Arthritis Top-Seller Humira Set for U.S. Rival After $193 Billion in Sales

(Bloomberg) -- AbbVie Inc. made its arthritis treatment Humira the best-selling medication in the world. Now, after years of wrangling, rivals are finally set to bring a wave of lower-cost versions to the U.S.

The arrival of the Humira copycats will be a pivotal test for a class of treatments that advocates have long said could help fence in runaway drug costs. Biosimilars -- cheaper versions of complicated treatments made from living cells -- remain a relatively small market in the U.S., in part because makers of big-name biologic drugs have fought hard to protect them from competition.

Humira is the biggest and best-protected of them all. Since AbbVie parent Abbott Laboratories introduced the drug in 2003, it's brought in almost $193 billion in sales through the end of 2021, in part because of an imposing wall of patents. AbbVie fended off prospective rivals for years, but now settlements reached with companies who want to make Humira clones for the U.S., where it sold $17.3 billion last year, are set to kick in.

First in line is Amgen Inc. with five months of exclusivity to try to maximize its share of an opportunity it says could eventually reach as much as $9 billion. While the ascent to that figure will likely be slow, the arrival of Humira copies represents a tipping point in a global biosimilar market that's still only reached $13 billion amid legal and logistical challenges, particularly in the U.S.

But there's a key difference with Humira that may give generic-drug makers an advantage: unlike physician-administered drugs, Humira is dispensed by pharmacies, giving the pharmacy benefit managers that purchase products for companies and insurers greater discretion in choosing whether and when to use substitutes.

“As more biosimilars come on in the market, payers are incentivized to increase adoption,” Bloomberg Intelligence analyst Duane Wright said. “But it's not going happen right away.”

In general, biosimilars have fared better in most European countries than in the U.S. because of lower legal barriers and the power of government health systems. Amgen's Amjevita launched in Europe in 2018 when it sold $11 million in its first three months. It's now the continent's leading biosimilar with $439 million in 2021 sales.

Speed of uptake will be a key issue for Amgen in the U.S. Six rivals -- including Pfizer Inc., Novartis AG and Boehringer Ingleheim -- are expected to follow its drug into the market starting next July.

Critical Edge

“I do think our lead is critical,” Murdo Gordon, Amgen's executive vice president of global commercial operations, said in March at a conference. “Being first or at least one of the first to launch is an important aspect of what we're doing here.”

Humira blunts overactive immune responses that occur in illnesses from rheumatoid arthritis to Crohn's disease. It costs about $7,000 for a month's supply, according to prices listed on Single Care, a pharmacy website. Its market supremacy lasted until the arrival of the Covid-19 vaccine of Pfizer Inc. and BioNTech SE that sold $36.8 billion in 2021.

AbbVie is already anticipating about 45% erosion in 2023 U.S. Humira sales and plans to shift focus to Skyrizi and Rinvoq, its next top two products. AbbVie responded to requests for comment by referring to its earnings call, without elaborating.

Amgen got its head start after making a deal with AbbVie to pay royalties on U.S. and European sales in exchange for its license. It plans to use the same approach it did in Europe, where field forces reached out to rheumatologists and dermatologists, and support programs and call centers helped patients.

The team “will utilize its decades of experience in the rheumatology and inflammation market to help providers and patients feel confident in switching from the brand to the biosimilar,” Amgen said in a statement.

The company and its rivals will still have to persuade PBMs to pick their drug. The drug middlemen often incentivize the use of cheaper alternatives; last year, Cigna Corp.'s PBM offered a $500 gift card to entice patients to switch to its preferred biosimilars.

But PBMs appear inclined to adopt Humira biosimilars gradually, according to analysts from Sanford C. Bernstein & Co. who conducted a survey of the firms.

“Payers are worried both about making a mistake in the conversion process and making the wrong product choice between the biosimilars,” the analysts led by Ronny Gal wrote in a note.

Still, U.S. sales of up to $500 million seem possible for Amjevita in the first six months, according to Bloomberg Intelligence analyst Marc Engelsgjerd. Organon & Co., which makes the Humira biosimilar Hadlima with partner Samsung Bioepis Co., said it's confident it can persuade PBMs to have its biosimilar in rotation when it enters.

Interchangeable Versions

PBMs will likely “choose a few and potentially continue to have Humira on the formulary to give their sponsors optionality,” said Joseph Azzinaro, Organon's head of biosimilars, in an interview, “which we think bodes very well for the launch of other biosimilars, including Hadlima.”

Amgen will also have to grapple with the entry of Boehringer Ingleheim GmbH, maker of the only biosimilar designated as interchangeable -- capable of producing the same clinical result as Humira in any patient. That often means the pharmacist can substitute the biosimilar without consulting the prescriber, and Pfizer is seeking the same status for its product.

The success of Humira biosimilars in the U.S. in convincing payers, PBMs and patients to adopt the copies just might be the push that market players need to increasingly look for cheaper alternatives to biotech drugs. Provider preference has often stood in the way of biosimilars, Bloomberg's Wright said.

“In some cases, payers haven't really been aggressive,” he said, “but I think that could change.”