Biogen Idec Inc., the world’s largest maker of multiple sclerosis drugs, plans to expand into biogenerics, Chief Executive Officer George Scangos said today.
“Biosimilars will have a major role to play in health care as we go forward,” Scangos said in an interview at the J.P. Morgan Healthcare Conference in San Francisco. “It’s clear there will be pressure on prices. Biosimilars are a way to get what presumably would be high-quality drugs to patients at a lower cost.”
The Food and Drug Administration is evaluating whether the copies should require extensive tests, which are being urged by biotech companies led by Amgen Inc., the Thousand Oaks, California-based maker of the $3.5-billion-a-year rheumatoid arthritis treatment Enbrel. Copies of biotechnology drugs could save $6.6 billion by 2018 in health-care costs, the U.S. Congressional Budget Office projected in June.
Scangos, who took the helm at Biogen in July and has reorganized the Weston, Massachusetts-based company to focus primarily on neurology, said his first priority will remain developing new brand-name drugs. He declined to say which diseases Biogen may target with its biosimilars.
“A few years from now, that should be a meaningful revenue stream for us,” Scangos said. “We have a lot of activities on several molecules.”
Biogen declined 90 cents, or 1.3 percent, to $67.40 at 4 p.m. New York time in Nasdaq Stock Market trading. The shares have gained 27 percent in the past 12 months.
Biologic drugs are made from living cells, and copies of them are often called “biosimilars” because innovators say their manufacturing process can’t be replicated and copycat products will have slight variances.
Scangos said Biogen has the biological manufacturing expertise and capacity in the U.S. and European Union to develop biosimilars. The company may consider partnering to help market the medicines, he said.