Insmed Chief Argues For Five-Year Biologics Exclusivity

Amgen was in the black on Neupogen/Neulasta three years after launch, CEO Allan contends.

WASHINGTON, D.C. - Likely the greatest obstacle to establishing a U.S. regulatory pathway for follow-on biologics is deciding how many years of data exclusivity they should have after they are approved. Insmed, which hopes to take FOBs of Amgen's Neupogen and Neulasta to market, suggests the five years provided for small molecule drugs under the Hatch/Waxman Act should be sufficient.

Speaking at the Biosimilars 2008 conference Sept. 23 at George Washington University, Insmed CEO Geoffrey Allan estimated Amgen's neutropenia franchise has produced $30 billion in sales since first launch in 1991. "With the growth in the market, by the time these patents expire, this franchise will have reaped $60 billion," he claimed.

Noting the general industry assumption that the process of taking a drug or biologic through development to launch costs about $1.2 billion, Allan said drug makers have made a return on their investment and then some.

"I think these guys made their money back," he said. "I heard a statistic recently that said a drug doesn't break even for 13.9 years. Well, these guys broke even three years [after launch]."

Of course, sniping between Insmed and Amgen is nothing new. Richmond, Va.-based Insmed earlier this year announced it had demonstrated bioequivalence of its INS-19 compound with Neulasta (filgrastim) in a randomized Phase I trial of 32 healthy volunteers (¹ (Also see "Insmed’s Biogeneric Deemed Equal To Neupogen" - Pink Sheet, 10 Jul, 2008.)). The biotech is developing a Phase III trial that would test INS-19 in several hundred patients.

Insmed also is developing a biosimilar (INS-20) of Neulasta (pegfilgrastim), Amgen's long-acting granulocyte-colony stimulating factor (² (Also see "Insmed Takes Follow-On Biologics Push To The Web" - Pink Sheet, 5 Feb, 2008.)). The firm is counting on an FDA process for approving FOBs to be in place by 2012, when Amgen's patents on filgrastim expire.

Cost savings for system and patients?

One of Insmed's strongest arguments in favor of FOBs is the cost savings for patients and the U.S. health care system. Allan previously has said market research indicates pricing an FOB 30 percent lower than the cost of the reference product would draw payers to a biosimilar.

At the conference, Allan said a study commissioned by his company estimated 10-year savings of $378 billion for the health care system if FOBs are allowed to enter the U.S. market. Legislative proposals are under consideration in Congress, although other speakers at the conference cautioned the audience not to expect action until after the next Congress convenes at the earliest.

Allan noted there are more than 500 biologics currently on the U.S. market, with the most expensive costing more than $100,000 a year. Annual sales of biologics are expected to reach $90 billion, he said, with consumers paying about $10 billion of that out-of-pocket. Meanwhile, early data from Europe and other nations where biosimilars have been launched show the beginning of market acceptance for these products, he added.

"The sooner [a U.S.] approval pathway is established, the greater the potential for dramatic savings," Allan said.

Approval of a pathway also is crucial, he argued, because few U.S. firms are following Insmed's lead and developing FOBs for the domestic market in the absence of an FDA approval process. In general, U.S. biotechs lack the skills and facilities needed to develop FOBs, Allan said, meaning the near-term opportunity from 2012 to 2015 - and potential resultant savings - will go unrealized.

The issues delaying approval of a regulatory pathway are mostly political and bureaucratic, not scientific, Allan added. Biosimilars of human growth hormone already are approved and marketed in this country, he noted, because they fall under the jurisdiction of the Food, Drug and Cosmetic Act, while G-CSF biosimilars can't yet be approved.

HGH and G-CSFs have virtually identical microbial expression, mass weight and amino aced structures, Allan said, suggesting the illogic of a system permitting one product but not the other.

"Analytical techniques and our manufacturing standards today are very sophisticated, and continue to get more sophisticated," he said. "We've clearly raised the standard."

"We have higher resolution, we have more reproducible techniques, we have greater sensitivity, we can miniaturize the samples, we can process more samples and we can capture more powerful data," Allan continued. "Basically, we can conduct more robust and detailed studies. We can examine the stability of the product in more detail. So this better analytical methodology leads to better control of the manufacturing process, improved quality control and the establishment of quality systems."

-Joseph Haas ([email protected])