Indian biogenerics industry emerges
from Nature Biotechnology
K S Jayaraman
Hyderabad, India
India approved two follow-on biologics— so-called biogenerics—in August, demonstrating the potential emergence of a world-reaching biopharmaceutical industry based there. The implementation of a global patent scheme under the trade-related intellectual property rights (TRIPS) agreement, due January 1, 2005, could still threaten the growth of this fledgling industry. Yet the industry could benefit from an August 30 World Trade Organization (WTO, Geneva, Switzerland) agreement that allows developing countries to import cheap copies of essential medicines, overriding international patents.
Human insulin is among the first biologic molecules to be copied by Indian biogeneric companies.
Last August alone witnessed the phase 3 trial clearance for Shantha Biotech's (Hyderabad, India) Filgrastim (granulocyte-colony stimulating factor) for leukemia as well as two marketing approvals—for Bharat Biotech's (Hyderabad) recombinant streptokinase to prevent blood clots and Wockhardt's (Mumbai, India) wosulin, India's first biogeneric human insulin.
The surge of interest in follow-on biologics coincides with the emergence of several generic drug companies in India as potential significant players in world markets (see Table 1). The generic drugs currently marketed or under development are from the 15 top selling biopharmaceuticals that are off patent or will come off patent in the United States and Europe over the next five years.
India does not currently respect western patents, so Indian companies have been able to copy drugs without worrying about patent infringement, but that will no longer be the case when the TRIPS agreement comes into effect January 1, 2005. "Drugs patented before 1995 [will be] off patent and drugs patented until [the] end of 2004 can be produced by generic [firms]," says Khalil Ahmed, Shantha's executive director. "Post 2005, we cannot copy [and will be forced to innovate ourselves]."
"Our preparation for the TRIPS regime began two years ago when we decided to set a separate division for generics," says Anil Motibar, managing director of Kee Pharma (Mumbai, India). He estimates the domestic Indian generics market for pharmaceutical and biotech drugs will triple to Rs.67 billion ($1.5 billion) by 2005 "thanks to a number of molecules going off patent."
However, Krishna Ella, managing director of Bharat Biotech anticipates problems on three fronts after TRIPS comes into effect in 2005. He acknowledges that the markets for copycat versions of first generation products may be limited given the threat of second-generation products produced by the original inventors. "As long as a company can continue making medically significant improvements on a therapeutic protein, it may be able to retain an exclusive market indefinitely," he says. For example, Amgen's improved treatment for anemia, Aranesp, has reached the market before its current patent for Epogen (epoetin alfa) expires next year.
Indian companies' advantage in cheap vaccines for hepatitis or rabies may also be eroded, says Ella, by potential development of cocktail vaccines that promise delivery of multiple vaccines in a single shot. He also fears that Indian biogenerics firms may face difficulties in obtaining vectors and expression systems to copy drugs whose patents will expire.
In order to gain market share, biogeneric companies do not focus on providing mere copies of existing drugs; they are also trying to improve manufacturing processes, which may themselves bring new patents. For example, Bharat claims to have developed the world's first cesium chloride-free Hepatitis B vaccine with the discovery of a novel purification matrix, and Shantha's expertise is in the use of expressions systems with the yeast Pichia pastoris, which have a higher yield and therefore lower production costs than other yeasts.
Despite the uncertain future with TRIPS constraints, Indian biogenerics could find rich pickings under a new WTO agreement signed in Geneva on August 30 that allows certain developing countries—such as India, Brazil, and China—to override global patents in order to export drugs to poor countries without a domestic manufacturing base, such as sub-Saharan Africa. Although the pact does not open a complete global market to Indian biotech firms, expectation of new export opportunities has already pushed up their share prices.
But the Indian Pharmaceutical Alliance (IPA; Mumbai, India), which represents generics firms in that country, feels the pact's utility has been curtailed by "cumbersome procedures" that are meant to ensure that the drugs are not diverted to third countries, which is a major concern of US biotech firms (Nat. Biotechnol. 21, 119, 2003). To reduce the risk of such diversion, the exporting country must, for example, obtain a license that covers only the required quantities, and any WTO member can object to any consignment. IPA secretary general Darmesh Shah says, "All these [procedures] add undue risks to the generic supplier [on top of] the risk of uncertainty associated with the development process for [a] new molecule. [Because of these procedures,] generic versions may not be readily available post 2005."
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