WASHINGTON (AP) — The
Food and Drug Administration is preparing to review the first
lower-cost versions of biotech drugs, expensive medications which have
never before faced generic competition.
The guidelines issued by
the FDA on Thursday are the final step in a decades-long effort to lower
the price of biotech drugs, high-tech injectable medications that cost
the nation billions of dollars each year.
"These draft documents
are designed to help industry develop biosimilar versions of currently
approved biological products, which can enhance competition and may lead
to better patient access and lower cost to consumers," FDA's drug
division director Dr. Janet Woodcock said in a statement.
Since
their introduction in the 1980s, biotech drugs have never faced generic
competition because the FDA did not have power to approve copies of such
medications. For years the biotech industry successfully argued that
their drugs, often made from living cells, were too complex to be
duplicated by competitors.
That finally changed with the Obama
administration's 2010 health overhaul, which ordered the FDA to create a
system for approving so-called "biosimilar drugs." The industry term
arose because biotech scientists insisted it would be impossible to
produce exact copies of their biologically engineered drugs. They differ
from traditional drugs, which are made by combining various chemicals.
Health
care data firm IMS Health estimates the global market for biosimilars
will range anywhere from $11 billion to $25 billion by 2020, accounting
for 4 to 10 percent of the total market for biotech drugs. The
Congressional Budget Office estimated biosimilars would save the
government $25 billion in reduced health care spending in the coming
decade.
The FDA's draft guidelines, posted online, reflect a final
agreement that was largely shaped by the biotech industry's demands. As
a result, new biotech drugs will enjoy a 12-year period of exclusive,
competition-free marketing before a rival medication can launch.
Additionally, companies seeking to market biosimilars will have to
submit extensive chemical and biological testing data to show that their
products function similarly to the originals. The FDA will also have
the option to require human and animal clinical studies, the most
expensive forms of testing, though staffers said the requirement would
be used only when necessary.
"We do not want companies repeating
studies that do not need to be done — that wastes precious resources,
and of course, exposing humans and animals to unnecessary testing is
unethical" said Dr. Rachel Sherman of FDA's office of medical policy.
Sherman said the FDA has not yet received any applications for
biosimilars drugs, though companies have submitted three dozen requests
for meetings on potential products.
The agency will require human
testing to declare a biosimilar "interchangeable," with the original
drug, a key point of contention between branded drugmakers and their
would-be competitors. Such a designation would allow health care
professionals to switch patients to a generic version, significantly
curbing sales of the original products.
Examples of biotech drugs
include specialty cancer drugs like Roche's Avastin, which costs more
than $100,000 for a year's supply, and the diabetes staple insulin,
which costs closer to $1,000 per year.
Analysts disagree over how
much of a discount biosimilars will provide in the U.S. In Europe, where
biosimilars have been on the market for several years, knock-off
versions of biotech drugs are generally about 20 to 30 percent cheaper
than the original products. Companies marketing biosimilars in Europe
include Novartis division Sandoz International, Hospira Inc. and Teva
Pharmaceutical Industries Ltd. Several U.S.-based brand-name drugmakers
have also announced plans to develop biosimilars, including Merck &
Co. Inc. and Pfizer Inc.
The FDA said it would take comments on its guidelines for 60 days before finalizing them.
Copyright 2012 The Associated Press.