No US employer, labour organisation or health plan can continue to offer affordable health care coverage without competition in the biopharmaceutical industry, a US Congressional panel has heard

Spending on biopharmaceuticals averages at least $55 per day compared to just $2 for traditional drugs, Priya Mathur of the California Public Employees’ Retirement System (CalPERS) told a hearing of the House Committee on Government Oversight and Reform. CalPERS is the USA’s third largest purchaser of employee health benefits (after the federal government and General Motors) and, this year and for the first time, it will spend over $1 billion on its 1.2 million members’ prescription drugs, he said.

He welcomed Committee chairman Henry Waxman (Democrat)’s Access to Life-Saving Medicine Act (H 1038), which seeks to create a regulatory pathway for the Food and Drug Administration (FDA) to approve biogenerics. Jonah Houts, senior analyst at pharmacy benefit manager (PBM) Express Scripts, agreed that the bill would make “wonderful therapies more readily available, with improved health outcomes and tremendous savings,” he said.

PBM switch tools “even more effective for biogenerics”

Whether the FDA deems a product interchangeable or just comparable, PBMs will be “quite effective at working with the prescribing physician to aid patients in receiving the most cost-effective and clinically appropriate therapy,” Mr Houts told the panel. “In fact, our switching tools will be even more effective in this market because of the limited number of patients, scripts, specialty physicians and the potential enormous savings. Our plan sponsors will be very motivated to have us pursue each and every savings opportunity,” he added.

Mr Mathur told the panel that, without generic substitution, CalPERS’ costs would be about 60% higher, but Duke University economics professor Henry Grabowski forecast that savings from biogenerics would be around 10%-25%. These products are much more expensive and complicated to develop, making them less attractive for manufacturers, he said, and also warned that HR 1038’s provision allowing a generic challenge from the first day a biopharmaceutical is marketed would discourage innovative R&D.

But Geoffrey Allen, president of small biotechnology company Insmed, told the panel that biogenerics “is a business in which we would like to specialise. It is my belief that there are a number of my colleagues in similar-size companies that are also interested in providing the scientific expertise to meet the challenges of producing biogenerics.” Passing HR 1038 “would be a positive step for the biotech industry and continue to fuel the cycle of innovation,” said Dr Allan.

Ganesh Ventatarman, co-founder of biotechnology company Momenta Pharmaceuticals, agreed. Biologic drugs can be designed to be interchangeable, which is an important public health perspective and “well within reach in the near term for a number of products,” he said.

Learn from Europe, urges industry spokesman

Any regulatory pathway for biogenerics “must take into account the fact that biological medicines are distinctly different from chemical drugs, or we will fail in our responsibility to ensure patient safety and product efficacy,” warned Inger Mollerup, vice president at Denmark-based drugmaker Novo Nordisk. Clinical data is necessary to ensure that a follow-on biologic is safe, as is required in the European Union (EU), and Congress should also consider following the EU path on traceability, he advised.

“Because these products are similar but not the same, all protein drugs should be prescribed and given to the patient based on a unique name. Different names will underscore that the products are, indeed, not ‘the same,’ and will help prescribers and dispensers avoid mistakes,” said Dr Mollerup.

A stepwise progression of scientific advances over a decade or so would be necessary before the FDA would be able to confirm that biogenerics are similar to the originator products, forecast Janet Woodcock, deputy commissioner and chief medical officer at the agency. It might be comparatively easy for it to approve relatively simple follow-on products, such as insulin, but the technology is not yet sufficiently advanced to allow this type of comparison for complex protein products,” she told the panel.

The FDA currently works closely with all product sponsors to assist them through the review process, but also plans to address scientific considerations related to the approval of follow-on protein products through a series of guidance documents, said Dr Woodcock, adding: “we expect this approach will provide useful guidance to industry while ensuring that we do not stifle innovation of the use of state-of-the-art technologies.”

Less cautious were two ex-FDA staffers who are now industry consultants. “I can say, without hesitation, that adequate scientific tools currently exist to assess and deem certain products as interchangeable,” said William Schwieterman. The “opposition” to Rep Waxman’s bill “completely ignores the FDA’s scientific and medical prowess - the same prudent, accomplished and proficient skills used every day by agency officials to approve branded biopharmaceuticals will be used to approve biogenerics,” he said. Added Theresa Gerrard: “the science exists for the creation of a clear, efficient abbreviated pathway for biogenerics to ensure safety and efficacy.”

To assess the impact of changes made by branded manufacturers to their biopharmaceuticals, the FDA currently reviews the data from advanced scientific tools which are deemed the most sensitive technologies to ensure the safety and efficacy of such changed products. Moreover, this well-established approach to testing is used routinely by the brand industry and has significantly reduced the need for clinical studies, she added. By Lynne Taylor