Stada secures third license for copycat biotech drug: CEO
By Frank Siebelt and Ludwig Burger BAD VILBEL Germany (Reuters) - Germany's Stada plans to bring a copy of Eli Lilly's Forteo osteoporosis treatment to market, its chief executive said, as the generic drugmaker moves further into the sale of cheaper alternatives for costly biotech drugs. Hartmut Retzlaff told Reuters in an interview on Friday that its partner - biotech development firm Richter-Helm - would develop a copy of synthetic hormone Forteo. Stada has secured the license to market it in Europe. "We are preparing for a market launch in 2019," said Retzlaff, who has been at the helm for 21 years. He added the company was in talks over another copycat biotech drug, or "biosimilar", that could be introduced in 2017, but declined to name it because a deal had not been struck. Hundreds of companies around the world are chasing the emerging biosimilars market, with more than 700 substances now in development or already approved, a major study of the sector showed last month. Many top-selling biotech medicines - made from proteins and other large molecules - are losing patent protection. But copycat versions of biological medicines can be difficult, since such drugs are produced in living cells and imitations can only be similar, not identical. After suffering cost overruns in developing its own biosimilar version of anemia treatment erythropoietin (EPO), Stada decided in 2011 to focus on the marketing side of the business and at the time won Hungarian drugmaker Richter as a partner for the development of two drugs. So far, such copycat medicines have typically been offered at a 20 to 30 percent discount to innovator brands, but Retzlaff warned he expected the average discount to rise to 50 percent three years after market launch, as more rivals pile in. PARADIGM SHIFT Still, the business promised better margins than the company's main generics business - copies of conventional chemicals drugs - in the medium term, he said. Stada's generics business carried a margin of 17.3 percent over sales last year. Its biosimilars business has so far generated only negligible volumes. Retzlaff added that generic drugmakers riding the wave of pharmaceuticals losing patent protection needed to gain a foothold in biosimilars or risk running slowly out of business. "We are in for a paradigm shift as more biopharmaceuticals will soon go off-patent than conventional generics," said Retzlaff. "If Stada doesn't have these products in its portfolio after 2020, the company will not be competitive." Shares in Stada were down 2.3 percent to 28.88 euros by 1128 GMT, underperforming a 1 percent fall in the European healthcare index. Retzlaff said Stada's biotech business would not take off before 2018 but the goal was for biosimilars to account for one third of the group's off-patent prescription drug revenues. Despite a flurry of development activity, the market is still in its infancy with overall biosimilar sales of 60 to million euros ($76 to $89 million) in Germany, Stada says. The European healthcare regulator's website shows it has approved biosimilars of five biotech drugs so far. The biggest players in the industry, who unlike Stada develop the substances in-house, are Novartis's Sandoz unit and Israel's Teva. Stada also sells non-prescription treatments and last year boosted that business by taking over British over-the-counter drug manufacturer Thornton & Ross. Biotech medicines - made from large protein molecules - have gradually gained importance compared with conventional chemical drugs because they offer more promise to tackle difficult-to- treat conditions such as cancer and auto-immune diseases. (Editing by Georgina Prodhan and Clara Ferreira Marques)
