Partnerships provide global foundation for Alvotech

A network of marketing deals with key players across the globe has laid the foundations for Alvotech’s biosimilars to be marketed worldwide, the company’s founder and chairman, Róbert Wessman, tells Generics Bulletin in an exclusive interview.

Since Alvotech was founded eight years ago, the Alvogen sister company has put in place development programs and manufacturing capabilities that have allowed it to build up a significant portfolio of biosimilars that are now progressing towards launch. And in recent years, Róbert Wessman explains to Generics Bulletin in the first part of an exclusive interview, a series of deals with some of the off-patent industry’s biggest players around the globe have provided the firm with a marketing network through which its products can reach payers and patients worldwide.

“When we started our journey in 2012, we basically said we wanted to build a company which would be fully integrated, having everything in-house from cell-line to drug production to fill-finish,” Róbert Wessman explained. “And that took us quite a number of years to build up.”

“24 months ago, we then started to sign contracts with commercial partners. The aim was basically to sign up with a leading partner in each region. And that has gone very well.”

Róbert Wessman pointed to the latest such deal with Yangtze River Pharmaceutical in China, which will see the Chinese firm market eight Alvotech biosimilars, to be produced at a plant in Changchun through an existing joint venture in the region.

The 420,000 sq m facility “will be operational next year,” Róbert Wessman noted, “so we will be able to service both China and the rest of the world. [And] of course we have our facility in Iceland.”

“Developing eight biosimilars is, of course, a huge investment. And being able to market those products into multiple territories was key.”

Other major deals struck by Alvotech worldwide have included a US deal with Teva for five products (Also see "Teva And Alvotech Strike US Biosimilars Pact" - Generics Bulletin, 5 Aug, 2020.); a European partnership with Stada covering seven biosimilars; and a recently-extended alliance with Fuji Pharma in Japan.

Further marketing agreements have included deals struck with Cipla in South Africa (Also see "Alvotech And Cipla Strike Biosimilars Alliance In South Africa" - Generics Bulletin, 5 Nov, 2020.); with JAMP in Canada; and DKSH in Asian markets.

“I think it’s a pretty unique model,” Róbert Wessman says. “Parallel to getting our manufacturing operational and building up our pipeline – we have a pipeline of eight products currently, mainly focusing on autoimmune and oncology – to sign up with marketing partners was quite important to us.”

Because “developing eight products is of course a huge investment. And being able to market those products into multiple territories was key.” Key milestones for the portfolio were “of course becoming near-term now,” he added, “and the pipeline coming to market will be a major milestone of a very long journey.”

“The team has done an outstanding job now,” he emphasized, noting that through its series of marketing agreements “we have covered now more or less the entire world, including the Middle East and Latin America. So we have more or less covered everywhere.”

Alvotech has previously disclosed that its pipeline includes biosimilar versions of AbbVie’s Humira 100mg/ml (adalimumab), Janssen’s Stelara (ustekinumab) and Simponi (golimumab), Amgen’s Xgeva/Prolia (denosumab), Regeneron’s Eylea (aflibercept), Genentech’s Perjeta (pertuzumab) and Takeda’s Entyvio (vedolizumab).

Selecting top-three players in each region

Outlining Alvotech’s approach to finding marketing partners, Róbert Wessman said “we tend to select a leading company in each region, a top-three company at least, with the ability to create a market share – and that has been extremely successful for us. We believe that this is going to be the key point when it comes to success for Alvotech going forward.”

In particular, he highlighted, “the deal with Yangtze River was very important. China is the second biggest market in the world and we are investing a lot into manufacturing.” And now, following the Yangtze River deal, he explained, “in China we are basically able to produce and supply the market going forward with all of our portfolio and pipeline.”

“Yangtze River is a leading company in China,” Róbert Wessman added. “It is private so the turnover is not being disclosed, but it has been among the top three of all pharma companies in China in the last ten years and has around 10,000 sales representatives. So I think we are very well covered.”

Róbert Wessman also indicated that Alvotech was looking at these alliances as long-term arrangements, for its current portfolio and beyond. “The way we look on this is as a strategic partnership, where most of the companies are taking our current portfolio, or most of the portfolio at least. We view these as long-term partnerships. Under most of these agreements, once we add more product to the pipeline and if everything is going well with our current partners, [we can] expand from there.”

“So I am extremely pleased to have all those contracts in place even before we launch the first product. It’s an amazing achievement I think.”

Higher strength offers Adalimumab advantage

One of Alvotech’s lead biosimilars is a version of AbbVie’s Humira in the higher 100mg/ml strength, which the firm expects to give it an advantage over competing adalimumab biosimilars, the majority of which are 50mg/ml versions. Alvotech recently filed its 100mg/ml version in both the US and Europe. (Also see "Alvotech Files Higher-Strength Adalimumab In US And EU" - Generics Bulletin, 19 Nov, 2020.)

Róbert Wessman explained why the firm had chosen to focus on the higher concentration. “This all came about a few years back when we heard that AbbVie was ready to launch a 100mg [version of Humira],” he noted. And “being in the generics industry, we know how that goes.”

“We were actually active in developing 50mg three or four years back and, when we heard that AbbVie was getting ready to launch 100mg, we stopped that and started to focus only on 100mg. We did not even consider 50mg any more. We made the switch overnight, and all the focus of the team and clinical design and everything was around the 100mg.”

This was especially important “in the US, where Humira has sales of $16bn and growing,” Róbert Wessman noted. “I believe they have managed to convert over 80% of the market into 100mg.”

“We believe that we should be there at market formation – and being able to offer 100mg at the same time, we believe that this will be of great value to patients, because most of the market is 100mg.” Moreover, he observed, in the US it was “highly unlikely or almost impossible to think that there will be any kind of switch between 50mg and 100mg.”

“Of course, the 50mg [biosimilars] will get their share,” he acknowledged, “and potentially they can convert back part of the 100mg [market]. But still the biggest portion, in our mind, will continue to be 100mg, and we are the first and the only firm with a confirmation of filing in the US, and this was a major milestone for us.”

Acknowledging that Celltrion had also filed for a 100mg/ml adalimumab biosimilar in Europe – having recently received a positive opinion from the European Medicines Agency’s Committee for Medicinal Products for Human Use (Also see "Celltrion Wins Race For High-Concentration Adalimumab" - Generics Bulletin, 11 Dec, 2020.) – Róbert Wessman said “we haven’t heard if they are going to file in the US or not, and that is the only other one which we know of.”

Biosimilars ‘a different ballgame’ to generics

Asked about the market dynamics for biosimilars, and whether they would remain separate to and different from those of the small-molecule generics market, Róbert Wessman was clear. “Biosimilars have a much higher barrier to entry,” he said. “Our journey with Alvotech has taken ten years, we have invested more than a billion dollars before we launched the first product. And that is a different ballgame.”

It was not only the cost that was a key factor, but also its complexity, he noted. “Those products are very complex in nature, getting to the biosimilarity, we are focusing on being that close to the brand. We believe that for the product that is where the value is, and we are looking at interchangeability, and so it is a totally different ballgame.”

The biosimilars industry was “a young industry,” Róbert Wessman observed, with fewer years of experience than the generics industry. And it was “not easy to set up a similar business in a low-cost area and believe you can deliver those products with relatively fast R&D and a low R&D cost, like it is possible to do in small molecules.”

“Having said that, I think the biosimilars industry will be more durable and more sustainable,” he suggested. “When I took the decision in 2012 to start [Alvotech], I believed – and I believe I was right – that post-2020, if you did not have access to biosimilars you would not be able to be a strong generics company. Because there are simply not enough small molecule [opportunities] to select from.”

“I was also asked in 2002, ten years earlier, why I would not be in biosimilars, and I thought back then that it was the wrong time to enter into the business.” This was “because the regulatory environment was not defined. The US, of course, was totally undefined. So I wanted to wait until there was greater clarity in the environment as to what the requirements were, and I think it was a perfect decision on timing and concept to set up in 2012 as we did.”

Hiring new staff and broadening shareholder base

More recently, Alvotech has been bolstered by financing rounds that Róbert Wessman said “got on board a few additional shareholders that we are very proud of.” (Also see "Private Financing Round Values Alvotech At $1.5bn" - Generics Bulletin, 28 Oct, 2020.) And earlier this year, the firm had brought in public markets specialist Tanya Zharov as deputy CEO, highlighting that she would “assist in the preparation of Alvotech for public listing.” (Also see "Alvotech Gears Up For Public Listing With Fresh Leadership" - Generics Bulletin, 19 May, 2020.)

“It would not be a big surprise in the long-term to see the company being listed,” Róbert Wessman acknowledged, “but disclosing any such plans would not be wise now.”

A year before Zharov’s appointment, Sandoz’ former head of development for biopharmaceuticals, Mark Levick, was chosen to become CEO of Alvotech. (Also see "Sandoz Biopharma Head Levick To Become CEO Of Alvotech" - Generics Bulletin, 10 May, 2019.) And later in 2019, the company recruited Pfizer’s former head of biosimilars development, Joseph McClellan, as its chief scientific officer. (Also see "People Round-Up: Alvotech Appoints Science Chief As Read Exits Pfizer" - Generics Bulletin, 30 Sep, 2019.)

“We have around 600 people now with Alvotech and we are still hiring a lot,” Róbert Wessman outlined. “To take the next step, as you can imagine for a company like this, requires different skills once it gets operational, so we were very pleased that we got our head of R&D coming from Pfizer with a lot of experience. Joe has clearly made a great impact since he arrived. And Mark Levick coming from Novartis.”

In terms of Alvotech’s management team, Róbert Wessman indicated that “we currently have most of the key positions filled,” but “in some important positions we are still looking.”

The only way to make sure that we can give people appropriate treatment and make sure that the access is there, is for governments and healthcare systems to continue to embrace biosimilars.

Asked whether recent pressures caused by the coronavirus pandemic were producing a greater appreciation of the value of both biosimilars and generics, in terms of reducing the cost burden on healthcare systems, Róbert Wessman recalled that “in the early days when small-molecule generics came to market, there was a little bit of scepticism from big pharma. That took five, six, seven years to blow over.” And now, he said, “we are seeing in the biosimilar industry, of course, that the regulations are becoming much clearer.”

Biosimilars would play a key role in terms of facilitating patient access to necessary treatments, he suggested. “In some countries less than 5%-10% of people who need biologic treatment are getting it because of the cost. Some medications are costing $50,000-$70,000 per patient in the US. And at the same time you are seeing over 30% of the global pharma market, more than $1trn, being biotech products.”

“So the only way to make sure that we can give people appropriate treatment and make sure that the access is there, is for governments and healthcare systems to continue to embrace biosimilars.”

“When we looked at this eight years ago, we felt that with the rate of new molecules coming out of biotech this would be the main portion of our industry towards 2025. We wanted to be there, we want to create access, and access comes with global manufacturing and being able to access all the key markets which we are able to do now.”

“Having everything in-house, we designed our business to get to a similarity which is better than has been seen in the past,” Róbert Wessman summarized. We see that when interchangeability studies, protocols for specific products are issued, we are complying with those requirements, and once you are complying with those requirements we believe there is no issue with substituting biosimilars, and that will make a big difference on cost for healthcare systems going forward.”