The Indian biopharmaceutical firms are all set to exploit the emerging biogeneric market, which is expected to receive further boost with many of the biopharmaceuticals are going out of patent protection in the coming decade.
Though biogenerics are available in less regulated and semi-regulated markets in Asia, Eastern Europe, Africa and South America, it is yet to hit the European and US markets. However, it is expected to achieve successful market penetration, as the patents of major biopharmaceutical blockbusters expire.
Currently, India is one of the major contributors in the global biogeneric market. The entry of Indian firms has changed the dynamics of the domestic biogenerics market. In the future, brand India is expected to be more powerful in the segment, as information, innovation and imagination are the prime drivers of the new knowledge economy. The biogenerics market size in India is estimated at Rs 600 crores and is expected to grow at 25-30 per cent per annum for the next five years. As per the current records, Indian firms account for 25 per cent of the total drug master file (DMF) submissions to the US Food and Drug Administration (US FDA).
"The EU market would be the first to be tapped by Indian companies, as the regulatory pathway for introduction of biosimilars for some products (such as growth hormone, erythropoietin, interferon alpha and GCSF) is available in the region, said, K V Subramaniam, President, Reliance Life Sciences. The US government is yet to firm up regulations for biosimilars, which is likely to delay the planned entry of Indian companies into this space in US. The industry is optimistic that the regulations would be in place in the near future.
However, very few Indian companies are geared up for entering the biosimilar space in regulated markets, as the process for obtaining product-marketing approvals is long and arduous. Indian companies would need cGMP manufacturing facilities compliant to US FDA and EMEA standards, as they also carry out pre-clinical and clinical development of these products as per the regulations set out.
Referring to the biogenerics market potential, Harish Iyer, General Manger, R&D, Biocon, said, "The biogenerics already has a huge potential in Indian pharmaceutical industry. The market of insulin alone is more than Rs 150 crore, while the market of G-CSF is between Rs 30 and Rs 50 crore. However, the future of biogenerics' market depends on the kinds of treatment."
Major Indian players
Dr. Reddy's, Wockhardt, Shantha Biotechnics, Biocon and Panacea Biotec are the major Indian players in this segment. Others like Zenotech, Cadila, Ranbaxy, Intas and Serum Institute of India are planning to enter into the market. Companies such as Bharat Biotech, Dr. Reddy's, Panacea, Biotec, Shanta Biotechnics, Biocon, Intas Pharmaceuticals and Shreya Life Sciences have already shown their capability in producing biogenerics in India.
Dr. Reddy's is a major player in the biogenerics segment with two products in its kitty - grafeel and reditux. Also, the company is working on eight new biologics products that are focused on oncology and auto-immune disorders.
Referring to the company's interest in the segment, Cartikeya Reddy, vice president and head, biologics, Dr.Reddy's, said, "Our focus is in the area of biopharmaceuticals and we are quite excited about the prospects in the domestic and global market. The complexity of biopharmaceutical products means that there has to be a commitment towards building up the right skills and capabilities with a significant investment in R&D and manufacturing infrastructure. Over the past few years, the company has been moving systematically in this direction".
The success of the company's efforts also depends heavily on the ecosystem of suppliers, technology companies and contract research organisations. "If there is balanced growth across these areas and the company continues to expand the pool of skilled professionals, biogenerics is the area where Indian companies can have global impact," he added.
Biocon, another major player in the biogeneric segment, is all set to enter the US and European market with biogeneric version of insulin. The pipeline projects of Biocon comprise of insulin, G-CSF, Erythropoietin, glargin and human growth hormone.
Reliance Life Sciences, a leading player in the biopharmaceutical sector, has several biogeneric products under different stages of development. These products are aimed at the domestic and international markets, including regulated markets. The company is building significant manufacturing capacities for biopharmaceuticals and all these facilities would be compliant to US FDA and EMEA standards. Also, Reliance Clinical Research Services is capable of conducting clinical studies for these products in multi-country settings sticking to ICH-GCP protocols. RCRS is already conducting clinical trials for clients based in US, EU, Japan and other countries.
Advantage India
One of the main advantages of India over other countries is the large number of US FDA approved plants. According to estimates India houses the largest number of US FDA approved plants outside US. Growing number of clinical trials and research, high human resource availability, high competitive bioprocessing skills and genomic research opportunity also supports the Indian setting.
With large number of English speaking medical professionals, nearly 7,00,000 post graduates and 1500 PhD's in biosciences and engineering every year, Indian firms are set to take advantage in this segment. Reports state that more than 30 per cent scientists and qualified personnel are employed in R&D by most of the biotech companies. Along with this the Indian pharmaceutical industry has proved to be globally competitive in fermentation-derived pharmaceuticals, which transforms and leverages production of biogenerics.
There are not too many players in the global one billion biogenerics market. Well-trained manpower and vibrant business culture forms are advantage to the Indian firms. However, the Indian companies needs to revamp the current facilities, competence and high cost involved in the biopharmaceutical business, which seems a hurdle for the firms in exploring the segment. According to Iyer, there is a huge potential for Indian firms in outsourcing biopharmaceuticals.
Out of the 50 approved recombinant therapeutic biotech products, 14 are available in the Indian market. Nearly 40 companies, domestic as well as multinationals, are engaged in R&D, importing, manufacturing and marketing of recombinant biotech products in India. As per reports, six to eight local companies are into manufacturing and marketing of the products.
According to industry sources, Indian players mainly focus on the drugs going off patent in the future. The country is trying to exploit these opportunities as a safer means than resorting to new drug discovery research. Erythropoietin, human growth hormone, G-CSF, insulin and interferon alpha are the familiar generics in the Indian market. As per reports, the Indian biogeneric market is expected to reach Rs 1,864.3 by the end of this year, registering a growth of 19 per cent.
The large export opportunity in the biogenerics has played a key role in attracting companies such as Shantha Biotech, Bharat Biotech and Panacea Biotech into this segment. The competitiveness of the Indian firms in terms of quality and price has never been in doubt.
India's first genetically produced vaccine costs less than half the price of competing vaccines. Many overseas companies and research institutions are now collaborating with and outsourcing to the Indian companies.
By 2010, about two-dozen biologics are likely to go off patent, a key stimulating factor for the Indian biogeneric players. The government is in the process of implementing cost cutting polices to save the generic usage. Lower prices, compared to the original products and aging population in the largest markets are likely to fuel the demand for biogenerics.
Challenges
Despite the significant opportunities, the biogenerics pose challenges in highly regulated markets of US and Western Europe. They are mainly in the form of ambiguous regulatory approval process and patent issues, which makes it difficult for the manufacturers to introduce biogenerics in these markets.
Regulatory and patent uncertainties form a block for the biogeneric industry. Regulatory authorities in the regulated markets are slow to respond to emerging trends in the biotech. More over, medical professionals and practitioners remain hesitant to use biogenerics. Complexity of patent battles poses another hurdle for the growth of the industry. Issues arise because not just the original biologic is patented, but the manufacturing process is also patented, along with several essential components and active ingredients required for manufacturing the product.
As per industry people, high cost forbids Indian firms from exploring biopharmaceutical business. The biopharmaceuticals business is capital intensive with large capex requirements for setting up cGMP manufacturing facilities. Besides, the product development timelines and costs are higher than those of generic pharmaceuticals, with elaborate requirements of pre-clinical and clinical studies, said, K V Subramaniam. Another major hurdle is in terms of human competencies. All over the world, good talent is scarce in the biotech industry, particularly when it comes to clinical development and manufacturing.
With prices of available biogenerics soaring high, consumers are set to influence the market in the future. But with many biopharmaceuticals going off patent in the future, the trend is expected to shift to manufacturers. The Indian firms need to retain reverse engineering capability and also inherent process chemistry. Companies are required to be fully integrated and to focus on core competence and regulatory compliance.