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SPECIAL REPORT 5 THINGS YOU NEED TO KNOW ABOUT BIOSIMILARS 1 1 5 things you need to know about biosimilars BY KAREN WELDS Plan sponsors can scarcely remember a time when drug benefit plans were not under financial pressure—and then along came biologic pharmaceuticals. Life-changing on the one hand; significantly higher costs on the other. As the pipeline for these drugs continues to grow in Canada, so too do payers’ concerns with plan sustainability. Now another category of biologics is emerging that promises to ease some of the pressure: biosimilars. Yet market viability for these lower-cost biologic medications in Canada is far from assured. Here’s what plan sponsors and benefits providers need to know as biosimilars seek a foothold. A biosimilar, also referred to as a subsequent-entry biologic (SEB), is a biologic medication that comes to market after the patent expires for its “originator” biologic. As such, it can be as effective as the originator in dramatically improving health and productivity for the small percentage of plan members for whom traditional pharmaceuticals do not work. “When conventional, non-biologic therapies fail, biologics are in fact the place to go,” says Ed Keystone, a rheu- matologist and director of the Rebecca MacDonald Centre for Arthritis and Autoimmune Disease at Mount Sinai Hospital in Toronto. “They can make an enormous difference to patients and dramatically improve the quality of life. I have had patients return to work from disability.” Like the originator biologic, biosimilars contain living organisms that require highly complex manufacturing processes and strict distribution methods. They cannot be swallowed in pill form—patients either get injections (which they can usually give to themselves) or go to an infusion clinic. Direct patient support is usually available to ensure the medication is taken properly and to navigate payment, which can be a combination of coverage from private and public plans, a co-pay from the patient and financial assistance from other sources (such as the manufacturer or a charity). Although a biosimilar by definition follows in the footsteps of an orig- inator biologic, they are not identical to each other. This goes back to the fact that they are made with living cells, and that the manufacturing process is complex as well as proprietary. With this in mind, the relationship between biosimilars and their originators is completely different from the relationship between traditional, chemically based generic drugs and brand-name pharmaceuticals. Generics are considered copies of the brand name, while biosimilars are considered similar—but never identical—to originator biologics. Due to the unique nature of bio- logic medications, researchers and regulators use degrees of similarity BIOSIMILARS CAN BE LIFE-CHANGING 2 THEY ARE SIMILAR, NOT THE SAME
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  • S P E C I A L R E P O R T 5 THINGS YOU NEED TO KNOW ABOUT BIOSIMILARS 1

    1

    5things you need to knowabout biosimilarsBY K A R E N W E L D SPlan sponsors can scarcely remember a time when drug benefit plans were not under financial pressure—and then along came biologic pharmaceuticals. Life-changing on the one hand; significantly higher costs on the other. As the pipeline for these drugs continues to grow in Canada, so too do payers’ concerns with plan sustainability. Now another category of biologics is emerging that promises to ease some of the pressure: biosimilars. Yet market viability for these lower-cost biologic medications in Canada is far from assured. Here’s what plan sponsors and benefits providers need to know as biosimilars seek a foothold.

    A biosimilar, also referred to as a subsequent-entry biologic (SEB), is a biologic medication that comes to market after the patent expires for its “originator” biologic. As such, it can be as effective as the originator in dramatically improving health and productivity for the small percentage of plan members for whom traditional pharmaceuticals do not work.

    “When conventional, non-biologic therapies fail, biologics are in fact the place to go,” says Ed Keystone, a rheu-matologist and director of the Rebecca MacDonald Centre for Arthritis and Autoimmune Disease at Mount Sinai Hospital in Toronto. “They can make an enormous difference to patients and dramatically improve the quality of life. I have had patients return to work from disability.”

    Like the originator biologic, biosimilars contain living organisms that require highly complex manufacturing processes and strict distribution methods. They cannot be swallowed in pill form—patients either get injections (which they can

    usually give to themselves) or go to an infusion clinic. Direct patient support is usually available to ensure the medication is taken properly and to navigate payment, which can be a combination of coverage from private and public plans, a co-pay from the patient and financial assistance from other sources (such as the manufacturer or a charity).

    Although a biosimilar by definition follows in the footsteps of an orig-inator biologic, they are not identical to each other. This goes back to the fact that they are made with living cells, and that the manufacturing process is complex as well as proprietary.

    With this in mind, the relationship between biosimilars and their originators is completely different from the relationship between

    traditional, chemically based generic drugs and brand-name pharmaceuticals. Generics are considered copies of the brand name, while biosimilars are considered similar—but never identical—to originator biologics.

    Due to the unique nature of bio-logic medications, researchers and regulators use degrees of similarity

    BIOSIMILARS CAN BE LIFE-CHANGING

    2 THEY ARE SIMILAR, NOT THE SAME

  • Selected biologics patents due to expire in Canada by 2020Drug Brand name (manufacturer) Indication(s)Adalimumab Humira (AbbVie Inc.) Crohn’s disease, rheumatoid arthritis,

    psoriatic arthritis, ankylosing spondylitis, chronic plaque psoriasis, polyarticular juvenile idiopathic arthritis

    Bevacizumab Avastin (Hoffmann-La Roche Ltd.)

    Metastatic colorectal cancer; metastatic or recurrent non-small cell lung cancer; glioblastoma; epithelial, ovarian, fallopian tube, or primary peritoneal cancer

    Darbepoetin alfa Aranesp (Amgen Canada Inc.) Anemia

    Epoetin alfa Eprex (Janssen Inc.) Anemia

    Etanercept Enbrel (Immunex Corporation) Rheumatoid arthritis, polyarticular juvenile idiopathic arthritis, psoriatic arthritis, ankylosing spondylitis, chronic plaque psoriasis

    Filgrastim Neupogen (Amgen Canada Inc.) Neutropenia

    Follitropin alpha Gonal-f (EMD Serono) Fertility disorders

    Ibritumomab tiuxetan

    Zevalin (Bayer Inc.) Non-Hodgkin lymphoma

    Infliximab Remicade (Janssen Inc.) Crohn’s disease, rheumatoid arthritis, ulcerative colitis, psoriatic arthritis, ankylosing spondylitis, chronic plaque psoriasis

    Insulin detemir Levemir (Novo Nordisk Canada Inc.)

    Diabetes mellitus

    Insulin glargine Lantus (Sanofi-Aventis Canada Inc.)

    Diabetes mellitus

    Pegfilgrastim Neulasta (Amgen Canada Inc.) Neutropenia

    Ranibizumab Lucentis (Novartis Pharmaceuticals Canada)

    Age-related macular degeneration, diabetic macular edema, macular edema secondary to retinal vein occlusion

    Rituximab Rituxan (Hoffmann-La Roche Ltd.)

    Non-Hodgkin lymphoma, chronic lymphocytic leukemia, rheumatoid ar-thritis, granulomatosis with polyangiitis

    Trastuzumab Herceptin (Hoffmann-La Roche Ltd.)

    Breast cancer, metastatic gastric cancer

    Source: Excepted from Canadian Agency for Drugs and Technologies in Health. Environmental Scan, January 2014 (Issue 43).

    2 5 THINGS YOU NEED TO KNOW ABOUT BIOSIMILARS S P E C I A L R E P O R T

    Based on what’s happening in Europe, where biosimilars have been on the market for almost 10 years,

    these medications cost 20 percent to 30 percent less than their origina-tor biologics.1

    In January 2014, Health Canada approved Inflectra, a biosimilar for Remicade (infliximab). Based on listed prices for provincial drug plans contained in a September 2014 report by Canada’s Common Drug Review, Inflectra costs about 30 percent less than Remicade. This translates into about $10,900 for the first year of treatment for a patient with rheuma-toid arthritis compared with about $15,800 for treatment with the originator biologic.2

    One may wonder how these lower costs are possible, given the compa-rable complexity of manufacturing, distribution and patient support. The cost savings come from how biosimilars are developed and what’s required for approval by regulators.

    First, “the cornerstone of biosimilar development rests on ‘reversed engi-neering’ and on a ‘reversed body of evidence.’ Similarity must be analyt-ically proven and then confirmed by relatively small clinical trials,” writes Brian Bressler, a gastroenterologist and researcher at the University of British Columbia.3

    3THEY COST LESS—AND HERE’S WHY

    as their compass for biosimi-lars. Health Canada has based its regulatory framework on that of the European Medicines Agency (EMA), and the guid-ing principle “is to demonstrate the similarity of the SEB with the reference product, as the therapeutic benefit has already been established for the refer-ence product.”1

    It’s worth noting that orig-inator biologics can become “similar” to themselves over time, often due to adjustments in manufacturing. “Batches of the originator biologic may change over time, and that’s called product drift. These are not sig-nificant differences that require manufacturers to retest the drug, but they are differences that need to be kept within certain limits,” says Dr. Keystone.

    “This means that a 10-year-old originator may be similar but not identical to what it was at the start, and it means that a biosimilar and the originator could become less or more similar to each other over time,” adds Dan Martinusen, a researcher and clinical phar-macy specialist, specializing in nephrology, at Vancouver Island Health Authority.

  • To substitute or not to substitute?Since biosimilars (or subsequent entry biologics, SEBs) are not the same as their originator biologic, Health Canada and other regulatory bodies recom-mend against the automatic substitution of an originator with a biosimilar. The main concern has to do with immunogenicity, or the immune system’s re-sponse to a drug. Since many biologics are used to treat autoimmune diseases, there is a risk that the immune system will make antibodies against the drug. Does the risk and incidence of such a negative reaction increase if the patient is switched to a biosimilar?

    “We won’t know that until SEBs have been around for five to six years,” says Ed Keystone, a rheumatologist and director of the Rebecca MacDonald Centre for Arthritis and Autoimmune Disease at Mount Sinai Hospital in Toronto.

    To that end, clinicians and researchers are monitoring the impact of switch-ing medications for consenting patients. At University Hospital Southampton in the U.K., for example, 150 patients taking Remicade (infliximab) for inflam-matory bowel disease recently switched to a biosimilar and are being moni-tored on a case-by-case basis. Clinicians also look forward to the findings of NOR-SWITCH, a randomized, double-blind study with 500 patients in Norway. The study, scheduled for completion in May 2016, will monitor patients for 52 weeks to determine whether switching results in a worsening of the disease for all six of Remicade’s indications (rheumatoid arthritis, ankylosing spondylitis, psoriatic arthritis, plaque psoriasis, Crohn’s disease, ulcerative colitis).

    Until research can tell us more, regulators and prescribers will likely err on the side of caution. “If a patient is stable on a biologic, I don’t think any phy-sician is going to switch them to a biosimilar, or another biologic. However if the patient has never been treated with a biologic, then it’s okay to start with a biosimilar,” says Dan Martinusen, a researcher and clinical pharmacy specialist, specializing in nephrology, at Vancouver Island Health Authority.

    Switching can, however, come into play if the current biologic no longer works well enough. “After five years only 50 percent of my patients are on the same biologic. This is not unusual as any biologic can lose effectiveness over time,” says Dr. Keystone. “This is another reason why SEBs are important, so we have more treatment options.”

    S P E C I A L R E P O R T 5 THINGS YOU NEED TO KNOW ABOUT BIOSIMILARS 3

    In Canada, patents on 15 origina-tor biologics are set to expire by 2020. Several global pharmaceu-tical companies—among them Amgen, Merck and Pfizer—have stated their intent to bring bio-similars to this country. Whether or not these medications will establish enough of a foothold in this marketplace, however, remains to be seen.

    “Any manufacturer trying to create an SEB market in Canada has to have pretty deep pockets, and they have to be patient while establishing as many markets as they can globally. Otherwise the question becomes, ‘Is it worth-while to launch in Canada?’ It’s such a small market on its own,” says Martinusen.

    IMS Brogan reports that Canada holds a 2.2 percent share of the global pharmaceutical market. Biologics (which include some oncology products in IMS’s tally) account for 27 percent of those dollars, and less than 5 per-cent of prescriptions dispensed. Biosimilars in Canada will need to carve their share from that pie. If we look to Europe as an example, after five years on the market biosimilars represented approximately 11 percent of all biologics dispensed.1

    With this in mind, listing policies from both public and private payers are likely

    In other words, large clinical trials with humans, which are costly and necessary for the originator, are not required for biosimilars. The empha-sis is on laboratory analysis, which has come a long way since biologics first arrived on the scene about 20 years ago. Notes Dr. Bressler: “Modern analytical tests are extremely sensitive, whereas clinical studies are imminently insensitive with regard to small differences in therapeutic outcome.”

    Second, the science of extrapola-tion “is essential to keep the cost of biosimilars competitive,” says

    Dr. Bressler. This means that data used to demonstrate similarity for one indication or disease (such as rheumatoid arthritis) may be extrap-olated to another (such as psoriasis). This is accepted practice, though Health Canada appears to be more cautious than the EMA: It approved Inflectra for four out of six possible indications (including rheumatoid arthritis), but decided not to allow extrapolation for the two indications related to gastrointestinal disease (whereas the EMA approved Inflectra for all six indications, using extrapolation).

    4 THEY’RE COMING TO CANADA—BUT WILL THEY STAY?

  • This report was made possible through the support of Merck Canada. The opinions and information contained herein are those of the author and do not necessarily reflect the views or opinions of Merck Canada.

    Karen Welds is a business writer specializing in employee health benefits and the pharmaceuticals market.

    2006 2011 2016

    99.98%$93 billion

    99.6%$156 billion

    98%$194 billion–$206 billion

    0.02% $14 million 0.4% $693 million 2% $4 billion–$6 billion

    Global market for originator biologics and biosimilars, forecast to 2016l ORIGINATOR BIOLOGICS l BIOSIMILARS

    4 5 THINGS YOU NEED TO KNOW ABOUT BIOSIMILARS S P E C I A L R E P O R T

    essential for biosimilars to get enough of a foot in the door. “Manufacturers of biosimilars don’t have to sell in Canada if they decide the market is too small, especially if the pricing rules are too complicated. They could simply not bother, which means we miss out on the sav-ings,” says Noel MacKay, senior consultant, group benefits, with The Williamson Group in Brantford, Ont. On the other hand, “if public payers decide to make them the first line of treatment, then there should be enough of a market in Canada.”

    Since gaining approval from Health Canada in January 2014, the manufacturer for Inflectra (Hospira, recently acquired by Pfizer) has been negotiating coverage with the pan-Canadian Pharmaceutical Alliance (pCPA), which represents provincial drug plans. The outcome for this med-ication, the first major biosimilar in Canada, could be an indicator of viability for the overall market.

    “We’re very close to conclud-ing a deal with pCPA. I expect it will be done by the end of the year, if not sooner,” says Gerry Stefanatos, general manager, global established pharma busi-ness, Pfizer Canada. This will provide a framework for relative-ly quick adoption by the “lion’s share” of provincial plans, and then renewed efforts can be made on the private side. “What we’ve seen generally speaking from insurers is a ‘wait-and-see’ approach based on what happens after pCPA. That’s the trigger.”

    Green Shield Canada (GSC) elected not to wait, and is one of the first major insurance carriers in Canada to list Inflectra as a preferred product for plan members not already using infliximab. “We have an obligation to support the further development of SEBs to create this market,” says Ned Pojskic, phar-macy strategy leader at GSC. “Our first principle is always plan member safety, and we are embracing SEBs as a whole as a valuable addition to the marketplace.”

    The Alberta School Employee Ben-efit Plan, which administers benefits for more than 110,000 plan mem-bers and dependents and which can make its own listing decisions, is also considering a policy for biosimilars. “We look at the health of our mem-bers first, and then we can turn to our very close second goal, which is the financial stability of our benefits plan. Biosimilars have certainly piqued our interest,” says CEO Jennifer Carson.

    Reimbursement policies from pub-lic and private payers are likely neces-sary to capture physicians’ attention as well. “Ultimately it’s the doctor’s prescription that will send biosimilars

    our way, but what will drive them to write those prescriptions? I specu-late that, at least initially, this will largely be driven by payer policies,” says Chris Dalseg, senior director of strategy and industry relations at Bio-Script Solutions, a specialty pharmacy network based out of Moncton, N.B.

    Dr. Keystone agrees. “I worry that as long as payers do not give priority to biosimilars there is going to be a prob-lem with access because prescribers will stick with the originator biologic. It’s what they’re used to. If biosimilars then disappear because they can’t survive, what happens to the price of biologics? We need the lower prices that come with patent expiries.”

    As a rheumatologist at Canada’s larg-est arthritis clinic, improved access is one of Dr. Keystone’s biggest concerns. “Right now there is a real problem for middle-income patients. The lower price of biosimilars will mean that more patients can afford the co-pay. I would prescribe any biosimilar, any time, because it’s good for the patient. And because it’s for the greater good to have lower prices for these excellent drugs.”

    REFERENCES1. Canadian Agency for Drugs and Technologies in Health, “Subsequent Entry Biologics—Emerging Trends in

    Regulatory and Health Technology Assessment Frameworks.” Environmental Scan 43 (January 2014).2. Canadian Agency for Drugs and Technologies in Health, “Common Drug Review Subsequent Entry Biologic

    Review Report for Inflectra.” (September 2015) www.cadth.ca/sites/default/files/cdr/seb/SE0384_Inflectra_SEB_Report.pdf (accessed October 30, 2015).

    3. B. Bressler and T. Dingermann, “Establishing a New Marketplace for Biologic Therapy with Biosimilar Agents: Importance of Extrapolation of Data.” Biosimilars 5 (March 2015):41–48.

    5 IT’S UP TO PAYERS AND PRESCRIBERS

    Source: IMS Consulting Group, May 2012.