trending Market Intelligence /marketintelligence/en/news-insights/trending/eM6HznjNW8UYFpBoARFb7g2 content esgSubNav
In This List

Drugmakers, public weigh in on efforts to boost US biosimilar competition


Japan M&A By the Numbers: Q4 2023


Essential IR Insights Newsletter Fall - 2023

Case Study

A Corporation Clearly Pinpoints Activist Investor Activity


Insight Weekly: Bank mergers of equals return; energy tops S&P 500; green bond sales to rise

Drugmakers, public weigh in on efforts to boost US biosimilar competition

The head of the U.S. Food and Drug Administration is not satisfied with the pace at which the American market for biosimilars — lower-cost versions of biologic medicines — is growing, noting only a dozen of those products have been approved by his agency.

Worse, only four of the 12 biosimilars are currently being marketed in the U.S. because of ongoing patent litigation or settlements that have delayed the cheaper competitor's market entrance, resulting in the loss of potential cost savings for Americans, FDA Commissioner Scott Gottlieb said.

Congress gave the FDA the authority in 2010 under the Biologics Price Competition and Innovation Act to approve biosimilars, whose manufacturers are permitted to rely on the brand-name company's data.

There are twice as many biosimilars on the European market as in the U.S.

Out of concern that U.S. marketplace dynamics were working against biosimilars, the FDA took a deep-dive examination into how it could speed the development of those products to U.S. patients and stop the gaming tactics used by brand-name drugmakers to thwart their competitors, Gottlieb noted.

From that came the FDA's July 18 action plan, a key element of which was to gain insight from manufacturers, researchers, healthcare providers, advocacy groups and the public.

Gottlieb got that input on a myriad of topics during an all-day public hearing on Sept. 4, where regulators heard from nearly three dozen stakeholders, including representatives from AbbVie Inc., Amgen Inc., Boehringer Ingelheim GmbH, Johnson & Johnson, Momenta Pharmaceuticals Inc., Mylan NV, Novartis AG and Pfizer Inc.

Drug industry lobbying groups the Pharmaceutical Research and Manufacturers of America, or PhRMA; the Biotechnology Innovation Organization; and the Association for Accessible Medicine, or AAM, and its Biosimilars Council also weighed in at the hearing, along with several other advocacy organizations.

Chief among the concerns of many who testified over the seven-hour session was the FDA's timeline for finalizing its guidelines governing the substitution of biosimilars for their higher-priced brand-name counterparts.

The FDA issued its much-anticipated draft guidance document in January 2017, where the agency laid out the steps biosimilar manufacturers must take to demonstrate their products meet the additional standards for the so-called interchangeability designation.

Some who testified at the FDA hearing said the guidelines needed tweaking before the agency finalized them, while others said the standards were appropriate as is and urged regulators to quickly sew them up.

Uncertainty slowing biosimilar uptake

Much of what regulators heard were concerns over the uncertain status of the interchangeability guidelines, which they said was creating doubt in the minds of patients and physicians about the use of biosimilars.

That uncertainty could be driving the slower-than-expected uptake of those products, said Wayne Winegarden, a senior fellow in business and economics at the Pacific Research Institute.

Patients and government programs, like Medicare, which covers seniors and the disabled, could be missing out on millions of dollars in savings, he said.

A June study from the Pacific Research Institute found that the annual per patient savings from using the biosimilar version of Johnson & Johnson's rheumatoid arthritis drug Remicade could range between $2,100 and $4,400, Winegarden said.

If biosimilar versions of Remicade grew to become half the market of the brand-name product, the annual cost reductions for employer-sponsored health plans could be as high as 8.4% — or a savings of between $262 million and $315 million, the study found. Medicare costs could be reduced by $150 million annually if the Remicade biosimilars were used.

A recent survey of 300 medical specialists from the Biologics Prescribers Collaborative found that nearly 70% of the responders said they were either "confident" or "extremely confident" that the FDA's current draft guidelines established the appropriate standards to demonstrate a biosimilar's interchangeability.

When asked about confidence level if the FDA relaxed its standards for demonstrating interchangeability, the figure fell to 46% of physicians who would feel "confident" or "extremely confident."

Richard Markus, vice president of biosimilars global development at Amgen, said his company "feels that the FDA guidance on interchangeability outlines appropriate science-based standards and allows the permit degree of regulatory stability."

"We therefore urge the agency to finalize the guidance without significant revision," Markus said. But it also would be beneficial if any updates to the draft guidelines clarify how proposed interchangeable products can address lifecycle management by the reference product, he added.

Other agency help

While approval of biosimilars is the FDA's responsibility, it needs the help of other agencies, like the Centers for Medicare and Medicaid Services, the U.S. Patent & Trademark Office and the Office of the U.S. Trade Representative, to ensure those products are successful on the U.S. market, said Christine Simmon, senior vice president of policy and strategic alliances at the generics lobbying group AAM and director of its Biosimilars Council.

CMS must ensure there is predictable reimbursement in the Medicare program and that formularies — the list of covered drugs — are designed to avoid rebate traps and exclusionary contracting and other barriers to market growth, Simmon said.

The U.S. PTO should also protect biosimilars against "patent thickets" designed to deter the entry of approved biosimilars, she said.

And the USTR should reject a provision in the preliminary U.S.-Mexico trade deal that would grant 10 years of data exclusivity protection to brand-name biologics, Simmon added.

Umbrella exclusivity

Some of the brand-name drug companies, like Amgen, and their lobbying group PhRMA urged the FDA to employ the so-called "umbrella exclusivity" for biologic therapies, which would grant those products a new period of data protection against competitors.

Under that policy, the biologics new or supplement application would receive an abbreviated exclusivity period amounting to the remaining unexpired exclusivity for the first-licensed product, PhRMA's David Korn said.

"Importantly, an umbrella policy would not extend exclusivity for any new product or use beyond the original period," he said.

An umbrella policy is essential to encouraging the research and development investments needed to support the development of continued improvements to biologic therapies, Korn said.

"Umbrella exclusivity preserves incentives for continued development and innovation with the goal to improve patient outcomes," Amgen's Markus added.