ANALYSIS: The challenges of forecasting biosimilar sales across Europe
pharmafile | October 29, 2015 | Feature | Manufacturing and Production, Research and Development, Sales and Marketing | biologics, biosimilars, generics, patent cliff, patents, sales, sales forecasts
The introduction of biologic medicines revolutionised treatment in several key therapeutic areas, including oncology, diabetes and various inflammatory diseases.
The landscape for biologics, however, will change dramatically in the next decade as many products – more than $60 billion in worldwide sales – lose their market exclusivity.
To capitalise on this opportunity, many companies are striving to bring similar biologic products, or biosimilars, to market. This generates many challenges for the forecaster, who must create a framework that captures dynamics that operate in these markets. A particular challenge is the need to forecast uptake (or adoption) of biosimilars, for there are few precedents established in this area.
Adoption Framework
Pharmaceutical forecasters must address various questions from a number of stakeholders – health care providers, payers, patients and pharmacists – all of whom can influence the use of biosimilar products. To what extent do health care providers adhere to an original biologic, and how willing are they to switch to a biosimilar? With payers typically focused on cost, what mechanisms will they employ to encourage usage of the (presumably lower priced) biosimilar? Will differences in patient co-payment levels affect product use? And what role will pharmacists play?
The forecaster assesses these dynamics using scenarios – similar o what they do with regulatory and legal uncertainties – though the scenario constructs here are more complex. The actual construct a pharma company employs will reflect the specific therapy area they plan to forecast.
The forecaster would place each assumption between the endpoints of the scales to create the scenario they wish to forecast. If the assumptions align with a ‘high substitution’ scenario, the forecaster would use a steep adoption curve for the biosimilar, and vice versa for a ‘low substitution’ scenario. The forecaster would also determine each assumption by using secondary data, primary market research, analog products, and inputs from each functional area within the organisation.
Lessons from Europe
Several biosimilar products have been launched in the European market, three of which provide useful insights that align with the above framework: filgrastim, epoetin alfa and somatropin.
Filgrastim
In its first three years post-launch, the biosimilar version of filgrastim achieved a significant share in Europe’s most populous countries. This uptake was partially driven by filgrastim’s relatively low complexity compared to larger biologic molecules, which translated into fewer safety concerns by physicians. Furthermore, the efficacy of filgrastim is easy to observe, also assuaging physicians’ concerns.
In the UK, filgrastim achieved initial adoption by winning hospital tenders with its advantageous pricing. Many hospitals updated their protocols to include the tender winner in first-line therapy, and regularly published information about the success of the biosimilar for budget savings. In fact, the UK market grew and expanded patient access to filgrastim. Overall, daily volume usage of filgrastim has grown 40% since the biosimilar was first launched.
There was similar success seen in France, where centralised price regulation and budgetary controls directed purchasing through hospital tenders and purchasing groups. In Germany, however, the quota system for individual physician and sickness funds fuelled rapid uptake, because the funds recognised cost savings with the biosimilar. But uptake has been lower in Italy and Spain, due to limited intervention from payers, in addition to low incentives for physicians or patients to switch to biosimilar versions.
In summary, filgrastim’s rapid market penetration is likely due to the purchasing channel cost advantage over the originator biologic.
Epoetin alfa
Biosimilar epoetin alfa’s uptake in Germany was profound, where it attained a volume share of approximately 60%. This was largely driven by payers who employed several tactics to encourage biosimilar uptake, such as prescription drug quotas in the retail setting, ‘Dear Doctor’ letters to endorse biosimilars as safe and effective, and educational sessions for physicians on the safety and efficacy of biosimilars.
Uptake has been limited in the UK, however, reportedly due to the manufacturer Janssen dropping the price of the originator, Eprex. In France, safety concerns voiced by the physician community have hindered uptake. Adoption in Italy and Spain falls between the extremes, but intervention from payers has increased pressures for physicians to initiate new patients on biosimilars.
As with filgrastim, payers have driven uptake of epoetin alfa. As seen in Germany, where payer management is most aggressive, so has been the speed of adoption.
Somatropin
The uptake of biosimilar somatropin has been uniformly low across Europe, largely because physicians were reluctant to prescribe paediatric patients a drug that lacks long-term clinical data. Moreover, physicians lacked incentives from payers. Finally, the low uptake may also have been linked to the fact that the biosimilar version requires refrigeration, whereas the originator product does not.
Forecasting the future: Infliximab
It is important to note the molecules discussed above are smaller and less complex biologics than monoclonal antibodies. The first biosimilar version of this type, infliximab, launched in Central and Eastern Europe in late 2013, but was only approved in Western Europe in February 2015. This was the first biosimilar monoclonal antibody therapy that the EMA biosimilars regulatory pathway approved for the continent.
Although its story is still unfolding, infliximab’s performance in European markets will provide another set of experiences which forecasters can rely on for future biosimilar introductions. In this case, insights may be gleaned into marketing as well as payer dynamics.
There are two biosimilars of infliximab available in Europe – Remsima and Inflectra. Both are manufactured by South Korean pharma firm Celltrion, and their marketing is divided amongst several companies. In the UK Napp Pharmaceuticals markets Remsima and Hospira markets Inflectra. Celltrion is launching Remsima in many of the European countries in which its co-exclusive partner, Hospira, has approval of Inflectra.
In this case biosimilars of the same product are competing with each other. An example of the marketing dynamics can be gleaned by looking at Norway. In February 2014, Alvogen (in partnership with Hospira) launched Inflectra in Norway, and priced it at a 39% discount compared to MSD’s Remicade. In February 2015, Orion (in partnership with Celltrion) offered their infliximab biosimilar at a 69% discount to Remicade. Although only a few months of data are available, competition on price may be a pathway biosimilar manufacturers are willing to adopt.
Lessons learned
What lessons can we take from these case studies? First, payer management is key to early biosimilar uptake: things like quotas, formularies and Dear Doctor letters have all successfully changed physician prescribing behaviours, as evidenced by the filgrastim example in Germany.
Second, adoption is typically greater in markets with effective mechanisms that are designed to encourage uptake, and in hospital settings where reimbursement mechanisms provide the advantage of lower cost options. However, the biosimilar does not command a rapid uptake in situations where the manufacturer of the originator is willing to compete on price – as evidenced by epoetin alfa in the UK.
Third, it is critical to address physicians and their perceptions of biosimilars. In the absence of strong payer management (either incentives or penalties), many physicians will be hesitant to prescribe biosimilars without clear education – as evidenced by the example of somatropin in France.
Finally, adoption remains highly variable by country, indication and route of administration. A general algorithm does not yet exist that can predict biosimilar uptake (and innovator erosion). Rather, the forecaster should employ the framework introduced above to map the dynamics specific to each situation, as a means to guide their assessments.
Art Cook is author of ‘Forecasting for the pharmaceutical industry’ and a principal at global sales and marketing firm ZS.
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