Recently, Biocon Ltd said it got regulatory approval for the biosimilar version of insulin glargine, for launch in Japan on 28 March. The 12% rise in Biocon’s share since then is partially owing to this approval and also to a re-rating of the stock by Morgan Stanley. A biosimilar is a drug that is similar to the original biological product.
The market for biosimilars is an attractive one for Indian companies, with Japan being the third-largest market after the US and the European Union (EU), according to a recent report by IMS Institute for Healthcare Informatics on the subject. The current market size of the top eight biologics losing their patent protection between 2015 and 2020 is shown in the chart.
That is a sizeable market opportunity opening up. The US is the largest, with an estimated market size of 199 billion euros between 2016 and 2020, while the EU5 countries will contribute 47 billion euros. On 5 April, the US Food and Drug Administration (FDA) gave its second biosimilar approval, for infliximab; earlier on 6 March, it had given an approval for a biosimilar of filgrastim.
Some Indian companies are attempting to tap this opportunity themselves, while others are attempting to lower their risk by taking the licensing route. Either way, getting a successful biosimilar into a developed world market will be a feather in the cap for any Indian company. But they are still some time away from a successful launch and this opportunity is not without risks, such as delays in regulatory approval, more competition than anticipated from other biosimilars or government-mandated price cuts.
