Biocon wins key Japan approval for Lantus biosimilar

Japan has approved a new biosimilar of Sanofi's ($SNY) blockbuster Lantus (insulin glargine) as its creator Biocon chalks up a much needed win after a tough 2015.

The Bangalore, India-based drugmaker said it had been granted authorization to sell its copycat version of the diabetes medicine from the country's Ministry of Health, Labor and Welfare (MHLW).

Biocon will co-market the drug with partner Fujifilm. The product is a ready-to-use, prefilled disposable pen complete with a biosimilar version of insulin glargine. Biocon expects to launch it there next quarter. 

"The Insulin Glargine approval in the highly regulated market like Japan marks a huge credibility milestone for Biocon. We see this as a significant achievement in our journey of making global impact in diabetes management through our affordable biosimilar insulins," Biocon's Kiran Mazumdar-Shaw, chairwoman and managing director, said in a statement.

"We hope to enable the Japanese government to bring down its healthcare expenditure on diabetes with the use of this cost effective, high-quality biosimilar Insulin Glargine."

This will be a boon for the company after a tough 2015 that saw analysts question its low growth, especially from its biopharma pipeline. Mazumdar-Shaw, however, remained upbeat, pointing to its burgeoning biosimilar development as one to watch for future revenue streams.

With its latest approval, Biocon is looking at capturing a large segment of the Japanese insulin glargine market, which it estimates to be worth around $144 million--the second largest market outside of North America and Europe. Japan has reported that there were 7.2 million cases of diabetes in the country last year, and this is set to rise.

It hopes the approval in Asia's largest pharma market will be a steppingstone into the world's biggest markets, given that the biosimilar nod from Japan is the first endorsement from a major market for the company. Biocon said it is now actively seeking future approvals from the EMA and the FDA.

This will all be a blow to Sanofi as the French drugmaker's CEO Olivier Brandicourt said last year that Japan "may be a good gauge of the company's performance on all counts" given that there are now two copycat versions of its insulin in this market.

Biocon has not released the price tag for its product, but it is likely to be around 25% cheaper than Sanofi's drug and therefore more attractive to a healthcare system attempting to save costs.

The Lantus SoloSTAR formulation of the basal insulin--a pen injector version of the drug--is a major seller for Sanofi, accounting for almost two-thirds of Lantus' $7 billion-plus global sales last year.

But Lantus has been under increasing pressure as its U.S. rival Eli Lilly ($LLY) and Germany's privately owned Boehringer Ingelheim have also developed their own pen-based insulin glargine biosimilar product Basaglar, which gained a delayed U.S. approval late last year alongside an EMA nod under the brand name Abasaglar.

Last year Lilly and BI also gained Japanese regulatory approval for their Lantus biosimilar insulin, making it the first biosimilar competition for the branded basal insulin analogue in Japan. Both Lilly/BI and Biocon's products could decimate Lantus sales in the region.

But Sanofi is looking to fight back with its next-gen basal insulin Lantus XR, or Toujeo, to treat Type 1 and Type 2 diabetes. The treatment was approved in Japan last summer and is a longer acting version of Lantus, meaning it needs to be injected less, possibly making it more attractive to patients.

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