Measuring the First Mover Advantage in US Biosimilar Markets

Area of Science:

• Pharmacoeconomics
• Market analysis
• Pharmaceutical industry trends

Background:

• The US biosimilar market is growing, with increasing competition among drug developers.
• Understanding market dynamics and the long-term impact of entry timing is crucial for strategic planning.

Purpose of the Study:

• To estimate the median long-run, steady-state market share advantage for first movers in US biosimilar markets.
• To quantify the difference in market share between first movers and later entrants.

Main Methods:

• Utilized IQVIA National Sales Perspective data for monthly unit sales of 6 key biosimilars (bevacizumab, filgrastim, infliximab, pegfilgrastim, rituximab, trastuzumab) from Q3 2015 to Q4 2023.
• Applied modified exponential decay and logistic growth functions to project long-run market share trends for first movers and later entrants, respectively.
• Compared median steady-state market shares to determine the first mover advantage.

Main Results:

• In 4 out of 6 studied US biosimilar markets, first movers are projected to achieve higher long-run market share than all subsequent entrants.
• The projected long-run steady-state market share advantage for first movers ranges from 8.9 to 12.0 percentage points over the second entrant.
• Each percentage point of market share advantage is estimated to represent approximately $5 million in annual sales, considering the scale of biologic markets.

Conclusions:

• A significant long-run market share advantage exists for the first biosimilar entrant in 4 of 6 analyzed US markets, independent of short-term pricing benefits.
• This substantial long-term financial benefit may explain why some biosimilar developers enter the market prior to resolving all patent disputes.
• The findings underscore the strategic value of early market entry in the competitive biosimilar landscape.