FDA ups the ante for copycats, antibiotics, orphan drugs. But is it working?
Deep inside last year's renewal of the Food and Drug Administration's user fee programs was a new type of drug designation, called Competitive Generic Therapy. To claim the title, a drug must enter a market where generic competition is lacking.
The prize: A 180-day marketing exclusivity period.
It didn't take long for manufacturers to reach for that incentive, as earlier this month the FDA cleared several strengths of potassium chloride oral solution through the CGT pathway — much to the delight of Commissioner Scott Gottlieb.
"The quick implementation of this new pathway is part of our broader effort to foster generic competition and help address the high cost of drugs," he wrote in an Aug. 8 statement.
It's the latest in a stream of incentive programs the FDA uses to spur development of needed drugs. Outside of generics, the FDA has encouraged over the last decade greater investment in antibiotics through legislation like the Generating Antibiotic Incentives Now, or GAIN, Act and additional drug designations that offer expedited reviews and years of market exclusivity.
The same time period has also seen an immense influx of rare disease treatments due in large part to the perks offered by the Orphan Drug Act. More recently, the FDA spent about two months clearing a backlog of roughly 200 orphan drug designation requests.
While the push to incentivize drug development in those areas started before Gottlieb, his contributions have so far registered positively with at least some lawmakers and industry executives.
Yet there are arguments against the current programs as well. Some are calling for better-tailored incentives that focus more on the commercialization and manufacturing of new products rather than the R&D behind them. There are also concerns that, at least within orphan drugs, incentives aren't as necessary as they once were — and that bad actors are taking advantage of the system to benefit bottom lines more than patient health.
Spurring competition to bring down prices
Fueled by outcries in Washington and around the country about sky-high drug prices, Gottlieb has made it a point since he took over the FDA to get more biosimilars and generics on the market.
On the biosimilars front, seven have gained approval since Gottlieb was sworn in last May — though, to be sure, regulators started reviewing most before then.
Although more copycat biologics are getting a thumbs up, many have yet to come to market because of sticky legal webs spun by reference product manufacturers. AbbVie, for instance, maintains a fortress of patent protection around its mega-blockbuster Humira (adalimumab) and has successfully entered licensing deals to ward off at least three copycat versions of the drug, which now aren't expected in the U.S. until 2023.
Gottlieb has criticized such "pay-for-delay" deals as well as the current payment system that, according to him, often rewards members of the value chain for keeping biosimilars at bay.
Addressing the issue hasn't been easy, though. The FDA issued draft guidance last September providing recommendations for how drugmakers should evaluate the similarity between biosimilars and reference products — one of the major regulatory barriers for copycat biologics. But the guidance was pulled back in June after a medley of big pharmas and medicines organizations said it would negatively affect the efficacy and cost at which such drugs are created.
More biosimilar guidance documents are expected. Whether or not they break down marketing and manufacturing obstacles remains to be seen.
Generics makers are facing their own set of problems, including pricing pressure and thin margins.
The FDA is trying to step in and ease the burden, particularly for complex generics or those targeting a market where little competition exists. In June, Gottlieb said the agency would soon launch a new platform to "modernize" the process for evaluating generic drugs and cut down the number of review cycles an application goes through.
In an aptly timed example of those initiatives' end goal, the FDA earlier this month touted the first approval of a generic version of Mylan's epinephrine auto-injector, EpiPen. Under Mylan's ownership, the price of the drug-device combination rose more than 600% from 2007 to 2016, a hike that caused intense blowback from the public, Congress and even industry trade group PhRMA, which called on the FDA to reform the combo product review process.
"These products can be hard to copy, and therefore sometimes don't face timely generic competition once patents and exclusivities are no longer a block to approval," Gottlieb said in a statement about the EpiPen generic approval. "We're advancing new guidance for sponsors to make the development of generic versions of complex products more efficient, and we're prioritizing review of many complex generic drug applications."
New antibiotics as resistance mounts
In mid-June, the FDA said it would try to further encourage antibiotic drug development by, among other things, implementing a new infectious disease designation that offers regulatory and marketing incentives, and by working with government agencies like Centers for Medicare and Medicaid Services to change the reimbursement model for such drugs.
About a month later, Novartis announced it would be exiting antibacterial and antiviral research.
Therein lies the trouble with antibiotics: even the few players who remain in the space haven't been attracted to the perks promised by regulators.
"More recently you've seen several larger companies kind of dropping out of the antimicrobial space just because there is not a return," Monika Schneider, a research associate at Duke University's Margolis Center for Health Policy, told BioPharma Dive.
Merck & Co. is one big player still in the fight. The New Jersey-based pharma plans to submit for approval its investigational beta-lactamase inhibitor relebactam on the heels of a positive Phase 3 readout in April. Still, securing substantial returns on these products hasn't been easy.
"The federal government has done a pretty good job on the push incentive side, meaning things that will help get products into development," Nicole Mahoney, director of global regulatory policy at Merck, said in an interview.
On the pull side, the GAIN Act extends Fast Track and Priority Review designations to certain antibiotics. It also puts extra exclusivity on the table, "but that incentive is more modest, frankly, and we would definitely like to see more incentives on the commercial side," Mahoney said.
Commercialization is also on the minds of smaller antibiotics developers, which can still stumble even after winning a sought-after approval.
"Almost everyone else has a single product they need to commercialize with all the redundant expense," Ted Schroeder, the newly minted CEO of Nabriva Therapeutics, a clinical-stage pharma that expects to file two New Drug Applications by year's end, told BioPharma Dive.
"And it's not like these things are dramatically expensive to build sales forces around, but when the sales are limited because of reimbursement issues from CMS, it's a really tough problem to get over and we won't get big companies interested in it until they can see ... there's a marginal return here."
A boon for rare disease drugs, and controversy
Unlike complex generics and antibiotics, incentives have translated into vastly more marketed products in rare disease.
In the decade before the Orphan Drug Act became law in 1983, 10 treatments for rare diseases moved onto the market. From 1983 to January 2017, however, more than 600 would do the same.
The act has, in many ways, been as much a positive for drugmakers as patients. It awards a plethora of benefits for therapies that earn the Orphan Drug Designation and gain FDA approval, including a tax credit that used to be equal to 50% of the clinical trial costs associated with the drug and seven years of marketing exclusivity.
Yet some have criticized these incentives for being almost too good.
A 2016 commentary published in the American Journal of Clinical Oncology pointed out that many rare disease drugs go on to accumulate approvals for more common indications. The problem there is that pharmas can, and have, gamed the system to first secure an orphan drug approval along with all its tax, regulatory and commercial benefits, then set a high price for the drug before expanding the market of patients for which it can be prescribed.
The commentary noted this double dipping is especially prolific in cancer therapies. Rituxan (rituximab), Perjeta (pertuzumab) and Herceptin (trastuzumab), for instance, each carry orphan and non-orphan indications — and have garnered billions of dollars for their manufacturer.
"These examples demonstrate the landscape that seems to have made orphan drugs no longer significant drugs of limited commercial value, but rather lucrative and popular through means not intended by the original ODA, distorting the act's initial purpose," wrote the commentary's authors.
Perhaps to that point, Congress last year passed a revised tax code wherein the tax credits offered through the ODA were decreased down to 25%. Gottlieb too has taken aim at potential abuse of the incentives, writing in a blog post about a year ago that "[f]or all the success of the ODA, there's been criticism that some sponsors are using designations as a way to sidestep other important public health goals set out by Congress."
Gottlieb added the agency will issue guidance on proper use of the ODA. In the meantime, regulators are keeping an eye on how to optimize incentives from that legislation as well as other initiatives like the increasingly attenuated Priority Review Voucher program.
"We have seen and listened to input about: Are we doing this in the right way? Are companies addressing this in the right way? And we are very interested, always, in input," Debra Lewis, deputy director at the FDA's Office of Orphan Products Development, said of orphan drug incentives in an interview with BioPharma Dive.
"It's always tough," she added, "so just as you saw with the tax credits, there could be modifications." But, there is value in providing patients and prescribers with more treatment options or disease information — which initiatives like the ODA have done, even if at times through a drug that also has a more commonplace indication, according to Lewis.
- BioPharma Dive GAIN Act gives Zavante a shot at new antibiotic development
- BioPharma Dive Gottlieb lays out FDA plans to speed generic reviews, spur label updates
- BioPharma Dive How the Orphan Drug Act changed the development landscape
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