With the patent cliff and subsequent innovation drought moving closer, generic drug makers are looking to move up the value chain and pursue new sources of revenue, and of all the piles of pay dirt out there, biosimilars represent one of the closest things to an El Dorado, though regulations won’t take their final form for a while.
Currently, follow-on biologics manufacturers are restricted to a small group of companies making them for the European market — namely Sandoz, Teva Pharmaceutical Industries and Hospira — as well as companies making them for other markets, such as Dr. Reddy’s Labs. But other drug makers with piles of cash are looking to get in on the action, and it’s a lot more complicated than simply building a new lab and hiring a few more people.
Watson Pharmaceuticals announced last month a deal with Amgen to develop follow-on biologics. The deal would combine Amgen’s expertise as a biotech drug maker and Watson’s deep industry connections as a generic drug maker. Under the deal, Watson will contribute $400 million in co-development costs with Amgen and take responsibility for marketing and commercialization.
Also last month, Baxter and Momenta announced a deal to develop biosimilars for cancer, autoimmune disorders and other chronic conditions, with Baxter using its expertise in clinical development and manufacturing of biologics, sterile injectables and global commercialization and Momenta using its experience in high-resolution analytics, characterization and product and process development.