INTRODUCTION

Biological generics are natural and recombinant protein products intended to be comparable to one or more already marketed innovative (brand) product(s). These products are comparable in quality, safety, and efficacy to the innovative product and are marketed after exclusivity has expired. Their safety, identity, purity, impurities, potency, and quality can be determined, monitored, and controlled. The animal and human studies necessary for approval may be abbreviated due to the vast amount of data accumulated on the marketed brand product in the desired indication(s) during marketing exclusivity. In many cases, the post-approval scientific study and medical use of the brand product provides a strong understanding of the structural and functional properties of the protein that correlate with product safety and efficacy.

Marketing exclusivity for biologics is usually in the form of patent protection. In the United States, it is not uncommon for this time period to last 20-plus years. As noted by Wood,¹ however, even after patent expiry, these products have an effectively unlimited period of exclusivity because of lack of a clear pathway for FDA approval. In the US, sales of biologics are expected to exceed US$60bn by 2010.² Biological drugs for which the patent period has expired or is soon to expire include insulin, human growth hormone (HGH), interferons, erythropoietin (EPO), growth factors, some monoclonal antibodies, and blood factors. These products are indicated for use in oncology, rheumatoid arthritis, hormone and enzyme deficiencies, and coagulation. These products range in the complexity of their structure from small non-glycosylated proteins less than 100 amino acids in length to large, highly complex glycosylated proteins. Not all of these products are currently candidates as biological generics for scientific reasons, such as the lack of available analytical methods to establish comparability; however, most are.

TERMINOLOGY

Much debate has taken place, especially in the US, on the proper terminology for these products. No paper can be written or presented without providing an opinion on what the correct term should be. The term 'biological generics' fits better than most. The decision makers on the use of these products are the patients, healthcare providers, and payers. Use of the term 'generics' implies cost savings, high quality, sameness, and choice to patients and is a term that the patient receiving treatment uses when requesting drugs from their pharmacist or physician. To the physician and healthcare provider, the term 'generics' also implies cost savings and sameness to the brand product. The term 'generics' may, however, imply a different meaning to scientists and regulators in that these products will follow the same biopharmaceutical development programmes and have the same scientific and regulatory requirements as chemical generics — which is not the case. It is well recognised that these products will require more clinical testing than the bioequivalence studies required for most chemical generics due to some clinical responses that are still not well understood, such as immunogenicity. As most biological generics will not be distributed by pharmacists, the therapeutic equivalence rating assigned to chemical generics and the Orange Book³ system that allows pharmacists to interchange with an innovator's product is not as relevant as with chemical generics. In addition, the Orange Book system is applicable only to products approved under the Food, Drug, and Cosmetic Act (FD&C Act), whereas the vast majority of candidate protein products were licensed under the Public Health Service Act (PHS Act), not approved under the FD&C Act. Outside of the US, in general, biologics are regulated under a single law.

What is important in establishing terminology is that the name be understood by the end users. As with many drug products, the term used by the lay person is different than the term used by scientists and regulators. It should be no different for this product area. To differentiate these products from chemical generics, the term 'biological generics' seems most appropriate for all. This is the rationale for the use of this term in this paper.

THE ECONOMICS OF BIOLOGICAL GENERICS

Much has been written on the opportunity and need for affordable biologics. In the EU, market size estimates for biological generics ('biosimilars') range from US$16 to 20bn per year by 2010–2011. Annual growth rates of nearly 70 per cent are expected between 2007 and 2011.⁴ By 2010, nearly 50 per cent of all new approved pharmaceuticals will be biologics⁵ and annual sales in the US for biologics are estimated to be US$60bn.²

When assessing this opportunity, one must factor into the equation the number of products that will be available. One usually considers the number of biological products on the market (over 140 in US and/or EU) and the number coming off patent in a specified time-frame. One source⁶ proposes 75 likely targets.

The economics for biological generics are different than chemical generics. To enable management decision making on entry into this area and pipeline filling, economic modelling is crucial. Factors that should be taken into consideration include costs, market share, price, sales estimates, time, risk, and options.⁷ Modelling should be product- and company-specific based on tolerance for uncertainty, core competencies, and strategic fit.

Biological generics are produced in the same manner as innovative biological products. Biologics are, in general, more costly to develop and manufacture than chemical drugs. While chemical generics require bioequivalence studies, most biological generics will require some degree of clinical safety and efficacy studies that are more costly. Owing to the administration of most of these products by healthcare providers in a hospital or non-hospital setting, such as home healthcare, physicians' offices or specialty clinics, these products will be prescribed by physicians and/or selected by hospital boards or committees. A marketing approach similar to that of an innovative product will need to be undertaken. The distribution of chemical generics does not require a large sales and marketing component as the ability to substitute the brand for the generic is recorded in the FDA Orange Book which is widely in use by pharmacists who traditionally dispense these products. In other countries, such as Canada, Health Canada's Biologics and Genetic Therapies Directorate, the body that regulates biologics, may not be ready to declare interchangeability for the purposes of provincial formularies' inclusion. These formularies typically allow pharmacists to interchange chemical generics for the brand name. In the near term, it is expected that a brand-style marketing approach will need to be taken until substitution is allowed for biological generics following the same system.⁸ In the EU, the situation is more complex. Biosimilars are reviewed through the Centralized Procedure by the European Medicines Agency (EMEA) and approved by the European Commission (EC). Substitution decisions are made by each individual member state, not by the EMEA or EC. In some member states, such as France, generic drugs are automatically recorded on a substitution listing, the so-called 'répertoire', that provides pharmacists with a list of drugs that can be switched. In other member states, however, such as Belgium, where substitution is not legally allowed, no such listing exists. Although generic substitution might be compulsory by law, in about 90 per cent of the European countries substitution can be prevented by both the prescribing physician and patients. Furthermore, while by law generic substitution is allowed in most European countries when a physician prescribes a branded original product post-patent expiry, the pharmacist may or may not be obliged to substitute with a generic product with or without reference to the prescribing physician. But while some substitution system is in place for chemical generics, it is noteworthy that so far no member state has moved forward to allow substitution in the same manner for biosimilars. Member states are only confronted with the issue now as the first biosimilars are entering the market.⁹ In either case, a brand marketing style will need to be followed due to the healthcare setting in which these products are administered. One may expect that in the rest of the world, the ability to substitute varies country-by-country as will the approach to marketing biological generics.

These factors must be part of the decision-making process for biological generic manufacturers. As the cost of development, manufacture, and marketing is higher, the relative price of a biological generic will be higher than that of a chemical generic. This being said, the cost of development for a biological generic will be lower than the cost of development for an innovative biological product. In a 2006 Tufts University study, the average cost of developing a new biotechnology product was estimated to be US$1.2bn. This cost also includes the cost of failures. The average capitalised costs (the sum of out-of-pocket and time costs) of the preclinical period is US$615m and the clinical period, US$626m.¹⁰ For biological generics, this cost is estimated to be between US$10–80m, whereas for a chemical generic, this cost is US$1–2m.² An innovative biological product receives 20-plus years of marketing exclusivity while under various types of marketing protection. Cost savings will occur as a result of the abbreviation of animal studies and clinical programmes due to the medical and scientific knowledge gained in the use of the innovative biological product and the indication(s). In addition, cost–savings can be realised through increased manufacturing efficiencies, use of state-of-the-art manufacturing equipment and technologies, availability of a global supply chain, and manufacture in economically favourable environments. In addition, the cost of the discovery phase will be negligible for biological generics as discovery per se is much reduced (ie, biological generics have already been discovered). Post-discovery, the probability of success of gaining regulatory approval of a biological generic will be higher as the inherent safety and efficacy of the product have already been established. A new medicinal compound entering Phase 1 testing is estimated to have only an 8 per cent chance of reaching the market.¹¹ Owing to the comparability exercise required during the development of a biological generic, products that are not comparable to the innovator's can be identified early on in development while investment is relatively low leading to a lower failure rate. Drug development timelines will also be shorter for biological generics. According to the Biotechnology Industry Organization, the average time for drug development for an innovative product is 15 years.¹² For a biological generic, this time period is estimated to be seven years.¹³ Thus, while the end user of a biological generic, whether a patient or payer agency, may not reap savings equivalent to a chemical generic, savings will be realised as compared to the brand and, in terms of absolute dollars, will be substantial. In Poland, for example, the introduction by Biotin of Gensulin (recombinant insulin) in 2001 resulted in a savings of 90m (US$118m) in four years. Currently, savings per year are 65m (US$85m).¹⁴ In the EU, where a legal pathway has been put in place for these products (see below), the market dynamics are just now being established. Sandoz, however, launched biosimilar Omnitrope^® (recombinant HGH) in Germany at a 20 per cent price discount to the innovator's product¹⁵ while in Australia, the product will be priced approximately 25 per cent below the current price level for recombinant growth hormone products.¹⁶ This is different than a discount of 50–80 per cent seen for some chemical generics.⁷

The decision criteria for economic modelling will most likely be consistent from company to company. The acceptable data range for each criterion will vary depending upon company experience, research, analysis, and fixed specifics, such as return on investment. An excellent, real-life simulation of the economic situation of biological generics has been presented by Tim Oldham of Mayne Pharma. The company's decision modelling assumes an 8–13 per cent profit margin of the innovator's price (25–35 per cent at discounted prices — typical of specialty generic margins before corporate overhead and expensed R&D) and product lifecycle of three years for both biological and chemical generics. The cost of sales is higher for the biological generic at 22–27 per cent of the innovator's price (as compared to a chemical generic at 12–17 per cent of the innovator's price). The success rate of a biological generic is lower at 60–70 per cent (as compared to 70–80 per cent for a chemical generic). Actual costs, which excludes capital costs of constructing a manufacturing facility, is at least 7–8m (US$9–10.5m) for a simple biological generic as compared to a chemical generic at 0.5–1.5m (US$0.7–2m). Risked costs of development are likely to be at least 11–13m (US$14.5–17m) for a simple biological generic as compared to a chemical generic at 0.7–2m (US$0.9–2.6m), a 7–16-fold difference. The outcome of Oldham's decision modelling is that in order to realise an acceptable profit on sales, the minimum efficient market size, even for such relatively inexpensive development, assuming a 10 per cent market share, is much higher for a biological generic at 270–560m (US$355–736m) than a chemical generic at 25–55m (US$33–72m).¹⁴ A major factor to be considered in estimating the cost of development is, however, the potentially more stringent and rising requirements of regulators for clinical demonstration of comparable safety and efficacy in multiple administration modes and disease states. In 2005, the EMEA issued guidelines on the preclinical and clinical requirements for EPO¹⁷ (see further discussion below). Based on strict compliance with the programme outlined in the EMEA EPO guideline (which is currently under reconsideration by EMEA), Oldham estimated the cost of clinical trials to be 20–40m (US$26.5–53m),¹⁸ requiring a minimum efficient market size of 600–1,300m (US$792–1,716m),¹⁹ the high end being larger than the EU market for EPO at the time. Owing to this cost of clinical development exceeding Mayne Pharma's initial (pre-guideline) estimate and likely entry position/competitive dynamics of the market at the time of launch, Mayne Pharma and Pliva halted their joint development programme for EPO in late 2005 as the product was no longer commercially viable.²⁰

It is highly unlikely that a company manufacturing and distributing these products in only the US or the EU will be able to realise an acceptable revenue stream to sustain the company or to financially break even in an acceptable time-frame. A strategy to be considered to generate sustainable revenue while working toward approval in the major markets is to first gain approval outside of the US and EU while simultaneously working toward approval in these markets — that is, a global approach to biopharmaceutical development and approvals. Many countries currently have atmospheres where patent rules facilitate distribution of biological generics. This is opposite the general innovative industry strategy of gaining approval first in a major market, usually the EU or the US, then rolling out approvals around the globe.

The most effective and efficient strategy would be synchronous approval in the EU and the US. This requires that a company proactively design their biopharmaceutical development programme to meet the scientific and regulatory requirements of both environments. This should be done very early in the development process to insure that costly animal studies and human clinical trials that are not needed for these approvals are not undertaken. (In addition, the ethical considerations of unnecessary studies must also be considered and weighed heavily.) Discussion with the regulatory authorities is necessary as the scientific and regulatory requirements are not well defined.

THE CURRENT GLOBAL REGULATORY ENVIRONMENT

Regulatory requirements are becoming clear in the major markets for biological generics. In the EU, legislation was passed in 2003 that placed the requirements for biological generics in the article of the law reserved for abbreviated applications. In this section of the law, results of toxicological and pharmacological tests or clinical trials are not required for demonstration of safety and effectiveness. For biological products, the type and amount of additional data demonstrating safety and efficacy is determined on a case-by-case basis in accordance with scientific guidelines. If more than one indication is sought, safety and efficacy, however, need to be justified or demonstrated separately for each indication.²¹ In 2004, legislation was added clarifying that results of testing should be provided to fulfil the requirements related to safety (pre-clinical) or to efficacy (clinical tests) or to both.²² Once this legislation was enacted, the EMEA issued seven Guidance documents — three broad guidelines to introduce the basic principles and concepts of similar biological medicinal products (the legal term used in the EU) or 'biosimilars' (the common term),²³ non-clinical and clinical issues,²⁴ quality issues,²⁵ and four product-specific guidelines on recombinant EPO,¹⁷ Somatropin,²⁶ Granulocyte-Colony Stimulating Factor,²⁷ and Insulin,²⁸ which further describe non-clinical and clinical requirements for these specific products as biosimilars. A Concept Paper which acknowledges the intent of the Agency to issue further guidance on non-clinical requirements for Alpha-Interferon²⁹ has been issued. The EC and EMEA have continued to move forward in bringing these products to patients with the approval of two recombinant HGH products (Omnitrope^®, Sandoz,³⁰ Valtropin^®, Biopartners³¹) in 2006 through this legal mechanism. The approval of these products follows the Centralized Procedure allowing distribution in all countries of the EU (this is the same procedure followed by innovative biotechnology-derived products as compared to the Mutual Recognition Procedure which is a country-by-country approval). As mentioned above, the issuance of these guidelines has, however, resulted in some companies halting development of biological generics as the products are now determined to be not economically feasible. In responses to a 2006 survey conducted by the European Generics medicines Association (EGA) on the effect of the issuance of EMEA Guidelines on biopharmaceutical development costs, the evolution of these guidelines resulted in increased non-clinical and clinical programme costs, increased trial duration, increased costs due to repeating studies, and, in one case, abandonment of a development programme. From 2002 to 2005, these companies had sought guidance from specific member states on the design of preclinical and clinical programmes. The guidelines issued by EMEA ultimately required more complex and extensive comparability testing compared to scientific advice previously given and resulted in the effects noted above.¹⁴ Although the guidelines differed from previous advice and have resulted in unexpected increased development costs, EMEA should nevertheless be applauded for taking the first steps in helping to bring these much needed products to patients. Although the barriers to entry are currently high, over time, as EMEA gains confidence with these products, the expectation is that regulatory hurdles will lessen thereby resulting in lowered clinical development costs. This cautious approach was also taken by EMEA with the introduction of scientific comparability protocols for demonstration that an approved innovative biotechnology-derived product is comparable pre- and post-manufacturing changes (see discussion below).

In the US, the situation has become clearer in the past year. Regulatory mechanisms for approval of biological products are contained in two laws — the PHS Act, §351 and the FD&C Act, §505. The vast majority of protein biological products have been approved through the PHS Act. A smaller number of biological products, primarily hormones, have been approved under the FD&C Act. The FD&C Act contains three types of drug applications — an application (new drug application or NDA) that contains full reports of investigations of safety and efficacy [§505(b)(1)]; an application (abbreviated NDA or ANDA) that contains information to show that the proposed product is identical in active ingredient, dosage form, strength, labelling, quality, performance characteristics, and intended use to a previously approved product [§505(j)]; and an application that contains full reports of safety and effectiveness but where at least some of the information required for approval comes from studies not conducted for or by the applicant and for which the applicant has not obtained a right of reference [§505(b)(2)].³² Chemical generics must meet the requirements under §505(j) and an ANDA is submitted. It is generally recognised that at the moment biological generics cannot be approved following the ANDA approach due to the inherent differences in a biological product as compared to a chemical drug.

FDA is moving forward with the review and approval of Follow-on Protein Products (FOPPs) that have met the statutory and regulatory requirements under §505(b)(2). FOPP is an informal term selected by FDA to refer to proteins and peptides that are intended to be sufficiently similar to a product already approved under §505 of the FD&C Act or licensed under §351 of the PHS Act to permit the applicant to rely on certain existing scientific knowledge about the safety and effectiveness of the approved protein product.³³ FDA has distinguished FOPPs from biological generics based on therapeutic equivalence ratings and substitution (as recorded in the FDA Orange Book). While Omnitrope^®, approved on 30th May, 2006, is the best known FOPP, FDA has approved other FOPPs under §505(b)(2), including GlucaGen (glucagon recombinant for injection; Novo Nordisk A/S), Hylenex (hyaluronidase recombinant human; Halozyme Therapeutics, Inc), Hydase and Amphadase (hyaluronidase; PrimaPharm, Inc and Amphastar Pharmaceuticals, Inc, respectively), and Fortical (calcitonin salmon recombinant; Upsher-Smith Laboratories, Inc) Nasal Spray.³⁴ According to FDA, the establishment of an analogous pathway to 505(b)(2) or 505(j) for protein products licensed under the PHS Act, §351 will require legislation.³³ The term 'analogous pathway' is, however, unclear. In addition, the question remains as to the possibility of gaining approval of a protein product that has been shown to be comparable to an already marketed product as a new molecular entity under the PHS Act. During innovative drug development, preclinical and clinical studies are frequently designed to compare the test product to one already marketed instead of comparison against placebo. This approach for a biological generic would be no different than current scientific and regulatory practices. An interesting note is that neither approval under the PHS Act nor FDA regulations issued under the PHS Act requires that the clinical study supporting approval of a new biological product be conducted on that very product for which approval has been requested. Avonex (interferon ) was approved by FDA on 17th May, 1996. FDA allowed Biogen to rely on the results of the clinical study of another company's interferon product, known as BG9015. Biogen conducted biological, biochemical, biophysical and functional analyses, and pharmacokinetic studies in humans to demonstrate equivalence (comparability) to BG9015, but no pivotal clinical studies were conducted on Avonex prior to approval. Avonex was, however, different from BG9015 in that clinical superiority was demonstrated allowing the Orphan Drug Exclusivity that had been granted for BG9015 to be broken by Avonex. This breaking of exclusivity allowed entry of Biogen's product to the US market.³⁵

In other major markets, there is an interest from regulators to make biological generics available to patients. In Canada, the Biologics and Genetic Therapies Directorate has drafted a Fact Sheet on Subsequent Entry Biologics.³⁶ Japan has proposed a harmonised international approach for biological generics through the International Conference on Harmonization (ICH). In Australia, Omnitrope^® has been approved (as mentioned above). In these three regions, biological generics will be approved under the existing legal pathway for innovative biologics. In other markets around the world, such as Eastern Europe, China, and India, biological generics have been available for more than ten years.

THE SCIENTIFIC COMPARABILITY EXERCISE

A scientific comparability exercise is conducted to demonstrate that the biological generic is 'comparable' to the brand product. Although guidelines do exist, there is no legal, scientific, or regulatory definition of 'comparable'. Comparability is established based on the adequacy of data generated through the comparability exercise. The decision on if comparability has been established is made by the regulatory agency scientists. Scientific ability, understanding, and experience allow the regulatory agencies to make determinations of comparability or non-comparability and adjust data requirements for approval accordingly. Comparability exercises have been used formally for over ten years by the brand biotechnology industry to demonstrate that a protein product is comparable pre- and post-manufacturing changes. This is not a new scientific principle being applied to biological generics — it is a natural extension of this principle and underpins approval of these products (see section below on the EMEA).

Historically, biological products have been complex mixtures that were difficult to characterise. Because of this limited ability to characterise the product, the manufacturing process became part of the definition; consequently, changes to the manufacturing process, equipment or facility were seen to potentially result in changes to the biological product. In order to determine if these changes had an effect on safety and efficacy, clinical studies were required, often on a small number of patients.

In the early 1990s, due to the Reinventing Government Initiative (REGO) and Prescription Drug User Fee Act (PDUFA), FDA examined their policy on comparability for biotechnology and other well-characterised biological products. This assessment lead to an altering in the 'process=product' paradigm. This change was due to an increasing capability and understanding of the separation sciences, analytical technologies, and biological methods that are used to characterise these products, evolution in manufacturing processes and controls, increased regulatory experience with various product classes, and acknowledgment that clinical trials in a small number of patients were less likely to determine product differences than rigorous analytical testing. FDA also recognised the need to avoid unnecessary testing in animals and humans. This policy on comparability was documented in FDA Guidance.³⁷ The publishing of guidance allowed greater flexibility in bringing important and improved products to patients more efficiently and expeditiously. It also allowed for increased availability and cost–savings to the manufacturers. Although this policy was put into writing in 1996, it had already been in place for a number of years and the requirements had been determined on a case-by-case basis. The rationale for issuing guidance was to clarify inconsistencies and remove ambiguities in this case-by-case policy. Approvals had been granted on analytical comparability alone for major manufacturing changes, such as the move of production from one site to another; increase from pilot scale production to commercial scale production; and changes to fermentation, purification, and formulation. FDA acknowledged that the most important factor for the Agency in the evaluation of product comparability is the anticipation of whether these manufacturing changes would have an adverse impact on product safety and efficacy. While the guidance did not provide a definition of comparable, it did state that the product pre- and post-manufacturing changes need not be identical.

The success of the development and rapid implementation of guidance was due to scientific support and strong partnership between FDA and the biotechnology industry. This advancement was acknowledged by EMEA in 2001 when the scientific body of this regulatory agency, the Committee for Medicinal Products for Human Use, formerly the Committee for Proprietary Medicinal Products (CPMP), adopted guidance in this area.³⁸ This body, however, took this approach one step further and acknowledged that comparability exercises can be performed to demonstrate that another manufacturer's biotechnology-derived product is similar to an already approved biotechnology-derived product. The CPMP Guidance acknowledges that the manufacturer of a biotechnology-derived product similar to one already authorised would not have all the data and information as the brand manufacturer. This approach underpins the current dataset required for approval of biosimilars in the EU.

The concept of comparability and methodology was subsequently adopted by the ICH. ICH brings together the regulatory authorities of Europe, Japan and the United States and experts from the pharmaceutical industry in the three regions to discuss scientific and technical aspects of product registration. Comparability was further refined in the Q5E guidance completed in 2004.³⁹ This document states that effects of manufacturing changes on the product can initially be evaluated by quality assessments using a series of analytical analyses. Additional animal and human studies are needed only when there is uncertainty regarding the outcome of analytical studies. In many cases, analytical studies alone are adequate to demonstrate that the changed manufacturing process does not have an adverse impact on the safety and efficacy of the product.

A comparability exercise is a stepwise approach using side-by-side comparisons of the biological generic and the brand product and begins with extensive analytical and biological characterisation. The primary (amino-acid sequence), secondary (alpha helix, beta pleated sheet, or random coil), and tertiary (folding) structures are elucidated using analytical methods such as mass spectrometry, N-terminal and C-terminal amino-acid sequencing, peptide mapping, isoelectric focusing, RP-HPLC, SE-HPLC, fluorescence emission spectroscopy, near infra-red and one- and two-dimensional nuclear magnetic resonance spectroscopies, and X-ray crystallography. Biological methods include cell proliferation assays and animal models (ie, hypophysectomised rats). Animal and/or human studies are then designed to answer scientific questions still remaining after analytical and biological characterisation and comparability between products have been completed.

The design and timing of the comparability exercise are critical. The design is dependent on the complexity of the molecular structure; differences to the innovative product, such as excipients; knowledge of the mechanism of action; and post-marketing experience of the innovative product, especially as it relates to safety. In certain circumstances, for example, if the mechanism of action is well known, a clinical trial may be conducted in one patient population and use of the product may be expanded to additional patient populations without performing clinical trials in the specific indication. Timing of these studies is critical to insure a cost-effective and efficient biopharmaceutical development programme. For example, if a robust, reproducible manufacturing process is not in place, any or all studies of the comparability programme may need to be repeated after major changes to the manufacturing process or after manufacturing personnel have a greater understanding of standard operating procedures.

ABBREVIATION OF ANIMAL AND HUMAN STUDIES

Owing to the scientific and medical knowledge accumulated during the marketing exclusivity period of the comparator (original) product, preclinical and clinical trials may be abbreviated for biological generics. In fact, this abbreviation will result in considerable cost savings during the biopharmaceutical development programme and lead to reduced development time.

According to ICH,⁴⁰ the primary goals of the preclinical safety evaluation are to identify an initial safe dose and subsequent dose escalation in humans, potential target organs for toxicity and whether such toxicity is reversible, and to identify safety parameters for clinical monitoring. The use of a biological product in humans will lessen the need for animal testing. As biological generics contain a comparable structure and form to the innovative product, one anticipates that the function and specificity will also be comparable. In addition, safety intrinsic to the product is expected to be comparable, but other potential safety issues related to minor species, such as aggregates, should be investigated. There is, however, no need to repeat scientific studies to demonstrate what is already known. This does not mean that one will not perform animal testing during the biopharmaceutical development programme or after approval. Scientific uncertainty with respect to a product's structure, activity, impurity profile, and other biochemical characteristics or safety may be addressed in an animal programme.

The preclinical safety evaluation programme for an innovative biological product is developed on a case-by-case basis with the focus on answering product-specific scientific questions. This approach is different from the approach taken for new chemical entities. As there is no interaction of the protein molecule with DNA, standard genotoxicity testing such as the AMES test is not required. Metabolism and the formation of metabolites is not a concern as proteins are degraded. Standard carcinogenicity assessments are generally inappropriate. Many protein products are inherently immunogenic in animals. The development of antibodies limits the use of these products for long-term studies and the correlation to human response has yet to be made. These studies may, however, be useful for determination of relative immunogenicity. In addition, if extensive public information is available regarding potential reproductive and developmental effects of a particular product class, mechanistic studies indicating that similar effects are likely to be caused by a new, but related molecule, may obviate the need for formal reproductive/developmental toxicity studies.⁴¹

This case-by-case approach can be logically extended to biological generics. As just mentioned, extensive public information on reproductive and developmental toxicity will more than likely be available for the innovative biological product so these studies may not be scientifically necessary for a biological generic. Safety pharmacology demonstrates the effects on major physiological systems, such as cardiovascular, respiratory, renal, and central nervous system. If these effects are well known for the innovative biological product and if a biological generic has been demonstrated to be comparable in its structure, activity, and other biochemical properties to the innovative product, and the function and specificity of a protein molecule is tightly related to this structure and form, the biological generic is expected to have the same effects on these major systems, and, thus, safety pharmacology studies will not usually be required. Animal studies in biological generics will be enabled as the published literature supports the selection of species, route of administration, dose and duration of treatment. As many parameters as possible should be measured in an individual study. For example, local tolerance can be measured during repeat dose toxicity studies. This approach allows for a reduced programme designed to avoid unnecessary testing in animals while generating scientifically sound conclusions supporting regulatory approval.

Intuitively, clinical data requirements for a biological generic will usually be less than those of the innovator product due to the understanding of the structural and functional properties of the protein that correlate with product safety and efficacy which come from post-marketing use of the brand product. If specific safety and efficacy issues have arisen post-approval for the innovative product, these issues will, however, need to be addressed for the biological generic. When performing clinical testing on an innovative product, the results of the study are uncertain. With a biological generic, the uncertainty decreases as the expectation is that the molecule will behave in the same manner clinically if comparable to the innovative molecule (due to the correlation between structure and function). Clinical trials may be abbreviated and the probability of success will be higher due to already known clinical endpoints; therapeutic regimens, such as concomitant medications; target population; and adverse event profile. During the marketing exclusivity period of the innovative product, medical progress continues and surrogate markers may become available. If the mechanism of action is known, clinical trials may be conducted in one patient population and expanded into other patient populations. Dose response/relationship studies usually need not be conducted as this response has already been determined. With regard to the design of the clinical programme, the extent of clinical trials will depend on the level of uncertainty remaining after a thorough analytical, biological, and preclinical comparability exercise. Owing to the many unknowns surrounding immunogenicity of protein products, immunogenicity will need to be assessed in clinical trials.

BIOPHARMACEUTICAL DEVELOPMENT FOR BIOLOGICAL GENERICS

A goal for a biological generic development programme is to bring a product to market as expeditiously and effectively as possible. This is most readily accomplished by a smooth transition through the drug development phases (analytical and biological comparability, animal studies, human studies) and a reduction in clinical trial requirements (reducing safety and efficacy studies — Phase III).

Another goal is resource savings through the ability to fail a product as early in development as possible. The use of biomarkers for measuring activity can allow one to determine early in development if a molecule has an anticipated clinical result, thus establishing a linkage between preclinical and clinical studies. Biomarkers are especially useful for complex molecules for which analytical and biological methods may not be available to fully characterise the molecule or product. For example, if the innovator's product has a known response to a biomarker and the biological generic does not, one may need to reconsider the comparability of the two products. The ability to do this early in development, rather than during the clinical programme, may lead to changes in the molecule or formulation resulting in a successful clinical programme and efficient use of resources.

STRATEGIC KEY SUCCESS FACTORS FOR BIOLOGICAL GENERIC COMPANIES

Certain strategic key success factors must be considered for a company entering the biological generics arena. A company must have excellence in scientific capabilities and biologics development. Analytical chemists must be able to develop and understand the limitations of analytical and biological methods used to characterise a molecule and to identify new technologies that will be of use in this effort. These protein chemists must also have the ability to perform an adequate analytical comparability exercise, understand structure:function relationships to provide scientific justification for expansion of labelling to patient populations in which clinical trials have not been conducted, and to provide strategic advice on pipeline products. Bioengineers must have the capability to design a manufacturing process that will produce a product that is comparable to the brand product, be efficient and cost-effective, and be located in a flexible (campaign), state-of-the-art current Good Manufacturing Practices (GMP) facility. Bioengineers, engineers, quality control, and quality assurance staff must work expeditiously to develop and validate the manufacturing process, facilities, systems, etc. Physicians and statisticians must have a strong understanding of clinical trial design and analysis to limit clinical trials to only those scientifically necessary for approval. Regulatory Affairs staff must understand the scientific and legal approaches to innovative biopharmaceutical development, and the dossier and approval requirements for biological generics. As with chemical generics, litigation will be a strategy to prevent market entry. A Legal team with a strong understanding of patent law and litigation must be in place to facilitate entry of a biological generic. In order to realise an acceptable financial model for a company, the product portfolio must be broad with global distribution channels and management must be willing to devote financial resources. As mentioned above, the cost for development, manufacture, and distribution of biological generics will be higher than chemical generics.

CHALLENGES AND OPPORTUNITIES

As companies encountered scientific and regulatory challenges bringing chemical generics to the marketplace, so do companies bringing biological generics. One can look to the EU where biosimilars have recently been introduced to see these challenges. For example, a comparability exercise requires that the same innovative product be used as a reference standard for all steps of the exercise — quality, safety, and efficacy. If the innovative product being used as the reference is removed from the market (usually due to the development of a second generation product) and a biological generic company fails to procure enough reference standard for the full comparability exercise or the reference standard expires during the exercise, a new reference standard (comparator) will need to be selected and the development programme may need to be re-started. Another challenge is the manufacture of a higher quality product by a biological generics manufacturer and the regulatory pathway for that product. For example, it is highly likely that due to the improved manufacturing technologies that exist today as compared to when the innovative product was first approved at least a decade ago, a biological generic with a higher purity level can be produced. As regards to purity, this product may be superior to the innovative product depending on the extent of the difference. Or during the comparative animal study, when using the same immunological assay to evaluate both products, a higher antibody titre is observed in animals dosed with the innovative product as compared to the biological generic leading to a decision of non-comparability, albeit superiority of the biological generic. Intuitively, one would expect the enablement of an improved, perhaps safer, product to patients. Due to these findings of non-comparability, a biological generic may, however, have to follow the same regulatory pathway as an innovative product. This will surely be cost and time prohibitive. From a regulatory perspective, the agencies will be challenged if approved product labelling for an innovative product states that the rate of antibody formation is lower than demonstrated though comparative clinical trials with a biological generic. Filling the pipeline will be a challenging task for biological generic manufacturers due to strategies already in place by the brand industry against generic drug makers. These include evergreening in the form of line extensions and next-generation franchise extensions, and authorised generics.⁴² As with all challenges, however, acknowledgment leads to the development of strategic solutions.⁴³

Opportunities exist to reduce healthcare costs for biological products and expand their use to patients in need. The entry of biological generics after the marketing exclusivity period has expired for the innovative product will result in rewards for all. As these products vary in the complexity of their molecular structure and indications, the mantra of biologics — case-by-case drug development — will need to be followed. Market dynamics will compel innovators and biological generics manufacturers to focus their efforts on what they do best: innovators will continue to develop breakthrough therapies that provide significant benefits for patients and healthcare providers while biological generic manufacturers will continue to bring affordable, high-quality drugs to patients.

References

References and Notes

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2. Grabowski, H., Cockburn, I. & Long, G. (2006). The market for follow-on biologics: How will it evolve? Health Affair 25, 1291–1301. | Article |
3. FDA's approved drug products with therapeutic equivalence evaluations. Available at: http://www.fda.gov/cder/orange/default.htm.
4. Ernest & Young. Beyond borders: The global biotechnology report 2006, www.ey.com/beyondborders.
5. URL: http://www.ims-global.com/insight/news_story/0405, 26th May, 2004.
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8. Personal communication, Julie Tam, Canadian Generic Pharmaceutical Association.
9. European Generics medicines Association.
10. Cost to develop new biotech products is estimated to average $1.2 billion. Tufts Center for the Study of Drug Development Impact Report 2006 Nov/Dec;8(6).
11. URL: http://www.fda.gov/oc/initiatives/criticalpath/whitepaper.html#execsummary.
12. URL: http://www.bio.org/speeches/pubs/er/statistics.asp.
13. Personal communication.
14. Oldham, T. Healthcare economics and biosimilars: Do we still risk missing the boat? presented at 4th EGA Symposium on Biosimilars, London, 18th May, 2006; and personal communication, T. Oldham, Mayne Pharma, and Chair, Biosimilars and Biotechnology Committee, European Generic medicines Association.
15. Global Insight. Available at: http://www.globalinsight.com/SDA/SDADetail5845.htm.
16. PharmWeek, Cambridge Healthcare Institute. Available at: http://www.pharmaweek.com/Exclusive_Content/1_26.asp.
17. Annex Guideline on Similar Biological Medicinal Products containing Biotechnology-Derived Proteins as Active Substance: Non-Clinical and Clinical Issues — Guidance on Similar Medicinal Products containing Recombinant Erythropoietins (EMEA/CHMP/94526/05).
18. Oldham, T. What future for biosimilars in an expanding European market? presented at the 12th EGA Annual Conference, Budapest, 21–22nd September, 2006.
19. Personal communication, Tim Oldham, Mayne Pharma, and Chair, Biosimilars and Biotechnology Committee, European Generic medicines Association.
20. http://www.maynepharma.com/global/news/latestnews_516.asp.
21. Commission Directive 2003/63/EC of 25 June 2003 amending Directive 2001/83/EC on the Community code relating to medicinal products for human use.
22. Commission Directive 2004/27/EC of 31 March 2004 amending Directive 2001/83/EC on the Community code relating to medicinal product for human use.
23. Guideline on Similar Biological Medicinal Products (CHMP/437/04).
24. Guideline on Similar Biological Medicinal Products containing Biotechnology-Derived Proteins as Active Substance: Non-Clinical and Clinical Issues (EMEA/CHMP/42832/05).
25. Guideline on Similar Biological Medicinal Products containing Biotechnology-Derived Proteins as Active Substance: Quality issues (EMEA/CHMP/BWP/49348/05).
26. Annex Guideline on Similar Biological Medicinal Products containing Biotechnology-Derived Proteins as Active Substance: Non-Clinical and Clinical Issues — Guidance on Similar Medicinal Products containing Somatropin (EMEA/CHMP/94528/05).
27. Annex Guideline on Similar Biological Medicinal Products containing Biotechnology-Derived Proteins as Active Substance: Non-Clinical and Clinical Issues — Guidance on Biosimilar Medicinal Products containing Recombinant Granulocyte-Colony Stimulating Factor (EMEA/CHMP/31329/05).
28. Annex Guideline on Similar Biological Medicinal Products containing Biotechnology-Derived Proteins as Active Substance: Non-Clinical and Clinical Issues — Guidance on Similar Medicinal Products containing Recombinant Human Insulin (EMEA/CHMP/32775/05).
29. Concept Paper on Similar Biological Medicinal Products containing Recombinant Alpha-Interferon — Annex to the Guideline on Similar Biological Medicinal Products containing Biotechnology Derived Proteins as Active Substance — (Non) clinical issues (CHMP/BMWP/7241/06).
30. URL: http://www.emea.eu.int/pdfs/human/press/pr/3179706en.pdf.
31. URL: http://www.emea.eu.int/pdfs/human/press/pr/6927606en.pdf.
32. Guidance for Industry: Applications Covered by Section 505(b)(2).
33. FDA response to Kathleen M. Sanzo, Stephan E. Lawton, and Stephen G. Juelsgaard re: Docket Nos. 2004P-0231/CP1 and SUP1, 2003P-0176/CP1 and EMC1, 2004P-0171/CP1, and 2004N-0355; 30th May, 2006.
34. URL: http://www.fda.gov/cder/drug/infopage/somatropin/qa.htm.
35. Berlex Laboratories, Inc. v FDA. United States District Court for the District of Columbia. 942 F. Supp. 19; 1996 US Dist. LEXIS 15169.
36. URL: http://www.hc-sc.gc.ca/dhp-mps/brgtherap/activit/fs-fi/fs-fi_seb-pbu_07-2006_e.html.
37. FDA Guidance Concerning Demonstration of Comparability of Human Biological Products, Including Biotechnology-derived Products, April 1996.
38. Note For Guidance on Comparability of Medicinal Products containing Biotechnology-derived Proteins as Drug Substance (CPMP/BWP/3207/00).
39. Draft Guidance ICH Q5E: Note for Guidance on Biotechnological/Biological Products Subject to changes in their Manufacturing Process.
40. Draft Guidance ICH S6: Preclinical Safety Evaluation of Biotechnology-derived Pharmaceuticals.
41. Ibid.
42. Hess, J. & Litalien, S. (2005). Battle for the market: Branded drug companies' secret weapons generic drug makers must know. J. Gen. Med. 3, 20–29. | Article |
43. Furniss, F. (2005). Strategies for biogeneric success. J. Gen. Med. 2, 145–152. | Article |