Yesterday, Amgen held its first business strategy meeting since the fall 2008, and mixed in with much talk of its bone-loss treatment denosumab was a discussion of its strategy around biosimilars. The company gave its view of the impact of generic versions of its biologic drugs in Europe and the U.S., as well as the opportunity for its own growth in the space.
Several core drugs in the Amgen portfolio will be under pressure from biosimilars after 2015, but management downplayed the impact the competition would have on its business. Because of their complexity, biosimilars aren’t subject to the same “patent cliff” small molecules face when their patent expires, Amgen’s CEO Kevin Sharer said. And although the company expects biosimilars to exist in the U.S., and for prices to be impacted, “we do not expect revenues to go away overnight,” he added.
Although U.S. regulatory authorities have yet to sort out a pathway for approving biosimilars, generic entrants have already made their way into European markets. Biosimilars have taken over about 6% of the market for Amgen’s anemia treatment Aranesp, and pricing has been “pretty disciplined” after their first few months on the market, noted Amgen’s president and chief operating officer Robert A. Bradway. European market share for biosimilar competitors to Amgen’s filgrastim franchise, which includes the multi-million dollar seller Neulasta, has also stayed steady at around 6%.
At the same time, Sharer cautioned that things will not play out identically to the U.S. and Europe. Further, he reminded the audience that “there is no such place as Europe—that’s some figment of a travel agent’s imagination.” The experience across countries has not been uniform, and generic erosion has occurred much faster in some countries than others.
Still, looking back to Amgen’s expectations for the impact of biosimilars had been far bleaker than what has occurred so far in Europe. “Frankly, if we’d beeen sitting here inside an Amgen meeting five years ago…we’d have anticipated a different outcome” regarding biosimilars, Sharer added.
Amgen’s chief also pointed out that because Amgen has such broad experience in developing and manufacturing large molecules, there could be a significant upside as the company starts to compete in the biosimilars arena. The business won’t immediately skyrocket after 2015, “but in the several years after that, it has multi-billion dollar potential for us,” he said.
The company has created a small biosimilars unit, and Sharer says that in talking with partners it appears that establishing a presence in the arena “will not require much investment on our part.”
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