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Merck plans generic biologic drug unit

Bloomberg News / December 10, 2008
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NEW YORK - Merck & Co. will start a new unit to copy biotechnology medicines, becoming the first big US maker of conventional drugs to leap into the $94 billion market for treatments based on living cells.

Merck will invest $1.5 billion in its new BioVentures division by 2015 and a "substantial amount" after that as it begins selling at least six new biologic generic medicines by 2017, said Merck's president of research, Peter Kim, at a meeting with analysts yesterday. The new division will copy products that are based on living proteins and enzymes instead of chemicals.

No other US-based maker of brand-name medicines has jumped into generic biologics, a business not yet possible under US law. President-elect Barack Obama supports making copies of biologic medicines available, and Congress is expected to debate next year how to establish a regulatory pathway to get such products on the market.

Generic drug makers can copy traditional, chemical-based medicines after patents expire, usually without extensive human testing. The Food and Drug Administration likely will require more testing for biologic copies. Merck needs new products as it braces to lose patent protection on $8 billion worth of medicines through 2012.

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