A rope-a-dope strategy of sorts on biosimilars is in play for India's Dr. Reddy's ($RDY) as it shifts from a strategy of racing to the domestic market with products in favor of a coiled approach that will let it strike out in several markets in a burst.
That means money, time and patience for a company that was among the first to race off in pursuit of a multi-billion dollar market among Indian firms in 2005 with four launches in India in about as many years, the Economic Times reports.
In fact, the company's last big biosimilar launch was back in 2011 when it introduced cut-price versions of Roche ($RHHBY) originator drug (Neupogen) pegfilgrastim, branded Cresp by Dr. Reddy's, the Economic Times noted.
But that has been in part because the company has slowly started to look at wider options and business models in biosimilars that has been buttressed by other steps in the past few months, the Economic Times said.
In August, Dr. Reddy's said it would seek local regulatory nods to market Amgen's ($AMGN) multiple myeloma drug Kyprolis, immunotherapy Blincyto and PCSK9 inhibitor Repatha in India, the Hyderabad-based company said in a press release, in something of a surprise move by both companies. Amgen also makes a biosimilar of pegfilgrastim called Neulasta.
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| The rebranded Dr. Reddy's Laboratories logo |
In July, the Hyderabad, India-based firm said it would expand in the U.S. and emerging markets this year and for the purpose sported a new look and brand slogan, "Good Health Can't Wait," along with a new logo and corporate color scheme.
Officials at the company told the Economic Times that they have strategically compromised speed to market in India to focus energies for approvals across key regulated and emerging markets as part of a way to make the value of hoped launches increase by several billions of dollars.
"Biosimilars are part of our global transformation into a specialty drug firm," Satish Reddy, chairman of Dr. Reddy's, was quoted as saying by the Economic Times. "Investments made over several years (in biosimilars) is coming to fruition now," he adds, referring to the delays mentioned earlier. "The (global) opportunity is tremendous."
Dr. Reddy's has already launched drugs like rituximab, darbepoetin and the aforementioned pegfilgrastim, but now with help from staff like Cartikeya Reddy, formerly with Genentech, candidates such as trastuzumab (Herceptin) and bevacizumab (Avastin) are in the pipeline, with an additional ten in the pre-development stage, the Economic Times said.
Citing a report by Phillip Capital in May, the Economic Times said Dr. Reddy's expects 50 filings of its first set of 6 biosimilar drugs across 14 major countries by 2020.
"It forecasts incremental sales of $150 million to $200 million from biosimilars in 2020 that will have a margin profile of over 25%. It also expects licensing/royalty incomes from U.S. and EU by 2020," the report added.
Still, rivals domestically, like Biocon, Cipla, Zydus Cadila and Ahmedabad-based Intas are pressing ahead with multiple launches. In June, Intas launched a domestic biosimilar of ranibizumab, the active ingredient in eye drug Lucentis from Novartis ($NVS) priced at a quarter of the cost of the original.
Lupin has said it plans for a 2017 filing in Japan for etanercept, a biosimilar version of Amgen's Enbrel, in partnership with a Yoshindo unit called YL Biologics. Lupin said it has 10 biosimilars under development with launches of pegfilgrastim and filgrastim-granulocyte colony stimulating factor (G-CSF) in India next year possible.
And last December, Zydus Cadila launched copies of Humira (adalimumab), AbbVie's ($ABBV) rheumatoid arthritis treatment.
Dr. Reddy's on the other hand has used its global network to access technology in cell culture, part of $300 million spent in research annually with $40 million routed each year towards biosimilars over the next five years, the Economic Times said.
But with competitors like South Korea's Celltrion and Samsung Bioepis prepared to invest even more and at a rapid pace, coupled with costs for clinical trials and other regulatory mandates the cost of development of a biosimilar could range anywhere between $100 and $200 million, Dr. Reddy's can't stay on the ropes for long, the Economic Times notes.
- here's the story from the Economic Times