Health Policy Check Up News

The Current State of Biosimilars

With the continued policy dialogue of how rising drug costs impact patient access, the theoretical cost savings that biosimilar medications may offer have intrigued many. A recent IMS Institute Report found several interesting points regarding the potential of biosimilars:

• By 2020, biosimilars will start competing with original biologics that currently have sales of $50 billion annually.
• Biosimilar use in the European Union and United States may yield total savings of $56 to $110 billion over the next 5 years.
• Within three years, 8 major biologic medicines are expected to lose exclusivity protection, including treatments for autoimmune disorders and diabetes.
• Health care systems, by opening markets to biosimilar competition, could realize a 30% reduction in price per treatment day compared with originator biologics.1

While biosimilars have the potential to slow the dramatic rise in the overall drug spend, many questions remain about what biosimilars are, how they will get to market, and whether they will be fully integrated into our health care system. This article will examine the basics of biosimilars and shed insight into the latest discussions surrounding this topic.

The first question to ask is what is a biosimilar? A biosimilar is a biological product that is approved based on demonstrating that it is highly similar to an FDA-approved biological product—known as a reference product—and has no clinically meaningful differences in terms of safety and efficacy.

Only minor differences in clinically inactive components are allowable in biosimilar products. The concept of a biosimilar originated under the Biologicals Price Competition and Innovation Act of 2009, and was enacted by the Patient Protection and Affordable Care Act in early 2010. This legislation created an abbreviated licensure pathway for biological products deemed biosimilar or interchangeable with an FDA-licensed biological product.2

There is a common misconception that biosimilars are classified informally as generics, but the FDA said this is not true. “Generic drugs are copies of brand-name drugs, have the same active ingredient, and are the same as those brand name drugs in dosage form, safety, strength, route of administration, quality, performance characteristics and intended use. That means the brand name and the generic are bioequivalent.

Biosimilars are highly similar to the reference product they were compared with, but have no clinically meaningful differences in terms of safety, purity and potency from the reference product,”2 the FDA noted in a biosimilar consumer guidance. Interchangeability is among the hot topics surrounding biosimilars.

An interchangeable biological product must not only be shown to be biosimilar to the reference product, but the sponsor also must demonstrate that the proposed interchangeable product is expected to produce the same clinical result as the reference product in any given patient. Additionally, when a product will be administered more than once to an individual, the sponsor must also demonstrate that the risk (in terms of safety or reduced efficacy) of alternating or switching between use of the proposed interchangeable biological product and the reference product is not greater than the risk of using the reference product without such a switch.2

In an industry guidance for biosimilars, the FDA notes that to have a product evaluated as a biosimilar, manufacturers must submit a 351(k) biologics license application (BLA) that includes data showing biosimilarity based on analytical studies that demonstrate the biological product is “highly similar” to the reference product, besides minor differences in clinically inactive components; animal studies that include a toxicity assessment; and clinical studies that demonstrate the biosimilar is safe and effective in 1 or more of the conditions that the reference product was approved for.3

Recently, the FDA released new guidance on interchangeability, titled “Considerations in Demonstrating Interchangeability With a Reference Product.” The guidance expands on the FDA’s current stated positions governing interchangeability by recommending that sponsors submit data from a switching study, or studies, to the agency in order to deem a biosimilar interchangeable.4

The regulatory arena is not the only forum shaping this debate. While it is too early to tell how the Trump administration and the 115th Congress will handle biosimilars, the 114th Congress was busy laying the groundwork for future discussions surrounding this issue. Legislators have considered ways to speed generics to market, considered alternatives to reduce market exclusivity time for biologics, and passed the 21st Century CURES bill, which seeks to get innovative products to patients faster.

Even the Medicare Payment Advisory Commission continues the debate over how to pay for these products through its discussions on the future of the Average Sales Price metric. State legislatures have also been active over the last 4 years, in which at least 36 states have debated legislation establishing varied standards for substituting a biosimilar product as a replacement for an original biologic.

Notwithstanding the advancements discussed thus far, US biosimilar policy still has a long way to go before it is fully developed. Along with recently released CMS guidance documents on biosimilar reimbursement, the FDA guidance on labeling, and the FDA’s approval of 4 biosimilars within the last 2 years, there are still a number of significant unknowns.

First, will the payer community see biosimilars as a way to lower drug costs, since it is not necessarily a given that biosimilars will be cheaper than the biologic?

Second, will the prescribing community feel comfortable enough to prescribe these new products?

Third, will patients be willing to accept biosimilars? Finally, and most importantly, what role will the US Supreme Court play? On April 26, the court will hear arguments in a case between Amgen and Sandoz where 2 critical questions will be asked:

1. Must there be FDA approval before providing the brand with a 180-day notice of intent to market?
2. Is the patent-sharing process required?

If both questions are answered in favor of Sandoz, we can expect biosimilars to come to market faster than previously expected.

References

1.      IMS Health: Surge in Biosimilars to Drive Significant Change in Health System Costs, Patient Access and Competition by 2020, March 2016.
2.      U.S. Food & Drug Administration information for Consumers (Biosimilars),
3.      Ibid.
4.      Ibid.
5.      U.S. Food & Drug Administration Information for Industry (Biosimilars)
6.      U.S. FDA Guidance titled Considerations in Demonstrating Interchangeability With a Reference Product

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