Rise of the Biogenerics?

Will generic competition invade the biologic space?

By Gil Y. Roth
Editor

When will generic biopharmaceuticals reach the marketplace? While some treat their presence in the marketplace as an inevitability, others contend that, by their very nature, biologics can’t be produced in “generic” form.

Some of the biggest bio-drugs have technically been “patent-expired” for years, and every rule of pharmacoeconomics dictates that generic pressure is necessary to reduce drug prices. Depending on your definition of the bio-drug, the market of expired biologics still produced only by innovators will reach approximately $17 billion by next year. So, on the face of it, there’s plenty of incentive for generic companies to move into the “bio-sphere.”

But biogenerics present a thorny question for regulators. The most recent illustration of this point is the filing process of Omnitrope. In September 2004, the FDA told Sandoz that its application for Omnitrope, a generic version of human growth hormone, was unruleable. That is, the agency sent a letter to Sandoz stating the the Omnitrope review was complete, there were no deficiencies in the application, and . . . bupkes.

Without a regulatory framework to process generic biologic drug applications, the FDA concluded that it simply couldn’t reach a decision on approving the product for sale in the U.S. A year later, Sandoz elected to sue the FDA to force a ruling.

How close are we to seeing a generic biologic? “The evolution of generic biological products will be part of the continuum of market pressures, but the  timetable for the appearance of generic equivalents will rest with product development effectiveness, and the FDA’s ability to expedite the regulatory process,” said Neil J. Lewis, Ph.D., vice president, XenoBiotic Laboratories.

According to Himanshu Parmar, team leader and industry analyst, Pharmaceutical and Biotechnology Healthcare (EMEA) for  Frost & Sullivan, the problem is that the Hatch-Waxman act was passed at a time when there were few biologic drugs available (insulin and HGH). Technically, the act only treats products that were approved by CDER. However, most marketed biologics were approved under CBER, which was later moved under CDER’s umbrella.

Still, Mr. Parmar believes that full-scale trials will not be necessary, and that the regulatory pathway will be developed in the U.S. soon. He contended, “The FDA has identified that the primary issue for biogenerics is the proof of bioequivalence. Since the manufacture of biogenerics is complex and there is a lack of therapeutic indexes, there are perceived difficulties of establishing therapeutic equivalence. It is likely that a limited clinical study program will be implemented to establish therapeutic equivalence. CDER has therefore been debating the use of the Hatch-Waxman route for the approval of biogenerics.”

Inherent Differences

No one is arguing that biologics will be as easy to shift to generic status as (most) small molecule drugs. The slightest change in a protein’s fold can have significant effect on a bio-drug, so a generic company, which often must use a different process than the innovator company, has significant obstacles to overcome. The big question is exactly how the generic company can show that its product is “biosimilar” to the existing drug.

Dr. Bernhard Fischer of Biotechnology Consulting, a Vienna, Austria-based drug development and regulatory affairs management consultancy, remarked, “All generic biologics face the same difficulty: finding a way to demonstrate the similarity to the originator product. This is very important with respect to impurities [see the EPO sidebar on page 32]. I assume that the manufacture of the recombinant biopharmaceutical is not a significant problem. The safety and immunotoxicity risk may arise from various (different) impurities, e.g. host cell DNA, host cell protein, degradation products, and process-related impurities. And at this level no one (except the originator and the agency) knows the intrinsic properties of the originator product. Here the agency can easily refuse marketing authorization if the generic molecule (even if it’s as effective and safe compared to the originator product) contains a ‘higher’ level of impurities than the original.”

He added, “It is my view that biosimilar medicines are not identical versions, as is the case with generic chemical medicines. Different immunogenicity profiles may result due to the smallest variations in the complex structure of bio-molecules or other impurity profiles: we see this in different raw materials, different expression constructs and host cell systems, variations in cell culture and down-stream processing. Because of this, quality and safety issues and assessment of immunogenicity risk is central to the strategy of biosimilar molecule development.” Dr. Fischer also served as the manager of CMC-documentation and regulatory affairs for the Sandoz team that developed Omnitrope.

Foreign Affairs

Sandoz has already gotten Omnitrope approved in Australia, and the company is having a better experience in Europe than it is in the U.S.

The EU’s Committee on Medicinal Products for Human Use (CHMP) gave a positive opinion to the drug’s application in January 2006, which should clear the way for market approval. This was facilitated by several of the EMEA’s annexes to directives, including the CHMP/437/04 Guideline on Similar Biological Medicinal Products, CPMP/3097/02 Note for Guidance on Comparability of Medicinal Products containing Biotechnology-derived Proteins as Drug Substance – Non-Clinical and Clinical Issues, and CPMP/BWP/3207/00 Rev.1 Guideline on Comparability of Medicinal Products containing Biotechnology-derived Prot-eins as Active Substance – Quality Issues.

“With respect to biogenerics (or biosimilars), the EU is ahead of the U.S. with a regulatory pathway for approval in place and a number of draft guidelines published most recently by the EMEA,” said Dr. Fischer. At present the CHMP is soliciting comments for annexes that pertain to individual biologics: insulin, EPO and HGH.

Unregulated Markets

Despite all the complications involved in getting biogenerics approved in the U.S. and Europe, there are generic biologics available in other regions that are euphemistically known as “unregulated markets.” With limited regulatory and IP laws, these regions have circumvented the processes that hamstring the U.S. and EU. In parts of eastern Europe, South America and Asia, biogenerics have already found a niche.

“It depends on geography,” said Enrico Polastro, vice president of Arthur D.Little Benelux SA/NV. “In the Mid-East, Latin America, and southeast Asia, particularly China and Korea, they are already a reality. We see interferons, filgrastim, EPO, hepatitis B vaccine and growth hormones already reaching the market.”

Besides big companies like Sandoz, there are plenty of smaller companies betting that the regulatory process will be smoothed over soon.

Toronto-based Microbix Biosystems, for one, is developing a generic version of Abbokinase (urokinase), Abbott’s biologic for pulmonary embolism. Said Microbix’s vice president, scientific affairs, Kenneth Hughes, Ph.D., “We are pursuing urokinase through a ‘biogeneric’ strategy; urokinase can go through regulatory process through a 505(b)(2) NDA. We are also now pursuing proprietary indications for urokinase to broaden our activities.” The company is developing its generic urokinase under the brand name of ThromboClear.

Dr. Hughes added, “Analytics and understanding of immunogenicity continues to improve in the industry. This results in a better understanding of the active substance in a biogeneric. Nevertheless, there will be differences in impurities (inactives). Therefore, we believe that there will likely always be the need for small clinical trials that will focus on safety and pharmacokinetic comparability/equivalence. Though some efficacy can be accrued here, clinical efficacy would not be the focus of the trial(s)—efficacy will be understood from many years of clinical experience with the first-entry biologic.”

Generic Outsourcing?

If we accept that biogenerics (in some form or other) are inevitable in the U.S., then we must wonder what impact they will have on the outsourcing market. The regulatory path will almost certainly demand new clinical work, which will create opportunities for CROs and bioanalytical laboratories.

Mr. Parmar believes that outsourcing will be a major component of the biogenerics market once the products start getting approval in the U.S. and EU. “Contract services and outsourcing is likely to account for a significant part of all the major manufacturing efforts. However challenges will remain with respect to quality and cost issues. Cost of establishment for complex biologic manufacturing process and associated quality concerns is likely to restrain the contract services market to a significant extent,” he remarked.

“On the other hand, additional capacity requirements and the requirement of additional expertise is likely to improve the demand for biogenerics contract manufacturing. Another important driver would be the ‘time-to-market’ factor in the generic industry. It is important for a company to be the ‘first to market’ to gain maximum margins. The history of ethical small molecule drugs and the biologics industry suggest that involvement of third party in the manufacturing and research phases of a product significantly improves the product launch timeline. Thus similar trends may be seen for biogenerics.”

Terry Novak, chief marketing officer for DSM Pharmaceu-tical Products, contends that it’ll take time for biogenerics to impact the outsourcing arena. “I think we will not see a significant impact at the outset but, if the generic biologics garner enough sales, then the biologic API contract manufacturers—and possibly fill/finish providers—may see a downturn in demand as their branded customers’ sales decline. [M]any of the companies with biologic generics have built their own capacity, while CMOs often have non-compete clauses in their contracts that would not allow them to provide contract manufacturing services for the generic company. Now, as generic biologics proliferate, there could be more of a need for contract capacity for both API manufacturing and fill/finish services.”