Mark it down: summer 2014 was when the Era of Biosimilars dawned on American pharma. On July 24, Novartis subsidiary Sandoz became the first company to file for biosimilar approval in the US under the FDA’s new 351(k) pathway. By submitting Zarzio (filgrastim) -- used to help prevent infection and bolster the immune system in patients undergoing chemotherapy -- Sandoz was obligated to provide data showing that its biosimilar therapy could compete with the quality, safety, and efficacy of the original version of the drug, Amgen’s Neupogen (fligrastim).
Then, just last week, the FDA tentatively approved Basaglar -- a biosimilar version of Sanofi’s Lantus (insulin glargine) being co-marketed by Eli Lilly and Boehringer Ingelheim (BI).
Although the approval pathway for biosimilar and interchangeable products is still in flux, 351(k) has provided crucial guidance for the submission process and established basic guidelines for dealing with patent infringement lawsuits. These guidelines further stipulate that the first company to have a biosimilar or interchangeable product approved will enjoy a one-year period of exclusivity.
Now, the pressure is on for U.S. pharma companies looking for a clear pathway to getting their biosimilar products approved. The good news? The FDA itself is eager to get the ball rolling. “Among our highest priorities at the FDA is to implement [biosimilar] regulations as quickly and efficiently as possible,” said FDA Commissioner Margaret Hamburg in February.
High costs are climbing higher
The pressure to move the biosimilar approval process forward is largely driven by pharmaceutical prices. “For the first time, the FDA has accepted a filing for a biosimilar drug, a major step toward access for Americans to safe, effective alternatives to costly brand biologic medicines,” said Ralph Neas, president and CEO of the Generic Pharmaceutical Association (GPhA).
“Biosimilars have been successfully developed, approved, and used in Europe and other markets for years. Filgrastim’s filing acceptance moves us closer to the day when US patients, who currently must rely on costly brand biologics for treatment, will have more choices for the medicine that they need.”
According to figures provided by GPhA, the average cost of a brand-name biologic is 22 times greater than a small-molecule drug, with prices ranging from $10,000 to several hundred thousand dollars per year. And costs have yet to plateau even at these steep levels. Between 2002 and 2007, annual spending growth for biologics was 16%, compared to 3.7% for small-molecule drugs. These larger-than-life costs place a significant burden not only on private insurance companies and consumers, who often shoulder part of the cost, but also public payers such as Medicare and Medicaid.
Despite cost concerns, biologics are therapeutic heavy-hitters, serving as the foundation for treating diseases such as cancer, multiple sclerosis, diabetes, rheumatoid arthritis, psoriasis, and even heart disease and AIDS. GPhA estimates that by 2016, eight of the top 10 drugs on the market will be biologics. The top-selling drug in the world is already a biologic -- Humira (adalimumab), which offers significant relief to patients with a variety of inflammatory conditions, including rheumatoid arthritis, psoriatic arthritis, and Crohn’s disease, and pulled in $10.7 billion 2013 revenues.
In fact, many of the top 20 best-selling drugs in 2013 were biologics. For example, Remicade (infliximab), co-marketed by Johnson & Johnson and Merck, came in at number two and had $8.94 billion in sales in 2013. Like Humira, Remicade has multiple indications for various inflammatory conditions, such as rheumatoid arthritis, ankylosing spondylitis, psoriatic arthritis, and severely active ulcerative colitis in certain children and adults. The third place slot went to Rituxan (rituximab), which generated $8.92 billion in sales in 2013 and is a go-to treatment for non-Hodgkin’s lymphoma, chronic lymphocyte leukemia, and rheumatoid arthritis.
All of which is to say: biologics clearly provide a level of unparalleled utility for treating patients with challenging medical conditions -- and, consequently, there is a strong incentive to develop more affordable versions of these treatments.
Stay tuned for part 2 of this series, in which BioPharma Dive will explore biosimilar development costs, potential savings, and the ongoing challenge to define and enforce standards of interchangeability.