In today’s pharmaceutical market, there is a new hot topic every week.

For an extended period of time, biosimilars were top-of-mind for news media and industry chatter. According to the FDA, biosimilars are as a type of biological product that can be licensed (approved) by regulatory authorities and which are either highly similar to or actually equivalent to an existing branded biological product.1 In the simplest of terms, biosimilars are “generic” versions of biologic products (although actually it is a little more complicated).

The first biosimilar in the US was approved by the FDA on March 6, 2015 (but for legal reasons it still has to be brought to market). Zarxio®, a biosimilar produced by the Sandoz division of Novartis, contains the same active ingredients as Amgen’s Neupogen®.2 By contrast, the European Union (EU) has been approving biosimilars since April 2006. Earlier this year, a Citigroup analyst anticipated an estimated €45 billion (US$50 billion) in savings to pharmaceutical expenditures here in the USA from the use of biosimilars.3 With these types of savings on the table, government regulators are actively looking for biosimilars to be approved as fast as possible – all around the world.

The original “received wisdom” had been that we might expect the average biosimilar to be discounted at about 30% compared to the original innovator brand products. However, in what always had the potential to be a highly competitive market, we are already seeing some distinctly more aggressive pricing strategies.

Recently, Reuters reported that Hospira and its manufacturing partner Celltrion had won a massive contract with France’s Assistance Publique, Hôpitaux de Paris (the French public hospital system in Paris,) by offering a biosimilar at a price that might save the Paris hospitals roughly €6 million a year. Hospira (which is to be acquired soon by Pfizer) succeeded by offering Inflectra® — a biosimilar to Remicade® — at a 45% discount compared to the current price of Remicade.4

In the EU, the general biosimilar discount is already being said to average about 45% compared to the original price of the equivalent branded drug. However, Hospira seems to be willing to push the limits further. In Norway they offered Inflectraat a 69% discount compared to Remicade. This sparked a reverse price war between the branded product and Inflectra®.4

Given these types of major savings opportunities from the use of biosimilars as opposed to the innovator brands, payers in both the US and the EU are actively looking to encourage use of such products in order to cut business expenditures. The EU has already reduced costs for biologic agents by millions of euros. Soon enough, the US will also start to show cost savings from the use of these products. At least some specialized manufacturers are looking to capitalize fast on the efficacy and safety of these cost-effective products – but the return on investment may be lower than many biosimilar developers had originally been hoping for.


  1. FDA, Information for Healthcare Professionals (Biosimilars), 2015 (downloaded on July 16, 2015).
  2. Beasley D, Hirschler B. Novartis wins approval for first U.S. biosimilar drug, Reuters, March 6, 2015 (downloaded on July 16, 2015).
  3. Hirschler B. Biosimilar copies of blockbuster drug launch in major EU markets, Reuters, February 25, 2015 (downloaded on July 16, 2015).
  4. Palmer E. Hospira’s Remicade biosimilar wins large French contract with deep discounts, Fierce Pharma, July 6, 2015 (downloaded on July 16, 2015).

About Andrew Lyle

Andrew Lyle is an Account Executive at Calcium USA. He holds a B.S. in Pharmaceutical and Healthcare Business from the University of the Sciences. Andrew has worked in various markets such as hematology, neurology, oncology, respiratory, and with many other orphan diseases. Andrew has also held consulting positions specializing in competitive intelligence, strategic planning and also, pricing, reimbursement and market access. When he is not working, Andrew enjoys any physically challenging outdoor activity with his girlfriend and chocolate lab.

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