all the information, none of the junk | biotech • healthcare • life sciences

Why Big Pharma Wants To Be Like Big Biotech

(Page 4 of 4)

sales as well. These sales will really erode when generic versions of Lipitor hit the market, which will very likely happen in the next few years. Pfizer’s acquisition of Wyeth earlier this year was driven, in large part, by its need to plug this upcoming revenue gap.

This situation has no current parallels with biologics in the US, since no biogenerics have made it into the marketplace. Biologics can be roughly divided into two classes. The first class is made up of drugs that are genetically engineered copies of proteins found naturally in the body, and are agonistic in nature, meaning they stimulate or provide an important function. Examples are recombinant erythropoietin, insulin, blood clotting factors, replacement enzymes, and growth factors. In contrast to small molecules, where there can be many drugs that target the same enzyme, biologics of this type usually enjoy standalone, monopoly status in their markets. Only the recombinant protein is biologically effective. Small molecules or other biologics that have the same effect have, with a few exceptions, not been discovered. These types of drugs are virtually immune to competition.

The second class, which include most monoclonal antibodies, are antagonistic in nature and can be termed “neutralizing biologics”. They are designed to block the action of a naturally-occuring molecule.

The place where biogenerics have the strongest potential to cut into sales of existing drugs is in the “neutralizing biologic” arena. For example, there are currently three monoclonal antibodies as well as a soluble receptor that all compete in the rheumatoid arthritis arena by binding to and neutralizing an inflammatory protein called TNF. In this situation, the introduction of a biogeneric would be quite likely to cut into sales of all of the members of the class. The bottom line here: biological agonists will be more resistant (in a revenue sense) to biogenerics competition than biological antagonists.

Biologics Will Get Market Exclusivity – A Good Thing?

Aside from patent considerations, discussions are well underway in Washington as to whether or not biologics deserve a period of market exclusivity, and if so, how long a period this should be. Market exclusivity means that once a biologic is approved for a certain indication, no generic form of that molecule could be sold for the same indication during the period of exclusivity. Given that drug patents these days last 20 years, one might wonder what all the fuss is about. Many consider the point moot. The pharmaceutical industry has lobbied for a 12-year exclusivity period, arguing that it’s necessary to protect their financial interests and to provide an incentive to innovate. As currently written, this 12-year period has found its way into pending health care legislation in both the U.S. House of Representatives and the Senate. While I am not troubled about the time frame due to the overriding patent issues, I am bothered by the inclusion of clauses in this legislation that can essentially enable drug companies to extend these time frames multiple times by producing minor variants or by altering the manufacturing process. Thus, a 12-year period of exclusivity could easily morph into one that was 24 years. This can only succeed in keeping prices high for consumers by keeping competitors off the market.

Left out of any of the market exclusivity discussions that I have read is the positive effect that this legislation could have on legacy molecules discovered during the period I refer to as the cloning wars (roughly 1980-2000). During this time, competing biotech companies cloned a fair number of significant proteins that never made it into clinical trials, didn’t get properly investigated there, or failed outright. There are many reasons they didn’t work out. However, the chances of these molecules receiving further clinical investigation are presently very dim, because their patents have already expired, or will soon. Without patent protection, these molecules will not attract a financial commitment from industry. But if Congress suddenly grants them a new 12-year period of market exclusivity, then companies will have a reason to rescue at least some of these proteins from the biologic scrap heap and return them to the clinic. Given the likelihood that many diseases, such as cancer, will need to be treated simultaneously with a spectrum of drugs, rescuing some of these promising biologics will be a good thing.

Single PageCurrently on Page: 1 2 3 4 previous page

By posting a comment, you agree to our terms and conditions.