HealthLawProf Blog

Editor: Katharine Van Tassel
Concordia University School of Law

Wednesday, August 13, 2008

Biotech Campaigns for Easier Access to Generic Drug Market

The Washington Post reports on a Richmond firm that wants Congress to revamp the FDA approval process.  Kendra Marr writes,

Fda1Geoffrey Allan has been giving Congress a lesson in biotechnology.

He's explained protein structures and how they work. He's reviewed how drugs are absorbed into the body.

If lawmakers understand the difference between chemical and biologic drugs, Allan reasons, they'll be more invested in his cause: getting quick approval for generic biotech drugs. Today the generics market for chemical drugs like aspirin is booming, but there is no way to get cheaper copies of pricey biologics, for complex life-threatening diseases like cancer, into patients' hands.

Allan, who has worked in the drug industry for 28 years, has a lot at stake. As chief executive of Insmed -- a small Richmond biotech whose goal is to be the first U.S. company to develop a portfolio of biotech generics, or "biosimilars" -- his company's success rides on Congress overhauling the laws to permit competition that would result in lower biologic drug prices.

"You have to talk to people and educate people to expand the possibilities in this field," he said.

The difference between chemical and biologic drugs lies in manufacturing. Chemical drugs are small, simple molecules. Because these drugs are made with tightly controlled chemical recipes, a lab test can easily confirm that a generic such as acetaminophen is identical to the original product Tylenol.

Biologics are much larger and more complex. Biotech companies manipulate living cells into mini-factories to produce the desired molecules for drugs. Any divergence in production processes can change the entire function of the product, potentially jeopardizing patient safety. It's impossible to create perfectly identical products -- hence the term biosimilar -- and tricky to compare divergences.

Last month, Insmed demonstrated that its version of Neupogen, which stimulates white blood cell growth, was equivalent in 32 healthy volunteers to the original product from Amgen. But, for Insmed's version, there is no pathway for approval. And some argue the process should be different than for chemical drugs.

"With a biosimilar, that's not enough," said Andrew Fox, Amgen's director of regulatory affairs. "You need to go into larger trials for safety and efficacy. Insmed's limited data appeared to be good data. However, bioequivalence testing in healthy volunteers does not provide the necessary data on how the biologic actually works in the body, which can only be determined through more extensive clinical testing in patients where safety and efficacy are evaluated."

Two decades ago, as prices for chemical drugs skyrocketed, Congress passed the Hatch-Waxman Act, which opened the doors for generic competition after patent expiration. Once a company demonstrates that its generic is chemically identical to a brand-name drug, it can use the approval of the brand-name drug as evidence that its copycat works just as well without additional human trials.

When the Hatch-Waxman Act passed, the biotech industry was young, and lawmakers didn't think to give the Food and Drug Administration an abbreviated review process to swiftly approve biosimilars. Now, escalating health-care expenditures have prompted Congress to consider one. Last year, two bills were introduced into the House and are still pending. Then, in March, representatives drafted yet another.

A recent Congressional Budget Office analysis of a Senate bill, which passed unanimously last year in committee, found that biosimilar competition would reduce expenditures on biologics by about $200 million by 2013 and about $25 billion by 2018. These savings would represent about 0.5 percent of national spending on prescription drugs, at wholesale prices, over the next decade.

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