Shire Cedes Biosimilar Field

| About: Shire PLC (SHPG)
This article is now exclusive for PRO subscribers.

Shire’s (NASDAQ:SHPG) decision to shed the legacy biosimilars portfolio of Baxalta is a sensible move given the group’s shift towards rare diseases. Sales and marketing forces attempting to appeal simultaneously to highly specialized physicians and cost-conscious payers would be working at cross-purposes.

Moreover, even in advance of major biosimilar launches in the US, scale looks to be an important indicator of success, with Amgen (NASDAQ:AMGN) and Pfizer (NYSE:PFE) now looking like they will take a big chunk of sales. Meanwhile, the victims of Shire’s clearance, Momenta Pharmaceuticals (NASDAQ:MNTA) and Coherus Biosciences (NASDAQ:CHRS), saw shares rise yesterday, as the decision could clear the way for more dealmaking (see table below).

Back to you

Shire returned to Momenta rights to Bax 2923/M923, a Humira biosimilar, and to Coherus rights to BAX 2200/CHS-0214, an Enbrel lookalike. Coherus said it was not responsible for any payments now or in the future to Shire, while Momenta stated that Shire would be responsible for funding M923 development for another year.

Neither agent is likely to be first to market. Novartis’ (NYSE:NVS) Enbrel copy Erelzi received approval in late August, followed by Amgen’s Humira biosimilar Amjevita earlier this week. Both are held up by patent issues – the trial date to resolve Enbrel’s intellectual property is not until April 2018, and the sector is likely to hear that AbbVie (NYSE:ABBV) is suing to protect its Humira patents soon.

Humira and Enbrel biosimilars to watch

Sales ($m)

Project

Company

Status

2016

2017

2018

2019

2020

2021

2022

Humira

Amjevita (ABP 501)

Amgen

Approved*

-

45

166

326

500

681

829

SB5

Biogen/Samsung

Filed**

-

-

-

-

-

-

-

ONS-3010

Oncobiologics

Phase III

-

-

-

7

69

154

242

GP2017

Novartis

Phase III

-

-

-

-

-

-

-

FKB327

Kyowa Hakko Kirin/Fujifilm Holdings

Phase III

-

-

-

-

-

-

-

adalimumab

Mylan/Biocon

Phase III

-

-

-

-

13

24

34

BAX 2923/M923

Momenta Pharmaceuticals

Phase III

-

1

5

15

32

47

56

adalimumab

Coherus BioSciences

Phase III

-

-

9

8

18

21

23

PF-06410293

Pfizer

Phase III

-

139

237

310

383

463

549

BI 695501

Boehringer Ingelheim

Phase III

-

-

-

-

-

-

-

MSB11022

Merck KGaA

Phase III

-

-

-

-

-

-

-

Enbrel

Benepali

Biogen/Samsung

Marketed**

15

45

69

91

109

124

139

Erelzi

Novartis

Approved*

-

-

-

-

-

-

-

CHS-0214/BAX 2200

Coherus BioSciences

Phase III

-

-

-

-

-

-

-

CT-P05

Pfizer/Celltrion

-

-

-

-

-

-

-

Note: *US; ** Europe. Source: EvaluatePharma.

Once these first biosimilars reach the market, any followers may be delayed from entering for at least a year. Thus while losing a partner in Shire is a mild setback, both Coherus and Momenta have time to continue development solo and to secure new partners if necessary. And the knowledge that Shire was looking to streamline its pipeline after the Baxalta acquisition gave investors confidence that the decision was not based on safety or efficacy.

The good news about being a later entrant to the biosimilar scene is that most analysts do not believe that prices and revenue will drop as sharply as for small-molecule generics. There could well be plenty to play for with multiple biosimilar players.

Partnership dance

Given that groups like Pfizer, Novartis, Biogen and Amgen are active in biosimilars, the question remains which are candidates to license in the unencumbered Humira and Enbrel copies. As Amgen has got there first on Humira, while Biogen and Novartis have done the same on Enbrel, the list of possible partners shrinks substantially.

As the commercial owners of Enbrel, Amgen and Pfizer have little interest in supporting a biosimilar entrant, which reduces the list of Coherus partners. Humira, Novartis and Pfizer have late-stage copycats, while Biogen has submitted its SB5 for review in Europe.

These two candidates could provide an opportunity for a latecomer to pull itself into the biosimilar game. Boehringer Ingelheim or Merck & Co (NYSE:MRK), for example, could top up their biosimilars pipeline with Coherus’ Enbrel lookalike, while Teva Pharmaceutical Industries (NYSE:TEVA) – active in the smaller molecule biologicals like somatropin and epoetin – could get into the monoclonal antibody business by picking up one or both.

However, it looks more and more like bigger pharma players will dominate biosimilars in a way that they do not in generics. Both Momenta and Coherus need new partners – a solo launch does not look like an attractive option.