A biosimilar drug (also known as follow-on biologic or subsequent entry biologic) is a biologic medical product which is almost an identical copy of an original product that is manufactured by a different company. Biosimilars are officially approved versions of original “innovator” products, and can be manufactured when the original product’s patent expires. Reference to the innovator product is an integral component of the approval.

And lower-cost copies of these complex biotech drugs could save the United States and Europe’s five top markets as much as 98 billion euros ($110 bln) by 2020, a new analysis showed on Tuesday as reported in an article by Reuters Health. Realizing those savings, however, depends on effective doctor education and healthcare providers adopting smart market access strategies, the report by IMS Institute for Healthcare Informatics said.

The potential for copycats to take business from original biotech brands is increasingly grabbing the attention of investors, with many worried about the impact on profits at companies like Roche and AbbVie. It also presents an opportunity for an emerging group of biosimilar specialists, such as South Korea’s Celltrion and large generic drugmakers with biotech know-how, like Novartis’ unit Sandoz.

A saving of 98 billion euros is based on eight major branded biotech drugs, including AbbVie’s Humira and Roche’s Herceptin, that are set to lose patent protection over the next five years. It also assumes an average biosimilar price discount of 40 percent, and savings would fall to 74 billion euros at a 30 percent discount and 49 billion at 20 percent. The IMS forecast covers Germany, France, Italy, Britain, Spain and the United States.

The European regulatory authorities led with a specially adapted approval procedure to authorize subsequent versions of previously approved biologics, termed “similar biological medicinal products”, or biosimilars. This procedure is based on a thorough demonstration of “comparability” of the “similar” product to an existing approved product. In the United States, the Food and Drug Administration (FDA) held that new legislation was required to enable them to approve biosimilars to those biologics originally approved through the PHS Act pathway. The FDA gained the authority to approve biosimilars (including interchangeables that are substitutable with their reference product) as part of the Patient Protection and Affordable Care Act signed by President Obama on March 23, 2010; on March 6, 2015, Zarxio obtained the first approval of FDA.

Interest in biosimilars has grown significantly in the past two years thanks to the arrival of copies of sophisticated antibody drugs that are among the world’s biggest-selling prescription medicines. Europe has lengthy experience with biosimilars, having approved the first such products 10 years ago, but uptake still varies widely from country to country, depending on local market conditions.