Follow-on Biologics News Briefs - No. 10

    By Donald Zuhn --

Affordable Health Care for America Act Placed on Senate Legislative Calendar

The Affordable Health Care for America Act (H.R. 3962), which was passed by the House of Representatives on November 7th by a narrow five-vote margin (220-215), has now been placed on the Senate Legislative Calendar.  The 1,990-page bill includes a section (§ 2575) providing for the establishment of a licensure pathway for biosimilar biological products, which precludes a biosimilar application from being approved "until the date that is 12 years after the date on which the reference product was first licensed," and offers an additional 6 months of exclusivity for the use of reference products "in the pediatric population" (see "House Health Care Bill Includes Biosimilar Licensure Pathway").

Health Care Bill Introduced in the Senate

On November 18th, two days after H.R. 3962 was placed on the Senate Legislative Calendar, Senate Majority Leader Harry Reid (D-NV) unveiled the Senate's own health care bill, the Patient Protection and Affordable Care Act (H.R. 3590).  At first glance, the bill appears to be unrelated to health care, stating instead that it "amend[s] the Internal Revenue Code of 1986 to modify the first-time homebuyers credit in the case of members of the Armed Forces and certain other Federal employees, and for other purposes."  However, a check of THOMAS indicates that the H.R. 3590 "is the vehicle for the version of health care reform that will be debated in the Senate."  Like H.R. 3962, the 2,074-page Senate bill contains a section (§ 7002) providing for an approval pathway for biosimilar biological products.  Also like H.R. 3962, the Senate bill precludes a biosimilar application from being approved "until the date that is 12 years after the date on which the reference product was first licensed."  In addition, the Senate bill, like H.R. 3962, offers an additional 6 months of exclusivity for the use of reference products "in the pediatric population."

AP Reports on Senate Health Care Bill

An Associated Press report ("Reid health bill helps chiropractors, drugmakers") regarding the Senate bill states that it "extends the protection some brand-name manufacturers would get from generic competitors," as "Reid's bill would add another six months of protection for drugmakers who also test those products for use by children."  Because the bill passed in the House contains an the same pediatric exclusivity provision, it is perhaps unfair to suggest that the pediatric exclusivity provision of Senator Reid's bill has somehow extended innovator exclusivity even further.

CCPM Comments on Senate Health Care Bill

The Coalition for a Competitive Pharmaceutical Market (CCPM), which recently released a statement "appealing to Congress to fix the excessive 12-year market exclusivity and ever-greening provisions for biologics or drop it altogether" (see "Follow-on Biologics News Briefs - No. 9"), released a short statement after Senator Reid unveiled H.R. 3590, in which the CCPM "voic[ed] serious concern in response to the extension of biologics exclusivity included in The Patient Protection and Affordable Care Act (H.R.3590)."  In particular, the group states that "[d]espite numerous economic studies, widespread media attention, patient outcry, and the support of the Administration for a more balanced approach, the Senate Health Care Reform bill went in the opposite direction by adding additional exclusivity to the already unacceptable 12 years of market exclusivity for brand products."  The CCPM statement does not specify exactly how the Senate bill goes "in the opposite direction by adding additional exclusivity."

According to the CCPM website, the group has 33 participating members, which include Apotex, Hospira, Momenta Pharmaceuticals, Mylan Labs, Ranbaxy Pharmaceuticals, Teva Pharmaceuticals USA, Watson Pharmaceuticals, and the Generic Pharmaceutical Association (GPhA).

GPhA Says Senate Bill "Gratuitously Extends Biologic Monopolies"

In a statement released by the Generic Pharmaceutical Association (GPhA) on November 19th, GPhA President and CEO Kathleen Jaeger writes that "[j]ust when you think the pro-BIO and PhRMA provisions in health care reform couldn't get any more favorable for them, the Senate health care reform bill has further disappointed consumers by adding additional monopoly protection to expensive biologic medicines," adding that "[r]egardless of the motivation, the biologic provision in this bill takes the already egregious and unwarranted 12 years of exclusivity and extends it."  With regard to how the bill extends the 12-year exclusivity period, Ms. Jaeger alludes to the Senate's failure "to close down a major loophole known as 'evergreening.'"  She also states that "[i]n the name of true health care reform, it is incumbent upon Congress to strip the anti-consumer biologic provision out of health care reform."  The GPhA represents manufacturers and distributors of finished generic pharmaceuticals and bulk active pharmaceutical chemicals.

Boston Globe Criticizes 12-Year Exclusivity Period; Prompts Response

An Op-Ed article in last week's Boston Globe commends Congress for trying "to open the door for approval of generic versions of drugs known as biologics," but concludes that "after intensive lobbying by the biotech industry, the measures that are emerging from Congress grant too many years of exclusivity to the original makers" ("Biotech bills give drugmakers too many years of exclusivity").  The Globe argues that the 12-year exclusivity period in current House and Senate bills is "too long, more than double the five years of protection from competition guaranteed for conventional drugs."

The Globe Op-Ed, however, appears to disregard the differences in developmental costs and time between small molecule therapeutics and biologics (see "Amgen VP Makes Case for Longer Exclusivity Period in Follow-on Biologics Legislation").  Instead, the article contends that "competition from generics is not likely to erode the ability of the original biotech manufacturers to continue reaping profits," because "[t]here are onerous technical barriers to making so-called biogenerics, unlike generic versions of conventional medications, so companies that invent original drugs are likely to retain market share despite the new competition."

In support of this argument, the Globe points to an article published in the New England Journal of Medicine last month, which contends that a 5-year exclusivity period would be sufficient because follow-on biologics have led to biologic price reductions of between 25-30% (as compared with innovator small molecule price reductions of up to 80%) in Europe (see "NEJM Authors Say Five Years of Data Exclusivity Would Be Sufficient").  The Globe parts ways with the NEJM article on an appropriate exclusivity period, stating that "[i]n clearing the path for generic alternatives to expensive biologics, Congress should enact a shorter window of market exclusivity than 12 years, but more than the five years afforded to simpler, conventional drugs," and adding that "[a] protection period that falls directly in between these extremes would strike a balance between encouraging companies to make biologic drugs and making them affordable."

In response to the Op-Ed article, Massachusetts Biotechnology Council (MassBio) President Robert Coughlin argued that the Globe's "editorial misleadingly compared the 12 years of data exclusivity in the biosimilars legislation with the five-year provision for traditional pharmaceuticals," contending that "[t]his apples-to-oranges comparison overlooks the fact that biologics cannot achieve the same kind of patent protection as pharmaceuticals."  Mr. Coughlin also noted that:

Data exclusivity does not prevent competition.  Companies can bring competitive products to market during the exclusivity period, provided they conduct their own safety and efficacy research.  They cannot piggyback on an innovator’s proprietary data to obtain FDA approval until the exclusivity period ends.  That’s simply fair.

According to the MassBio website, the group represents more than 600 biotechnology companies, universities, academic institutions and others dedicated to advancing cutting edge research.

Comments

[EG]

Don,

Those who whine about the 12 year data exclusivity being "too long" for biosimilars won't acknowledge that now there isn't any pathway, so some pathway is better than no pathway. Even Europe recognized the need for a longer pathway for biosimilars after the "pure red cell" tragedy in 2001. And if 12 years of data exclusivity is "too long," biosimilars can still choose to start their own NDA process.