Biologic drugs should face the same generic competition as standard pharmaceuticals after seven years, aides of US president Barack Obama have stated.
Be they called bio-similars, bio-generics, follow-on biologics or something else, products derived from biotechnology have been a hot topic in the US recently. Obama has come down somewhere between the extremes currently proposed for these drugs.
Democratic House rep Henry Waxman proposed legislation that would give biotech drugs just five years of exclusivity before other companies could muscle in. Another rep, Republican Anna Eshoo, put forward a proposal offering 12 years.
Now Bloomberg has obtained a letter from Nancy-Ann DeParle, director of the White House Office of Health Reform, and Peter Orszag, director of the Office of Management and Budget, pushing for a “generous compromise” on seven years.
“Lengthy periods of exclusivity will harm patients by diminishing innovation and unnecessarily delaying access to affordable drugs,” they wrote.
Reaction
“We are extremely concerned that the seven years of data exclusivity called for by the administration in the letter points to a risky short cut to biosimilars. We believe this abbreviated period will undermine the incentives necessary for continued biotech research into breakthrough medicines and cures for diseases such as cancer, multiple sclerosis, Alzheimer’s and HIV/AIDS as well as unmet medical needs.”
– Biotechnology Industry Organization President and CEO Jim Greenwood
It seems that the administration based its policy on the Federal Trade Commission (FTC) report released earlier. The report, released June 11 said generic versions of expensive biotechnology drugs would reduce the amount of money spent on healthcare in the United States; however, brand-name manufacturers push for “the 12- to 14-year regulatory exclusivity period is too long to promote innovation,” particularly since brand-name companies “likely will retain substantial market share” after generic competitors are approved. The report also found that competitors would likely enter the market only for drugs that had more than $250 million in annual sales, and only two to three generic entrants would be expected.
For the last decade or so, the industry’s argument that competition would block innovation has prevented Congress from taking any action on generic biologics. It has also kept prices for these drugs—which are usually administered by injection in a doctor’s office—sky-high: $48,000/year for treatment with the breast cancer drug Herceptin; $100,000 for the cancer drug Avastin, and tens of thousands spent on biologic drugs to treat rheumatoid arthritis and anaemia. Meanwhile, the market for biologics has changed significantly; and so has the public’s attitude toward spiralling health care costs.