A Unicorn right from the start | Klaus Falk, Samsung Bioepis Head of European Operations, introduced his “start-up company” at the Pharma MBA Friday Talks series

Who wouldn’t dream of working for a start-up company whose seed capital amounts to 1.3 billion US-Dollars? For Klaus Falk this dream came true four years ago when he joined the South Korean company Samsung Bioepis as a Vice President to build its European operations. Prior to that he had gained 30 years of experience in the pharmaceutical industry, both at Merck KGaA and at Boehringer Ingelheim, where he most recently had served as head of the business unit biosimilars. “We consider ourselves a start-up company and in fact we are”, he said on occasion of his presentation at the “Friday talks” of the Master of Pharmaceutical Business Administration course. “We have an amazing start-up mentality but not really an issue of getting financed.” In his well-attended lecture, he introduced the concept and strategic vision of Samsung Bioepis.

Conceived in an internal think tank

 “We do not belong to the Samsung group, because there is no such thing like the Samsung group. There are just many legally independent businesses with the name of the founding family”, Falk clarified. Under the umbrella of this family, however, a common internal think tank operates to strategically explore business areas, in which the family could invest “to become the leading company there within a foreseeable time frame”. In this think tank, around 2010, the decision was made to enter the biopharmaceutical field via biologicals. It was a time when on one hand the global demand for therapeutic monoclonal antibodies (mab) continued to increase substantially, and on the other hand the first of those mabs were soon due to run out of patent so that the first mab biosimilars emerged on the horizon, with the South Korean company Celltrion being one of the frontrunners. Consequently, the Samsung family conceived and founded two companies, namely Samsung Biologics in 2011 and Samsung Bioepis in 2012. The first is a contract manufacturer for biologicals, today capable of offering in its three factories in Incheon the world’s largest production capacity to international customers like Roche, BMS, and many more. Samsung Bioepis’ primary focus is the development and commercialization of mab biosimilars. It is an 85:15 joint venture between Samsung Biologics and Biogen. As of today, four biosimilars of Samsung Bioepis had been approved and were marketed in both Europe and the US and other markets around the globe, Falk said. “How did we achieve this? Through our people, our platforms and our partners!”

Continuous process innovation as a key to success

During his four years with Samsung Bioepis, its staff had more than doubled from 400 to more than 840 people, 53% percent of them with an advanced degree, quite some of them hired from Big Pharma. Most remarkable about it, however, was its average age of 33 years only, said Falk and lauded the “agility and dynamism” of a young company with ambitious goals. “It is extremely exciting and very challenging to work there.” One of the challenges is the commitment to continuous process innovation. Lessons learned, elsewhere often more a buzzword than a reality, were taken very seriously. Each department had to present its learnings at least every three months to all others. They had to state what went right and what went wrong, for what reasons, and what they were doing to further improve processes in the future. “This way of learning from each other changes the mindset of people.”

This mindset also fostered new habits in the development of biosimilars. On its development platform, Falk explained, his company strived to take entrepreneurial risks, e.g. by conducting certain development steps in parallel rather than sequentially, without compromising quality and patient safety. As thoroughly as possible, perhaps even more so than some competitors, Samsung Bioepis ran its biosimilar platform to meet all the rigorous regulatory standards, from characterization via cell line and process development all through scale-up and commercial manufacturing. As the first step for the development of their trastuzumab biosimilar, for example, they had extensively analysed 103 lots of the originator, which they had sourced over more than five years. Or in the next step, they had screened over 15,000 single clones to determine the most optimal one for the recombinant production of their biosimilar.

“We do not trust in CROs alone”

In this context, Klaus Falk reminded his audience of the characteristic feature of biosimilars. Due to their recombinant production in living organisms, they are only similar to their originators, yet naturally can never be fully identical copies of them. This differentiates them from generics. This also made their development a “huge investment of 100 to 300 million US-Dollars, compared to one to four million US-Dollars for a generic”, said Falk. “You can skip phase two clinical trials, which are merely for dose finding, but you have to conduct at least one phase three study”. If an originator product has more than one indication, regulatory authorities demand such a trial in the “most sensitive indication” and normally allow for an extrapolation of its results so that they will approve the biosimilar for all indications of the originator. Only if the latter has two different modes of action, its biosimilar will need to undergo two phase III trials.

To maximize the medical effectiveness and the cost efficiency of clinical trials, Samsung Bioepis has introduced a rigorous quality control management for the more than 300 sites with which it collaborates. A lot of companies relied solely on clinical research organizations (CROs), said Falk. “We also work with CROs, but frankly we do not trust them 100 percent. We send some of our young scientists to our study sites all over the world. They control recruitment procedures, help medical doctors to stick to the study protocol and ensure a timely supply of study medication.” This was all the more necessary, as two third of Bioepis’ clinical trials took place in relatively remote hospitals in Eastern Europe. “Clinics in Western Europe and the US had initially no interest in developing biosimilars, because they wanted to put their research capacities on innovation. Clinics in Eastern Europe, however, were happy to give their patients access to these new biologics, because this access had been lousy.” Bioepis’ ambassador approach obviously works well, as the company not only met or even exceeded the requirements of the regulatory authorities but also recorded much higher recruitment rates than its competitors.

Biosimilars are only the beginning

Important for the success of Samsung Bioepis’ were from the beginning also its partnerships with Merck Inc. and with Biogen, both in manufacturing and in commercialization, said Falk. In March 2016, the company launched its first biosimilar, etanercept, in Europe. At the end of that year, four years after Bioepis’ foundation, sales for this product exceeded 100 million US-Dollar. In the two following years, the company launched its infliximab and adalimumab biosimilar. “We are the first company in Europe and the US to obtain regulatory approval for biosimilars referencing all three first generation anti-TNF medicines.” Additionally, the pipeline looked more than promising. Besides seven late stage products and many earlier candidates, under the lab code “SB 26” it contains an antibody molecule licensed-in from Takeda, which Samsung Bioepis develops as its first original biological.  “Our biosimilar business will continue to serve as the foundation of our company, while collaborations in novel biologics development will set the stage for future growth.” Klaus Falk strongly believes in the success of this strategy: “I am convinced, that we will be among the top ten pharmaceutical companies of the world within the next 15 to 20 years.”