Abbreviated Biologics Pathway Could Revive Biosimilar Competition

An abbreviated biologics license application (ABLA) pathway modeled on the 1984 Hatch-Waxman Act—one that would grant new biosimilars class-level interchangeability with their reference products immediately upon licensure—is needed to revive a stalled US biosimilar market, according to a recent study published in Therapeutic Innovation & Regulatory Science.¹

The authors frame the proposal against a backdrop of rising biologic spending. Prescription drug expenditures reached $806 billion in 2024, with biologics accounting for 49.6% of that total. Specialty drug spending, driven largely by biologics, grew at an annual rate of 23.5% and now makes up 71% of Medicare Part D spending. Yet competition remains scarce: 81% of biologic products, or 216 drugs, had only a single manufacturer in 2022, and just 12 biosimilars were in development for the 118 biologics expected to lose patent protection over the next decade.

A researcher reviews biosimilar drug pricing data alongside FDA regulatory guidance documents. | Image credit: @TStudious_AdobeStock.jpeg

Hatch-Waxman's Lesson for Biosimilar Competition

The authors trace the model to the small molecule generics market before 1984, when only 2 of 13 top drugs saw generic entry between 1976 and 1982 because manufacturers faced the same clinical trial costs as brand-name developers. Hatch-Waxman tied market entry to bioequivalence rather than new clinical studies, transforming the market: generics now account for 91% of dispensed prescriptions, and the FDA estimated $18.9 billion in savings the following year from 2022 generic approvals alone.

By contrast, the 2009 Biologics Price Competition and Innovation Act required biosimilar developers to prove interchangeability through additional "switching studies" beyond biosimilarity data, driving development costs as high as $300 million over 9 years, the authors noted, citing McKinsey estimates. In the years since, the FDA has approved 81 biosimilars, but only 21 have achieved interchangeability, and uptake has lagged further behind state substitution laws and payer formulary decisions that shape which products reach patients.

"The need for a more competitive biosimilars marketplace is clear," the study authors wrote.

How an Abbreviated Biologics Pathway Would Work

The authors called on Congress to establish an ABLA pathway that grants class-level interchangeability and directs the FDA to create a review office independent of the new drugs program. The pathway would need mechanisms to determine program eligibility, adjudicate any "residual uncertainty" about biosimilarity, and decide what additional evidence, if any, is required to resolve it, while statutorily emphasizing the minimum evidence necessary for bioequivalence.

"The small number of interchangeable products and high entry barriers has doomed the biosimilar market to repeating the early history of generic markets," the study authors wrote.

The proposal follows recent FDA action in the same direction. In an October 29, 2025, announcement, the agency said it would generally no longer recommend switching studies for interchangeability determinations, noting that the requirement has slowed development and created public confusion about biosimilar safety.²

Congress has 2 competing bills pending: the Biosimilar Red Tape Elimination Act, which would grant immediate interchangeability upon licensure for new biosimilars, and the Expedited Access to Biosimilars Act, which would keep pharmacokinetic study requirements but eliminate blanket pharmacodynamic and immunogenicity testing unless warranted.¹

The Limits of an Abbreviated Biosimilar Pathway

The authors acknowledged that an ABLA pathway would not fit every product. As with generics, some biosimilar candidates would likely encounter distinct barriers to a streamlined route, summarized below.

Patent challenges, payment policy, and manufacturing infrastructure would remain obstacles even under an ABLA pathway, the authors wrote, but they maintain that for most biosimilar products, the pathway would attract more entrants and help keep older biologics affordable for patients.

References

1. Miller BJ, Woodcock J. The future of biologics: lessons from Hatch-Waxman. Ther Innov Regul Sci. 2026;60:925-928. doi:10.1007/s43441-026-00961-9

2. US Food and Drug Administration. FDA moves to accelerate biosimilar development and lower drug costs. News release. October 29, 2025. Accessed August 19, 2026. https://www.fda.gov/news-events/press-announcements/fda-moves-accelerate-biosimilar-development-and-lower-drug-costs