Mabthera&Herceptin prices get lower in India

March 23, 2012 7:54 AM

According to Wall Street Journal, Roche will be cutting the price of two expensive cancer drugs in India, in an effort to gain market share and avoid competition from biosimilars. 

Roche will be giving new names to the drugs in India and the company hopes to avoid losing pricing power elsewhere, though it isn’t clear the company will succeed on that score.

Lately, Roche signed an agreement with Emcure of India to locally pack these well-known cancer drugs in India. After this move, it was expected to lower the prices of Mabthera and Herceptin but Roche also wants to get new licenses with new brand names for these products.

The wholesale costs of Herceptin and Mabthera are about $3,000 to $4,500 a month per patient in India. According to WSJ, Tuygan Goeker, head of Middle East and Asian markets at Roche, said the prices would be cut in India starting next year, though he declined to say by how much. By offering lower-priced versions, Roche also aims to avoid being compelled under Indian law to allow generic-drug makers to produce less-expensive copies.

The drugs will be packaged locally by India-based Emcure Pharmaceuticals Ltd., Mr. Goeker said. Roche is hoping the new names, which haven’t been revealed and are subject to Indian approval, will prevent wholesalers from buying the Indian product and reselling it at a profit in other markets, where the new brand names won’t be licensed for sale, he said.

This rebranding shows us a big problem for the industry. As these cancer drugs are more expensive in the developed-markets, middlemen are trying to buy them from low-cost markets and resale them to U.S. and Europe.

Lately, counterfeit Avastin was caught in the U.S. and although the brand name was different (Avastin-Altuzan), the product was able to reach from Turkey to the U.S. over Syria, Egypt and the U.K.

So, although Roche hopes that, this rebranding procedure will lower the possibility to affect the prices in other markets, it will be hard to block middlemen to buy these products from India and sell it to other markets, legally or illegally.

Also, as mentioned in the article, it is far from guaranteed that other countries won’t demand the Indian-level prices once they become public. Insurers and government health systems in many markets have been pushing for discounts on the expensive drugs.

Roche’s plan also partly is aimed at preventing India from demanding a so-called “compulsory license” for Roche drugs, which would allow a generic-drug maker to make less-expensive copies. Indian law gives the country’s patent regulator such authority if a medicine is priced beyond patients’ reach.

India this month exercised the right for the first time, forcing Germany’s Bayer to grant a compulsory license for cancer drug Nexavar, which costs $5,700 for a month’s supply. The patent regulator said generic-drug maker Natco Pharma Ltd. had pledged to sell Nexavar for $178 a month.

Editor’s comment: Briefly, it is clear that, Roche is trying to take more actions to secure their products and make the market less attractive for biosimilar players.

This Indian-move is one of the several actions which can be taken by Roche and other pharma-giants but will it help them to keep their market share? We will all wait and see till the first wave of monoclonal antibody biosimilars enter the market.


Source: Wall Street Journal

1 Comment

  • Christian Schmitz

    Certainly, major costs for biosimilar producers are initial plant investments, COGS and purification of the final product. The theme ‘the process is the product’ seeems key to biosimilar producers and new entrants have to balance out developmental cost, clinical trial cost and the (risk) of regulartory registration hurdles. From my perspective it remains to be seen if the number of players moving into the same biosimilar product will reduce margins in the long run for all market participants.
    Hence, the move of Roche seems to threaten new entrants and give Emcure a competitive advantage over its competitors.

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