Kiran Mazumdar-Shaw, Chairperson and Managing Director, Biocon, is elated about not only her company’s achievements as the first Indian biotech company to get a US FDA nod for a biosimilar drug but is more happy about India and its talent making a mark in the global arena to prove naysayers wrong. In an interview with BusinessLine , she outlined the kind of challenges faced in this journey, the issues with capping doctor fees and the biosimilars opportunity that Indian pharma can address. Excerpts:
Your FDA nod for biosimilars has come after several challenges...
Unlike small molecule generic drugs, the development of biosimilars is a highly expensive, complex and time-consuming exercise. This is because biosimilars are large and complex target-specific molecules, placed at the high end of the pharma value chain. We went through very challenging times, as there was a lot of skepticism on whether India could make it in this league.
Why have Indian pharma companies shied away from the biosimilars play?
Biosimilars is a very different league as it requires huge investments and much longer timelines. Most Indian companies which have been successful in generics but have shied away from this space and have not made serious bets. Biocon was among the earliest pharma companies in India to spot the opportunity offered by patent expirations on expensive innovator biologic drugs. We spearheaded this initiative as we had the risk appetite, skills and capabilities to address the biosimilars opportunity. It has been an expensive but successful journey and gives us confidence to invest more.
Before the final approval from the US FDA for our biosimilar Trastuzumab, we had to go through the scrutiny of FDA’s Oncologic Drugs Advisory Committee (ODAC) . The FDA uses advisory committees and panels to obtain independent expert advice on a variety of matters, including product approvals. The unanimous recommendation for approval of our biosimilar Trastuzumab by all the 16 members of the FDA’s ODAC is a testimony to our work in this complex area of biosimilars.
The approval for biosimilar Trastuzumab by the US FDA has helped us establish the high efficacy and quality perception of our product among a larger number of oncologists in India as well and have addressed the perception that biosimilars are not safe for patients. At the heart of it, we have demonstrated that strong commitment along side deep pockets are needed to make breakthroughs in biosimilars.
The market has welcomed it when you consider that Biocon's performance has been better when compared to the pharma index.
Yes. The markets have not been very optimistic about the Indian pharma sector for a number of reasons. If you look at the small molecules generics space, it is commoditising rapidly. Add to that the recent noise around warning letters issued to some of the Indian pharma companies by the US FDA.
However, ours is not a generics business but a differentiated long-term play in the biologics and biosimilars space. We were among the earliest players in India to take big risks and follow a capital intensive and research-intensive path of developing biosimilars at a time when guidelines for them were evolving. Eventually it has all worked out as we always erred on the side of caution. Investors are now realising the potential value of the biosimilars pipeline built painstakingly by Biocon over the past decade or so. Our current pipeline of biosimilars has an addressable global market opportunity of over $60 billion.
Will the government easing its stand on clinical trials help to address problems specific to South Asia?
I think Soumya Swaminathan, director general of Indian Council of Medical Research (now deputy director-general WHO), has done a terrific job of restoring the clinical trials. We suffered a huge setback in drug research when a blanket ban was imposed on clinical trials in 2013. The situation has improved since, with the Narendra Modi government taking some important steps to revive the clinical trials industry. In formulating the new guidelines, Swaminathan was able to address the concerns raised by the Supreme Court on the ethical conduct of these trials in India. The apex court’s key concerns related to compensation for clinical trial participants, informed consent and ensuring that there were no unethical clinical trials practices, have all been addressed through these guidelines. Clinical trials are critical if Indian patients are to benefit from the latest advances in medical research. Our doctors need to focus on clinical research rather than doing only clinical practice. Investigator-led clinical trials are very important as it gives better results. For India there is a huge opportunity in the area of translational research as we have a large and diverse patient base.
What do you make of governments trying to control the prices of drugs?
Any form of price control has its pros and cons. While I agree we need to increase access through affordable pricing and some of the drugs need to be under price control, I don’t agree with the current formula for calculating drug price caps. This is because the current formula treats at par companies that have made large investments in creating high-end R&D capabilities and modern US FDA-approved manufacturing infrastructure with a small company which has not invested in these areas. Many of these small companies are able to price drugs at one-tenth of the cost as they have not made significant investments in R&D and manufacturing infrastructure. In a competitive landscape where there are 500 competing brands for certain products market forces should be able to bring down prices to affordable levels. Our suggestion for an equitable formula of calculating price caps is to take the top 10 companies and compare their price variance to arrive at the ceiling price.
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