Twenty-five pharmaceutical companies are being asked to adopt common principles regarding biosimilars on patient safety, lobbying and business partnerships.
DETROIT, MI // Aug. 11, 2014: A coalition of 19 institutional investors representing $430 billion in assets commends Amgen and Novartis for support of a set of investor principles to guide corporate boards on policy and oversight responsibilities related to biosimilar activities. The principles, included in the coalition’s Investor Statement on Board Oversight of Biosimilar Issues, call on boards to ensure that information provided to policymakers on patient safety is balanced, investor dollars used for political lobbying is aligned with shareholder interests, and disclosure on significant business partnerships is transparent. Biosimilars are biologic medical products whose active drug substance is derived from a living organism and used to treat serious illnesses including cancer, rheumatoid arthritis, and multiple sclerosis.
In responses to the coalition, the two companies expressly affirmed support for the principles and noted existing policies and practices that also advance the principles. Amgen and Sandoz are the first to recognize the principles as part of an on-going initiative, led by the UAW Retiree Medical Benefits Trust, to engage 25 of the largest pharmaceutical companies on the issue of biosimilars.
The company responses come at an important time when biosmilar market activity appears to be heating up in the U.S. On July 24, 2014, Sandoz, a division of Novartis, became the first company to file for U.S. biosimilar approval under the FDA’s rules for biosimilars included in the Biologics Price Competition and Innovation Act of 2009. Sandoz’s filing seeks approval for a biosimilar of Amgen’s Neupogen, a biologic drug used to fight infection in patients undergoing chemotherapy.
“As long-term investors, we are very pleased that the companies support the investor principles,” said Meredith Miller, Chief Corporate Governance Officer, UAW Retiree Medical Benefits Trust. “Corporate behavior that encourages innovation, transparency, patient safety and access is the financial engine of the healthcare sector.”
“We rely on the board of directors to ensure that these corporate governance best practices inform the range of company activities related to biosimilars,” said William Atwood, Executive Director of the Illinois State Board of Investments. “As financial stewards for our beneficiaries, it is our responsibility to communicate these expectations to our company directors.”
While new to the U.S., biosimilars play an important role in the European healthcare markets where 14 biosimilars have been marketed since 2006 with no patient safety issues, according to the European Medicines Agency.
“The investor principles reinforce the need for balanced and transparent information as biosimilars markets continue to expand globally,” said Manuel Isaza of Hermes Equity Ownership Services.
“We view these best corporate governance practices as guideposts for future company engagements on biosimilars and for setting expectations going forward,” said Lauren Compere, Managing Director, Boston Common Asset Management, LLC.
Members of the investor coalition include:
AFL-CIO Office of Investment
Massachusetts Laborers Benefit Funds
AFT Retirement Plan & Trust
Mercy Investment Services, Inc.
Bon Secours Health Systems, Inc.
Middletown Works Hourly & Salaried Union Retirees Health Care Fund
Boston Common Asset Management
New York Common Retirement Fund
Northwest Coalition for Responsible Investment
CHE Trinity Health
The Nathan Cummings Foundation
Dominican Sisters of Hope
Trillium Asset Management, LLC
Hermes Equity Ownership Services
UAW Retiree Medical Benefits Trust
Illinois State Board of Investment
Ursuline Sisters of Tildonk, U.S. Province
Marco Consulting Group
This release was originally published by UAW Retiree Medical Benefits Trust, which is solely responsible for its content.