McKesson Corporation · NYSE:MCK
McKesson — Investor Presentation (April 2018)
58 slides from McKesson's investor presentation, Apr 13, 2018
Slide 1: The New World of Biosimilars: From Clinical Use to Reimbursement
The New World of Biosimilars: From Clinical Use to Reimbursement Robert M. Rifkin, MD, FACP Medical Director - Biosimilars McKesson Specialty Health | The US Oncology Network April 13, 2018
Slide 2: Relevant Disclosures
Robert M. Rifkin, MD, FACP Relevant Disclosures Biosimilar Advisory Boards: • Amgen • Coherus • Mylan • Pfizer (Hospira) • EMD Serono • Sandoz
Slide 3: The New World of Biosimilars: Basics, Education, Reimbursement
The New World of Biosimilars: A Way to Increase Access and Decrease Cost Basics Education Reimbursement
Slide 4: Biosimilars Bringing Value to the U.S. Healthcare System
Biosimilars Bringing Value to the U.S. Healthcare System RAND Corporation Estimated Cost Savings • Reduction of $54 billion in direct spending on $250 Billion From just biologic drugs from 2017 to 2026 Projected Savings 11 biosimilars • 3% of total est. biologic spending; Range of $24 to $150B http:
Slide 5: Access and Affordability Remains an Issue for Many Patients
Access and Affordability Remains an Issue for Many Patients “A lot of my patients cry — they're frustrated," says Dr. Ayalew Tefferi, a hematologist at the Mayo Clinic. "Many of them spend their life savings on cancer “Can a miracle drug also be a drugs and end up being bankrupt." bitter pill? The a
Slide 6: Cost Burden to Patients – Biologics & Insulins
Cost Burden to Patients – Biologics & Insulins Examples of biologic and insulin medicines and associated cost: Small Molecule Comparison $542,000 US Annual Patient Cost by Product $81,000 $3,700 $79,000 $52,000 $620,000 $4,700 (Brand) “Generally, biologics treatments cost about 22x more than small m
Slide 7: Price Increases Have Driven Up the Cost of Oncology Supportive Care
Price Increases Have Driven Up the Cost of Oncology Supportive Care Historical Prices in the US US$ per unit (WAC) 5,500 +98% pegfilgrastim Wholesaler pegfilgrastim WAC 5,000 Acquisition Cost (WAC) has Consumer Price Index(1) nearly doubled since 2006 4,500 4,000 3,500 +20% 3,000 2,500 2006 07 08 09
Slide 8: Increases in Cancer-Drug Prices Have Been a Contributor to Declining Patient Affordability
Increases in Cancer-Drug Prices Have Been a Contributor to Declining Patient Affordability $10,000 Median monthly cost for new US cancer drugs $8,000 Median monthly household income $6,000 $4,000 $2,000 $0 1975-79 1980-84 1985-89 1990-94 1995-99 2000-04 2005-09 2010-14 Source: Sabo L. Treating Cance
Slide 9: The Oncologist’s Dilemma
The Oncologist’s Dilemma
Slide 10: Biological Medicines
Biological Medicines • Biologicals started with the synthesis of human insulin via recombinant DNA technology in 1982 • Biologicals: • Are drugs manufactured from living organisms • Are complex • Display minor differences from lot to lot in molecular structure and immunogenicity
Slide 11: What are Biosimilars?
What are Biosimilars?* • Biosimilar • Products that have been shown to be highly similar to the reference product in appropriate comparative, head-to-head quality, non-clinical and clinical studies • Intended Copies of Biological Products (“me-too biologics”) • Copies of already licensed biological
Slide 12: ASCO Statement: Biosimilars in Oncology Key Features
ASCO Statement: Biosimilars in Oncology Key Features* 1. Safety and Efficacy of Biosimilars 2. Interchangeability, Switching, and Substitution 3. Naming, Labeling, and Other Regulatory Considerations 4. Value of Biosimilars 5. Prescriber and Patient Education *Lyman G, et.al. J Clin Onc March 2018.
Slide 13: Small-Molecule Generics Versus Biosimilars
Small-Molecule Generics Versus Biosimilars Small-Molecule Generics Biosimilars • Precisely defined structure Monoclonal Antibody • Inherent variability based on a • Generally produced by complex manufacturing process chemical synthesis • Structure can be • Biosimilars may not be interrogated with hi
Slide 14: Production Variability, or “Drift,” Can Make Defining the Reference Product Challenging
Production-Variability, or “Drift,” Can Make Defining the Reference Product Challenging* Sources of variation between manufacturers *Mellstedt H, et al. Ann Oncol. 2008;19(3):411-419.
Slide 15: Manufacturing Changes are a Regulatory Norm
Manufacturing Changes are a Regulatory Norm – Subject to Review in Each Market - Each Biologic becomes “Biosimilar” to itself A PRODUCT THAT IS “HIGHLY SIMILAR” HAS THE “SAME” ACTIVE INGREDIENT, AND THE CLINICAL OUTCOME IS EXPECTED TO BE THE “SAME” Each manufacturing change is approved by the regula
Slide 16: Challenges: Variability and Drift
Challenges: Variability and Drift* • Significant differences in drug products (variability and drift) can arise due to: • production at different sites • changes to manufacturing processes after initial approval • FDA or EMA approval required for changes in manufacturing process • Manufacturers need
Slide 17: Biosimilars Represent Paradigm Shift in Product Development
Biosimilars Represent Paradigm Shift in Product Development Reference Biologic[1]] Biosimilar[2] High Postmarketing Low Postmarketing Surveillance Surveillance Contribution to Clinical Predictability Contribution to Clinical Predictability Phase III Clinical Clinical Phase II Clinical Immunogenicity
Slide 18: Preclinical Assessment: Four Levels of Analytical Characterization
Preclinical Assessment: Four Levels of Analytical Characterization* Studies of Structure & Function: Residual Uncertainty No further development High Not similar through 351(k) Additional information Similar needed: analytical, comparative PK/PD, etc. High confidence; appropriate Highly similar for
Slide 19: Advances in Technology: Innovator vs. Biosimilar Analytical & Characterization Tools
Advances in Technology: Innovator vs. Biosimilar Analytical & Characterization Tools • Low resolution instruments: Mass spectrometer, SDS-Gel, Sanger’s method, low resolving Technology columns etc. Then • Cell based qualitative assays • Limited assays for process & product related substance & impuri
Slide 20: Rigorous Assessment of Critical Quality Attributes
Rigorous Assessment of Critical Quality Attributes, to Assess Similarity in Structure, Functional Activity, Purity and Stability Comprehensive analysis of > 30 attributes • Amino acid sequence • PEG mass • Deamidation • Secondary structure • PEG attachment • PEG polydispersity • Norleucine misincorp
Slide 21: Comparability of Biosimilar Filgrastim with Reference Filgrastim
Comparability of Biosimilar Filgrastim with Reference Filgrastim* Protein Characterization (NMR Spectroscopy) *Sorgel F, et al. BioDrugs. 2015;29:123-131.
Slide 22: Comparability of Biosimilar Filgrastim with Reference Filgrastim
Comparability of Biosimilar Filgrastim with Reference Filgrastim* Receptor Binding Affinities Pharmacokinetic Analysis: No Significant Differences Protein Characterization (NMR Spectroscopy) Between the Biosimilar and Pharmacodynamic Reference Product Analysis *Sorgel F, et al. BioDrugs. 2015;29:123
Slide 23: Biosimilar Filgrastim (EP2006) vs Reference in Breast Cancer
Biosimilar Filgrastim (EP2006) vs Reference: Patients with Breast Cancer Receiving Myelosuppressive Chemotherapy* Biosimilar Filgrastim Non-inferior to Reference Time Course of ANC in Cycle 1 218 patients receiving 5 µg/kg/day filgrastim over 6 chemotherapy cycles *Blackwell K, et al. Ann Oncol. 201
Slide 24: Immunogenicity Concerns
Immunogenicity Concerns* • All biologics (not just biosimilars) confer a risk of immunogenicity • Related to patient, disease, and product factors • Consequences include neutralizing antibodies or cytokine release • Scientific tools for detecting immunogenicity exist, but they are not precise • Chan
Slide 25: Alternating Treatment Biosimilar Filgrastim and Reference
Alternating Treatment Biosimilar Filgrastim and Reference for Prevention of Severe Neutropenia in Patients with Breast Cancer* Switched (alternating Reference (Neupogen) biosimilar and reference) Only N = 107 n = 51 Incidence of febrile 3.4% 0% neutropenia (FN) [95% CI: -9.65; 4.96] Infections 9.3%
Slide 26: The New World of Biosimilars
The New World of Biosimilars Basics Education Reimbursement
Slide 27: The Filgrastim Landscape – April 2018
The Filgrastim Landscape – April 2018* *Sarshad M. GABI Journal 6(4):165-173,2018)
Slide 28: Awareness, Knowledge, and Perceptions of Biosimilars Among Specialty Physicians
Awareness, Knowledge, and Perceptions of Biosimilars Among Specialty Physicians* *Cohen H, et al. Adv Ther 33:2160-72,2016.
Slide 29: Awareness, Knowledge, and Perceptions of Biosimilars Among Specialty Physicians
Awareness, Knowledge, and Perceptions of Biosimilars Among Specialty Physicians* *Cohen H, et al. Adv Ther 33:2160-72,2016.
Slide 30: Pathway for Biosimilar Approval in the US: BPCI
Pathway for Biosimilar Approval in the US: Biologics Price Competition and Innovation Act (BPCI):* • Most biologics are approved under the Public Health Service Act (PHSA) (rather than the Food, Drug, and Cosmetics Act) • Drug Price Competition and Patent Term Restoration Act (informally known as Ha
Slide 31: Approval Pathways for Biosimilars and Interchangeable Biologics in the US
Approval Pathways for Biosimilars and Interchangeable Biologics in the US* Extrapolation: One, some, all indications e.g. Zarxio®(filgrastim - sndz) BIOSIMILAR Files Application: Supplement: 351(k) BLA Interchangeability Candidate Files Application: INTERCHANGEABLE Biosimilar (IC) BIOLOGIC 351(k) BL
Slide 32: BPCI Act Abbreviated the Licensure Pathway for Biosimilars
Biologics Price Competition and Innovation Act Abbreviated the Licensure Pathway for Biosimilars Requirements for Biosimilarity Stepwise Evidence Development • Biological product is highly similar to reference product notwithstanding minor differences in clinically inactive Clinical If uncertainty r
Slide 33: The Regulatory Concept: Biosimilarity Versus Originator Biologic
The Regulatory Concept Biosimilarity Versus Originator Biologic* BIOSIMILARITY IS GROUNDED IN ANALYTICAL HIGH SIMILARITY – WHICH IS NECESSARY BUT NOT SUFFICIENT, AND A SINGULAR FOCUS OF FDA McCamish, M., Pakulski, J., Sattler, C. and Woollett, G. (2015), Toward interchangeable biologics. Clinical Ph
Slide 34: Sponsors Need to Weigh the Risks/Rewards of Each Pathway
The Approval Pathway for Each Biologic Is a Case-by-Case Decision Sponsors NEED TO Weigh the Risks/ Rewards of Each Pathway For Each Product Biosimilar [US 351(k)] “Standalone” Biologic [US • Limited exclusivity (1 year, 1st IC) 351(a)] • Extrapolation (+++) • Data exclusivity 12 years (+) • Interch
Slide 35: Key Principles for Extrapolation for Biosimilars in the Future
Key Principles for Extrapolation for Biosimilars in the Future:* Extrapolation across indications for a biosimilar will depend on several factors, including: • A common MOA and receptor/target/interaction • Totality of the evidence showing comparability • Acceptable safety profile without increased
Slide 36: Extrapolation: Regulatory Perspective
Extrapolation: Regulatory Perspective* • Extrapolation is a familiar concept for regulators • Aims to avoid unnecessary studies in the target population for ethical reasons, for efficiency, and to allocate resources where needed[1] • FDA guidance states that extrapolation of indications for a biosim
Slide 37: Extrapolation: Clinical Perspective
Extrapolation: Clinical Perspective* • Extrapolation is an unfamiliar concept for clinicians • Traditionally, clinicians have relied on clinical trial data to judge the safety and efficacy of therapeutic agents • By definition, approval of a biosimilar for one indication may be based on extrapolatio
Slide 38: Framework for Extrapolation
Framework for Extrapolation Patient Factors Disease Factors Endpoint Factors • Similarity of biologic • Defined MOA • Differential efficacy and toxicity disposition: PK/PD • Similarity in target distribution • Short-term vs long-term • Organ function • Single vs combo therapy • Sensitivity of surrog
Slide 39: Extrapolation to Additional Indications Possible With Scientific Justification
Extrapolation to Additional Indications Possible With Scientific Justification* Biosimilar Extrapolation: extending Postmarketing Surveillance conclusions from studies in one pt population to make inferences in another population[1] Clinical Convincing evidence to Immunogenicity support PK/PD + extr
Slide 40: Biosimilar Filgrastim in US: Extrapolation to Other Indications
Biosimilar Filgrastim in US Extrapolation to Other Indications Oncology Drug Advisory Board recommended to the FDA approval of filgrastim-sndz for all current FDA indications of filgrastim: • Cancer patients receiving myelosuppressive chemotherapy • Patients with acute myeloid leukemia receiving ind
Slide 41: Interchangeability of Biosimilars
Interchangeability of Biosimilars* • A biosimilar may also be designated as “interchangeable” if there is proof that: • Switching or alternating between the biosimilar and the reference product does not affect safety or efficacy any more than using the reference product more than once without such a
Slide 42: Interchangeability
Interchangeability* • Interchangeability - use of a biosimilar without impacting on safety or efficacy if it is alternated or switching between the biosimilar and the innovator compared to the use of the innovator without alternation or switching • Draft guidance on interchangeability evaluation iss
Slide 43: Clinician Perspective: Finding the Right Balance
Clinician Perspective: Finding the Right Balance
Slide 44: The New World of Biosimilars
The New World of Biosimilars Basics Education Reimbursement
Slide 45: A “Perfect Storm” for Oncology Biosimilars?
A “Perfect Storm” for Oncology Biosimilars?* APMs MIPS OCM Implications for Patients MACRA *Adapted from McGivney Global Advisors – Personal Communication
Slide 46: Big Brand Biologics Continue to Lose Patent Exclusivity Over Time
Big Brand Biologics Continue to Lose Patent Exclusivity Over Time $26B+ LoE $95B+ LoE $3B+ $6B LoE + LoE: 2008 2013 2014 2020 2021 2025 Biosimilars may receive regulatory approval, but patent challenges may still exist Source: IMS 2016 Data; Brand sales for major biologics going off patent through 2
Slide 47: Biosimilar Manufacturers will Need to Overcome Several Physician Barriers to Adoption
Biosimilar Manufacturers will Need to Overcome Several Physician Barriers to Adoption Physician Barriers to Adoption Clinical Ease of Use Economic Barrier Barrier Barrier • What are biosimilars? • Does this have the same support • How good is the • Is the manufacturer as good services as the brand?
Slide 48: How do you differentiate something that is essentially the same?
How do you differentiate something that is essentially the same ? *Sarshad M. GABI Journal 6(4):165-173,2018
Slide 49: The Launch of Zarxio
The Launch of Zarxio* *Sarshad M. Major Lessons Learned from Zarxio’s US Launch: The Start of a Biosimilar Revolution. GABI Journal 6(4):165-173,2018
Slide 50: Medicare Part B Reimbursement
Medicare Part B Reimbursement *Sarshad M. GABI Journal 6(4):165-173,2018
Slide 51: Drug Rebates and Provider Profits
Drug Rebates and Provider Profits* *Sarshad M. GABI Journal 6(4):165-173,2018
Slide 52: The Need for Payer Education
The Need for Payer Education* *A Small Midwestern Health Plan Coverage Determination
Slide 53: The Impact of ASP Adjustment
The Impact of ASP Adjustment* *Sarshad M. GABI Journal 6(4):165-173,2018
Slide 54: History of FDA Approvals for Filgrastim-Based Therapies
History of FDA Approvals for Filgrastim-Based Therapies Pegfilgrastims: FDA begins expedited biosimilar MYL-1401H pathway expected approval Filgrastim Pegfilgrastim tbo-filgrastim Filgrastim-sndz CHS-1701 (Neupogen) (Neulasta) 351(k) (Granix) (Zarxio) expected approval approval pathway approval appr
Slide 55: Oncology Biosimilars in Development
Oncology Biosimilars in Development* *J Adv Prac Oncol 2017
Slide 56: Current U.S. Biosimilars & Insulins Approved
Current U.S. Biosimilars & Insulins Approved Biosimilar Name Manufacturer of Reference / Approval Date Launch Date Biosimilar Innovator Zarxio® (filgrastim-sndz) Sandoz Neupogen® March 2015 Sept. 2015 Biosimilars Approved Inflectra™ (infliximab-dyyb) Pfizer /Hospira Remicade® April 2016 Nov. 2016 Re
Slide 57: Current U.S. Biosimilars Under Review
Current U.S. Biosimilars Under Review* Biosimilar Name Manufacturer Innovator BsUFA Goal Date pegfilgrastim (Zioxtenzo) Sandoz Neulasta® Jun 2016 CRL As more biosimilars are Biosimilars Under Review pegfilgrastim (CHS-1701) Coherus Biosciences Neulasta® June 2017 CRL introduced into the epoetin-alfa
Slide 58: Biosimilars: Everyone’s Dilemma
Biosimilars: Everyone’s Dilemma How do you differentiate something that is “essentially the same”?