The Impact of Cost of goods (CoGs) on the commercial viability of biosimilar monoclonal antibodies (mAbs) within India PHAR5403

1. Contents

2 Introduction.. 3

2.1 India's Biosimilar Industry Overview.. 4

2.2 Research Boundary. 4

2.3 Theories, Models, or Frameworks. 4

3 Literature Review.. 5

3.1 Definitions of Biosimilars. 5

3.2 Cost drivers in Biosimilar monoclonal antibodies manufacturing.. 6

3.3 Capital Expenditure. 9

3.4 Strategies for cost reduction.. 10

3.5 Regulatory and Market Challenges. 10

3.6 Regulatory Harmonization.. 10

3.7 Research Gap.. 11

4 Research Methodology. 11

5 Potential Outcomes. 12

6 Bibliography. 13

7 Industry mentor resume. 14

2.Introduction

The main research issue is the impact of CoGs on the commercial viability of biosimilar monoclonal antibodies within India. As indicated in figure 1, the global biosimilar industry is growing rapidly, with a valuation of about USD 41.97 billion in 2025 and an expected market value of about USD 97.32 billion in 2030, growing at a CAGR of 18.32%. Since many high-value biologics drugs are expected to lose their patents within the next five years, there is growing need for more affordable alternatives to biologics medications, which is driving this increase.(Intelligence, 2023)

This created a great opportunity for biopharma companies, especially in the emerging markets like India to supply biosimilars in the global market. However, the high cost of biosimilar remains a significant burden for both prescribers and patients despite regulatory acceptance in the US, Europe, and most emerging markets. (Biosimilars Market Size, Share And Trends Report, 2030, 2022)

Typically, the biosimilars are expected to be priced at 60 -70 % lower prices than the innovator drug, which poses a substantial challenge for biopharma manufacturers due to the significant investments required for capital expenditure, clinical and regulatory development and commercial manufacturing.(Biosimiar market size, share and covid 19 impact analysis, 2024)

Moreover, though the price of biosimilars should go down every year, on the other hand, their CoGs will increase over time due to the increasing cost in manufacturing. That is why minimizing CoGs could be a primary driver of improving the biosimilar profitability and growth

The project has been carried out in context with the Indian biosimilar industry and the growing demand of biosimilar monoclonal antibodies for various therapeutic indications globally. In this regard, the basic issues related to increasing manufacturing costs need to be addressed and hence find effective solutions that could render biosimilars more affordable. off patent strategies of innovator which is posing challenges to biosimilars and hence a appropriate technical and regulatory development strategy is key to commercial success.

2.1India's Biosimilar Industry Overview

• Market Potential:India is a significant player in the global biosimilars market, with many domestic companies actively developing and manufacturing biosimilars.

• Regulatory Environment:The regulatory environment of biosimilars in India is still evolving, as guidelines have been laid down that focus on ensuring the safety, efficacy, and quality of biosimilars

• Key Players:Major biotech companies based in India include Biocon, Dr. Reddy's Laboratories, and Intas pharmaceuticals, CuraTeQ Biologics and Enzene biosciences, among others.

• Strategic Plans: Indian companies are focusing on expanding their biosimilar portfolios and enhancing their manufacturing capabilities to meet the growing global demand.

• Key Competitors:The Indian biosimilar manufacturers have some competition in the form of global players that are equally eager to decrease the CoGs and improve the commercial viability of their biosimilars

2.2Research Boundary

The research scope is limited to the Indian market, where all the challenges and opportunities concerning the subject are an issue in this geographical area. The study will not include other markets, as the regulatory and economic conditions may differ significantly.

2.3Theories, Models, or Frameworks

The following frameworks shall be used in addressing the issue

• Porter's Five Forces:To analyze the competitive landscape and identify factors influencing the cost structure

• SWOT Analysis:This analysis analyzes the strengths, weaknesses, opportunities, and threats concerning biosimilar manufacturing.

The major challenge that would benefit from this research is that the high CoGs associated with biosimilar manufacturing is high. Overcoming this problem is crucial not only for profitability and growth of the Indian Biosimilar Industry but also for the affordability and accessibility of biosimilars to patients

The stakeholders are Indian Biosimilar Manufacturers, Regulatory Authorities and Patients and Healthcare Providers and below are my research questions that can be addressed.

• What are the primary factors contributing to the high COGS of biosimilar monoclonal antibodies in India?

• How can manufacturing processes be optimized to reduce costs?

• What role do regulatory policies play in influencing the CoGs?

• How can Indian companies leverage economies of scale to lower production costs?

• What are the potential risks and benefits of implementing cost-reduction strategies?

3.Literature Review

3.1Definitions of Biosimilars

As per USFDA: A biosimilar is a biological product that is highly similar to and has no clinically meaningful differences from an existing FDA-approved reference product.

As per EMA: A biosimilar is biological medicine highly similar to another already approved biological medicine in the European Union (EU), for which marketing exclusivity rights have expired.

As per India: DBT and CDSCO: A similar biologic product is that which is similar in terms of quality,?safety?and?efficacy?to?an?approved reference biological product based on comparability.

As per WHO: Similar biotherapeutic products (SBP) is a biotherapeutic product which is similar in terms of quality, safety?and?efficacy?to?an already licensed reference biotherapeutic product.

Biosimilar monoclonal antibodies (mAbs) serve an important role because they offer affordable alternatives to existing biologic therapies, therefore, thereby increasing patient access to life-saving treatments for cancer, autoimmune diseases, and chronic inflammatory conditions. Moreover, they will help to reduce healthcare costs while maintaining similar efficacy and safety profiles as their reference products.(WHO Technical Report Series, 2017)

As mentioned in figure 2, biosimilar mAbs development is a lengthy process and time-consuming process due to many reasons and mentioned below (John Isaacs, 2017)

• Complex Manufacturing Process: Biosimilars are produced in living cells, which introduces heterogeneity and requires tight control of the production conditions.

• Extensive Characterization: Extensive analytical investigations must be performed to ensure that the biosimilar product is similar to the reference product regarding structure, function, and impurity profile.

• Regulatory Requirements: Biosimilarity, safety, and efficacy need to have quite strict regulatory requirements and therefore broad clinical trials.

Any variation in the manufacturing process can affect the biosimilar mAb molecular activity. Such factors may include glycosylation, protein folding, post translation modifications which can result in variation on drug stability, efficacy, and immunogenicity. (Jackie Cullinan, 2021). Ensuring consistency in these attributes is critical to maintaining biosimilar therapeutic effectiveness.(USFDA)

Theaimof biosimilar mAb clinical trials is toshowno clinically significantdifferencesin immunogenicity, safety,andefficacyforthe biosimilarfromits reference product.According to theGuideline on similar biological medical products including monoclonal antibodies-non-clinical and clinical concerns,these trialsshouldbe designed tomeet regulatoryrequirements. Often,thesearecomparativestudiesusinglarge patient populations and longin duration.(EMA, 2012)

3.2Cost drivers in Biosimilar monoclonal antibodies manufacturing

The manufacturing of biosimilar mAbs is always costly because the processes are complex and the regulatory demands are very high. Key contributors to CoGs include. (Mohanty, 2022)

• Raw Material Costs: Biosimilar mAbs depend on expensive raw materials, including culture media and purification resins. These materials are critical for ensuring product quality but are highly influential in determining manufacturing costs

• Process Development:Developing a process that ensures the biosimilar matches the reference product in terms of structure, function and purity is a complex task. This process involves.
  
  
  • Extensive analytical studies
  
  
  • Iterative testing and optimization
  
  
  • Hight levels of expertise and infrastructure
  
  
  

This involves a large upfront financial and time investment pre-commercialization for biosimilar mAbs.

• Regulatory Compliance:Biosimilar mAbs must meet stringent regulatory requirements, which involves:
  
  
  • Conducting comprehensive clinical trials to demonstrate safety, efficacy and similarity to the reference product.
  
  
  • Implementing though quality assurance system to ensure consistency and compliance with regulatory standards.
  
  
  • Because above process will add substantial costs due to the high level of rigor and the need for specificized resources.
  
  
  

• Manufacturing Scale:The scale of operations will directly impact the cost of production.
  
  
  • Small-scale manufacturing is less cost efficient due to higher per unit costs.
  
  
  • Large-scale operations can reduce cost though economies of scale, where fixed are spread across a greater number of units. (Brian Abt, 2020).
  
  
  

• Technological Advancements: Advanced manufacturing technologies such as single use bioreactor, perfusion and continuous manufacturing will have potential to improve efficiency and reduce the costs. However, these technological advancements require initial investments and update to existing processes and infrastructure and mentioned in figure 4.

The authors indicate that optimization of manufacturing process, utilization of economies of scale, and new technologies are some of the key strategies towards reduction of CoGs in biosimilar manufacturing.

• Pembrolizumab Case Study

The production of pembrolizumab (Keytruda) demonstrates the potential of cost-efficient technologies.

• Continuous Bioprocessing: Enables near-continuous operations, increasing yields and reducing costs.

• Single-Use Bioreactors: Simplify processes, reduce contamination risks, and minimize cleaning requirements, resulting in lower operational costs (Brian Abt, 2020).

• Regulatory compliance:

Extensive clinical trials and regulatory filings will significantly increase the overall costs to biosimilar manufacturing. Here are some references to support this:

• Study on Efficacy Trials: A studyshowedthat clinical efficacy testing for biosimilars often costs millions of dollars more than for originator products. The median cost for phase 3 biosimilar trials was estimated at $27.6 million, compared to $19 million for pivotal trials of originator products. These trials also tend to enroll larger patient populations and have longer durations to meet high equivalency standards (Jeremias, 2020)

• Comparative Efficacy Trials: Another study shows that the median cost for 29 studies of comparative efficacy of biosimilars at $20.98 million. These studies generally require the participation of a median number of patients amounting to 538 with an average duration of 55 weeks. (Hagen, 2021). This indicates that the high-cost burden arising from regulatory compliance and clinical trials in the biosimilar industry.

3.3Capital Expenditure

Biosimilar manufacturing requires high investments at the beginning of establishing a facility for production, which contributes to major cost drivers. Here are some references:

• There has been a related considerable amount of emphasis in the literature on quantifying capital and operational costs for the development and commercialization of biosimilars. In one such estimation on six biopharmaceutical companies from India, the approximate biosimilar development costs were reported to be about $18 million for microbial and $21 million for mammalian expression systems. Besides, it requires a one-time capital investment of US$ 4550 million to establish advanced manufacturing facilities that can meet the stringent regulatory requirements. The study also points out that US/EU authorization can add an additional cost of US$ 25 million per product and clinical studies alone account for 60%70% of the total development cost. (Sonia Gandhi, 2024).

• A huge upfront investment required to establish and maintain a highly advanced manufacturing facility for biosimilars may be beyond the reach of small and medium-sized pharmaceutical companies (Arnum, Top 10: Investments & Moves in Bio/Pharma Manufacturing, 2019)

• A high-potency manufacturing investments by pharmaceutical companies such as Lonza, WuXi AppTec, and Seqens and the acquisition and expansion of manufacturing facilities to enhance production capabilities (Arnum, Tracking Expansions in High-Potency Manufacturing, 2020)

3.4Strategies for cost reduction

A number of studies propose CoGs reduction strategies by focusing on technological innovation and process optimization

• Advanced Manufacturing Technologies: Adoption of single-use bioreactors, continuous manufacturing, and process intensification has shown significant reducing CoGs in biopharma manufacturing. (Renaud Jacquemart, 2016)

• Economies of Scale:

Biopharmaceutical manufacturing utilizes a substantial scale of economies to enable the average cost per unit to be reduced by scaled-up production. Indeed, spreading out fixed capital investment costs in larger facilities enables such savings for both infrastructure and equipment across much higher volumes of production. Examples include process standardization, high-level automation, and bioreactors that boost production capacities at higher scales and efficiency with associated major cost reductions. The scale ensures that resources are optimally used to minimize losses. Economies of scale will help biopharmaceutical companies to improve their competitive positioning, ensuring affordability and accessibility of medicines globally (Lee, 2022).

3.5Regulatory and Market Challenges

CoGS is a very critical factor in the commercial viability of biosimilar monoclonal antibodies in India. Low CoGs allows for affordability and expands access to lifesaving treatments in a cost-sensitive market. However, biosimilar manufacturing is inherently complex, and adding analytics, biosimilarity assessments, and regulatory compliance further raises operational expenses. The stringent regulatory framework in India, guided by CDSCO and DBT, ensures product quality but increases development costs. Advances in production technologies, however, mitigate these challenges by reducing CoGs while maintaining efficacy and safety. Balancing affordable production with regulatory adherence is pivotal for biosimilar market success and long-term sustainability in Indias competitive landscape (Anu Sharma, 2019).

3.6Regulatory Harmonization

The cost of goods (CoGs) is one of the major factors affecting the commercial viability of biosimilar monoclonal antibodies in India. High CoGs will act as a barrier to market entry and limit affordability, ultimately affecting wide adoption. Regulatory harmonization will facilitate seamless approval processes, reducing costs and development time. By doing so, India will increase the accessibility and competitiveness of biosimilars. Efficient manufacturing and regulatory practices will drive down CoGs, making biosimilars more commercially viable and thus ensuring greater patient access to more affordable biologic therapies. This approach will contribute toward sustainable healthcare and the fostering of innovation in the Indian pharmaceutical industry (Niazi).

3.7Research Gap

Although the existing literature widely discusses and debates on the global biosimilar market, it barely provides insights into CoGS challenges pertaining specifically to India. Moreover, cost reduction strategies are being suggested, but how these can practically be implemented in the Indian context remains underexplored. This paper, therefore, tries to bridge this gap by:

• Investigating India-specific cost drivers and constraints.

• Assess the feasibility of advanced manufacturing technologies in an Indian context.

• The role that regulatory reforms have played in CoGS reduction.

Reduction of CoGS is essential for improving the commercial viability of biosimilar monoclonal antibodies in India. Addressing this challenge will help Indian manufacturers to establish a strong position in the global market while ensuring the products' affordability for patients. This literature review forms the basis for determining effective cost-reduction strategies relevant to the unique dynamics of the industry in India.

4.Research Methodology

The qualitative research methodology will be adopted for this study in order to explore the effect of Cost of Goods on the commercial viability of biosimilar monoclonal antibodies in India. This qualitative approach will be appropriate for in-depth insights into the experiences, perceptions, and strategies of key stakeholders in the biosimilar industry.

semi-structured interviewswith key stakeholders in the biosimilar industrywill be conducted, including executives from biosimilar manufacturing companies, regulatory experts, and healthcare professionals.Theseinterviews willbeutilizedtoobtaindetailed information onchallenges and strategiesconcerningthereductionofCOGs

The questionnaire will be designed to capture quantitative data on key variables related to COGS, such as manufacturing costs, regulatory compliance costs, and market pricing.

A sample size of 7-10 participants is planned for the interviews. This size is appropriate for qualitative research, allowing for in-depth exploration of the research questions while ensuring manageability within the given timeframe.

• Executives from Biosimilar Manufacturing Companies:These participants will provide insights into the strategic and operational challenges of reducing COGS.

• Regulatory Experts:These participants will offer perspectives on the regulatory landscape and its impact on CoGs.

• Healthcare Professionals:These participants will share their views on the accessibility and affordability of biosimilars from a clinical perspective.

5.Potential Outcomes

The research on the impact of Cost of Goods (CoGs) on the commercial viability of biosimilar mAbs in India aims to provide actionable insights into key challenges and opportunities, answering critical questions for the biopharmaceutical sector.

Primary factors contributing to high CoGs include complex manufacturing processes involving cell culture, purification, and quality control; high costs of raw materials, consumables, and specialized equipment; and stringent regulatory requirements demanding extensive comparability and stability studies. Manufacturing processes can be optimized by implementing advanced technologies like continuous bioprocessing to enhance yield and efficiency, reducing process variability through robust process characterization and validation, and utilizing cost-effective raw material sourcing and innovative downstream processing techniques. Regulatory policies ensure quality and safety while increasing CoGs through compliance burdens, but streamlining approval processes and harmonizing global standards can help reduce costs.

Indian companies can achieve cost advantages by scaling production, consolidating manufacturing facilities, and negotiating bulk procurement of raw materials. Collaborative manufacturing agreements and strategic partnerships can further distribute costs effectively. However, implementing cost-reduction strategies carries potential risks, such as compromises in product quality, safety, or efficacy; increased scrutiny from regulators; and higher initial capital investment. Benefits include lower prices, improved market access, and enhanced competitiveness in domestic and international markets.

The findings will be published and made widely accessible to biopharmaceutical stakeholders, ensuring the broader ecosystem benefits from actionable recommendations that drive growth and accessibility in the biosimilar market.

6.Bibliography

1. Anu Sharma, N. S. (2019). Regulation of biosimilars in India: A review. International Journal of Multidisciplinary Research and Development.

1. Arnum, P. V. (2019). Top 10: Investments & Moves in Bio/Pharma Manufacturing. DCAT Value chain insights.

1. Arnum, P. V. (2020). Tracking Expansions in High-Potency Manufacturing. DCAT Value chain insigights.

1. (2024). Biosimiar market size, share and covid 19 impact analysis. Fortune Business Insights .

1. (2022). Biosimilars Market Size, Share And Trends Report, 2030. Grand view research.

1. Brian Abt, C. B. (2020). Design of a Pembrolizumab Manufacturing Plant Using Continuous Bioprocess.

1. EMA, E. M. (2012). Guideline on similar biological medicinal products containing monoclonal antibodies non-clinical and clinical issues.

1. Hagen, T. (2021). Study: Biosimilar vs Originator Spending on Comparative Efficacy Trials. AJMC The center for Biosimilar.

1. Intelligence, M. (2023). BIOSIMILARS MARKET (2024 2029). Mordor Intelligence.

1. Jackie Cullinan, A. O.-N. (2021). A rapid HPLC-based method for a comparative assessment of biosimilar structural heterogeneity and biological activity. FDA poster.

1. Jeremias, S. (2020). Study: Efficacy Trials Cost More, Take Longer for Biosimilars Than Originators. AJMC The center for Biosimilars.

1. John Isaacs, J. G.-H. (2017). The biosimilar approval process: how different is it? BMJ Publishing Group Ltd and CESAS Publications Ltd.

1. Lee, A. C. (2022). Biopharmaceutical Manufacturing: Historical Perspectives and Future Directions. Annual Review of Chemical and Biomolecular Engineering.

1. Mohanty, A. S. (2022). Cost Analysis of Biosimilar Monoclonal Antibodies. Journal of Biopharmaceutical Research.

1. Niazi, S. K. (n.d.). Biosimilars: Harmonizing the Approval Guidelines. Biologics 2022.

1. Peter Rogge, D. M. (2015). The Single-Use or Stainless Steel Decision Process: A CDMO Perspective. BioProcess International.

1. Renaud Jacquemart, M. V. (2016). A Single-use Strategy to Enable Manufacturing of Affordable Biologics. Computational and Structural Biotechnology Journal 14.

1. Sonia Gandhi, D. P. (2024). The economics of translating a biosimilar from lab to market in India. Annals of the New York Academy of Sciences.

1. (n.d.). Biosimilars Info Sheet: Regulatory and Scientific Concepts.

1. WHO Technical Report Series, N. 1. (2017). Annex 2: Guidelines on evaluation of monoclonal antibodies as similar biotherapeutic products (SBPs). WHO Expert Committee on Biological Standardization.

1. (2025). ChatGPT (January 2025 version) [AI model]. https://chat.openai.com/ is used for summarizing the literatures and paraphrasing the sentences in this SOP.

1. Elicit: The AI research assistant. https://elicit.org/

7.Industry mentor resume

Name: G. Krishna Prasad

Education

• PhD in International Business Management pursuing from international school of Business and Research, Bangalore, India since December 2022.

• MBA in International Business Management, from Adam Smith University of America,

June 2008 with distinction. Gold Medalist

• sc in Bio-engineering Technology, April 2003 from K.S.R. College of Technology (Periyar University, INDIA) with aggregate of 74% - Gold medalist, University Rank Holder

• sc in Botany, Biochemistry and Biotechnology, April 2001 from T.S.R & T.B.K Degree college (Andhra University, INDIA) with aggregate of 76%.

Industrial Project Assessment of Global Pharmaceutical Generics Market in the next 10 years at Biocon Limited, Bangalore, India in 2008. Received Gold medal for best project excellence in MBA.

Expertise: With proven Technical, Quality, Regulatory, Business acumen and SLIM

(Strategic Lean Integrated Management) driving Business units from Concept to commercialization.

Areas: Microbial and Mammalian Drug Substance-Biologicals, Vaccines, Drug Product-Vials, Cartridges, Prefilled syringes

• Biopharma site management

• Operations Management

• Biopharma Manufacturing-Process development, Scaleup and Commercial Manufacturing

• Project and Program Management

• Quality/Regulatory Management

• Lean Management-Certified Kaizen Practioner

• Strategic Human Resource Management

• Business Development and Licensing

Professional experience summary:

2023-2023 BiotechZen UAE, Business

2021-2023: Shilpa Biologicals, Dharwad, India - Senior Vice president and Site Head

2015-2021: Scigen Biopharma / M.J. BioPharma, Pune India-Vice President and Site Head, Board member

2017-2021: KAS Institute of Research, Pune India

2017-2021: Marvel Biosciences-Business Consultant

2012-2015: Julphar-United Arab Emirates-Manager-Manufacturing and Materials management

2003-2012: Biocon, Bangalore, India -Associate manager Manufacturing

Other positions: Key Member of the committee for setting up GMP compliant Mammalian cell line National repository, testing and characterization at National Center for Cell Sciences, Pune India

• Member of committee for Biotechnology Policy revision in Odisha state, India appointed by Department of Science and Technology, Govt. of Odisha.

• Chief Mentor for Startups

• Served as Board Member in M.J. BioPharma and KAS Institute of Research, India

• Served as Chairman of committee for establishing BSL2 facility for GMP compliant Mammalian cell line National repository, testing and characterization at NCCS, Pune India

• Served as Member of the Advisory Board for Department of Biotechnology-Acharya Group of Institutions, Bangalore, India

Publications: Co-authored a chapter Current trends and advances in bulk crystallization and Freeze-drying of Biopharmaceuticals in the book Lyophilized Biologics and Vaccines-Modality based approaches published by Springer.