- Biogen Inc. plans to soon increase its ownership stake in biosimilars maker Samsung Bioepis Co. Ltd., anticipating quickening sales of the copycat biologics developed by the Korean pharma.
- Under a 2012 joint venture agreement, Biogen owns an option permitting it to boost its current 5% stake in Samsung Bioepis to 49.9%.
- "In the coming months, we plan to exercise our option to increase our equity stake in the Samsung Bioepis joint venture," said Biogen CFO Jeff Capello on an April 22 earnings call.
While biosimilars have struggled to gain traction in the U.S., sales of the knockoff drugs in Europe have grown substantially in recent quarters. Biogen's plans to up its stake in Samsung Bioepis will give the big biotech a greater share of that upside, and help provide another source of revenue as it faces growth concerns elsewhere.
Biogen commercializes biosimilar versions of Remicade (infliximab) and Enbrel (etanercept) in the EU through a separate agreement with Samsung Bioepis. Over the first three months of 2018, sales of the drugs nearly doubled from the same period a year ago to total $128 million.
And a recent settlement deal with AbbVie Inc. opens the door for Biogen to begin selling a biosimilar version of the multi-blockbuster anti-inflammatory drug Humira in Europe starting this October.
Under the current arrangement, Biogen and Samsung Bioepis split profits on sales of those three drugs equally. Bumping up ownership of the Korean company would allow Biogen to realize a greater share.
"The company noted that once they opt-in, [Biogen] would effectively get 75% of European profits and 25% of US profits by their estimates," wrote Mizuho analyst Salim Syed in an April 24 note. (That calculation presumes that Biogen opts to take its stake up to the 49.9% level set under the 2012 joint venture agreement.)
Outside of Europe, Merck & Co. is responsible for commercializing those three biosimilars (one, Renflexis, is actually marketed) as well as proposed candidates for several cancer biologics. As Syed notes, owning more of Samsung Bioepis indirectly allows Biogen to benefit from those sales as well.
In addition, Biogen's plans to own more of Samsung Bioepis could pay off down the road when the current licensing agreement governing sales of the three biosimilars in the EU expires in 2023.
While biosimilars have not had as large of an impact as some had initially hoped, Biogen's plans — along with bets by Amgen Inc., Pfizer Inc., Novartis AG and others — indicate drugmakers expect that to change.