The Federal Trade Commission (“FTC”) held a public workshop on February 4, 2014, concerning biosimilars and the impact of recent legislative and regulatory naming proposals. The workshop was part of a regulatory initiative to address issues potentially affecting future competition in the biologics space. During the workshop, the FTC sought comment on several issues, including the impact of state-substitution laws on biologics and naming conventions that may affect substitution and competition.
FTC Chairwoman Edith Ramirez opened with remarks, expressing the FTC’s perspective on competition in biologics. She commented on the increasing growth of the biologics industry, which has accelerated the need for regulatory guidance in this area, and highlighted recent state activity that may affect the biologics market. Though recognizing the differences between small-molecule generics and biosimilar products, Chairwoman Ramirez stated that marketplace competition should still work to lower costs of biologics and increase accessibility to such therapies. The FTC believes that regulatory policies, accompanied by appropriate safeguards to protect patient health and safety, can be used to achieve these goals without chilling competition or deterring investment in biologics and biosimilars.
The workshop proceeded with sixteen fifteen-minute presentations and two one-hour panel discussions. Speakers and panelists included representatives from reference-product sponsors, biosimilar applicants and advocates, pharmacies, academia, and patient-advocacy groups. Overall, many speakers generally agreed that, like small molecule generics, healthy marketplace competition is essential for the future of biologics in the United States, and that the regulatory framework should foster, not impede, entry of biosimilar products into the market. Many groups highlighted the need to draft regulations consistent with patient-safety goals. Summaries of several topics discussed and opinions presented by the groups are provided below.
Representatives from patient-advocacy groups and pharmacies commented on the steady and rapid growth of biologics, reporting that biologic medicines now comprise nearly 50% of the specialty-pharmaceutical market. Increasing costs of these important drugs were of concern to these groups and many expressed the need to limit costs to promote accessibility to these therapeutics. Reflecting on small-molecule generic-drug development through the Hatch-Waxman regime, one professor opined that generics have flourished, are considered safe, and have saved patients one trillion dollars in the last ten years. Moreover, creating a viable generic-drug market has not reduced brand-name innovation. He suggested that regulators look to lessons learned from Hatch-Waxman in developing a framework for biosimilars.
An independent U.S. Food and Drug Administration (“FDA”) consultant provided an overview of biosimilars and interchangeable products, and the current state of FDA approval for biologics. She commented on the high caliber of FDA reviewers in this area and argued that, as a result, the FDA is best qualified to determine interchangeability, safety, and efficacy. She also opined that, historically, the FDA has been risk averse and will likely not approve a biosimilar product unless it is reliably expected to perform clinically similar to its reference product. She argued that biosimilar applicants would need supporting data using modern analytical techniques to assure highly similar clinical performance in addition to rigorous clinical and nonclinical testing. She opined that due to these modern analytical techniques, however, small differences between products are unavoidable, expected, and can be detected. This standard, she argued, will likely yield a “virtually interchangeable” biosimilar product and that such biosimilars will be among the most heavily analyzed and predictable protein products to enter the market.
Following an overview of recent legislation regarding substitution of biosimilars, pharmacy and patient-advocacy groups were generally critical of recent proposals and enacted legislation. More specifically, these groups were critical of laws that require prescriber or patient notification upon substitution and recordkeeping requirements detailing such substitutions for pharmacies and prescribers. They expressed concern that many bills are premature given that the FDA has yet to approve a biosimilar and opined that the laws will cause consumer confusion and undermine public confidence in biosimilars. Additionally, pharmacy representatives rejected notification requirements as unnecessary in light of verification systems currently in place and noted that adding extra verification requirements on physicians will lead to poor biosimilar adoption in the United States. As a result, the pharmacy representatives argued that such laws favor branded biologics and will create a barrier to biosimilar market entry. Patient advocates shared this view and also expressed their continued concern over lengthy exclusivity periods for biologics.
A representative from a reference-product sponsor presented an industry perspective on state legislation with the caveat that the evolving biologics industry now represents a mixture of reference-product sponsors partnered with smaller biologics companies. Reference-product sponsors advocated that the FTC must acknowledge that biologics are not generic drugs, and that each product is unique from a scientific, regulatory, and healthcare-policy standpoint. Reference-product sponsors also argued the need for complete and accurate medical records due to experiences with misattribution of adverse events between products. From the industry’s point of view, state-substitution legislation will ensure accurate recordkeeping—without it, patient records will be rendered ambiguous or inaccurate.
Biosimilar applicants and advocates opposed strict state mandates. One biosimilar-applicant representative opined that many recent efforts have served as commercial marketing campaigns designed to discourage substitution by making interchangeable products look clinically different from reference products. The representative also argued that biosimilar laws should be designed to promote innovation and investment, while addressing patient needs and safety. Costs related to complying with varying state laws were also cited as a disincentive for biosimilar innovation.
Most agreed, however, that state legislation requiring state pharmacy boards to maintain lists of approved biosimilars and interchangeables and their reference biologics was unnecessary. Rather, advocates suggested that there should be a uniform publication of approved biologics and substitutions maintained by the FDA, akin to the Orange Book.
The effect of naming on competition was heavily debated. Industry representatives and reference-product sponsors, mostly concerned with widespread misattribution of adverse events, advocated for unique proprietary and nonproprietary naming for biosimilar products. They argued the importance of drug traceability and accountability, focusing on accurate adverse-event reporting. One sponsor presented a study showing an increased trend in adverse-event reporting where the adverse events were reported for the brand-name product when, in actuality, the patients were using the generic counterpart. In addition to pharmacovigilance benefits, reference-product representatives suggested that distinct names would actually reduce marketplace confusion and increase transparency. One representative even suggested the need for third-level identifiers such as batch or lot numbers. Patient safety was also cited in support of distinct naming.
In contrast, biosimilar applicants and patient-advocacy groups argued that distinct naming would have a negative impact on competition, increasing market confusion and reducing competition. Some suggested that assigning distinct names is intended to create a market perception that biosimilars have different clinical effects from their reference-product counterparts, naturally discouraging biosimilar adoption. Some reference sponsors responded that inherent differences between biologics and biosimilars warrant distinct naming. Some groups, including biosimilar applicants, also advocated against changing International Nonproprietary Names (“INN”) due to unintended consequences affecting reimbursement-payer systems that may not accept substitutions where INNs or names differ. Others strongly rejected prefix distinctions but were somewhat accepting of suffixes, though noting that neither was ideal. One commentator called on the FDA to publish clear guidance on naming conventions for biologics to help reduce consumer confusion.
Pharmacy representatives also believed that assigning distinct names would adversely affect market penetration, citing consumer and prescriber confusion as the main consequence. They argued that the current naming conventions and pharmacovigilance standards should be improved rather than replaced.
The archived webcast is available at http://www.ftc.gov/news-events/audio-video. The FTC indicated that written comments regarding the topic will be accepted until March 1, 2014, and may be submitted to the Federal Trade Commission, Office of the Secretary, Room H-113 (Annex X), 600 Pennsylvania Avenue, NW, Washington, DC 20580. Online comments can be filed at https://ftcpublic.commentworks.com/ftc/biologicsworkshop.
Copyright © Finnegan, Henderson, Farabow, Garrett & Dunner, LLP. This article is for informational purposes, is not intended to constitute legal advice, and may be considered advertising under applicable state laws. This article is only the opinion of the authors and is not attributable to Finnegan, Henderson, Farabow, Garrett & Dunner, LLP, or the firm's clients.
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