One of the trends set to define 2025, and the decade ahead, is the 2022-30 patent cliff, and the gradual shift in biopharma revenues from small to large molecules. While India was able to leverage the 2008 patent cliff of small molecules, the same playbook will not work for biologics and biosimilars.
Of the top 24 blockbuster drugs going off-patent during the patent cliff 2022-2030, 14 are biologics, as per a study conducted in August 2023 by the Department of Pharmaceuticals (DoP), Ministry of Chemicals & Fertilizers, Govt of India. The study also points out that sales of biologics like biosimilars, immunomodulators and monoclonal antibodies, which comprised 69 per cent of overall revenues of these 24 blockbuster drugs in 2022 will increase to 75 per cent by 2030.
Many biopharma companies in India have already leveraged the biosimilar patent cliff. For instance, the DoP study points out that while blockbuster biologic Humira (adalimumab) lost exclusivity in the US in early 2023, the Indian government permitted multiple companies to manufacture adalimumab under the provisions of compulsory licensing from 2018. Biocon became the first company from India to launch its biosimilar Hulio in the US in July 2023.
While Biocon and peers are in the limelight, this decade will hopefully mark the coming of age of quite a few ‘baby Biocons’: smaller biotech companies, following in the footsteps of the pioneers. One of these aspiring companies is the Dubiotech Park-headquartered Epygen Group, headed by founder Debayan Ghosh. Not surprisingly, he cut his biotechnology teeth in … where else? Biocon.
A seed is sown
After a BTech from University of Calcutta, Ghosh was part of one of India’s earliest batches of MTechs in biotechnology from Anna University, Chennai’s Center For Biotechnology. In 1993, Ghosh, like most aspiring biotechnologists, made his way to Biocon. Set up in 1978, Biocon was slowly and silently laying the foundation of India’s biotechnology sector. As a fresher recruit from campus, Ghosh found himself working along side technologists from renowned institutes like MIT Boston, who had heeded founder Kiran MazumdarShaw’s call, to come back to India and put India on the global biotech map.
Looking back on those early days, Ghosh believes that Biocon has been “like an incubator for biotech entrepreneurs”, recalling that in the early 1990s, very few people knew about biotechnology or Biocon. “We used to throw a party every time you got a big order … that was how we started, filled with the thrill of adventurism.”
Ghosh is referring to a certain brand of bio-entrepreneurship, following the footsteps of Biocon founder Mazumdar-Shaw. He spent almost five crucial years early in his career, developing enzyme technologies and learning the industrial biotech and enzyme business from some of the best scientists/ biotechnologists in the world.
Commenting on Ghosh, Mazumdar-Shaw, Chairperson, Biocon recalls that he handled the enzymes business at Biocon in the late 1990s. “He was very driven and when we pivoted to biopharma he ventured out and eventually set up Epygen Biotech.”
Commending him on his success, Mazumdar-Shaw comments that Ghosh has been in touch over the years apprising her of his progress. “He is very entrepreneurial and the fact that he has endured the challenges of building his business, does speak volumes of his commitment to succeed.”
In fact, Mazumdar-Shaw and Biocon have been the guiding light for many ventures in the biotech field and beyond. Alluding to this fact, Mazumdar-Shaw wishes greater success to Ghosh, commenting that she is extremely proud to see many new ventures set up by enterprising former Bioconites.
The biosimilar CDMO opportunity
Mazumdar-Shaw’s wishes for Ghosh’s greater success speaks volumes, given the intense competition in the biologics market. As per a Frost & Sullivan analysis, the share of the global biologics market in the global drug market rose to nearly one-fourth in 2022 and is expected to reach 31.8 per cent by 2026 and 37.5 per cent by 2030.
Pharma companies choose to outsource development and manufacturing of biologics as scale dictates profitability. Thus as per the Frost & Sullivan analysis, the global market size of biologics contract development and manufacturing organisations (CDMOs) has grown significantly from $13.3 billion in 2018 to $29.3 billion in 2022 and is projected to reach $58.1 billion by 2026 and $100.4 billion by 2030.
The good news is that as many biologics near patent expiries, the biosimilars CDMO market is moving to geographies like Asia where production costs can be scaled down by improving R&D efficiency and clinical performance.
Ghosh’s personal estimate is that the CDMO market could be up to $30 billion, outsourced primarily by the US and some Western European countries. In the long term, he believes that the US BioSecure Act could leverage India over competitor China owing to the Wuhan incident. While President-elect Trump’s goal as part of the Make America Great Again movement would be to ship higher value-addition activities to the US, the cloning work, scaling up and toxicology clinical batches could be outsourced, significantly impacting Novel Biological Entity (NBE) economics.
Considering that the development cost of biologics is close to half a billion to a billion dollars, Ghosh believes “that is where we see a lot of potential for India in terms of pitching in as a biologics CDMO hub.” While India’s biologic CDMO market is currently worth “just a couple of hundred crores”, Ghosh is certain “it’s going to double in three-four years and is predicted to grow five times over the next decade”. Typically, biologics development companies are expected to maximise hit rates by simply outsourcing standardised processes.
The business pitch
While the seeds of entrepreneurship were sown at Biocon, it was Ghosh’s next stint at Florida-based Dyadic International that gave him the business idea. He spent the next six years working with a fine team of scientists at Dyadic USA who focused on a unique expression host system that would catapult productivity levels of critical biologics, with a clear goal to make those drugs affordable to the masses.
Explaining the challenges of biomanufacturing in layman’s terms, Ghosh says, “You just could not make or passage as much as you commercially desire because nature calls the shots and says, hey, you cannot make the bacteria or fungi metabolise more than a certain level, because I have programmed this organism to make only so much protein. So that’s when recombinant platform technologies came into play.”
Ghosh narrates how biologics companies “efficiently tweaked genes, shot up expressions while adapting proteins to fit the human model.” Licensing out such expression platforms to big pharma companies had proven extremely profitable.
Having aced both the science and the business of licensing out technologies, he decided to bring these learnings closer to home. Once again, he harks back to his early days in Biocon where the zeal to harness scientific progress for the benefit of the Indian people attracted talents back to India.
While shortlisting possibilities to expand back in India, he was approached by the UAE government, which was looking to start the Dubiotech Park, Dubai. Impressed by the scale and speed of investments, Ghosh found a middle path.
In 2006, he started Epygen Labs, with its headquarters based in Dubiotech Park, Dubai, UAE, focusing on industrial biotechnology. After five years, revenues were steady enough for “the final frontier’ as Ghosh puts it: to take the plunge into biopharma manufacturing. Epygen Biotech India was started in 2011, and today comprises an end to end biopharma R&D and manufacturing facility at MIDC Patalganga, near Mumbai, which develops and produces critical therapeutic proteins for both biosimilars and NBE space.
More than a decade later, and having more than Rs 120 crores invested in Epygen’s Patalganga manufacturing facility, Epygen is living by its tag line “building future strand by strand”, as a biotech CDMO involved in developing and manufacturing affordable biologics for patients in the region and beyond.
Today, as founder of the Epygen Group, Ghosh leverages his contacts and expertise across three continents, hoping to snag a slice of the $70 billion global biosimilar pie, tapping biosimilars in the diabetes, oncology and cardiovascular segments.
Key milestones
After inception, Epygen Biotech licensed in a biosimilar recombinant Streptokinase (rSK) from Institute of Microbial Technology (IMTECH) which was designed to solubilise clots causing myocardial infarction (ST Elevation Myocardial Infarction: STEMI) with a goal to replace the beta lactam marker with a non-beta lactam from its gene for improved patient safety profile. Subsequently licensing process and development was initiated for a further modified version of rSK for ischemic stroke and STEMI.
Tipped to ‘revolutionise the way ischemic strokes are treated around the globe’ as per the Epygen Biotech press note, this NBE could be administered to ischemic stroke patients within a much wider window of 8-10 hours, unlike existing stroke medication, which has only a three-hour window. This prolonged window of administration was aimed to drastically improve patients’ survival. Additionally, Epygen would make the NBE at a fraction of the cost, while ensuring no side effects unlike other drugs used for Ischemic stroke that compromised blood brain barrier.
Ischemic stroke, commonly referred to as brain stroke, is caused by the blockage of an artery that supplies oxygen to the brain. It is reportedly a leading cause of death and disability in CVD patients and an estimated 15-17 lakh Indians suffer from it every year.
Globally, as per the American Stroke Association (ASA), brain strokes are the second leading cause of death in the world with a staggering 15 million people affected causing 11 million people to either die or become permanently disabled. The prevalence of stroke is much higher in India than the west and about 87 per cent of all strokes are ischemic strokes.
The Epygen team made remarkable progress on improving yields and tweaking the gene to replace with a non-allergenic version, making it safer for the patients of thrombolysis, but by the time the team was ready to initiate human trials, COVID struck and clinical trials ground to a halt.
While the company was able to pivot to answer the COVID challenge, Ghosh remains confident that their work on making the recombinant streptokinase NBE at an affordable cost for cardiovascular use will proceed in the future. The burden of stroke remains a global concern and an affordable recombinant streptokinase would be the logical solution. Especially as more governments are set to negotiate medication prices and strive to control healthcare costs.
Prepping for the next pandemic
With the rSK on the back burner, Epygen needed to find a way to utilise their topline biomanufacturing facility and a team with proven skills in protein expression and purification rising to the cause of COVID.
Ghosh tied up with his partners Dyadic International in the US, who in turn were working with the European Union Zoonotic Anticipation and Preparedness Initiative (ZAPI) programme. This company developed and demonstrated the use of a highly productive proprietary protein production platform, a key part of developing Receptor Binding Domain (RBD) based vaccines against present and future SARSCoV–2 variants.
Through this tie-up, in April 2022, Epygen Biotech received funding from the Department of Biotechnology, Government of India to initiate the Phase I and Phase II trials of an indigenous affordable RBD based vaccine against present and future SARS-CoV–2 variants.
An example of the possible impact of Epygen’s work was that its involvement in the project was anticipated to reduce the price point to less than Rs 150 per dose, making it the first Indian protein vaccine able to adapt to the rapidly mutating variants of the virus (e.g. Omicron BA.5).
Looking at the big picture, Ghosh stresses that working on this project has “honed our skills in expressing proteins of interest very quickly using this expression platform” so that once CDC has the gene sequence of a variant of concern has been identified, the Epygen team can roll out a proteinbased vaccine in 100 days. These skills position Epygen as a key part of future pandemic preparedness platforms and strategies.
A clone to vial CDMO
Beyond pandemic threats, Epygen’s biomanufacturing and development skills have progressed to offer the full suite of “clone to vial” activities, handling the complexities of optimising high cell density fermentation, protein purification, and scale-up for a range of clients.
Seated in his Patalganga facility, Ghosh explains how the company can handle varying client requests, with multiple CDMO suites where they can go from the client’s protein of interest to manufacturing the finished product for animal and then human trials in a few months time, depending on the project.
Ghosh believes that Epygen is thus poised to tap the biologics CDMO market, which by all accounts, is the next growth frontier. “We do a few million vials of recombinant human insulin, which gives us 80 per cent or so of our CMO revenues”. Epygen’s current CDMO work focuses on insulin analogues, human hormones and obesity drugs.
Ghosh indicates that while the current break up of revenues between CMO and CDMO is skewed towards the former, the aim is to slowly shift the current bias from M to D (from manufacturing to development).
Betting on the future
While biosimilar CDMOs like Epygen are revving up to ride the wave of key biologics going off patent in coming years, a lot depends on timing and funding. Ghosh is gearing up to approach investors for the funding to scale up. As Ghosh reasons, “Now that Epygen has proved itself as a CDMO at a certain scale with a steady revenue stream, we are ready to replicate/scale up and would be tapping investors in the near future.”
He strongly believes that 2025 will be about biotech CDMOs charting funding strategies to scale up. Ghosh is betting on Big Pharma’s need to replace molecules losing exclusivity over the next decade and choosing to partner and invest in relatively mid-sized biotech companies like Epygen with key strengths, rather than setting up individual biologics suites within their own manufacturing setup.
Will the bet pay off? Quite a few smaller biotech companies are aiming for the same pot of gold but Ghosh seems confident of pulling it off as he feels this opportunity is here to stay for the next decades in healthcare, and there is enough room for many. Will his pitch to find a funding partner succeed in time to catch the biosimilar CDMO wave? Only time will tell.
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