Evaluating Biosimilar Development Projects: An Analytical Framework Utilizing Net Present Value
Ranjit Ranbhor,1 Priyanka Kulkarni2 1Pergament and Cepeda LLC, Florham Park, NJ, 07932, USA; 2Feliciano School of Business, Montclair State University, Montclair, NJ, 07043, USACorrespondence: Ranjit Ranbhor, Email ranjitranbhor@gmail.comBackground: The increasing prominence of biosimilars in health...
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Dove Medical Press
2025-03-01
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| Series: | Biologics: Targets & Therapy |
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| author | Ranbhor R Kulkarni P |
| author_facet | Ranbhor R Kulkarni P |
| author_sort | Ranbhor R |
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| description | Ranjit Ranbhor,1 Priyanka Kulkarni2 1Pergament and Cepeda LLC, Florham Park, NJ, 07932, USA; 2Feliciano School of Business, Montclair State University, Montclair, NJ, 07043, USACorrespondence: Ranjit Ranbhor, Email ranjitranbhor@gmail.comBackground: The increasing prominence of biosimilars in healthcare delivery has created the need for robust financial evaluation methods to assess development opportunities. Unlike traditional generic drugs, biosimilars require substantial investments ($100-250 million) and longer development timelines (6– 8 years), necessitating sophisticated evaluation approaches.Methods: This study presents a comprehensive Net Present Value (NPV) analysis framework specifically designed for biosimilar development projects. Our framework incorporates key technical, regulatory, and commercial factors through a risk-adjusted NPV methodology, validated through case studies of three monoclonal antibody biosimilar development programs.Results: The analysis reveals that successful projects require minimum peak sales of $250-300 million to achieve a positive NPV, with market share and manufacturing efficiency serving as critical value drivers. Cost analysis shows that clinical development represents the largest share (57%) of total development costs.Conclusion: The framework demonstrates that early market entry, manufacturing optimization, and market share achievement are key success factors, whereas technical complexity and competitive intensity significantly influence risk-adjusted returns.Keywords: biosimilars, net present value analysis, investment evaluation, pharmaceutical development, risk assessment |
| format | Article |
| id | doaj-art-eded45be312e42f093fd6d8234cc29c8 |
| institution | Kabale University |
| issn | 1177-5491 |
| language | English |
| publishDate | 2025-03-01 |
| publisher | Dove Medical Press |
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| series | Biologics: Targets & Therapy |
| spelling | doaj-art-eded45be312e42f093fd6d8234cc29c82025-08-20T03:40:34ZengDove Medical PressBiologics: Targets & Therapy1177-54912025-03-01Volume 19125135101450Evaluating Biosimilar Development Projects: An Analytical Framework Utilizing Net Present ValueRanbhor RKulkarni PRanjit Ranbhor,1 Priyanka Kulkarni2 1Pergament and Cepeda LLC, Florham Park, NJ, 07932, USA; 2Feliciano School of Business, Montclair State University, Montclair, NJ, 07043, USACorrespondence: Ranjit Ranbhor, Email ranjitranbhor@gmail.comBackground: The increasing prominence of biosimilars in healthcare delivery has created the need for robust financial evaluation methods to assess development opportunities. Unlike traditional generic drugs, biosimilars require substantial investments ($100-250 million) and longer development timelines (6– 8 years), necessitating sophisticated evaluation approaches.Methods: This study presents a comprehensive Net Present Value (NPV) analysis framework specifically designed for biosimilar development projects. Our framework incorporates key technical, regulatory, and commercial factors through a risk-adjusted NPV methodology, validated through case studies of three monoclonal antibody biosimilar development programs.Results: The analysis reveals that successful projects require minimum peak sales of $250-300 million to achieve a positive NPV, with market share and manufacturing efficiency serving as critical value drivers. Cost analysis shows that clinical development represents the largest share (57%) of total development costs.Conclusion: The framework demonstrates that early market entry, manufacturing optimization, and market share achievement are key success factors, whereas technical complexity and competitive intensity significantly influence risk-adjusted returns.Keywords: biosimilars, net present value analysis, investment evaluation, pharmaceutical development, risk assessmenthttps://www.dovepress.com/evaluating-biosimilar-development-projects-an-analytical-framework-uti-peer-reviewed-fulltext-article-BTTbiosimilarsnet present value analysisinvestment evaluationpharmaceutical developmentrisk assessment |
| spellingShingle | Ranbhor R Kulkarni P Evaluating Biosimilar Development Projects: An Analytical Framework Utilizing Net Present Value Biologics: Targets & Therapy biosimilars net present value analysis investment evaluation pharmaceutical development risk assessment |
| title | Evaluating Biosimilar Development Projects: An Analytical Framework Utilizing Net Present Value |
| title_full | Evaluating Biosimilar Development Projects: An Analytical Framework Utilizing Net Present Value |
| title_fullStr | Evaluating Biosimilar Development Projects: An Analytical Framework Utilizing Net Present Value |
| title_full_unstemmed | Evaluating Biosimilar Development Projects: An Analytical Framework Utilizing Net Present Value |
| title_short | Evaluating Biosimilar Development Projects: An Analytical Framework Utilizing Net Present Value |
| title_sort | evaluating biosimilar development projects an analytical framework utilizing net present value |
| topic | biosimilars net present value analysis investment evaluation pharmaceutical development risk assessment |
| url | https://www.dovepress.com/evaluating-biosimilar-development-projects-an-analytical-framework-uti-peer-reviewed-fulltext-article-BTT |
| work_keys_str_mv | AT ranbhorr evaluatingbiosimilardevelopmentprojectsananalyticalframeworkutilizingnetpresentvalue AT kulkarnip evaluatingbiosimilardevelopmentprojectsananalyticalframeworkutilizingnetpresentvalue |