South Korean biopharmaceutical company Celltrion is on track for a major business expansion in the US, as it now has three biosimilars to compete against blockbuster original drugs in the US market.

The US Food and Drug Administration on Friday approved Celltrion’s Herzuma, a biosimilar referencing blockbuster breast cancer drug Herceptin.

The news came a month after the US regulator’s approval of Truxima, a Celltrion-developed biosimilar referencing Rituxan used for the treatment of non-Hodgkin’s lymphoma. 

Truxima is the first-ever biosimilar copy of Rituxan to be approved in the US, and is therefore expected reap gains from being an exclusive product being sold in the drug segment.

With the latest set of approvals, Celltrion now has US regulatory clearance for three biosimilars: Herzuma, Truxima and Remsima, a biosimilar referencing Remicade that was commercialized in the US in October 2016.

“As the US makes up more than 50 percent of the world’s total biologic drug revenues, we expect the FDA’s approval of our three main drug products to spearhead our sales in the US market,” Celltrion said in a statement Saturday.

According to the Korean drugmaker, worldwide sales of the original drug were 24 trillion won ($21.2 billion). Of this, 14 trillion won accounted for sales made in the US, signaling vast market opportunities.

Biosimilars are cheaper, near-replicas of cell-based biologic drugs whose patents have expired, which includes many of the world’s top-selling blockbuster drugs, such as Herceptin (trastuzumab), Rituxan (rituximab) and Remicade (infliximab).

Due to development difficulties, only a few companies in the world have managed to develop and secure regulatory approval for biosimilars, with Korea’s Celltrion considered an early mover in the segment.

In Europe, Celltrion has already reaped early success with its portfolio of biosimilars. Remsima, since its commercialization in Europe in 2015, now has taken up 54 percent of the infliximab market, according to IQVIA.

Truxima, launched in Europe in April this year, now has a 32 percent market share in the region’s rituximab market. Herzuma, launched initially in France in May this year, is in the process of expanding its business, Celltrion said.

In the US, sales of Celltrion’s Remsima are being handled by Pfizer. Teva Pharmaceutical Industries is in charge of marketing Truxima and the recently-approved biosimilar Herzuma.

“We are excited about building Teva’s presence in biosimilars,” said Brendan O’Grady, executive vice president and head of North America Commercial at Teva. “The addition of Herzuma to our biosimilars portfolio will allow us to leverage our strengths from oncology and generics.”

For the time being, Celltrion said Herzuma is likely to remain the only Herceptin biosimilar being sold in the market. Ogivri, another Herceptin biosimilar, developed by Biocon and Mylan, was approved by the FDA in December 2017, but has yet to be commercialized.

Other Herceptin biosimilars -- including those filed by Amgen and Allergan, Pfizer and Samsung Bioepis -- are still undergoing FDA approval procedures, with the US regulator having requested additional approval data or extended its evaluation period.

Despite achieving a number of business milestones in the US market, Celltrion’s marketing and distribution business unit is currently facing hiccups at home turf, as an investigation is underway over allegations of accounting irregularities.

The Financial Supervisory Service is reportedly looking into allegations that Celltrion Healthcare, the marketing and distribution unit of Celltrion, engaged in questionable accounting practices in order to inflate its profits in the second quarter of this year.

The regulator has problematized how Celltrion Healthcare sold back the drug licensing rights it had initially acquired from Celltrion to the parent company at 21.8 billion won, which was calculated as a profit that allowed the company to avert falling into the red in the April-June period.

Celltrion Healthcare released a responding statement claiming that the gains constitute a legitimate form of “operating income.” However, accounting experts assert that licensing rights are an “intangible asset” that by principle should not be treated as operating income.

By Sohn Ji-young (jys@heraldcorp.com)