Biosimilars are a growing share of the U.S. pharmaceuticals market. But while there are at least 240 biosimilars in the development pipeline, just nine have achieved FDA approval and only three have reached the market.
What needs to change for more biosimilars to enter the U.S. market?
A biosimilar is a cheaper copycat version of a biologic, a large-molecule drug made of proteins in living cells. It’s the equivalent of a generic for a small-molecule drug. Biologics are increasingly important in healthcare, now representing $232 billion in revenue globally and 25 percent of the total global pharmaceutical market.
As biologics expand, so will the importance of biosimilars. Billions of dollars are at stake. Nine of the patents for the top 20 biologics are set to expire by 2020, according to a report by market research firm IQVIA.
As biosimilars are made from living proteins in living cells, they are more technically challenging to make than small-molecule drugs, and a biosimilar may not be as exact a copy as a generic drug is. Even so, Europe has been producing biosimilars since Omnitrope’s 2006 approval and has now approved 33 biosimilars to the US’s nine.
The U.S. is about ten years behind the EU, having waited until 2015 to approve its first biosimilar, Zarxio (a biosimilar of Neupogen, used to treat low blood neutrophils). But timing isn’t the only difference. Even now, various hurdles complicate biosimilar uptake in the US. These range from FDA approval to patent law, insurers, and the preferences of physicians and patients. Changes in any of these, some of which are already underway, would smooth the rocky path to release for US biosimilars.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
Regulatory hurdles
The FDA approval process for a new drug is, of course, long and costly. Fortunately for biosimilars, the Affordable Care Act of 2010 outlined for the first time a fast-tracked approval process for biosimilars. Unfortunately, that process is still fairly long, costly, and complicated.
The provision called the Biologics Price Competition and Innovation Act said that a biosimilar could reach approval by showing that it is “highly similar” to its biologic and that there are no “clinically meaningful” differences. Theoretically, this should be faster than doing all the research from scratch needed to show that a new drug is safe and effective.
However, even if the FDA approves the biosimilar, there are even more stringent requirements in order for a pharmacist to substitute a biosimilar when given a prescription for a biologic (as pharmacists can do with generic drugs). For this, biosimilar manufacturers have to prove “interchangeability,” meaning that the drug would produce the exact same result as the biologic in any patient. No biosimilar makers have yet been able to demonstrate. Meanwhile, biosimilar makers in Europe do not have to show interchangeability.
FDA approval for biosimilars also involves a complicated step called the patent dance. Two judicial rulings in the last year have simplified this from the perspective of biosimilar makers: a June 2017 Supreme Court ruling found that makers of biosimilars don’t need to wait an extra six months after FDA approval to launch their drug, and in December 2017 a Federal appeals court ruled that biologic drugmakers can’t use state laws to go after their biosimilar copycats for withholding information.
“I think that the more that the FDA can simplify and facilitate the review of biosimilar products, the greater the opportunities for their market entry,” says Dr. Caleb Alexander, co-director of the Johns Hopkins Center for Drug Safety and Effectiveness.
Patent Problems
Biologic makers also make use of patent litigation, which has tied up six biosimilars approved by the FDA and prevented them from launching.
It’s also more difficult for biosimilar makers to look up their rivals’ drug patents. Unlike small-molecule drugmakers, biologic drugmakers are not required to list their patent applications publicly in the Orange Book. “There are ways of getting around them, but it’s more difficult,” says Dr. Gregory Curfman, a professor at Brigham and Women’s Hospital at Harvard Medical School.
In another move that Dr. Curfman describes as “sort of like a pay for delay tactic,” the biologic maker AbbVie “made a deal with the biosimilar company Amgen for them to stay off the market in the US until 2023 in return for getting access to the patents that they will need to refine their product, and there may be other aspects to the deal that we don’t know about,” Dr. Curfman says. AbbVie’s biologic Humira, a rheumatoid arthritis treatment, is the top-selling prescription drug in the world.
Skeptical Insurers
Insurers so far have not gone all in on biosimilars.
“I think that one reason is that so far the amount of money that is being saved is rather modest. That can change if we develop a robust consumer market, but so far it’s been about a 15 percent savings,” says Dr. Curfman.
That’s small enough that insurance companies can increase their premiums to cover the difference of the slightly more costly biologics, he says. Biologic drugmakers also offer substantial rebates for their products and can threaten to withdraw these if insurers favor biosimilars, a phenomenon called the rebate trap.
Physician and patient preferences
Physicians and patients may also prefer biologics, a view “propagated by brand name companies stigmatizing biosimilars,” says Dr. Curfman. “They try to make the case that they’re unsafe or ineffective, which is not true.” There is some research comparing the effectiveness of biosimilars and their biologics, like Dr. Alexander’s October 2016 review of drugs used to treat rheumatoid arthritis and irritable bowel syndrome, but this research hasn’t been done for all biosimilars.
“I think in the next half decade,” Dr. Curfman says, “these barriers can be overcome gradually, one by one. With a few very successful biosimilars, I think that will sort of break the logjam and begin to open up the market.”
Photo: AdrianHillman, Getty Images
