Amgen Devastated as Novartis AG Wins Approval to Sell First-of-a-Kind Copycat Drug

Published: Mar 24, 2015

Amgen (AMGN) Devastated as Novartis AG (NVS) Wins Approval to Sell First-of-a-Kind Copycat Drug
March 20, 2015
By Riley McDermid, Breaking News Sr. Editor

Swiss drugmaker Novartis AG will be allowed to sell the nation’s first biosimilar drug, a knockoff of Amgen ’s blockbuster treatment Neupogen, or filgrastim, a U.S. federal judge ruled late Thursday, as the fight over a billion dollar drug market heats up.

Novartis originally won approval from the U.S. Food and Drug Administration (FDA) to sell its white blood cell drug Zarxio, a biosimilar, on March 8. But Amgen had been pinning all its remaining hopes on a last-minute court injunction to stay the sale of the drug, a request which was denied by U.S. District Judge Richard Seeborg in a San Francisco federal court Thursday.

Kristen Davis, a spokeswoman for Amgen, said in the company plans to appeal the decision.

“Biosimilars will provide access to important therapies for patients who need them,” said FDA Commissioner Margaret Hamburg. “Patients and the health care community can be confident that biosimilar products approved by the FDA meet the agency’s rigorous safety, efficacy and quality standards.”

Biosimilars, which are made inside a living cell, are always uniquely different in composition, which differentiates them from generic drugs, which are exact replicas of other drugs. They have been widely available in Europe since 2006, but the FDA was only granted the right to review and approve them when Obamacare was passed in 2010.

Analysts remained sanguine about the ruling Friday, pointing out that the appeals process can take years in the U.S., meaning neither company should be “baking in” possible gains or losses from the sale of Zarxio anytime soon.

On the surface our counsel believed that the judge's arguments were logical (again, with the caveat that these judgments are preliminary and our council has had limited time to review),” said Mark Schoenebaum, a biotech analyst and medical doctor with ISI Evercore.

“From here, Amgen will appeal to the Federal Circuit Court of Appeals, which typically takes one to two years,” he said. “In addition, our counsel noted that this ruling in the Northern California District Court is not binding as other District Courts can make their own interpretation. However, a decision by the FCCA would likely be final (although could go to the Supreme Court but unlikely).”

Schoenebaum also stressed that while that judge argued that although the statute encourages biosimilar manufacturers to participate in the disclosure and dispute resolution process ("patent dance"), the process “just to commence patent litigation” could take up to 230 days and the statute does not require the biosimilar sponsor to do so.

The money at stake is significant. Neupogen raked in $1.2 billion for Amgen last year, a lucrative market that Novartis, and its Sandoz, Inc. unit that makes Zarxio, are now eyeing eagerly. The FDA said in January that an internal panel seemed inclined to give Zarxio the green light to treat the same five conditions Neupogen does. Sandoz declined to issue a price target for Zarxio

The FDA granted approval after parsing a Sandoz pivotal head-to-head PIONEER study that showed high similarity between the two drugs. During that study, Zarxio and the reference product both produced the expected reduction in the duration of severe neutropenia in cancer patients undergoing myelosuppressive chemotherapy (1.17 and 1.20 days for Zarxio and the reference product, respectively). The mean time to absolute neutrophil count recovery in cycle 1 was also similar (1.8 days ± 0.97 in ZARXIO arm vs 1.7 days ± 0.81 in reference product arm). No immunogenicity or antibodies against rhG-CSF were detected throughout the study.

That data was enough for the FDA to issue the historic decision, opening the floodgates for the biosimilar market to begin flooding American markets, a move that has long been sought by U.S. health insurers and other large health cost payers.

With cheaper biosimilar drugs, health costs will come down for patients everywhere, they’ve argued, particularly as expensive patented drugs lose their protection.

Marketed as Zarzio outside of the US, the Sandoz biosimilar filgrastim is available in more than 60 countries worldwide.

Neutropenia, the condition both drugs treat, happens when common white blood cells, neutrophils, dip below healthy levels, most commonly due to cancer treatment or advanced HIV/AIDS.

"Filgrastim has proven clinical value in treating patients at increased risk of neutropenia, but it is underused in the US for a variety of reasons, including price" said Louis Weiner, chairman of the department of oncology and director of the Lombardi Comprehensive Cancer Center at Georgetown University. "Biosimilars have the potential to increase access and the approval of Zarxio may reduce costs to the healthcare system. The comprehensive data set supports its use in clinical practice."

BioSpace Temperature Poll
After Amgen Inc. said last week that it will close its South San Francisco facility acquired during its $10 billion buyout of Onyx Pharmaceuticals and will lay off 300 of Oynx’s 750 workers, BioSpace is wondering—will the number of mergers and acquisitions completed in 2014 mean a “streamlining” of biotech jobs in the Bay Area? Tell us your thoughts.

Back to news