Blocking Biosimilars

As the U.S. Food and Drug Administration (FDA) continues to finalize regulations to establish a pathway for approving biopharmaceutical or biosimilar drugs, leading branded drug manufacturers are looking ahead and lobbying state legislatures to enact laws that would limit the substitution of biogenerics for brand-name drugs. Currently, pharmacists in most states can substitute lower-cost generics for branded chemical or small-molecule drugs without such approval.

Bills are under consideration in at least 13 state legislatures that would limit future biogeneric substitution. For example, in January the Virginia House of Delegates passed a measure that would allow pharmacists in that state to substitute “an interchangeable biosimilar” for a brand-name drug only with permission of both the prescribing physician and the patient. The bill would require pharmacists to record the names of both drugs, their manufacturers, and provide retail cost information to patients. An identical bill was pending in the state Senate as this publication went to press.

Similar bills are pending in Arizona, Arkansas, Colorado, Florida, Indiana, Maryland, Massachusetts, North Dakota, Oregon, Pennsylvania, Texas, and Washington, according to the Generic Pharmaceutical Association (GPhA). Amgen and Genentech have been lobbying lawmakers in these and other states to introduce and pass the restrictive legislation, according to the New York Times. Both companies earn billions of dollars annually from their blockbuster biological drugs. Amgen makes the rheumatoid arthritis drug Enbrel, anemia drugs Epogen and Aranesp, and chemotherapy anti-infectives Neupogen and Neulasta. Genentech, which is owned by Roche, makes the best-selling cancer drugs Rituxan, Herceptin, and Avastin.

Amgen and Genentech are also members of the Alliance for Safe Biologic Medicines as is the Biotechnology Industry Organization (BIO) and several professional medical associations and patient advocacy groups. The alliance frames the state initiatives in terms of patient safety. “Creating global standards for biosimilars has to boil down to one thing – patient safety – no matter where in the world the biosimilars are approved,” said alliance chairman Richard Dolinar, MD, during a Center for Business Intelligence biosimilars summit in Washington, DC in March.

The European Union has had a biosimilars approval process in place since 2005. “Opponents of physician notification consistently cite the European Union as an example of good biosimilars policy,” Dolinar said. “Yet automatic substitution by a pharmacist of a biosimilar for a reference biopharmaceutical medicine is not allowed in any European country and is not recommended by the World Health Organization or by medical societies. Countries with the most experience with biosimilars don’t allow automatic substitution due to concerns about patient safety.”

But Ralph G. Neas, GPhA president and chief executive, said that “the push for these new measures has nothing to do with safety and everything to do with Amgen and Genentech, two biotech Goliaths, trying to thwart competition.” Amgen and Roche have noted that most of their products are administered in hospitals and in physician offices and wouldn’t be protected by pharmacy laws.

Biopharmaceuticals are large molecules or complex proteins that are synthetic or recombinant versions of natural biological substances, such as human growth hormone, insulin, erythropoietin, and blood coagulation factors. Unlike their small-molecule chemical counterparts, biological drugs are difficult to produce with consistency, even by the same manufacturer. And because biologics are derived from specific cell lines, manufacturers argue that generic versions cannot be truly identical. This is one reason why the FDA has been taking so long to finalize a regulatory pathway to approve biosimilar drugs.

The stakes are also high. Worldwide sales of biological drugs reached $157 billion in 2011, according to research firm IMS Health and are expected to exceed $200 billion by 2016. As with small-molecule chemical drugs, patents on biological drugs are expiring. Branded biological drugs having between $50 billion and $80 billion in annual sales will lose patent protection by 2015, according to various estimates.

Datamonitor, a market analysis firm, estimates biosimilars could capture $3.7 billion of this market worldwide by 2015, up from just $243 million in 2010.

The Congressional Budget Office has estimated that the availability of biosimilar drugs in the United States would save $25 billion in national health spending over 10 years, including about $7 billion for Medicare and other public health insurance programs. Express Scripts, a pharmacy benefit manager, places the 10-year savings at $70 billion.

Authorization for a biosimilars approval mechanism is contained in the Affordable Care Act, signed into law by President Obama in March 2010. In February 2012, the FDA issued three draft guidance documents and requested public feedback on them. Final regulations have yet to be released. Unlike the generic approval process for small-chemical drugs, which does not generally require new clinical trials, the FDA will require sponsors of a “highly similar” product to submit at least one clinical study comparing immunogenicity to that of the reference or branded product, according to the draft regulations.

After a product has been designated biosimilar, a generics company can request it to also be considered “interchangeable” with the pioneer or reference drug. That designation would give physicians added confidence to switch patients to the biogeneric version and give payers added incentive to reimburse for the cost of the drug. In this case, the FDA will require at least one additional clinical study. The agency will require biosimilar manufacturers to conduct a post-marketing safety monitoring program, which in some cases may include long-term clinical studies.

Clinical trials are generally costly and time-consuming. Combined with the uncertainty surrounding issuance of final FDA regulations, efforts by pioneer drug companies to shore up their patents and limit prescriptions, some companies that had been enthusiastic about biosimilars are becoming less so. For instance, Merck & Co. last year dissolved a dedicated biosimilars unit and decided to not produce a biosimilar competitor to Enbrel after Amgen gained a new patent on the drug.