Ranbaxy has made a strategic decision to aim for the European biosimilars market, where regulations are already in place, before moving on to global marketing, including the US. The Food and Drug Administration (FDA), unlike its European counterpart the European Medicines Agency (EMEA), has been unable to come up with a regulatory framework to bring generic versions to market, so far.
If successful, Ranbaxy's G-CSF, a drug that encourages white blood cell production, might be the first Indian biosimilar to be launched in Europe.
The company claims that no Indian biosimilar product has hit the European market before, mainly due to a lack of funds for clinical trials and regulatory expertise. But, Indian firms absorb 22 per cent of the global generics market, according to a KPMG report. Indian companies have perfected their scientific, technical and manufacturing skills to match the requirements of global drugmakers that are increasingly seeking to offshore many manufacturing activities previously performed in-house, the report says.
As part of the Ranbaxy agreement, the biosimilars will be manufactured in Zenotech's US FDA/EU approvable biologics facility in Hyderabad, where the company has completed the technical and regulatory requirements for launching G-CSF.
"This agreement signals Ranbaxy's foray into biosimilars by pooling in Ranbaxy's significant regulatory and front-end infrastructure with Zenotech's expertise in the development and manufacture of biosimilar products," said Malvinder Mohan Singh, CEO and managing director of Ranbaxy.
"My team and I, are proud to associate with Ranbaxy for development of G-CSF for the European Union and eventually for the US market. G-CSF will lead the way for the development of other biosimilar molecules within the Zenotech portfolio." said Jayaram Chigurupati, CEO Zenotech Lab.
So far, the European Commission has approved two biosimilars, such as Sandoz's Omnitrope and BioPartners' Valtropin, to be marketed in Europe. In addition they have turned down an application for BioPartners' Alpheon and have a further four applications from 2006 to consider, according to EMEA. In addition, the EMEA predicts twelve biosimilars applications will be launched in 2007.
With a total value of $20.2bn in global sales, insulin, human growth factor, epoetin, colony stimulating factors, interferon alpha and interferon beta are all now susceptible to competition from biogenerics. Overall biologic drug product sales jumped 17.2 per cent in 2005 to $32.8bn (€25.4bn), according to IMS health.
The problem for regulators is that, given the complex, biological nature of protein drug production, it has been difficult to establish a set of criteria to show that a biogeneric is indeed equivalent to its branded counterpart.
Biotechnology companies claim the complex nature of biologics means it is hard to show that a 'biogeneric' behaves in the same way as its branded equivalent, and are asking for safety and effectiveness testing to be included in the bill. If the bill is successful, generic biodrugs or 'follow-on-biologics' will have a significant impact on competition and pricing of protein-based therapeutics.
As a result, the development of biogeneric ingredients needs financial resources much higher than those required for the development of ordinary generics, because of the complex manufacturing technology, more extensive testing and arduous approval procedures.
Nevertheless, the low sales costs associated with the targeting of clearly defined patient grounds, in combination with the high prices of biopharmaceuticals, make the pursuit of biogenetics a risk many drug firms are willing to take.