Biologics – Untapped Opportunities

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India Emerging as a Next Biologic Drug Hub

SHUCHI.P.NAHAR

The Indian pharmaceutical companies always had strong chemistry skills to work on small molecules to make generic drugs, but they lacked skills, people and ecosystem to work on large molecules to come up with reverse engineered versions of biotech drugs, many experts complain. However, it is beginning to change.

 

‘India: the emerging hub for biologics and biosimilars’, the Indian pharmaceutical companies have launched 123 biosimilars and currently have 201 active biosimilars covering multiple indications in the development pipeline.

Further, India has 95 approved biosimilars in the domestic market, more than any other country in the world.

Biologics are the biological products regulated under

the rules of the Food and Drug Administration (FDA).

They are used to either diagnose, prevent, treat, or

cure various medical conditions. 

Significantly, biologics are large, complex, and diverse molecules produced through biotechnology. And, this uses living systems including animal cells, plant cells or microorganisms. Some biologics are therapeutic proteins such as filgrastim, monoclonal antibodies such as adalimumab,vaccines such as for influenza and tetanus, etc.

Biologic Phases

Moreover, the main challenge of manufacturing
biologics is the consequent inherent variations.
These variations of products have to be characterized
with time.

Therefore, the FDA assesses the manufacturer’s

strategy as well as the manufacturing procedure in

order to control the product variations.

The biologic market is set to grow, with biologic drug sales forecast to increase from $239bn in 2018 to $493bn by 2025, representing a compound annual growth rate of 11%, according to GlobalData’s Drug Sales and Consensus Forecast (DSCF) Database.

Furthermore, with biologics making up 41% of pipeline drugs, combined with investor understanding of these drugs’ potential and ongoing attractive IPO conditions across all markets, we can expect to see further biologic IPOs in the very near future.

Biologics are one of the top selling drugs worldwide
as well as in the United States but the major
drawback of this drug has been its exorbitant cost,
which makes it unaffordable and inaccessible to many
patients, especially in developing countries where a
large number of people are poor and the concept of
health insurance is at its nascent stage.

But the silver lining is that once the innovator company loses their intellectual property right and patent protection after a stipulated period, it opens the window of opportunities for companies evince an interest in manufacturing similar products, which cost less, and at that time, it is known as biosimilar or similar biologic.

Biosimilar is a biologic product, which is very similar to Food and Drug Administration (FDA)-approved biological product known as reference product and has no clinically meaningful differences in term of safety and effectiveness from the reference product.

But similar biologics are not exactly identical to reference biologics because of the complex structure, which may be affected by minor alteration in sequences and post translational modification

Degree of Complexity in Biologics

Unlike generic medicines, manufactured through
chemical synthesis, biologic medicines contain one
or more active principles produced or derived from
a biologic source, including a wide range of products
like vaccines, allergens or recombinant proteins.

Drug Molecules

Most biologics, such as monoclonal antibodies, have a
highly complex molecular structure that is difficult to
identify or characterize and they are manufactured
using the most innovative technologies.


In biologics, monoclonal antibodies have relevance
in the treatment of pathologies that affect a large
number of people: cancer, lymphoma, rheumatoid
arthritis, psoriasis, ulcerative colitis.


Biosimilars are medicines manufactured through
biotechnology and which have demonstrated their
equivalence in quality, efficacy and safety to the
reference product.

What is the Opportunity for India?

The global biologics market size was valued at
USD 276.6 billion in 2015. These products represent
cutting-edge research and also enable the latest
scientific discoveries. Such discoveries can be
translated into novel therapies that provide new
treatment options for patients.


Moreover, an increased understanding of the
genetic and molecular basis of disease has opened
the development of a range of targeted treatments.
For instance, recombinant proteins aid the immune
system in the identification and binding of foreign
substances.

Market Share Biologics

Future in Biologics 

Biologics are basically products that are produced
from living organisms or contain components of
living organisms. They include a wide variety of
products derived from humans, animals or
microorganisms using the tools of biotechnology.
Follow-on biologics and biosimilars as a class of
drugs have emerged as an effective alternative
to reduce the cost of biologic therapies.


According to a report by Associated
Chambers of Commerce of India (Assocham),
the global market for biologics will be $240 billion
and the Indian market will be over $35 bn by 2030
Indian pharma companies including Biocon,
Glenmark Pharmaceuticals, and Zydus Wellness
are actively focusing on the biologics market.
Biocon, for instance, earned Rs 1,517 crore or nearly
28% revenue from biologics in FY19- FY20.

A lot will however depend upon factors such as
access to cr gitical technology, regulatory guidelines
and the price difference between biosimilars and
the underlying biologics. For instance, the price
gap between the two has significantly widened to
over 60% for some drugs in Europe from just
over 20% a few years ago.

There is a pressing need for the biologic drugs in
the global healthcare to address the unmet need in
multiple therapeutic areas, particularly in oncology,
nephrology, immunology, diabetes and others.
India is a leading player in the biologics market
at global level.

Domestic Indian companies such as:
Biocon, Dr Reddy’s, Intas Pharmaceuticals, Hetero
Pharma, and Lupin Pharmaceuticals are few of the
key players with the largest number of products
launched in the country as well as in other emerging
economies.

Moreover, with growing interest in biologics in the
Indian landscape, many new companies,
including startups such as Enzene Biosciences,
are also jumping on the biologics bandwagon. 

SHUCHI.P.NAHAR 

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Shuchi Nahar
Shuchi is NISM Certified Equity Research Analyst, CFA - Level 1, a student of Law and Finance, and an aspiring CS.
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