Mainland China’s anticipated biosimilar boom – potential and key drivers of the market

The market of major biologics in Mainland China has tripled since 2017, with the potential to grow five-fold over the next ten years – which could drive biosimilars growth. Clarivate expert Akash Saini discusses this market’s potential and key drivers. 

 

The approval of Shanghai Henlius Biotech’s HLX01—a biosimilar of rituximab (Roche’s MabThera)—in February 2019 marked the formal entry of biosimilars in Mainland China, even though copy biologicals such as Yisaipu (etanercept) have long existed in the country. Biosimilars of bevacizumab (Roche’s Avastin), trastuzumab (Roche’s Herceptin) and adalimumab (AbbVie’s Humira) have since launched, while many others are in late-phase development. In fact, Mainland China currently has the biggest biosimilars pipeline compared to any other country.

 

Mainland China’s biologics market is relatively small despite high patient burden

Mainland China has a high burden of cancer and lifestyle-related conditions, and according to Clarivate epidemiology research, the country bears the highest global footprint of many major diseases, including non-small-cell lung cancer, breast cancer, type-2 diabetes and hypertension. Despite the disease burden and population, Mainland China’s market of premium-priced, targeted therapies—including biologics and their biosimilars—is relatively small compared to the United States and major European markets.

According to our research, the 2019 sales in Mainland China of major anti-cancer and immunotherapeutic biologics—that have either recently lost or are about to lose patent protection—were nearly $3 billion, of which only less than 2% were from biosimilars. In contrast, sales of these drugs in the United States and the EU5 were much higher—approximately $50 billion and $12 billion, respectively.

 

Regulatory and market access reforms are driving uptake of premium-priced medicines and encouraging domestic innovation

The reasons behind biologics’ poor uptake in Mainland China are likely their relatively late approval, low patient affordability and poor rate of reimbursement. Even though more than 95% of Mainland China’s population is covered under the government’s public insurance schemes, most premium-priced therapies remained non-reimbursable and out of reach for patients until recently. Moreover, Mainland China’s domestic pharma has historically focused very little on research and innovation, leaving a white space that was almost exclusively filled by expensive multinational corporation (MNC)-manufactured products.

However, the scenario is improving quickly since 2017, when the Chinese government introduced major healthcare reforms to improve the regulatory, access and reimbursement landscape. The most impactful of these reforms is the regular yearly update of the national reimbursement drug list (NRDL), which now makes more than 1,400 western medicines reimbursable in Mainland China, including worldwide blockbuster biologics against various cancers (e.g., bevacizumab, trastuzumab, rituximab) and rheumatological diseases (e.g., etanercept, adalimumab).

In addition, incentives for domestic innovation and research have allowed many Chinese manufacturers to enter this segment, who are now competing with the MNCs through their domestically developed, cost-effective biologics and biosimilars. In fact, local manufacturers overwhelmingly dominate the biosimilars pipeline of Mainland China while MNCs have very little representation in the space, likely because of the MNCs’ unwillingness to compromise on prices in this highly competitive and price-sensitive market.

 

Mainland China’s biosimilars market is set to grow exponentially with anticipated entry of nearly 40 biosimilars

With many biologics now reimbursable and many more expected to be approved and reimbursed in the coming years, Mainland China’s biologics market has finally started to flourish. Therapies included under the NRDL have registered robust growth in sales following the inclusion, despite undergoing massive price cuts. Clarivate research suggests that the market of major biologics in Mainland China has tripled since 2017 and could further grow by five times of its current size over the next ten years.

Considering that many of these biologics have lost or are about to lose patent protection, biosimilars are set to benefit significantly from this growth. Mainland China’s biosimilars pipeline more than 100 candidates in various phases of clinical development, many of which will be available in the market soon. Clarivate research suggests that in the next five years, Mainland China’s biopharma market could see the entry of more than 40 biosimilars of major anticancer and immunotherapeutic agents—most notably those of trastuzumab, bevacizumab, cetuximab, adalimumab and rituximab – all of which are reimbursable and are approved for diseases with a high burden in Mainland China.

With a plethora of cost-effective and reimbursable options available in the market, more and more patients will shift to biosimilar treatment options, driving growth in this market. Even with price erosion of branded drugs following the launch of their biosimilar counterparts —as already seen in the case of Roche’s Avastin and Herceptin (prices reduced by 23% and 24%, respectively) and AbbVie’s Humira (prices reduced by 59%)— biosimilars will take away a significant proportion of patient share and sales from the brands.

Clarivate forecasts suggests that Mainland China’s biosimilars market will increase 2,500% by 2029, allowing it to become the second largest in the world after the United States. Mainland China’s biosimilar market growth will be a game changer for the country’s domestic pharma, which has so far had limited success in leveraging the country’s growing demand for western medicine. On the other hand, MNCs are expected to gain very little from this trend.

 

References:

  • Clarivate Epidemiology
  • Disease Landscape & Forecast, Clarivate
  • Liu S et al., Burden of Cardiovascular Diseases in China, 1990-2016: Findings From the 2016 Global Burden of Disease Study, JAMA Cardiol. 2019 Apr 1;4(4):342-352
  • Feng R et al., Current cancer situation in China: good or bad news from the 2018 Global Cancer Statistics?, Cancer Commun (Lond). 2019 Apr; 39: 22

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