US demand for biosimilars testing will grow substantially in the next few years according to BioOutsource, which expects to generate half of its revenue in the country by 2019.
The Scotland-based biopharma testing firm announced plans to set up a laboratory in Massachusetts last week , citing its expanding US client base as the main driver for the investment.
Spokesman Mitch Scanlan told us “The US is our fastest growing market where we have tripled our revenues and client base in the last 18 months and we expect this market to represent 50% of our total sales within the next 3-5 years.
“The new facility is being set-up predominantly to support Biosimilars, but we also plan to offer additional services that will support our Biosafety customers” he said.
The US biosimilars market has not taken off as well as had been expected in 2010 when the government created an abbreviated approval process as part of the Affordable Care Act (ACA), also known as Obamacare.
The main issue has been a lack of clear guidance from the US Food and Drug Administration (FDA) on biosimilars, specifically how developers should go about proving their drugs are similar to the originator product.
This lack of guidance has already seen some potential major players scale-back their the efforts. In 2013, for example, Lonza and Teva dissolve their biosimilars joint venture citing US regulatory uncertainties.
In May this year the FDA finally moved to address this problem by issuing draft guidance on biosimilarity, but whether this will be enough remains to be seen.
BioOutsource told us "The FDA is drip-feeding biosimilar guidelines in draft form which is less than ideal to encourage the industry. However what is clear is a key requirement for analytical comparability assessment which BioOutsource are able to provide."
BioOutsource has not chosen a site for the new laboratory. However, Massachusetts was the “logical choice” according to Scanlan, who said that: “Boston is already home to several of our US clients [and] our local sales office was also established there in 2013.”
Scanlan also said: “We will be refurbishing an existing facility rather than a new build construction,” which is an approach that a number of other biopharmaceutical services firms have adopted to accelerate geographic expansion .
The firm also describes itself as an active member of the Massachusetts Biotechnology Council (MassBio) and cites this as another reason for choosing to set up its services base in the State.
However, while efforts to expand its US client base are a major part of the expansion plan, they are not the only focus according to Scanlan.
“We are focused on a global market and we believe the new lab will accelerate growth and open up opportunities across North and Latin America.”