Legislation on biosimilars is pending, but thorny issues remain
Time is running out this year for Congress to pass landmark legislation that would, for the first time, create a regulatory pathway by which the Food and Drug Administration (FDA) could approve the marketing of follow-on biologics or biosimilar drugs once patents have expired on pioneer biopharmaceuticals.
The financial implications of this legislation are huge. Biopharmaceuticals-large molecules or complex proteins that are synthetic or recombinant versions of natural biological substances, such as human growth hormone (HGH), insulin, erythropoietin (EPO), and blood coagulation factors-had global sales of nearly $65 billion in 2006. That figure represents 10% to 15% of the world'S pharmaceutical market. More than 150 biopharmaceutical products are currently marketed, and over 400 more are in various stages of testing and clinical trials.
Biologics generated around $40 billion in sales in the United States in 2006. With an annual growth rate of 15% to 20%, U.S. sales are expected to exceed $50 billion by 2010, according to the Congressional Budget Office. Individual biopharmaceutical treatments can be staggeringly expensive: Interferon beta costs $10,000 to $14,000, while the cost of Herceptin (trastuzumab, Genentech, Inc.) and other cancer treatments can exceed $30,000 annually.
But while patents on dozens of biologics with annual sales ranging between $10 billion and $15 billion have either expired or will do so over the next several years, no biosimilar has been approved in the United States. This is because biological drugs, unlike their small-molecule chemical counterparts, 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.
While various bills have been introduced in Congress over the past few years to create a biosimilars pathway, three measures-two in the House and one in the Senate-appear to have garnered the most bipartisan support.
Unfortunately, not much time remains during this abbreviated, election-year session of Congress. "This is the second half of the second year of Congress, so everything becomes more difficult," says Jim Greenwood, president and chief executive of the Biotechnology Industry Organization (BIO), the branded industry trade association. "There are less than even odds that Congress will enact this legislation," he tells Pharmaceutical Formulation and Quality.
Even if the legislation is not acted on this year due to time constraints, abiding interest among lawmakers, biotech companies, and generic manufacturers makes it likely that new bills will be introduced in Congress next year. And with the White House up for grabs, some Democrats believe the odds of enacting a more favorable version might improve next year.
A PATHWAY
In March, Reps. Anna Eshoo (D-Calif.) and Joe Barton (R-Texas), key members of the House Committee on Energy and Commerce, introduced the Pathway for Biosimilars Act (H.R. 5629), which would create a framework for approving biosimilars. In some ways, the bill is comparable to the Hatch-Waxman Act, the 1984 law that created the generic drug industry by allowing manufacturers to demonstrate bioequivalence to chemical drugs without supplying additional-and expensive-safety and efficacy data.
We need to come to terms on this. The differences that separate us are more rhetorical than substantive. No one will achieve any savings until we get a bill on the president'S desk.
-Jim Greenwood, president and CEO, Biotechnology Industry Organization
H.R. 5629 would give pioneer or innovator companies a base of 12 years-in some cases, up to 14.5 years-of data exclusivity before generics manufacturers would be allowed to compete. Because of this, the House measure "is a pathway to the wrong destination for patients in need of safe and affordable biogenerics," says Kathleen Jaeger, president and CEO of the Generic Pharmaceutical Association (GPhA).
When a Similar is Not Similar
Biochemical differences warrant substantial clinical studies to demonstrate the absence of clinically meaningful differences.
-Inger Mollerup, MSc, Novo Nordisk
When it comes to biosimilars, the European Medicines Agency (EMEA), unlike the Food and Drug Administration (FDA), has guidelines in place for approving biosimilars that are based on a 2003 European Commission legal framework creating "similar biological medicinal products."
In April 2006, the EMEA approved its first two biosimilars, both based on the human growth hormone somatropin: Sandoz'S Omnitrope, (reference product: Pfizer'S Genotropin), and Biopartners' Valtropin (reference product: Eli Lilly'S Humatrope). Later that year, EMEA approved five biosimilars of epoetin alfa and epoetin zeta (reference product: Janssen-Cilag'S Eprex).
In 2006, Sandoz won marketing approval for Omnitrope in the United States, with the FDA calling the drug a "follow-on protein product," sufficiently similar to an already approved product, rather than a "generic biologic."
Even the product'S manufacturing location can play a role in approvals. In April, further illustrating the FDA'S caution about entering this arena, the agency rejected a request from Genzyme to sell its own drug, Myozyme (alglucosidase alfa), used to treat the orphan disease Pompe. The reason? It was manufactured at Genzyme'S 2,000-liter scale bioreactor facility in Allston, Mass., rather than at its 160-liter scale bioreactor facility in Framingham, Mass.
The FDA determined that molecules produced in the two batches had different carbohydrate structures and were thus distinct products. The Allston factory version, the FDA said, would require Genzyme to submit a separate biologics license application with new clinical data demonstrating safety and efficacy. The company expects to submit information for priority review by the end of the year.
"Biochemical differences warrant substantial clinical studies to demonstrate the absence of clinically meaningful differences," said Inger Mollerup, MSc, vice president for regulatory affairs at Novo Nordisk A/S, at the BIO International Convention in June. "There are no definitive technologies currently available to predict how the human immune system will respond to a product. Immunogenicity can only be determined in human studies."
Granting an additional 14.5 years of exclusivity "beyond the years companies already have under their existing patents" would be "unwarranted, unprecedented," and "unjustifiable," Jaeger adds. The GPhA and many consumer groups support legislation that would streamline the FDA approval process without providing the protections and incentives pioneer biotech companies seek.
Among these is data exclusivity, essential because biosimilars-unlike generic drugs-are not necessarily identical to the reference product and are less likely to infringe on the patents of the innovator, Eshoo and others say.
The House bill requires a biosimilar applicant to conduct analytical studies demonstrating that the product is "highly similar" to the reference product, including animal studies and at least one clinical study assessing immunogenicity and pharmacokinetics or pharmacodynamics.
In June 2007, the Senate Committee on Health, Education, Labor and Pensions voted favorably on the Biologics Price Competition and Innovation Act of 2007 (S. 1695), sponsored by such heavyweights as Sens. Edward Kennedy (D-Mass.), Hillary Rodham Clinton (D-N.Y.), and Orrin Hatch (R-Utah).
COMPETING BILLS
Both the House and Senate measures give the FDA the discretion to waive clinical studies. But the House bill, unlike the Senate version, requires that the FDA first issue guidance on data requirements for immunogenicity. Both versions require the FDA to determine interchangeability based on whether a biosimilar can be expected to show the "same clinical result" in "any given patient" as the innovator product and to demonstrate that switching does not increase risk.
Both bills give the first biosimilar to win FDA approval its own period of market exclusivity (one year in the Senate version and two years in the House version), during which time the FDA would not approve another biosimilar using the innovator product as its reference. While both versions give innovator companies a data exclusivity base of 12 years, the House version adds two more years for a "medically significant new indication" and six additional months in exchange for pediatric studies, for a possible 14.5 years. "New indications are critical for biologics and are often more significant than the indications for which approval was granted," Eshoo said in introducing the House bill in March.
In addition, while the Senate bill allows pharmacists to substitute a biosimilar for the original brand-name product without obtaining the prescribing physician'S approval, the House version does not.
A third House bill, the Patient Protection and Innovative Biologic Medicines Act of 2007 (H.R. 1956), was introduced in April 2007. While it shares many provisions with the other two bills, H.R. 1956 grants pioneer biotech companies up to 15 years of exclusivity.
Many observers feel these differences can be ironed out. "In conjunction with the bipartisan Senate legislation, the Pathway for Biosimilars Act signals an emerging consensus on key issues," wrote Donald R. Ware and Kalah Auchincloss, pharmaceutical and intellectual property attorneys with Foley Hoag LLP in Boston, in a policy paper. "The result may be an increased likelihood of enactment of comprehensive and balanced legislation creating an abbreviated approval pathway for biosimilars with enhanced incentives for biomedical innovation."
But even if a biosimilars bill were signed into law this year, immediate results are unlikely. The FDA would be required to issue guidance documents and hold public hearings as part of the rule-making process. In the past, the agency has been notably slow in this area. For instance, after holding public workshops in 2004 and 2005, the FDA announced that it would issue a white paper on biosimilars, to be followed by guidance documents on policy, technical characterization, and immunogenicity. The agency issued the white paper two years later.
Data exclusivity is simply the protection of the innovator'S investment in bringing a new molecule to market in order to provide the incentives to innovator companies.
-Stephen G. Juelsgaard, DVM, JD, executive vice president, Genentech
Savings from a biosimilars bill are also unlikely to come quickly. The Congressional Budget Office estimates that S. 1695 would reduce total spending on biologics in the United States by about $25 billion from 2009-2018, equal to only about 0.5% of wholesale prescription drug costs. The Federal government'S share-through Medicaid and Medicare-would total $6.6 billion by 2018.
PATENT ISSUES KEY
Under Hatch-Waxman, the 1984 law that permits the marketing of generic small-molecule chemical drugs after innovator patents expire, generic manufacturers need only reference the original testing data submitted to the FDA, because the generic drug is virtually identical to the original.
Biologics, on the other hand, are difficult-sometimes impossible-to characterize. Manufacturing processes are unique to each and are not generally disclosed as part of the published patent. Because a biosimilar must only be "comparable" or "similar" to the innovator molecule, its composition may differ from that of the innovator molecule and may not be covered by the innovator'S composition patent. Thus, some say, arises the need for data exclusivity.
"Data exclusivity is designed to prevent free riders by not allowing others to use the innovator'S data free of charge for a period of time," said Stephen G. Juelsgaard, DVM, JD, executive vice president at Genentech, in a presentation at the BIO International Convention in June. "Any company is free to create its own data to develop the same or a similar molecule to an innovator molecule. Data exclusivity is simply the protection of the innovator'S investment in bringing a new molecule to market in order to provide the incentives to innovator companies."
It is largely because of the issue of data exclusivity that members of the generic drug industry, along with many consumer groups and large employers, don't support either S. 1695 or its companion House bills. Instead, they favor bills introduced in February 2007 that would give the FDA streamlined authority to grant biosimilars approvals.
The Access to Life-Saving Medicine Act (H.R. 1038, S. 623), introduced by Rep. Henry Waxman (D-Calif.) and Sen. Charles Schumer (D-N.Y.), authorizes the FDA to approve abbreviated applications for biological products that are deemed comparable to brand-name versions with expired patents.
The bill establishes two classes of follow-on biological products-"comparable" and "interchangeable." A comparable product must demonstrate no "clinically meaningful differences" from the pioneer biotech drug with respect to safety, purity, and potency. It must also contain highly similar "principal molecular structural features" along with the same mechanisms of action, if known.
An interchangeable product must be comparable to the pioneer drug and is also expected to produce the same clinical results in any given patient. Because establishing interchangeability is more difficult, the first manufacturer who does so receives 180 days of marketing exclusivity, an incentive similar to the one available for pharmaceutical manufacturers under Hatch-Waxman.
In this version, the FDA is given the authority to determine on a case-by-case basis what, if any, clinical or other tests are needed. "Under the legislation, FDA would let sound science drive the approval process for biogenerics, just as it does today for biopharmaceuticals," said GPhA'S Jaeger.
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