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Biopharm Development & Manufacturing Biosimilars In Emerging Markets T By Cliff Mintz, Ph.D., contributing editor o date, 14 biosimilar marketing authorizations have been granted in the EU. Despite their lower cost (20% to 35% less than branded counterparts), the uptake and use of biosimilars in the EU has been less than expected. However, the ongoing global economic downturn, skyrocketing healthcare costs, and patent expiry by 2018 of biologics with annual sales in excess of $67 billion have prompted a renewed global interest in biosimilars, especially in emerging markets. The growing popularity of biosimilar products in emerging markets can be explained by a number of factors. First, the high cost of branded biologics is placing enormous financial pressure on the nationalized healthcare systems of many emerging countries. Substituting lower-cost biosimilars for branded biologics would help reduce government healthcare costs and lessen the financial burden of insurance companies and third-party payers. Second, countries like China, Brazil, and Russia are extremely dependent upon foreign biologics manufacturers and suppliers for many biologics products. In the past, this has frequently resulted in shortages, rising drug prices, and reductions in patient access to potentially life-saving drugs. Finally, biosimilars represent an opportunity for emerging economies to build domestic biologics and biotechnology capabilities which, in turn, would allow them to penetrate and more effectively compete for a share of the global pharmaceutical and biologics markets. 28 LifeScienceLeader.com VARYING FORCES SHAPE BIOSIMILARS' GROWTH While biosimilar companies in emerging markets share certain advantages over their counterparts in more mature markets, including lower labor costs, cheaper cost of goods, access to large domestic and regional markets, and in many cases, greater government support and involvement, the forces that shape the growth of a biosimilar industry in emerging markets can vary between countries and regions. This certainly is true for the biosimilar industries that have emerged in Brazil, Russia, India, China, and South Korea. Because the market dynamics that shaped the biosimilar industries in each of these countries are different, it is not surprising that their business strategies, practices, and goals are also different. BRAZIL Brazil has a population of 205 million and is the second-largest biologics market among emerging countries. Brazilian healthcare is nationalized, and its government is responsible for covering all healthcare and drug costs. "The growing demand for expensive biologics has placed enormous financial stress on the Brazilian pharmaceutical budget," said Kai Wolf, head of Generic July 2013 Pharma 2.0's Brazilian office. Because of this, Wolf asserted that "the Brazilian government views biosimilar development as a means to improve its domestic biologics capabilities, produce its own biosimilar products, and reduce the country's reliance on expensive, imported, branded biologics and biotechnology drugs." In 2010, Brazil's regulatory agency, Agencia Nacional de Vigilancia (ANVISA), created a new regulatory approval pathway for biosimilars. Nevertheless, since the early 2000s, biosimilar versions of erythropoietin (EPO), granulocyte colony stimulating factor (G-CSF), and insulin have been available in Brazil. Interestingly, in 2011, almost 20% of biologic drugs prescribed in Brazil were biosimilars. At present there are as many as 10 Brazilian companies involved in biosimilars' drug development. These include PharmaPraxis, Fiocruz, Cristália, Blausiegel, Eurofarma, Silvestre Lab, Ache, and Prodotti. The focus of almost all of these companies is developing biosimilar versions of blockbuster monoclonals such as Enbrel, Avastin, Herceptin, and others. This is likely because mAbs represent only 1% of the total amount of biologics used in Brazil but represent 32% ($767 million) of the total amount spent