Novartis ($NVS) will be the first to hit U.S. shores with a copy of a blockbuster biotech drug, winning FDA approval for its take on Amgen's ($AMGN) Neupogen and heralding a new era in biopharma.
The injection, to be sold as Zarxio, is designed to boost white blood cell counts and is commonly used to ease the side effects of chemo- and cell therapy. The FDA has cleared Novartis' version for all 5 of Neupogen's approved indications, giving the Swiss drugmaker a chance to cut in on the roughly $1.4 billion Amgen made on the product last year.
Beyond its promise for Novartis, Zarxio marks the arrival of biosimilars on the U.S. market, ending a protracted regulatory delay and pointing to a looming patent cliff for some of the world's best-selling medicines. Express Scripts ($ESRX) estimates that the U.S. healthcare system could save roughly $250 billion over the next 10 years thanks to the introduction of lower-cost biosimilars, and global sales of copycat biologics are projected reach $35 billion by 2020 after scraping together just $1.3 billion in 2013.
|FDA Commissioner Margaret Hamburg|
"Biosimilars will provide access to important therapies for patients who need them," FDA Commissioner Margaret Hamburg said in a statement. "Patients and the health care community can be confident that biosimilar products approved by the FDA meet the agency's rigorous safety, efficacy and quality standards."
But despite the imminent launch of the nation's first biosimilar, the U.S. is yet to finish codifying how it will regulate biotech knockoffs.
For starters, what should they be called? Key to all those bullish projections on savings and revenue is physicians prescribing biosimilars interchangeably with their reference products, and yet it remains undecided whether the new versions can share the generic names of their forebears. As a placeholder, the FDA is calling Zarxio "filgrastim-sndz," appending an abbreviated reference to Novartis' Sandoz unit onto the end of Neupogen's nonproprietary moniker.
Novartis became the first company to file for a stateside biosimilar approval under the FDA's newly created pathway when it submitted its take on filgrastim over the summer. Now, Hospira ($HSP) and Celltrion are marching forward with what's expected to be the U.S.'s second biosimilar, a copy of Johnson & Johnson's ($JNJ) blockbuster autoimmune drug Remicade. Apotex has its own take on Neupogen already under FDA review, and Sandoz, which touts a more than 50% share of the world biosimilars market, is working up copies of Humira, Enbrel, Rituxan and Procrit.
And while the coming onslaught of quasi-generic biotech treatments is sure to eat into the profits of drugmakers, many have positioned themselves ahead of the curve, at once developing biosimilars while working to defend their vulnerable products. Amgen, the company behind the blockbuster Enbrel, is developing copycat treatments of its own, and Biogen Idec ($BIIB) has teamed up with Samsung to create a biosimilar powerhouse, enlisting Merck ($MRK) to handle the commercial aspect.
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