glargine, lispro, and aspart Also see "With Biocon Deal, Pfizer Expects To Gain First Mover Advantage In Global Biosimilar Insulin Market" - Scrip, 18 October, 2010.. It had just begun selling those products in India, where it shared rights with Biocon, when it decided to withdraw from the deal. Biocon, which has retained all of the up-front payment and much of the additional funds as a result of the breakup, continues to sell the insulins in India and may look for other partners, though on a smaller scale.

The breakup didn’t lead to internal repercussions at Pfizer. In any event, Nguyen says, Pfizer remains flexible as the field evolves. “We’re building a portfolio based on a hypothesis, and also building a portfolio based on what if we are wrong. What if biosimilars are not differentiated by brand, as we believe they will be, and the point of differentiation is cost and quality? We are comfortable with that scenario, too.”

Select Rituximab Biosimilars Programs
Company	Name of Biosimilar Rituximab	Status
Merck Bioventures	MK-8808	Phase I
Pfizer	PF-05280586	Phase I/II
Celltrion	CT-P10	Phase I
Samsung	SAIT-101	Phase I
Teva	TL-011	Phase II
Novartis/Sandoz	GP-2013	Phase III
Dr. Reddy’s	Reditux	Marketed in India
Gedeon Richter/Stada	Rituximab biosimilar	NA
Sources: Decision Resources, clinicaltrials.gov

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