This presentation was delivered at CPhI Japan 2014, held at Tokyo. IT outlines the key trends and dynamics in the global biosimilars market whilst highlighting the business prospects for India and Japan in particular

1. Strategic Positioning and Business
Potential for Japan and India in the Global
Biosimilars Market
11th April 2014
Aiswariya Chidambaram
CPhI Japan 2014

2. 2
Focus Points
Focus Points
Global Biosimilars Market Overview
Key Market Drivers and Restraints Summary
Biologics Patent Expiry
Global Biosimilars Market – Timeline of Key Events
Competitive Landscape Analysis
Key Companies to Watch
Global Evolving Regulatory Environment for Biosimilars
Indian Biosimilars Market Overview
Strategic Partnerships between Indian and Global Companies
Japan Biosimilars Market Overview
Japan Biosimilars – Pricing Analysis
About Frost & Sullivan
Market Opportunities for New Entrants

3. Source: Frost and Sullivan
Partnerships and
alliances are the major
focus of firms entering
the biosimilars market.
Non-pharma
companies begin to
show increasing
interest in biosimilars
Regional
Governments strive
to actively promote
growth of
biosimilars – South
Korea to capture
22% by 2020
The global biosimilars market was valued at $876.1 million
in 2012, growing at 53.4%
Patent expiry of biologics worth $100
B by 2020. 2013 – 2015 considered to
be period for significant growth.
Highly concentrated market – top 3 players constitute 82%
market share
Europe is the world’s largest
biosimilars market constituting
44%. Europe seems a
favourable market due to
well established
regulatory guidelines
and increasing pressure
to control spiralling
healthcare costs.
While the US is under
penetrated presenting
huge opportunity
Global Biosimilars Market Overview

4. 4
Comparative Analysis:
Generics, Biosimilars, and Biologics
Moderate (5075%)
Low (~30%)
BiosimilarsGenerics Biologics
MarketingOtherDynamics
Probability of Success
Time
Cost
Pricing
Marketing Investment
Point of Differentiation
Barriers to Entry
Product Operational Profit
Margins
Decision Makers
Competitors
Short (34 years) Long (812 years)
Low (~$5 million)
High
($350$800 million)
Commodity pricing Premium (full pricing)
Low
High
Group purchasing/
medical professional
organisations
Prescribers, patients
High,
less differentiated
Few,
well differentiated
Price,
breadth of portfolio
Product profile,
marketing
Low
(cost efficiency)
High
(development process)
Low (~20%) High (~40%)
High (~90%)
Moderate (78 years)
$100$200 million
Lower pricing value
Payers, prescribers
Moderate
Few,
partially differentiated
Price, product profile, and technology
High (capital and development)
Mixed (2530%)
Product
Development
Source: Frost & Sullivan

5. United States
(Regulated)
0 Approved
Products under
New Framework
Europe
(Regulated)
~ 14 Approved
Products
Japan
(Semi-regulated)
5 Approved
Products
India
(Semi-
regulated)
~ 50
Approved
Products
China
(Semi-
regulated)
~ 2000
Marketed
Products
Number of Approved Products in Regulated and Semi-
regulated Markets
Source: Frost & Sullivan

6. 6
Global Biosimilars Market – Product Segmentation
Segmentation is done based on existing biosimilar products and emerging biosimilar products, which
may differ among regions.
 Existing Biosimilars: Existing biosimilars market
segments include those with approved products in
respective countries.
 Emerging Biosimilars: Emerging biosimilars
market segments include those with products that
are being developed, coming up in the future, or
waiting for approval.
Total Biosimilars Market
Existing Biosimilars*
EPO
G-CSF
HGH
Emerging Biosimilars
Insulin
Interferons
mAbs
Total Biosimilars Market:
Market Segmentation, Global, 2012
* Biosimilars are not available in some regions.
Source: Frost & Sullivan

7. 7
Key Market Drivers and Restraints Summary
Key Drivers
Key Restraints/Challenges
Biosimilars Market: Key Drivers and Restraints Summary (Global), 2013-2018
Source: Frost & Sullivan
Lack of access to
process information
may affect product
quality
Emergence of new
market participants
expected to drive market
expansion
Time consuming
approval process may
slow down market
growth
Patent expiry of
blockbuster biologics
worth $79.0 billion by
2015 and 100 billion
by 2020
New provisions
introduced by
governments to
reduce medical
expenditure
Uncertainty and
reluctance of
physicians to adopt
biosimilars

8. 8
2005 2010 2015 2020 20252000 2030
Epogen
2013
Biologics Market: Key Patent Expirations, US, 2000–2030
Year
Lantus
2015
Neupogen
2013
Herceptin
2019
Remicade
2018
Neulasta
2015
Erbitux
2016
Humira
2016
Rituxan
2009
(Expired)
Enbrel
2028Avastin
2019
Product
HGHandInsulinmAbs
EPOand
G-CSF
Source: Frost & Sullivan
Biologics Patent Expiry – US

9. 9
2005 2010 2015 2020 20252000 2030
Epogen
2004
Biologics Market: Key Patent Expirations, Europe, 2000–2030
Year
Genotropin
2008
Neupogen
2006
Herceptin
2014
Remicade
2014
Neulasta
2015
Aranesp
2016
Humira
2018
Rituxan /
Mabthera
2018
Enbrel
2029
Product
HGHmAbs
EPOand
G-CSF
Source: Frost & Sullivan
Biologics Patent Expiry - Europe

10. 10
Global Biosimilars Market - Timeline of Key Events
Regulatory guidelines were the main focus in 2012, with pathways becoming clearer and new products
getting approved.
Total Biosimilars Market: Timeline of Key Events, Global, 2012 and 2013
Jan–Feb March–April May–June July–Aug Sep–Oct Nov–Dec 2013
January 2012:
EMA guidelines
released on
recombinant
interferon beta
February 2012:
US FDA
biosimilar
guidelines
released
June 2012: Finox
Biotech initiates
phase III clinical
trial for Afolia, a
recombinant follicle
stimulating
hormone (r-FSH)
July 2012: The
Ministry of Food and
Drug Safety
approves Celltrion’s
Remsima™;
awaiting European
final approval
December 2012:
EMA guidelines
released on
recombinant
human insulin and
mAbs
November 2012: First
G-CSF biosimilar
approval of Mochida
Pharmaceuticals and
development partner,
Fuji Pharma, in Japan
September 2012:
Sandoz begins
phase III clinical
trials in the United
States for biosimilar
epoetin alpha
September 2012:
Mexico released
biosimilar guidelines
July 2012:
India
announced
biosimilar
guidelines
June 2013:
First-time EMA
gives positive
opinion on 2
Mabs: Inflectra
and Remsima™
Source: Frost & Sullivan

11. Competitive Landscape Analysis
Biosimilars Market: Top Five Companies by Market Share (Global), 2012
Source: Frost and Sullivan
Rank Company
1
2
3
4
5
 The top three global biosimilars market participants
contributed 82.0% of the total market revenue with
Sandoz as a global leader.
 Teva Pharmaceutical’s acquisition strategy has
allowed the company to stay ahead in the G-CSF
sub-segment.
 Hospira has been active in the EPO biosimilars sub-
segment.
 Competition will likely increase as new market
participants from emerging countries are penetrating
the market.
**Sandoz includes Sandoz and Hexal.
***Teva includes Ratiopharm and CT Arzneimittel.

12. 12
Competitive Landscape Analysis (continued)
Source: Frost & Sullivan.
SalesandMarketingStrength
LowHigh
Low HighProduct Development Strength
Generics and
Specialty
Pharma
Big
Pharma
Biotech /
Biopharma
Potential
Entrants
Sandoz
Teva
Hospira
STADA
Medice
CT
Arzneimittel
Biopartners
Mylan
Merck
Eli Lilly
Pfizer
Astrazeneca
Zydus Cadila
Actavis
Dr. Reddy’s
Boehringer
Ingelheim
Biocon Cangene
Crucell
Reliance
Life Sciences
Companies with a strong integration of marketing and R&D is likely to succeed.
Total Biosimilars Market: Competitive Landscape Analysis, Global, 2012
Celltrion
Samsung
Fujifilm

13. 13
Government Regulation and Policies
The Dynamic and Complex industry nature makes it difficult to formulate and
implement uniform regulatory guidelines for approval of new products
Divergent Interests
Uncertain Long-term
Impact
Brand innovators
fear that the
widespread
adoption of
biosimilars might
hamper their
growth and have
questioned the
safety of biosimilars
In countries where
the regulatory
bodies have already
approved
biosimilars,
credibility of such
products as
equivalent long-
term substitutes for
originator products
is often debated
Complex Molecules
Molecular
complexity of
bitech-based
products has
traditionally driven
regulators to treat
biosimilars extra-
cautiously , often
requiring lengthy,
expensive clinical
trials , restricting
small players from
entering this space
Source: Frost & Sullivan

14. 14
Global Evolving Regulatory Environment for Biosimilars
Region Regulatory Environment
• EMEA global leader in providing a formal path for biosimilars approval
• Regulatory guidelines vary on a country-by-country basis
• Regulation drafted by developed countries other than the US are often based
on EMEA approval standards
• FDA lags behind the EU in framing clear regulatory policies for biosimilars
• The Biologics Price Competition and Innovation Act (BPCIA, 2009, provides
a framework for biosimilars approval
• FDA is preparing to provide further guidance to companies seeking for
approval
• In 2009, WHO published Guidelines for Evaluation of Similar Bio-therapeutic
Products , providing high-level guidance for national regulatory agencies
• Though it targets developing markets , regulators’ ability to evaluate and
formally approve products remains limited
Source: Frost & Sullivan

15. 15
Global Evolving Regulatory Environment for Biosimilars
(continued)
Region Regulatory Environment
• A National Biotechnology Regulatory Authority (NBRA) Bill is soon expected
to passed hoping to significantly streamline the approval process
• The current biosimilar approval process is quite complex requiring approval
from multiple government agencies
• Hence a clearer regulatory pathway is required to cut costs and time
• Despite having the maximum number of approved products domestically,
China lacks a specific approval process for biosimilars till date
• The bar set by the Chinese SFDA remains lower than that of the US and EU
• Guidelines for the Quality, Safety and Efficacy Assurance of Follow-on
Biologics was established by the PMDA on March 2009
• Currently existing regulatory policies are not on par with those of the
regulated markets
Source: Frost & Sullivan

16. 16
Indian Biosimilars Market Overview
What are current market dynamics, and what are the primary challenges?
• The Indian biosimilars market as estimated to be worth $58.8 million in 2012
• Large companies develop not only biosimilars but also their own biologics
• Medium-size firms struggle to gain a footing in India
• Despite leveraging a large share in the global generic market, this segmnet
warrants a unique combination of generic and innovative drug industry
What are the key opportunities and risks for this
market?
Which companies are successful in this market
and why?
Opportunities Risks Leading Companies  Overcome
challenges and
mitigate high risk and
costs associated with
drug development
and manufacturing
 Importance of
strategic
partnerships has
been recognised
 Patent expiry of 17
blockbuster biologics
between 2011 and
2019
 Lower facility and
development costs
than developed
countries
 Progress towards
achieving better
clinical capabilities
 Tedious approval
(bioequivalence
studies), processes
and patent litigations
 Cold chain
distribution – a major
hindrance to supply
chain
Source: Frost & Sullivan

17. 17
Indian Biosimilars Market - Existing and Pipeline Products
Company/Product EPO Insulin HGH Interferon GCSF MAB Enbrel Streptokinase
Biocon
Intas
Biopharmaceuticals
Dr Reddy’s Labs
Reliance Life
Sciences
Bharat Biotech
Lupin
Wockhardt
Ranbaxy & Zenotech
Labs
ShanthaBiotechnics
(Sanofi Aventis)
Expected Global
Biosimilars Market
Share (2015)
11% 10% 4% 9% 10% 36% 12% <8%
Launched
product
Pipeline
product Sources: Frost & Sullivan, BioPharm International and IBEF.

18. 18
Strategic Partnerships between Indian and Global
Companies
Product
Development
Manufacturing
Clinical
Trials
Partnerships Comments
Capabilities driven by
strategic alliances with
global leaders
First Indian company to
receive EU-GMP
Certification
Partnership with GSK to
assist in manufacturing
and marketing; have a
WHO cGMP facility
Have multiple cGMP
facilities in India in addition
to main plant in Ireland
Partnership for product
development. Evaluating
for marketing partners in
EU
5 manufacturing facilities
across India; emerging
capabilities in biosimilars
Sources: Frost & Sullivan and IBEF.Strong Weak

19. 19
Strategic Partnerships between Indian and Global
Companies (continued)
Product
Development
Manufacturing
Clinical
Trials
Partnerships Comments
Bought 40% stake in Goa-
based Mab Pharm & 25%
stake in Bio Mabs in China
to grow mAb capabilities
Subsidiary Shantha West
in San Diego has
developed 4 mAbs; R&D
partnership with
International Vaccine
Institute
Ranbaxy holds 45% stake
in Zenotech Labs for
marketing biosimilars
N/A Recently opened a large
biotech park in
Aurangabad, designed
according to US and
EMEA standards
Sources: Frost & Sullivan and IBEF.
Strong Weak

20. 20
Way Ahead for Indian Biosimilars Market
Strategic partnerships between global and Indian companies are expected to increase significantly
over the next five to ten years
Sources: Frost & Sullivan and IBEF.
Path forward for Indian Biosimilars
Establish
partnerships with
local industry
leaders
Market to
physicians
serving the
emerging
middle class
Export to unregulated
and semi-regulated
markets
Huge
opportunity for
investment in
Indian market
Establish clear
pathway for
Regulatory
Approval

21. 21
Japan Biosimilars Market Overview
What are current market dynamics, and what are the primary challenges?
• Japanese Biosimilars Market was estimated to be $26.2 million in 2012
• Generics constituted 23% by volume and 10% by value in 2012.
• Japanese Government strives to reduce healthcare costs and increase use of
generics
• Biosimilars are considered a sub-category of generics. Till date, 5 products
approved in Japan
• Slower uptake of generics is mainly due to quality and efficacy concerns
• Market is expected to grow gradually driven by patent expiry of biologics, increase in
demand and physician acceptance
What are the key opportunities and risks for this
market?
Which companies are successful in this market and why?
Opportunities Risks Leading Companies  Sandoz and JCR - early-
entrance companies that have
approved biosmilar products in
Japan since 2009; both filed
another biosimilar product for
approval.
 Nippon Kayaku established a
strategic partnership with
Celltrion to develop few other
mAbs biosmilars.
 Patent expiry of
original medicines
 Government
prospective payment
system and incentives
for physicians,
pharmacists
 Aging population
 Regulatory
hurdles
 Physicians’
perceptions
 Stringent price
cut system
Source: Frost & Sullivan

22. 22
Product Component
Therapeutic
Indication
Manufacturer
Reference
Product
Authorization
Date
Epoetin alfa BS epoetin alfa
Anaemia, renal
anaemia
JCR
Pharmaceuticals
Espo 20 Jan 2010
Filgrastim BS filgrastim
Cancer,
hematopoetic stem
cell transplantation,
neutropenia
Fuji Pharma
Neulasta
21 Nov 2012
Filgrastim BS filgrastim
Cancer,
hematopoetic stem
cell transplantation,
neutropenia
Sandoz Neulasta
24 March
2014
Filgrastim BS filgrastim
Cancer,
hematopoetic stem
cell transplantation,
neutropenia
Teva Neulasta 28 Feb 2013
Somatotropin
BS
somatotropin
Growth Hormone
Deficiency, Turner
Syndrome
Sandoz Genotropin 22 June 2009
PMDA Approved Biosimilars in Japan
BS stands for biosimilar.
Biosimilars Market: PMDA Approved Biosimilar Products, Japan, 2012
Source: Frost & Sullivan

23. 23
Market Opportunities for New Entrants
Competitive
Knowledge
Capital
Investments
Vision
and
Strategy
Scale-up
Production
Capabilities
Clinical and
Regulatory
Expertise
Marketing
and
Sales
Skills
• Clearly defined long-term vision,
commitment, and strategic fit
• Goals for in-house development,
marketing, and geographic focus
• Competitive intelligence
on biologics and
biosimilars market
• Competitor pipeline
analysis and competitor’s
R&D investment strategy
• Competitive regional
benchmarking
• Healthy finance infrastructure
for high upfront investments
• Ability to cope with high
manufacturing, maintenance,
and promotional costs
• Effective sales communication to
the scientific community
• Effective market activities for
commercialization of biosimilars
• Continuous promotional activities
and marketing relationships with
doctors and pharmacists
• Technical know-how for
clinical development
• Regulatory expertise on
guidelines such as EMA,
FDA, and
pharmacovigilance
expertise
• Stable multi-step reproducible
manufacturing facilities
• Proper supply chain management
• Standard testing control facilities
Strategic
Factors
for New
Entrants
Source: Frost & Sullivan

24. Questions

25. 25
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26. 26
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27. 27
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