The global biosimilars market has been forecast to increase at a compound annual growth rate (CAGR) of 5.6% over the next five years, rising from $128 billion in 2012, to generate sales of over $168 billion by 2017.
Biosimilars also known as follow-on biologics are biologic medical products whose active drug substance is made by a living organism or derived from a living organism by means of recombinant DNA or controlled gene expression methods.
Biosimilars or follow-on biologics are terms used to describe officially approved subsequent versions of innovator biopharmaceutical products made by a different sponsor following patent and exclusivity expiry on the innovator product.
Biosimilars have stated their intention of being here to stay, as recent events show an increasing trend in efforts by companies to enter and/or enhance their position in the biosimilars industry. Indeed, biosimilars are becoming crucial features of governments' plans to reduce healthcare expenditures and increase foreign investment.
Various factors, including financial austerity measures due to increasing budget deficits and debt, slowed economic growth in countries such as the US, an increasing aging population and an associated increase in the demand for healthcare in other countries like Japan, are some of the key drivers of initiatives to encourage biosimilars.
Although biosimilars will deliver some healthcare cost savings, the discount percentages earlier expected have been significantly reduced. Biosimilars are expected to be marketed at between 70% and 80% of the cost of the branded biologic, thereby delivering only a 20%-30% reduction in cost.
For instance, Celltrion's recently approved Remsima - a biosimilar to Merck's Remicade (infliximab) - is expected to sell for 70% the price of Remicade in South Korea. This is in sharp contrast to generic small-molecule drugs, some of which sell for up to only 10% of the price of the innovator drug.
The biosimilars market is not for the faint-hearted, as various challenges are currently facing the development and commercialisation of biosimilars.
One of these is the uncertainty regarding the regulatory and legislative structures available for the review, regulation, and substitution of biosimilars in certain markets, particularly the US. Furthermore, the development of biosimilars involves greater investment than is required for the development of chemical-based generics.
For more information on the global biosimilars market, see the latest research: Global Biosimilars Market
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