Biosimilars set to boom as new patent cliff on biologic superstars looms

If you look at the biosimilars market as a global whole, the sum total of revenue generated by the follow-on crowd just barely crossed into blockbuster territory in 2013, according to a new study from Allied Marketing Research. But that $1.3 billion base is expected to swell to $35 billion by 2020 as new products penetrate the market in North America, Europe and Asia.

Driving that market will be a new patent cliff that awaits some of the top biologics in the market. AMR counted 10 biologics with a collective $60 billion in revenue that will come off patent in the next four years. At the top of that list is Humira, a $10 billion drug that loses patent protection in 2016. Hospira ($HSP) and Celltrion already snagged a European approval for a knockoff of J&J's ($JNJ) Remicade, which loses protection in Europe early next year, with the U.S. market opening up in 2018.

The drugmakers say they plan to sell their generic at a 30% discount, which may help set the standard for biosimilar pricing.

Not surprisingly, AMR concludes that the European market has been making some of the greatest strides in biosimilar development, with a clear set of regulations on development that are now considered the industry "benchmark" for the world. The U.S. market may be the richest in the world, but the AMR analysts note that some major league pharma groups like Novartis ($NVS) and Amgen ($AMGN) have been partnering up to take advantage of expected openings in the Asian market "as the demand for cost effective treatment is growing due to the prevalence of chronic diseases."

There's another reason why Asia, and India in particular, have emerged as leading fields for biosimilar pioneers. IP protection has been a big issue in the subcontinent, and a looser regulatory framework will make it easier to gain approvals. But as Europe and particularly the U.S. catch up on the regulatory side, richer markets will catch up.

"Biosimilars developers have been using emerging markets with less intellectual property protection as their launch pad for established markets," says the report. "With regulatory framework maturing in established markets, it will be easier for biosimilars manufacturers to quickly enter into such markets."

AMR highlighted a collaboration between Mylan ($MYL) and Biocon to commercialize a biosimilar of trastuzumab in India and the approval of the first biosimilar version of a monoclonal antibody drug by Hospira in Europe as evidence of major progress.

-- John Carroll (email | Twitter)