Biosimilars look like a good bet now. But will they later? Allergan CEO says maybe not

Allergan CEO Brent Saunders
Allergan CEO Brent Sauners expects the to see the crowded biosimilars field to thin out down the line as discounts take hold.

Companies are flocking to the biosimilars scene, eager to capture a piece of the market for the world’s best-selling biologic drug brands. But one CEO won’t be surprised if those biosim developers one day change their tune.

Allergan chief Brent Saunders thinks companies will eventually back away from the field—his own included. The Dublin drugmaker likely won’t venture further into the arena, beyond the four cancer copies it’s currently developing with Amgen, he told Bloomberg.

Why? While the market may seem wide open now, with only Novartis and Pfizer on the scene with marketed biosims, that's not going to last. Once the plethora of companies with biosimilars still in development win their approvals, it’ll be pretty crowded. Eventually, small biosim makers working to catch up with the big guns will have to slash prices to nab a slice of revenue. And that, in turn, won’t do anyone any favors.

"It's great for society, but it's bad for business," Saunders told the news service of the discounting competition will bring.

The way he sees it, the biosimilars industry could wind up one day looking like the generics industry, but with much higher R&D, legal and manufacturing costs.

That’s presumably not something Saunders would like to hang around for. Last year, he completed a $40.5 billion sale of his company’s generics unit to Teva Pharmaceutical, which is still struggling under generics price erosion despite the acquisition. 

Current biosimilars makers have plenty of issues to deal with in the meantime. As some industry players have insisted, uptake for the meds won't be as fast as that of regular generics, as they're not as easy to substitute. Plenty of other hopefuls working to bring their products to market are also involved in legal tussles, and the FDA is still finding its regulatory footing, too.