Fed Expert Describes Improving Regulatory, Policy Structure for Biosimilars

November 19, 2020
Tony Hagen

Tony Hagen is senior managing editor for The Center for Biosimilars®.

Prior to the turmoil of the pandemic, the FDA and CMS were at work on shoring up the biosimilars market, and this work continues on various fronts, a regulatory/policy expert explains.

Two biosimilars were approved by the FDA in mid-2020, well down from the total of 10 approved last year, but this drop-off does not give a true account of the federal government’s commitment to expanding biosimilar options for patients, according to John Brooks, JD, MBA, formerly a senior advisor to HHS and principal deputy director of the Center for Medicare at CMS.

At the Association for Accessible Medicines 2020 GRx+Biosims conference, Brooks, currently a consultant with South Capitol, discussed the federal policy and regulatory infrastructure for biosimilars that has been constructed over the past few years and pending changes that could pick up the pace of biosimilar adoption.

“Regardless of administration, regardless of party, everybody agrees that encouraging biosimilar uptake, encouraging more competition, is the direction we should be headed. That’s for a pretty obvious reason,” he said giving the oft-cited statistic that biologics, costly by nature, now represent 3% of prescriptions written and 40% or more of total drug costs. “Everyone agrees that the biosimilar market is critical to making sure patients are adequately cared for and we get a good return on our health care investment.”

Commitment to Biosimilars Runs Deep

Politicians may be prodded by public sentiment to beef up biosimilar adoption, but the commitment to getting this done extends deep into the professional ranks of the FDA, CMS, and other federal departments, Brooks said. Such consensus led to the FDA’s Biosimilar Action Plan in July 2018, which was supported by President Donald Trump’s drug price reduction “blueprint,” issued in May 2018.

“Encouraging biosimilar competition was one of the primary planks identified as important for reducing costs and improving quality,” he said. “We saw a lot of actions from both the FDA/regulatory side in terms of governing the supply of biosimilars coming into the marketplace, as well as on the CMS side in terms of how we reimburse.”

In May 2019, the FDA finalized guidance for the interchangeable biosimilar pathway. This would take the doctor decision out of whether biosimilars or originator drugs are issued at the pharmacy counter. Interchangeability qualification is a stringent pathway for these agents and that’s because the FDA is very concerned about maintaining safety standards, Brooks said. But there are companies that are moving insulins through the pipeline, which could be the first interchangeable biosimilars, supported by recent FDA “patch” guidance that facilitates the process. This included modification of the requirements for immunogenicity studies leading to biosimilar approval. Interchangeable insulins could become a reality within a 24- or 36-month timeframe, “which would be a tremendous win for a lot of patients as well as for our overall health care system,” he said.

An example of a building block that levels the playing field for biosimilars is the CREATES Act, which was signed into law in December 2019 and targeted anticompetitive practices that make it difficult for biosimilar companies to obtain reference product samples they need for development of biosimilars.

Revisions to guidance on naming biosimilars (March 2019) have relaxed but not eliminated requirements for 4-letter random suffixes on biosimilar names, which critics say differentiate biosimilars from reference products in patients’ minds and make it harder for these drugs to achieve acceptance. “That guidance does not come as far as some stakeholders in the industry would like, but the FDA has also engaged in a pretty comprehensive education campaign to reassure people around the safety of biosimilars,” Brooks said. “As we saw with generics, where it took 5, 10, 15 years to get everybody on board with assurances around the safety of those products, there’ll be a journey here.”

On the payment side, CMS has assigned separate codes for each biosimilar “so that each company entering the biosimilar space can control a little bit more of their destiny in terms of what their [average sales price] is going to look like, what their pricing strategy is going to be,” he said.

A Lower-Cost Tier

Proposed changes to Medicare Part D would lower cost sharing for patients who use drugs on a new specialty tier designed to incentivize manufacturers to compete to get their drugs on this tier by offering lower prices. “It hasn’t been finalized yet; we’re still anxiously keeping our eyes on the Federal Register to see if CMS will finalize that policy—hopefully, sometime this fall—but it is a particularly good step forward, and it’s also an indication of how the agency is looking at this issue. They see biosimilars as a really important tool in terms of improving the cost piece,” Brooks said.

This tier might also encourage more biosimilar developers to enter the market, thereby enhancing competition, he said.

Several further ideas under consideration at CMS also could make a difference, Brooks said. One is the creation of a demonstration model for shared savings from biosimilars, under which providers would be “nudged” to use biosimilars in place of reference products because of the additional revenue they might earn.

He also expressed faith in the potential value of a Star Ratings system of measures that would grade Medicare Advantage plans on their biosimilar uptake and incentivize a greater shift in that direction. “There are a lot of exciting policy ideas out there. This an extremely dynamic marketplace,” Brooks concluded.


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