Biologics have helped to revolutionize care for conditions ranging from psoriasis to cancer, but they often come with a sky-high price tag.
“Those products are very effective … but they are also extremely costly,” says Róbert Wessman, founder and executive chair of Iceland-based Alvotech. “Some of the treatments cost over $100,000 per patient, per year. Just to put that into perspective, because those products are so pricy, 40% of the U.S. spend is on biologics today, but [they represent] only 5% of all prescriptions.”
Alvotech is on a mission to help bring those costs down by creating a suite of biosimilars — near copies — of leading biologic medications. With the help of several strong commercial partnerships, it’s now poised to bring many of these biosimilars to a global market as its products approach the finish line.
“Overall, we have a pipeline of eight products. We expect to have five of those eight on the market by the end of 2025,” Wessman says.
The company’s first biosimilar to gain approval in Europe and Canada was AVT02 (adalimumab), a copycat of Humira, the world’s bestselling drug, which has seen $200 billion in global sales since it was approved for use in the U.S. in 2002. Although its biologics license application is currently on deferred status pending FDA review, Alvotech’s biosimilar to the autoimmune blockbuster is slated to launch in the U.S. on July 1, 2023. The biosimilar is also under review in several other countries.
"Overall, we have a pipeline of eight products. We expect to have five of those eight on the market by the end of 2025."
Founder, executive chair, Alvotech
Among the other advanced candidates in Alvotech’s pipeline are biosimilars for the immunology treatment Stelara (ustekinumab), which successfully demonstrated therapeutic equivalence in May. Also in clinical trials, are biosimilars for Xolair (omalizumab), a respiratory therapeutic often used to treat moderate to severe asthma and Eylea (aflibercept), which is used to treat a number of serious eye conditions, including wet age-related macular degeneration, macular edema and diabetic retinopathy.
On Aug. 25, the company also initiated a confirmatory patient study for Prolia/Xgeva (denosumab), a drug commonly used to treat bone loss, fracture and osteoporosis as well as in oncology.
“We believe the next three, four years for us will be very, very exciting,” Wessman says.
A complicated road to savings
The FDA has pushed to help make biosimilars more available in the U.S. where they lag significantly behind Europe in availability. Much like generic drugs, biosimilars have the potential to help rein in high drug costs for patients.
In the U.S., some of the drag on biosimilar availability is related to issues surrounding patents. A bipartisan group of U.S. senators recently called on the U.S. Patent Office to crack down on the drug company practice of applying for multiple patents for a single product, which they say is designed to artificially extend the patent on a product to fend off competition. AbbVie’s patent on Humira, for example, expired in 2016, but the company has 132 other related patents on the drug, which led to a lawsuit filed by welfare-benefit plans that pay for the biologic. The groups charged that the company was using patents to unlawfully block competitors from the market. The U.S. Court of Appeals for the Seventh Circuit, however, ruled in AbbVie’s favor, saying that patent laws don’t limit the number of patents a company can hold.
In addition to patent issues, the complex and costly process of manufacturing biosimilars remain a deterrent for many companies, Wessman says. It often takes more than seven years to develop a single product, and it’s an expensive process.
“We are spending easily above $150 million to develop each product,” he says.
A traditional generic medication, in contrast, costs around $2 or $3 million to develop.
Biologic medicines are typically large, complex molecules created using a living system, such as an animal cell, which means that they have natural variations. So unlike a generic drug, it’s not possible to recreate them precisely. Even different batches of the original biologic can vary.
In order to gain FDA approval, biosimilar-makers must prove they have a close enough copy of the original biologic by meeting the same quality standards and showing there are no clinical differences with regard to efficacy or safety. These hurdles have driven many from the market.
“The landscape has been changing over the last 10 to 15 years. There was a lot of excitement in the early days. We saw quite a number of companies starting in the industry,” Wessman says. Over time, he says, many companies abandoned the effort.
“So, the competition is clearly healthy, but much more limited than you're seeing in other industries,” Wessman says.
Because of the challenges and costs of bringing these biosimilars to market, Alvotech invests a lengthy amount of time determining which products are worth pursuing, Wessman says. They consider a product’s future potential, the competitive landscape, and its technology base.
“It's a combination of multiple factors which [to make] a decision like this, because it's a big decision to add in a new product,” he says.
Bringing alternatives to market
Demand for biosimilar products is likely to stay strong, Wessman says. However, there will be significant competition for Alvotech’s Humira biosimilar come July, as a host of other biosimilars are expected to jockey for market share. But Wessman says the formulation of Alvotech’s product will help to position it for success.
“The competition is clearly healthy, but much more limited than you're seeing in other industries."
Founder, executive chair, Alvotech
“AbbVie changed the concentration of the product a few years back and we were the first to file with FDA on that concentration, which now [represents] 90% of the sales in the U.S. So, we believe that there will be a very strong demand,” Wessman says.
That high-concentration Humira formula was the subject of a legal battle between AbbVie and Alvotech. The parties reached a settlement in March, opening the door to uncontested sales of the biosimilar in the U.S.
Regardless of how the market shakes out, the availability of a biosimilar product for Humira will likely be a boon for patients.
“There will be an enormous cost savings for the U.S. This is the single highest cost savings I think the U.S. will ever have seen,” Wessman says.
Wessman can’t yet disclose what specific patient groups might stand to save on biosimilar prescriptions compared with Humira once it is approved in the U.S.
“We are in a very competitive environment so it’s fairly difficult to disclose that now,” he says. “But for the U.S. market overall it will be billions in savings.”
While efforts to develop biosimilars have the potential to pay off financially for Alvotech, the company remains focused on more than just the bottom line, and is also intent on boosting access to biologics for patients.
“We believe that this company has a great purpose,” Wessman says.