*Editors note: This article was originally published as part of a longer article in the December 2018 edition of Life Science Leader magazine. It has been split into two parts for publication on Biosimilar Development.
Without a doubt, one of the most important developments in 2018 was the release of the FDA’s Biosimilar Action Plan (BAP). In the first part of this article, I unpacked the basic goals of the BAP and discussed several industry comments urging the FDA to explore waiving bridging studies and increase global regulatory collaboration. In addition to some of the more scientific aspects discussed in the industry comments, I was interested to see the areas in which the industry was pushing for the FDA to exert greater influence outside of regulatory policy. But as we all know, the most successful biosimilar markets around the world have an involved government to thank for part of that success. I was also happy to see a number of public comments from industry call attention to the need for additional U.S. government agencies — particularly CMS and the Department of Health and Human Services (HHS) — to play bigger roles in fostering the biosimilar market. In the second part of this two-part article, I unpack how the FDA could solve one particularly challenging market barrier and why we should expect to see (and call for) more from other government agencies in 2019.
Can The FDA Play A Larger Role In Ending Market Misbehavior?
Perhaps one of the most exciting aspects of the FDA’s BAP is that it encourages the agency to step outside of the strict scientific elements of development and regulation and into the commercialization sphere. One such area that could use more FDA involvement is in ending Risk Evaluation and Mitigation Strategies (REMS) abuse. REMS programs, which are FDA-mandated, are implemented following the approval of certain drugs that pose safety concerns and require oversight following distribution. However, some innovators have also created their own voluntary programs in the name of patient safety, without the FDA’s urging. In many cases, innovators then restrict distribution of the necessary drug samples to generics and biosimilar makers citing patient safety concerns. This ultimately results in delayed generics/biosimilar development and market competition.
There is currently legislation before the Senate known as the Creating and Restoring Equal Access to Equivalent Samples Act of 2018 (CREATES Act) which could serve as a solution. This Act aims to ensure biosimilar and generics companies can purchase the necessary samples, regardless of whether those samples are protected by an FDA-required or voluntary REMS program. But according to Bruce Leicher, former SVP and general counsel of Momenta Pharmaceuticals, the FDA could also provide more of a solution outside of what has already been done, namely creating lists publicly calling out REMS offenders. The agency has the ability to draft a policy making it a condition of regulatory approval for the originator to supply the reference product to generic and biosimilar companies.
According to Leicher, in administrative law, there is a principle permitting an agency to “fill in the blanks,” if you will, when it comes to statute gray areas. “An agency isn’t allowed to expand the scope of what occurs under a law, but it’s allowed to figure out how to implement what occurs under the law,” Leicher explained. “There’s no question, when the BPCIA was passed, it was within the scope of the law that you would get access to reference biologics. The gap is that the law doesn’t say ‘You must do it.’ But courts will respect an FDA decision that fills in this gap. Every guidance document the agency releases is an example of filling in these gaps.”
In addition, Leicher’s comments to the agency also argue in favor of collaborating with CMS to make participation in Medicare, Medicaid, and other federal healthcare reimbursement programs contingent upon the originator making samples available. “Why should taxpayers pay for someone to break the law?” Leicher asked.
CMS And HHS Join FDA In Spotlight For 2019
A number of other comments surrounding the BAP homed in on the role CMS and other government agencies can and should play in furthering the biosimilar industry. Pfizer’s BAP comments do a great job of showing just how many organizations need to be in alignment to make this industry a success. Instead of focusing solely on what the FDA should consider, the company’s comments point out the roles HHS, CMS, and the NIH can play in helping this market grow. As Lisa Skeens, VP, global regulatory affairs at Pfizer, said in an interview, “We know the FDA can’t do this alone. We expect all stakeholders, including Congress, insurers, CMS, biologics manufacturers, and the FDA to all work together. We wanted our comments to the agency to reflect that message.”
Juliana Reed, global corporate affairs lead for biosimilars at Pfizer, specifically highlighted the critical role CMS needs to play. “We’re calling on CMS to publicly track the uptake of biosimilars,” she shared. “It’s time for CMS to check if we actually achieve the cost savings that we expected when we passed the BPCIA. We’re asking Medicare to do that, as well as Medicaid on the state level.”
CMS has shown an increasing amount of interest in biosimilars over the past year. Not only did a portion of Pfizer’s Inflectra (limited) uptake come from CMS, but in recent weeks, UnitedHealthcare also announced it was making infliximab biosimilars — namely Pfizer’s Inflectra and Merck’s Renflexis — preferred treatments for Medicare Advantage Plans. This move came following CMS’ call permitting Medicare Advantage plans to negotiate prices and implement step-therapy — the latter being a move many in the biosimilar industry are hopeful will lead to greater biosimilar uptake.
But there is still much room to grow. The Pfizer court case against Johnson & Johnson, which alleges that exclusionary contracting practices blocked Inflectra uptake, argues that biosimilars are being held back from Medicare and Medicaid populations (as well as other plan holders). Because CMS is the largest payer and purchaser of drugs in the country, Reed pointed to just how much power the agency wields when it comes to biosimilars. CMS has access to the average selling prices of all biosimilars compared to their reference products and can tell us over time whether the U.S. is successfully using biosimilars. An important question this data could answer, for example, is why “CMS is not realizing the cost savings we expected from biosimilars,” Reed offered.
The rebate system in the U.S. also has been under fire throughout 2018, which has led to a potential HHS rule that could remove the safe harbor provision from federal programs. Though the terms or scope of this rule are still unclear, supporters have come out in favor of restructuring the U.S. rebate system.
Overall, 2019 looks to be a year of continued evolution in the biosimilar industry, both in the regulatory and reimbursement arenas. Though the impact of biosimilar competition has not yet been realized in the U.S. market, the government policies taking shape at the tail end of 2018 will no doubt continue to keep stakeholders on their toes well into 2019 — and beyond.