Roche faces a double biosimilar threat

Biosimilars are coming, and they are coming for Roche. Amgen and Allergan have filed ABP 215, an Avastin biosimilar, with the US FDA a week after Mylan and Biocon submitted their Herceptin copycat to the agency, and the effects on Roche’s sales could be dramatic.

Both branded antibodies come off patent in 2019, and though Roche will doubtless fight the introduction of biosimilars in court its competitors will surely win through eventually. A look at the companies and products at risk of biosimilar competition in 2019 shows Roche to be particularly exposed (see table), with sales of more than $7bn at stake – $6bn from Herceptin and Avastin.

The company will not lose that entire sum, of course. In fact it is tricky to say exactly how much its sales might decline: the biosimilar threat is yet to be fully quantified.

With a substantial biologics portfolio Roche is widely exposed in the coming years. EvaluatePharma data show that it is ahead of both Novartis and Bristol-Myers Squibb in terms of US patent risk in 2019; Herceptin is the drug with the greatest exposure to biosimilar competition.

The industry's biggest patent risks in 2019
Company Company's US 2018 sales at risk ($bn) % of total 2018 Rx sales Notable expiring products Product's US 2018 sales at risk ($bn)
Roche 7.4 16% Herceptin  3.2
Avastin 2.9
Novartis 2.3 5% Gilenya 1.9
Bristol-Myers Squibb  1.7 8% Orencia 1.7
Source: EvaluatePharma.

Roche does have some protection from the loss of Herceptin sales in the shape of Perjeta and to a lesser extent Kadcyla. It has no such direct cushion against Avastin competition owing to the failure of the follow-on version, vanucizumab, in trials last month.

As a small molecule Novartis’s multiple sclerosis pill Gilenya will see the swiftest sales erosion of these top three threats, analysts believe. Bristol-Myers Squibb’s antirheumatic Orencia is a biological so less likely to see immediate loss of market share.

Novartis, meanwhile, is at least playing the other end of the biosimilars game. Its Sandoz unit launched the first biosimilar, a version of Amgen’s Neupogen, in the US last year and also has acheived FDA approval of Erelzi, a copycat of Amgen’s Enbrel.

Sales hit

A clue to the degree of US sales erosion developers can expect can be gleaned from the performance of products that have seen biosimilar competition in Europe. European sales of Johnson & Johnson’s Remicade fell from $2.4bn in 2014 to $1.8bn last year following the introduction of Pfizer’s biosimilar, Inflectra, in February 2015.

This 24% drop in Remicade sales might be repeated in the US in the months to come: Inflectra was approved by the FDA in April this year and is on the verge of launch in the US.

But comparisons between drugs must be made with care. It does not necessarily follow that Avastin or Herceptin would see a similar drop-off in sales. Usage patterns could affect uptake: Remicade is used chronically to treat rheumatoid arthritis whereas the cancer drugs are given in a more episodic fashion, meaning there could be more opportunity to switch cancer patients to biosimilars, so the decline in Avastin and Herceptin could be even more precipitous.

But the manufacturers of the branded products might be able to employ a defensive strategy in the form of co-pay subsidies. Insurers use co-pays to push patients to choose cheaper options. In subsidising these out-of-pocket payments the brand makers take a small initial hit but steer patients to their products, thus coming out ahead.

Whether Roche and its fellows use this approach aggressively will depend on just how badly their top line is hit by the advent of the biosimilars.

To contact the writer of this story email Elizabeth Cairns in London at elizabethc@epvantage.com or follow @LizEPVantage on Twitter

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