GPhA applauds Congress for establishing an abbreviated approval pathway for biosimilars and interchangeable biologics as part of the Affordable Care Act (ACA), which became law March 23, 2010. GPhA and its member companies are working hard with the FDA to assure that the new biosimilar pathway is implemented in a manner that encourages development of safe and less-costly biosimilars.
Biologic medicines are often the only lifesaving treatments for the most severe diseases, but their high price tag can keep them out of reach for many patients. The cost of biologics is increasing at a faster annual pace than any other component in health care.
As proven with chemical prescription drugs, biosimilar competition is expected to be the most important opportunity to hold down the cost of biologic medicines. GPhA is working with the FDA to ensure the approval process is workable and provides for timely availability of FDA-approved, safe, effective and less-costly biosimilar medicines.
- Unlike traditional, chemical-based prescription drugs, biologic medicines are derived from living cells. Biologics typically are administered via an injection, and are used to treat cancers, immunological diseases like rheumatoid arthritis and multiple sclerosis and other debilitating chronic illnesses.
- The Affordable Care Act authorized the FDA to develop regulations for the approval of less-costly biosimilar medicines. While biosimilar products are available in other highly regulated markets, like the EU, Canada, Australia and Japan, the FDA is now charged with, and in the process of, developing the regulations and guidances for biosimilars.
- FDA has stressed the importance of developing an approval process for biosimilars, with Commissioner Hamburg saying in February 2012 that “among our highest priorities at FDA is to implement [biosimilar] regulations as quickly and effectively as possible.” Indeed, capturing the opportunity to make lifesaving biologic medicines available to millions of patients at lower cost is a priority objective for our industry.
- The Congressional Budget Office (CBO) has estimated that the resulting increase in competition from biosimilars will yield substantially lower prices for these medicines.
- By every account, competition from biosimilars in the biologic sector would save patients, insurers and the government billions of dollars each year in treatment costs. Estimates from various economic impact studies pin the projected savings from $42 billion on the low end to as high as $108 billion over the first 10 years of biosimilar market formation. Even stakeholders on the originator side — namely BIO and PhRMA — recognize that biosimilar competition will significantly reduce health care costs.
Through various presentations and testimony at the FDA, GPhA has pushed for the scientific feasibility of a regulatory scheme that ensures patient safety and is not a barrier to competition. It is our position that robust competition is needed to lower costs, increase patient access and spur future innovation.
Among the key issues we are working with the FDA on are:
Biosimilarity: The biosimilar law, under the ACA, requires the FDA to use the same standard of “highly similar” for biosimilars as it does when approving post-approval changes to the reference product.
Naming: The biosimilar law does not require different names for products approved via the abbreviated biosimilar pathway; the regulations must honor this intent of Congress. Otherwise, a finding of interchangeability or biosimilarity will count for very little among healthcare providers. Most importantly, use of different non-proprietary names for biosimilars can compromise patient safety. GPhA supports biosimilar sponsors selecting unique trade names for their products.
Interchangeability: Interchangeability or substitution is the engine that drives generic competition. It is the reason why generic drugs have generated savings of $1.06 trillion over the past decade. The way that FDA deals with interchangeability will be directly responsible for the market dynamics generated by the biosimilar pathway. FDA guidance on the requirements to obtain an interchangeability designation is needed for full realization of the benefits of biosimilars.