January-February BioProcess Insider

Launched in June 2018, the BioProcess Insider digital information portal delivers the latest financial and business news and expert insider views influencing the commercialization of biopharmaceuticals. Here are just a few recent stories edited for our space limitations in print. For more discussion and in-depth analysis, check out the website at www.bioprocessinsider.com and sign up for the twice-weekly newsletter.

AstraZeneca Closing Two Colorado Sites

Anglo-Swedish pharmaceutical giant AstraZeneca is ending operations at its facilities in Boulder and Longmont, CO, less than four years after acquiring them from Amgen. The decision to shutter both sites was made as part of a biomanufacturing consolidation strategy, a spokesperson told BioProcess Insider.

“AstraZeneca has made the decision to consolidate the biologics manufacturing network in one large-scale drug-substance facility: our site currently operating in Frederick, MD. Neither Boulder nor Longmont is currently licensed for commercial operations, so there is no need to transfer supply to another manufacturing facility.”

According to a Colorado state Worker Readjustment and Retraining Notification Act (WARN) notice from 8 January 2019, the closures will lay off 210 staff. AstraZeneca confirmed that will be the case. “Those employees will exit the organization 22 March, with full decommissioning of the facilities to be completed by Q4 2019.” No decision has been made about the future of the sites, but the company said both facilities will be preserved for potential sale.

AstraZeneca acquired Amgen’s Lake Center facility in Boulder in September 2015, saying at the time that the plant would be “operational and licensed for commercial production by late 2017, providing for additional capacity within the company’s biologics operations.” Expansion plans to double the facility’s capacity also were laid out. AZ bought Amgen’s Longmont plant in October 2016 to further support those biomanufacturing ambitions. Under their previous owner, those sites made and supported bulk drug-substance production of blockbuster biologics Epogen (epoetin alfa) and Aranesp (darbepoetin alfa).

AstraZeneca has regularly invested in its facility in Frederick, MD, to support biologics programs. In 2014, the company pumped over US$200 million (€174 million) into that site. And last March, AZ pledged to add 100 jobs there.

Big Pharma’s Exit from Biosimilars May Be Imminent

Biosimilar developers are targeting blockbuster “Big Pharma” biologic originator companies. Roche and AbbVie, two companies most susceptible to biosimilar erosion, have vocalized a need for stringent regulatory frameworks — calling for appropriate data, individualized labels, and unique identification for all biotherapeutics — while attempting to rebuff competition by reformulating their products and beefing up both their pipelines and intellectual property (IP). Meanwhile, several other Big Pharma companies are dominating European and US biosimilar markets: namely, Novartis, Pfizer, and Amgen, which claim some of the largest biosimilar pipelines in the industry.

Through its Sandoz division, Novartis has been marketing biosimilars in Europe for over a decade. It was first to launch a US biosimilar when its version of Neupogen (filgrastim), received approval in 2015. Pfizer has had four US approvals, including the first biosimilar version of J&J’s Remicade (infliximab). The company expanded its biosimilar pipeline in 2015 through a $17 billion ( €14.9 billion) acquisition of Hospira. And despite suffering revenue loss from an influx of first-wave biosimilars while trying to defend against versions of bestselling biologic Enbrel (etanercept), Amgen has 10 biosimilars in a portfolio that includes US-approved versions of AbbVie’s Humira (adalimumab) and Roche’s Avastin (bevacizumab).

History Repeating: Even so, Big Pharma’s interest in biosimilars may be soon to end, according to Sarfaraz Niazi, a pharmaceutical sciences and biotechnology expert with over 30 years of industry experience who founded biosimilar developer Karyo Biologics earlier this year. In his 2014 book Handbook of Biogeneric Therapeutic Proteins, he predicted that exit would occur once specialized biosimilar developers have appeared on the scene.

“This is history repeating from the generics era,” he said. “There are so many ways to cut the cost of development and manufacture, but because of their mindset and design, Big Pharma cannot do this. They can change both, but that requires a monumental shift.”

Niazi told BioProcess Insider that back in the 1980s, many large pharmaceutical companies planned to enter the generics market. “However, as the prices tanked, they all pulled out.” So far, the big companies are seeing much bigger profits from biosimilars than are sustainable, Niazi argued. “Once prices fall to below 60% of the current prices, it will no longer be feasible for the Amgens and Pfizers to stay in this market for long.”

He says their exit will accelerate when other companies from overseas bring forth products at substantially lowered costs. “Every MAb, regardless of its use, costs about $150–200/g. This price will drop by another 50% once the Indian and Chinese companies start getting approvals; at this stage, prescribers will become redundant and payers will take over.”

Biosimilar Exit? When asked for examples, Niazi cited Merck KGaA’s 2017 divestiture of its biosimilars business to Fresenius for an upfront payment of €170 million ($195 million). Last month “the other Merck” — Merck & Co. (known as MSD outside North America — dropped its Lantus (insulin glargine) biosimilar program after assessing its pricing and costs of production. And recently Sandoz, after a US Food and Drug Administration (FDA) complete response letter (CRL) demanding more data, has pulled the plug on its US rituximab program.

“It will take at least five and perhaps 10 years before the real impact of dropping prices is felt,” Niazi warned, “given that the approval of biosimilars is not fast enough, but it is coming.” He predicts that specialized biosimilar companies such as Samsung Bioepis and Coherus, both of which are already competing in the space, will take over as Big Pharma backs out. A joint venture between Biogen and Samsung BioLogics, Bioepis has a Remicade (infliximab) biosimilar competing in the United States and several other such products in Europe. And Coherus recently won US approval for its version of Amgen’s Neulasta (pegfilgrastim).

Meanwhile, the traditional generic drug companies also are lining up to take their place: Teva, which has seen success with first-wave biosimilars in Europe, is poised to enter the US market with a Celltrion-developed Rituxan (rituximab) biosimilar. Mylan already has a Neulasta biosimilar approved in the United States and boasts another 20 biosimilars and insulin analogs in its portfolio.

Economy of scale at Sandoz

Big Pharma Responds: When Merck & Co. pulled its insulin glargine product, it told BioProcess Insider that it remained committed to biosimilars. Sandoz, Pfizer, and Amgen also have dismissed the idea of any looming exit from the space.

“Pfizer is committed to biosimilars as an important treatment option for patients,” spokesperson Thomas Biegi said. “We are working hard on bringing our biosimilars to market and will continue our efforts to ensure that patients around the world have access.”

Amgen’s Kelley Davenport added: “While we can’t comment on our strategy, with 10 biosimilars in our portfolio, Amgen remains committed to its biosimilars program.”

Sandoz spokesperson Chris Lewis said his company is a “global pioneer and leader” in biosimilars and remains committed to the sector. However, he acknowledged that this is a challenging space in which “only a handful of players will succeed globally in the mid to long term.”

Boehringer Ingelheim Abandons Biosimilars Outside the United States: German drugmaker Boehringer Ingelheim will not commercialize its approved adalimumab product Cyltezo in Europe and is discontinuing all biosimilar development activities outside the United States.

“Boehringer Ingelheim believes that the introduction of high-quality, lower-cost biosimilars is critical for both patients and the sustainability of the healthcare system,” spokesperson Ralph Warsinsky told BioProcess Insider. However, “at this point, future biosimilars activities will be driven out of the US market, including partnership opportunities, while Boehringer Ingelheim is stopping development activities for the rest of the world.”

A December 2017 snapshot of Boehringer Ingelheim’s biosimilar pipeline webpage showed that a version of Roche’s Avastin (bevacizumab) was in phase 3 clinical studies, and a version of AbbVie’s Humira (adalimumab) had been approved. But an error message greets website viewers visiting the page as of early January.

Humira Biosimilar: Humira is the top selling drug in the world. In 2017, AbbVie earned $18.4 billion (€16.2 billion) in worldwide sales from the monoclonal antibody, with the US market contributing $12.4 billion.

In 2017, BI’s adalimumab product became the first biosimilar version to be approved in Europe and the second to be approved in the United States. Neither is available on the market yet, and Warsinsky said that only the US product is expected to be commercialized. “Due to the patent litigation with AbbVie in the United States, we will not commercialize our biosimilar in the European Union.”

Recently, rival biosimilar makers Sandoz, Amgen, Samsung Bioepis, and Mylan all launched adalimumab products in Europe. US lawsuit settlements have several biosimilar companies agreeing to launch their adalimumab products in 2023.

Meanwhile, Boehringer Ingelheim continues to battle with AbbVie in court. “We are committed to making [the biosimilar adalimumab] available to US patients as soon as possible — certainly before 2023,” said Warsinsky. He confirmed that it will be commercialized by Boehringer Ingelheim itself, rather than through a marketing partner.

Lonza Adding Single-Use Capacity and 180 Jobs at a UK Plant

Swiss contract development and manufacturing organization (CDMO) has told BioProcess Insider that it is making a “multimillion-pound investment” into its facility in Slough, UK. Located about 40 km west of London, the site serves as Lonza’s center of excellence for mammalian-cell biopharmaceutical process development and small-scale current good manufacturing practice (CGMP) manufacturing, primarily for clinical materials. It also offers a range of analytical services, process scale-up activities, and process optimization.

A 2,000-L fermentor at Lonza in Slough, UK

The investment “will enable an increase in disposable production capacity that will increase the capability to handle a greater number and range of products,” said spokesperson Constance Ward. “In addition, we are seeing increasing demand for preclinical and clinical development, particularly for a growing number of ‘next-generation MAbs,’ including ADCs, bispecifics, fragments and constructs.”

According to Lonza’s website, the site employs around 650 people. To support this expansion, it is recruiting 180 more.

Brexit Investments: Following an unprecedented referendum in June 2016, the United Kingdom is expected to leave the European Union on 29 March 2019. A lack of clarity about the country’s position after that has caused upheaval and concerns in the business world. Already the Brexit vote has led to the European Medicines Agency (EMA) moving from London to Amsterdam in The Netherlands.

Mike Thompson, head of the Association of British Pharmaceutical Industry (ABPI), said recently that a no-deal exit from the single market would be catastrophic for the pharmaceutical industry. ABPI members are stockpiling medicines in anticipation of such a scenario. And investment in the UK industry has been stifled since the referendum. Anglo-Swedish firm AstraZeneca, for example, has implemented an investment freeze in the United Kingdom while urging clarity on Britain’s situation.

So I asked Lonza how it is preparing for Brexit. “Lonza is closely monitoring the progress of the negotiations,” a spokesperson said. “Reflecting recent developments, we have established a working group of relevant functions planning for [among other possibilities] the scenario of a non-negotiated Brexit (or ‘hard Brexit’). Based on current information available, we believe that Lonza is well prepared.”

Consortium Scales Up to Make Polio Vaccine Less Expensive

In December 2016, a consortium led by Belgian biomanufacturing technology company Univercells received a $12 million (€10.4 million) grant from the Bill & Melinda Gates Foundation to develop a low-cost vaccine manufacturing platform. The consortium also involves Batavia Biosciences, which has developed a polio-vaccine manufacturing process, and Natrix Separations (now MilliporeSigma) for purification membranes. Now two years on, a $4 million grant extension has been awarded to Univercells and Batavia to scale up their NevoLine system for production of inactivated polio vaccine (sIPV).

“This challenging two-year project is aimed at delivering a new manufacturing system to drastically decrease cost, footprint, and time to market for vaccine manufacturers,” said Univercells chief executive officer (CEO) Hugues Bultot, “and we are pleased to have met these goals.” He says his company produces trivalent sIPV for under $0.30/dose, representing a fivefold reduction compared with other current manufacturing technologies. “The NevoLine system is self-contained into a 6-m² series of isolators. A facility designed with four NevoLine units would deliver up to 50 million sIPV doses/year for an estimated capital cost of $20 million. These breakthrough achievements further strengthen our dedication to innovating flexible, scalable, and accessible vaccines and biotherapeutics manufacturing solutions.”

This consortium hopes to reduce the polio vaccine cost even further — to as little as $0.15/dose. José Castillo, Univercells cofounder and chief technology officer (CTO), has said that one of the main milestones in the program was to demonstrate a 40-fold increase compared with benchmark current bioreactor processes. “[We] achieved this by acting on the cell culture equipment (bioreactor) and on process optimization. Designing a compact, fixed-bed bioreactor achieving high cell density was instrumental in reaching high final concentrations” over 200,000 cells/cm².

For more information, see “A Brief History of Adherent Cell Culture: Where We Come From and Where We Should Go,” by Alex Chatel, elsewhere in this issue.

Dan Stanton is editor of BioProcess Insider. Contact him at [email protected].