The article by Sarfaraz K. Niazi, PhD, critiques the irrationality surrounding biosimilars, suggesting that regulatory changes and cost reductions in manufacturing could make biosimilars as affordable as generic drugs.
The arrival of biosimilars brought a slew of associations, expert opinions, political interventions, marketing discussions, and many more online discussions. Experts were born, scientists came up with complex ideas, statisticians published papers, the US Congress went into action, and the pharmacy benefits managers (PBMs) bumped into receiving the most significant financial break.
As someone who’s been engaged in this space since before the term “biosimilar” was coined, I want to share my opinion about why there is so much irrationality in the introduction of biosimilars, albeit at the risk of challenging the deniers.
Biosimilars could have been just another generic drug with no hoopla. Still, biologic drugs were excluded from generic treatment because of the structural variability even for therapeutic proteins, even though that is not as large as a bacterial vaccine. The Hatch-Waxman Act of 1984, also known as the Drug Price Competition and Patent Term Restoration Act, made it easier and less expensive for manufacturers to enter the generic drug market. The Act established an abbreviated new drug application (ANDA) process that allowed manufacturers to apply for FDA approval before the patent on an existing drug expired.
The first ANDA approved under the Act was for generic disopyramide to treat cardiac arrhythmias. Many large pharmaceutical companies initially opposed the Act, arguing that it would disincentivize innovation and hurt patients. However, recognizing the profitability of generic drugs, many big pharma companies eventually entered the generic market, often through subsidiaries or partnerships.
Despite their involvement, these companies tend to exit once intense competition drives prices down to less profitable levels. This cycle has led to the establishment of large, dedicated generic manufacturers, like Teva Pharmaceuticals and Mylan (now Viatris), dominating the space.
Generics are priced, on average, 80% to 85% lower than their brand-name counterparts. The initial steep decline in price occurs when the first few generics enter the market, and a more significant change comes when more generics become available. This is not happening with biosimilars; there are only 16 molecules available as biosimilars. So, there is nothing different in the history of biosimilars than the history of generic drugs. Many big pharma companies have jumped into the race and maintained their interest because the price has yet to drop 80% more universally. I predict that this will happen as competition rises, which is currently being kept low due to the high cost of development for biosimilars. In my opinion, a rational mind would conclude that it is all in the regulatory guidelines to modulate. Instead, all promoters of biosimilars talk about how much biosimilars would have saved or will save as if this were news. None of them have given attention to the cause of the lack of competition because it required a scientific investigation and contribution that is not their area of expertise.
The FDA, European Medicines Agency (EMA), and the United Kingdom’s Medicines and Healthcare products Regulatory Agency (MHRA), among other significant agencies, have dramatically changed the approval guidelines once the fear of disaster created by big pharma is reduced, saying that only they know how to make these drugs. If the primary, secondary, and tertiary structures of the drugs are the same, which is quickly confirmed, the risks are no different than any other drug administered parenterally. However, the regulatory agencies are not in the business of being rational at the risk of being blamed; a good example is that the FDA and EMA have yet to declare the futility of clinical efficacy testing, which adds about 75% of the development cost. None of the promoters of biosimilars have worked on promoting this thought to the FDA; all I see is a redundant declaration that biosimilars are saving money.
While the MHRA has been more rational, I anticipate both EMA and FDA will agree with MHRA and remove efficacy testing; this direction is evident from the recent FDA move to remove the redundant switching and alternative testing of approved biosimilars to receive an interchangeable status. All agencies have approved the biosimilars with pharmacodynamic markers, but this is not necessary since any biological property is proportional to the plasma concentration profile that is easily compared—no different than the traditional bioequivalence studies. Such studies are not required for generic drugs administered parenterally. Still, in the case of biosimilars, it is necessary to ensure that the subtle structural differences do not affect disposition kinetics.
So, what should be the rational path to making biological drugs more affordable is to reduce biosimilars' cost of goods (COGs). The first element is the media that is commercially supplied at a high premium; we should be able to switch to in-house media using the lowest cost components. Second, switch to continuous manufacturing as the FDA has recently suggested. And third, let the United States Pharmacopoeia create release specification, thus eliminating analytical assessment studies—all of it will reduce the COGs significantly so that biosimilars will likely become available to patients for a cost no different than what they pay today for generic drugs, but only if we better align PBM practices with that goal.
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