Sun Pharma, India's largest drug maker, said it will be joining the race to develop biosimilar drugs.
"We are evaluating development of some biosimilars, which can be classified amongst the third wave," said Dilip Shanghvi, Managing Director, at the company's earnings call on May 27.
"I think we are looking at products, which have significant future patent expiry dates, we can be amongst the first approvals. That's the focus ... we are finding a way to leverage our presence in the market...so that we can successfully build a biosimilars portfolio," he said.
Shanghvi anticipates a timeline of 2028-2030 for the proposed biosimilar assets to hit the market.
He added that Sun Pharma would develop biosimilars within the limits of usual R&D (research and development) and capital expenditure budgets. Sun Pharma targets to spend between 8 and 9 percent of turnover on research and development (R&D).
Sun Pharma had sales of Rs. 33,139.2 crore in FY21.
"It shouldn't be a big drain on our cash flows," Shanghvi said.
Late entrant
Sun Pharma chief Shanghvi, known for his midas touch in the pharma industry, has for years stayed away from biosimilars saying that it's not a category that he understands.
Biosimilar are copies of biologic drugs, but companies developing them will have to conduct clinical trials to establish similarity with the original biologic drug.
The manufacturing is also complex as it involves possessing biotechnology capabilities.
The global biosimilars market size is projected to reach $35.7 billion by 2025 from $11.8 billion in 2020, at a CAGR (Compound Annual Growth Rate) of 24.7 percent, according to Reportlinker.com.
But the competition is hotting up with several Indian drug makers like Biocon, Dr Reddy's, Lupin, Aurobindo and Cadila Healthcare, among others, aiming to get a slice of the market.
Shanghvi statements indicate that Sun Pharma is in it for the long haul.
But being a late entrant, did Sun Pharma miss the early mover advantage?
"I am expecting that over time, with familiarity and confidence that doctors will develop on biosimilars, we will see an increasing percentage of patients being treated with biosimilars," Shanghvi said.
Experts concur with Shanghvi's view.
"I don't perceive late entry as a disadvantage. Especially in the context of how biosimilar markets have evolved over the last few years, regulatory impetus has been high," said Pushpa Vijayaraghavan, Director & Practice Lead - Healthcare at Sathguru Management Consultants.
Vijayaraghavan advises companies on biosimilars and vaccine strategy.
"Commercial opportunity in the largest market in the United States is just opening up. If the portfolio is well conceived and targets mature markets where opportunity for return on investment is now ripe, the foray into biosimilars could be a good call," he said.
Another analyst at a Mumbai-based brokerage house tracking Sun Pharma who didn't want to be named, said the company has the regulatory, and clinical expertise to develop biosimilars, targeting highly regulated markets.
"It has already developed and launched specialty products; biosimilars aren't going to be much different. Coming late also helps because they don't have to repeat the mistakes some early mover companies had made at regulatory, manufacturing and commercialisation stages," the analyst said.
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