Bellevue Asset Management

Biosimilars - an imperfect copy but a perfect investment

Bellevue Asset Management / Bellevue Asset Management : Biosimilars - an imperfect copy but a perfect investment . Processed and transmitted by NASDAQ OMX Corporate Solutions. The issuer is solely responsible for the content of this announcement.

A wave of expiring biotech patents will lead to a surge in growth for manufacturers of biosimilars during the coming years. Read how Bellevue Asset Management's Healthcare Team selects the best candidates from a crowded field of specialists to address this trend. 

Average life expectancy is increasing around the world and creating a variety of challenges for health care systems. The prevalence of certain diseases such as arthritis, cancer, diabetes, stroke, high blood pressure and cardiovascular disease or neurodegenerative diseases such as Alzheimer's will steadily increase for years to come. Biologically produced medications that alleviate the symptoms of these diseases and also target pathogens at the molecular level will play a pivotal role in the treatment of these conditions. The cancer drugs Rituxan, Avastin and Herceptin are good examples of biologic drugs derived from antibodies and proteins that are generating billions of dollars in sales.

From an investor's standpoint, it is interesting to note the wave of patent expirations in the biotech industry that began in 2015 and will last until about 2022. Many of the drugs coming off patent are prescribed to treat autoimmune diseases and cancer. Biosimilars are highly similar copies of these drugs. Over the next ten years they are projected to generate savings of USD 44 bn in healthcare costs in the USA alone.

Regulatory aspects

Conventional generic drugs are copies of brand-name drugs with relatively simple molecular structures. Cost of clinical development and production are accordingly low. Biosimilars are a completely different story. They mimic proteins and antibodies with complex protein structures. As implied by the term "biosimilar", an exact replica is virtually impossible to produce due to the complexity involved. The greater objective when developing biosimilars is to achieve a high degree of similarity with regard to the molecular structure, biologic activity, and the clinical result of the originator or "biological reference" product, and be just as safe.