Charles,
While I suspect Collins is full of hot air, no, it is not required for Catholics to believe that all people in the Bible literally existed.
For example, the book of Tobit (featuring Tobias and Tobit) is widely acknowledged as being an extended parable. Some people argue the same for Jonah. Speaking of parables, the characters in Jesus's parables typically did not exist for real (I say "typically" because in one parable, Abraham was mentioned, and he is traditionally understood as a historical person, and Lazarus is mentioned, who some speculate may be the man Jesus raised from the dead).
Traditionally, Daniel is regarded as a historical person. He is even venerated as a saint.
Most of this so-called "scholarship" that undermines the historical existence of Biblical characters is just bogus and outdated. But not heretical (unless you argue Jesus didn't really exist). Nevertheless, if the scholars are right, it doesn't impact the veracity of the Catholic faith as we do not hold as a matter of faith that all these people, in particular in the Old Testament, are historical.
Eric Ewanco
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