DEC 19 - Amgen Inc, the world's largest biotechnology company, and generic drugmaker Watson Pharmaceuticals Inc, said on Monday they will work together to develop and sell biosimilar versions of several biotech cancer drugs.
The companies, which plan to sell biosimilar products under a joint Amgen/Watson label, did not identify which drugs they are planning to develop cheaper versions of, but said they will not be current Amgen products.
Amgen, which is already facing competition in Europe from biosimilars of some of its products, signaled in April that it hoped to utilize its biotech manufacturing expertise to get into the business of biosimilars.
Under terms of the agreement, Amgen will assume primary responsibility for developing, manufacturing and initially commercializing the biosimilar cancer drugs, the companies said. Watson will contribute up to $400 million in co-development costs and take advantage of its expertise in the sale and marketing of specialty and generic drugs. Watson will initially receive royalties and sales milestones from product revenue.
The Food and Drug Administration is expected soon to shed more light on a process for the production and approval of less expensive copies of biotech medicines in the United States in an effort to save billions of dollars in health care costs. However, because biologic drugs are far more complex to produce than chemical pills, biosimilars are not expected to be anywhere near as cheap as traditional generic drugs.
"Biosimilars provide an exciting long-term growth opportunity for Amgen. We have a dedicated team to leverage existing capabilities and capacity and drive the success of the collaboration," Amgen Chief Operating Officer Robert Bradaway, who will become CEO next year, said in a statement.
The deal will also allow Watson to gain a major foothold in the field of biosimilars without having to first develop the complex capability of biologic manufacturing.
(Reporting by Bill Berkrot)