This is Part I in a series exploring the history, challenges, and opportunities in the regulation of biosimilars, or biologic medical products that are very similar to already-approved biological medicines. This Part briefly covers the history of American regulation of biologics and touches briefly on the European experience.
The Biologics Price Competition and Innovation Act (BPCIA), part of the 2010 Affordable Care Act, sought to drive down prices for biologics, much as the 1984 Hatch-Waxman Act did for small-molecule drugs. By allowing manufacturers of follow-on products to rely in part on the clinical data of the brand-name reference product, both laws were designed to lower development costs and attract competitors.
Since the BPCIA’s enactment, however, scholars have compared it unfavorably to the Hatch-Waxman Act, criticized its pathway as “obstructed” and lacking in sufficient incentives, lamented the scarce approvals it has produced, and recommended that it be “abandoned.” Although criticisms of the law are not without basis, their collective implication—that the BPCIA is irredeemably defective and will never yield robust competition—may be wrong.
Several factors unrelated to the BPCIA distinguish the small-molecule market in 1984 from the biologics market in 2010 and provide an alternate explanation for the small number of biosimilar approvals to date. These differences relate to industry familiarity with each follow-on pathway, number of available reference products, patient population sizes, number of patents, and drug costs. Unfavorable comparisons of the number or usage of biosimilars in the US versus Europe can best be explained not by differing legal regimes, but by differences in the date of enactment of each law.
Industry Familiarity with Abbreviated Applications
The 1962 Kefauver-Harris Amendments established the modern drug approval framework, including the requirement that manufacturers submit evidence from adequate and well-controlled investigations. Although generic versions of post-1962 drugs were not exempt, the Food and Drug Administration (FDA) promulgated regulations in 1970 (35 Fed. Reg. 6574) establishing an abbreviated new drug application (ANDA) pathway that could be used to copy pre-1962 drugs; approximately 1,840 ANDAs were approved over the next 14 years (Exhibit 1). By the time the 1984 Hatch-Waxman Act expanded the ANDA pathway to post-1962 drugs, a robust generic drug industry had already gained more than a decade of relevant experience.
Exhibit 1: EU and US Biosimilar Approvals, and US ANDA Approvals, 1970-2019
*Sources: FDA (ANDAs, Biosimilars), European Medicines Agency. US data exclude follow-on biologic products approved under Sections 505(b)(1) and 505(b)(2).
By contrast, although a handful of follow-on biologics were approved prior to 2010 under the Hatch-Waxman Act’s 505(b)(2) New Drug Application (NDA) pathway, the new BPCIA pathway was distinct from it. The 505(b)(2) pathway, for example, was primarily used for small-molecule drugs and permitted differences in characteristics such as strength, dosage form, or route of administration, whereas these differences were not permitted under the BPCIA’s biosimilar framework, which applied only to biologics. Biosimilar approvals were also judged under a different statutory standard than 505(b)(2) approvals, meaning that manufacturers could not be certain that evidence sufficient to meet the standard under one pathway would necessarily be sufficient under the other. The 505(b)(2) pathway continued to exist after 2010 alongside the new BPCIA pathway, and although existing 505(b)(2) NDAs for biologics will be “deemed” to be Biologics License Applications as of March 23, 2020, these biologics will be treated as potential reference products and not biosimilars.
More EU Biosimilars
In 2003, European authorities created an approval procedure for “similar biological medicinal products,” and the EU’s first biosimilar, somatropin (Omnitrope), was approved in 2006 (somatropin was approved in the US in 2006 under the 505(b)(2) pathway). US biosimilar legislation was not enacted until 2010. The FDA then issued draft guidance explaining the new clinical data requirements in 2012, and the first US biosimilar, filgrastim-sndz (Zarxio), was approved in 2015. Although US biosimilar approvals therefore began approximately 9 years later than in the EU, during the first five years of each agency’s approvals, US regulators approved 26 biosimilar products compared to the EU’s 14 (Exhibit 1). Approvals in the US thus occurred later—not more slowly—than in Europe.
Author’s note 1: This post provides updated data on biosimilar approvals through December 2019. An original version of this article was published under the title “Biosimilar Approvals And The BPCIA: Too Soon to Give Up,” available at https://www.healthaffairs.org/do/10.1377/hblog20190718.722161/full/.
Author’s note 2: The author receives grant support from Arnold Ventures and the Harvard-MIT Center for Regulatory Science. The funders had no role in the design and conduct of the study; collection, management, analysis, and interpretation of the data; preparation, review, or approval of the manuscript; and decision to submit the manuscript for publication. The author gratefully acknowledges Peter Bach, Yaniv Heled, and Aaron Kesselheim for feedback on the completed draft.
