Proposed Legislation Seeks to Spur Competition, Price Drops, and Patient Access to Biosimilars

June 16, 2017
Kelly Davio

Lawmakers are contemplating a substantial range of reforms to make biologics more affordable for patients.

The Trump administration’s stated goal of repealing and replacing the Affordable Care Act (ACA) left many in the industry wondering what would become of the Biologics Price Competition and Innovation Act (BPCIA); however, the American Health Care Act (AHCA), narrowly passed by the House of Representatives, has not made any provisions that specifically affect biosimilar drugs.

Yet, as Erin Ator Thompson, counsel for Intellectual Property at Vinson & Elkins LLP, discussed at the 8th Annual Summit on Biosimilars, a number of newly proposed bills seek to reform the biologics marketplace. While none of the bills discussed have yet been passed out of committee, lawmakers are contemplating a substantial range of reforms to make biologics more affordable for patients. The proposed bills include the following:

  • Improving Transparency and Accuracy in Medicare Part D Spending Act. Along with its sister bill in the House, this Senate bill seeks to prevent companies from retroactively reducing payments on claims submitted by pharmacies under Medicare Part D (prescription coverage for outpatient medicines for Medicare enrollees). If passed, the act could improve the rate of collection on the full amounts of claims, and could also increase transparency in biologics pricing.

  • Creating and Restoring Equal Access to Equivalent Samples Act (CREATES Act). This legislation, which has bipartisan support, would provide for equal access to equivalent samples for testing, and would facilitate judicial review in lawsuits concerning innovators’ improper withholding of samples from companies seeking to develop biosimilar products.

  • Fair Access for Safe and Timely Generics Act (FAST Generics Act). Like the CREATES Act, the FAST Generics Act would require innovators to provide samples to biosimilar manufacturers upon request. This legislation has a unique component, however, in that it would require innovators to identify a distributor through which requests for samples would be processed. The distributor would be required to keep the identity of the biosimilar manufacturer confidential.

  • Improving Access to Affordable Prescription Drugs Act. This legislation, which does not have bipartisan support, was described by Thompson as “truly aspirational” and supported “mostly by Democrats.” The act would require companies to publish information related to development and manufacturing costs, require pharmacy assistance programs to report on the amount of assistance they provide, allow Medicare to negotiate prices, allow wholesalers to import drugs from outside the United States, cap cost-sharing for some claims, and reduce exclusivity periods for biologics to 7 years, among other provisions.

  • Medical Innovation Prize Fund Act. This act seeks to create a fund to reward innovators, and would stipulate that a percentage of the US gross domestic product would be earmarked for this fund. Such a reward for innovation could help ensure that innovators receive an appropriate return on their investments despite competition from biosimilars after exclusivity periods have expired.

If passed, these acts would impact federal law, yet biosimilar-related reform is also taking place at the state level—a level that, based upon this week’s Supreme Court ruling in the case of Sandoz v Amgen, seems to be increasingly important for biosimilars. Thompson pointed out that 43 states have considered legislation to stipulate when a pharmacy can substitute a biosimilar product for a reference product, and 32 states have enacted such legislation. The laws enacted by these states vary, but they do have common features, including leaving decision-making power in the hands of prescribers, requiring notes concerning substitution in patients’ medical records, and providing legal immunity to prescribers.

Many Summit attendees who commented on Thompson’s talk agreed that these legislative efforts reflect the mood of the public. Legislators, it seems, are finally taking seriously the blockades to patient access, and are making efforts, however aspirational, to rein in the rapidly increasing costs of these biologic treatments.