Contract Manufacturing of Biosimilars

Contract Manufacturing of Biosimilars Patti Seymour Senior Consultant BioProcess Technology Consultants, Inc. IBC Life Science s Biopharmaceutical Development and Production Huntington Beach, CA February 25 - March 1, 2013 BioProcess Technology Consultants www.bptc.com

Introduction Overview of biosimilar product approvals and pipelines Global biomanufacturing capacity between CMOs and product companies BioPulse Survey: Biosimilar Manufacturing: Choices, Challenges, and Capacity Uncertainty 2 From Clone to Clinic

Growing and Changing Pharmaceutical Market A Few Issues Shaping the Pharma Industry 1 Prescription pharmaceuticals forecast to cost >$500B by 2017 Currently, biologics drug expenditure already accounts for ~25% of pharmaceutical spend and are >33% of all drugs in development MAbs are largest and fastest growing segment 2 Financial crisis requiring healthcare systems to make significant and sustained cost reductions US healthcare spending by 2021 forecast to be ~20% GDP Global Pharma Market 2005 2017 (USD bn) biologics 3

Growing and Changing Pharmaceutical Market 3Major products are losing patent protection coupled with new regulatory approval pathways Enable emergence of a biosimilar industry Source: Evaluate Pharma May 2012 Duncan B. Biosimilar Opportunities: Pipelines and Companies. Decision resources. 2011 Sep 2. 4

Biosimilar Approvals ROW (as of Sep 2011) Duncan B. Biosimilar Opportunities: Pipelines and Companies. Decision resources. 2011 Sep 2. 5

Biosimilar Pipeline by Phase and Molecule (as of Sep 2011) Duncan B. Biosimilar Opportunities: Pipelines and Companies. Decision resources. 2011 Sep 2. 6

Biosimilars Pipeline for Monoclonal Antibodies Duncan B. Biosimilar Opportunities: Pipelines and Companies. Decision resources. 2011 Sep 2. 7

Distribution of Mammalian Cell Culture Capacity 8

Product Companies Control ~70% of Capacity 4,500 3,600 Installed Capacity 2,700 1,800 900 0 2010 2011 2012 2013 2014 2015 2016 CMO XS Product Co. 9

Capacity Distribution by Bioreactor Scale 10

Increased Productivity 10000 Productivity has doubled every 1.5 years Following Moore s Law Cell lines 1000 100 Expression systems: GS, UCOE, SGE, GPEx etc. Cells: High viable cell density, suspension and medium adapted Process 10 Media: Animal component free, defined medium, cell protectants 1 0.1 1 10 Culture conditions: Feed strategies, catabolite control, gas exchange 1990 2000 2010 11 Courtesy of P Ball of Watson Pharmaceuticals. Adapted from Noe, Biomanufacturing Summit, 2011

Balance of Supply and Demand 12

Conclusion: Total Biomanufacturing Capacity Adequate but Potentially Misaligned Increase in number of products and expanding markets will increase demand by ~1 million liters by 2016 Current and anticipated supply of capacity is sufficient to meet the market needs for the foreseeable future Existing capacity may not be available at the time needed or under the appropriate conditions Product companies control >70% of total capacity Utilization rates for the majority of the industry will reach almost 75% by 2016 Companies without manufacturing capacity or ability to secure manufacturing contracts may experience difficulties in accessing capacity in the coming years 13

BioPulse Biosimilar manufacturing: Choices, challenges, and capacity uncertainty (http://www.bptc.com/forms/biosimilar manufacturing choiceschallenges and capacity uncertainty) Preliminary Survey Results 14

Respondents Yes, we currently have biosimilars in our portfolio 53% No, and we have no plans to add biosimilars 21% Not at the moment, but we plan to 26% 15

Predictions about Biosimilar Impact on Capacity The increase will cause a shortage of capacity, but only in certain manufacturing markets 16% Biosimilars will probably cause a shortage of manufacturing capacity 37% The increase will definitely cause a shortage of capacity 10% Biosimilars will not cause any shortage of manufacturing capacity 37% 16

Biomanufacturing Outsourcing Strategy for Biosimilars None, we have or will have our own manufacturing capacity 37% <25% Will be Outsourced 21% 25 50% Will be Outsourced 26% >75% Will be Outsourced 16% 17

Changes in Outsourcing to CMOs in Emerging Markets We do not plan to use an emerging market CMO 25% Stay the same 8% Decrease 17% Increase 50% 18

Outsource to CMOs in Different Geographies 75% 50% 25% 0% Very North America Not Will Not Consider 75% 50% 25% 0% Very Europe Not Will Not Consider 75% 50% 25% 0% Very China Not Will Not Consider 75% South America 75% 50% 25% India 75% 50% 25% Asia (excluding China or India) 50% 25% 0% Very Not Will Not Consider 0% Very Not Will Not Consider 0% Very Not Will Not Consider 19

Challenges Working with CMOs in Emerging Markets Technical competence 42% All of the above 5% Regulatory compliance 37% Intellectual property protection 16% 20

Regulatory Expertise of CMOs Manufacturing Biosimilars Seek CMOs with a global regulatory compliance record 75% Seek CMOs with a regional regulatory compliance record 25% 21

Likelihood of Manufacturing Global Supply in Emerging Markets We are already manufacture global supply in emerging markets 10% We aren t considering manufacturing global supply in emerging markets 42% We are seriously considering manufacturing in an emerging market and very likely to 16% We are considering manufacturing in an emerging market, but are not likely to 32% 22

Likelihood of Manufacturing Biosimilar in Multiple Locations We already manufacture in multiple locations 5% We are not likely to manufacture in multiple locations 27% To take advantage of local incentives We will not manufacture in multiple locations 26% We are somewhat likely to manufacture in multiple locations 37% We are very likely to manufacture in multiple locations 5% 23

Thank You! Patti Seymour pseymour@bptc.com 781-281-2707 BioProcess Technology Consultants, Inc. 12 Gill Street, Suite 5450 Woburn, MA 01801