Citi On The Impact Of Biosimilars And Losing $360 Billion In Revenues

Citi analyst Andrew Baum released research notes on several pharmaceutical companies Monday. Baum’s overarching theme was about the impact from biosimilars.

Baum believed "that the market materially underestimates the magnitude and the timing of the impact on exposed innovator companies as well as the commercial opportunity for the biosimilar sponsors.”

Citi's analysts estimated that “despite the multiple defensive tactics, innovators will likely lose an aggregate >$360 billion in revenues over the next ten years, with c.$110 billion captured by biosimilar sponsors and the residual helping to alleviate the high and growing cost pressures for both patients and payors associated with introduction of premium-priced speciality drugs, most notably immunotherapy.”

The analyst note indicated that biosimilars would create approximately 50 percent savings for western healthcare budgets by 2015. The need for savings was noted, in particular, for the United States due to its outlier position on healthcare spending.