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The rancorous debate over a regulatory approval pathway for follow-on biologics (aka biosimilars) continues to rage on in the US Congress. Despite recommendations from the Federal Trade Commission that a data exclusivity period for follow-on biologics isn't necessary and a seven year compromise offered by President Obama,the pharmaceutical and biotechnology lobbies continue to press Congress for a 12 to 14 year period of data exclusivity in any legislation for follow-on biologics. 

In a well-balanced article in today’s New York Times, Andrew Pollack diligently put forth the arguments against follow-on biologics that innovator companies have been espousing for the past decade. These include: complexity of the manufacturing processes for biotechnology drugs, potential tolerability and safety issues and perhaps, most importantly, an anticipated loss of profits that innovator companies claim “would stifle American innovation” in the life sciences. Until recently, these arguments were successfully used to hinder any substantive debates on follow-on biologics legislation. However, it  has become increasingly apparent that the American healthcare system can no longer sustain the high costs and lack of access to potentially life-saving branded biotechnology drugs. For those of you who may not know, a regulatory approval pathway for biosimilars already exists in Europe and it has been used to approve eight products since its inception in 2004.  Biosimilars are also available in Australia and have been sold for many years in less-regulated markets including India, China and elsewhere. Japan recently approved legislation for approval of biosimilars and Canada is close to finalizing its regulatory guidelines for these products.

American innovator companies recognizing the inevitability of follow-on biologics, no longer oppose legislation for approval of these molecules. Instead, these companies and their supporters have tenaciously latched on to the data exclusivity argument, presumably in a last ditch effort to preserve their profits from multibillion dollar biotechnology drug franchises that may be lost when follow-on biologics legislation is enacted.  And, for the most part, their uncompromising insistence on an excessively long data exclusivity period appears to be taking hold with members of Congress. At last count, there were more Congressional sponsors of legislation favoring a 12 to 14 year data exclusivity period than there was for those who support a 5 year data exclusively period. The five year data exclusivity period was proposed by follow-on biologics proponents because it is identical to the period required for generic versions of small molecule drugs enacted in the Hatch Waxman Act.

I have been following the follow-on biologic debate for the past eight years and, to date, I know of no scientific claims or relevant safety concerns which argue that 12 to 14 years of data exclusivity is warranted for follow-on products.  For example, no untoward safety or tolerability problems have been reported for any of the eight biosimilar products that were approved and sold in Europe for the past three years. Further, European healthcare agencies and physicians haven’t readily embraced biosimilars despite an almost 25%-30% reduction in price. The one exception is Germany (the largest generic market in Europe), where biosimilar versions of erythropoietin (Eprex) have captured 30% of the anemia market. This, in turn, has  forced some innovator companies to lower prices on their branded products.

Based on the European experience, it is likely that follow-on biologics won’t catch on quickly in the US and it may take years for them to erode the market share garnered by innovator brands.  Also, contrary to earlier assertions, it is becoming increasingly apparent that only large, well capitalized companies with sophisticated regulatory, marketing and distribution capabilities will be able to compete in the US follow-on biologics market. To that end, companies like Sandoz (Novartis) and Merck—one of the companies that originally opposed follow-on biologics legislation—will likely dominant the US follow-on biologics market.

Ironically, the biggest losers in the follow-on biologics debate will likely be the innovator companies—but not for the reasons they once cited to prevent regulatory approval of these molecules. By spending hundreds of millions of dollars lobbying against follow-on biologics legislation—rather than investing to develop their own lower cost, generic versions of blockbuster biotechnology products—innovator companies have unwittingly provided foreign follow-on biologics manufacturers with a competitive advantage when follow-on biologics are finally approved for sale in the US. Companies like Sandoz, Teva and several Indian biosimilar companies— with products already on the market in Europe, India and China—have been developing biosimilar molecules for the past fiver years or more. Their scientific and regulatory experiences with these products suggests that they will be poised to dominate the US market after legislation permitting approval and sale of follow-on biologics is finally completed. Surprisingly, Merck is the only major pharmaceutical company to publicly announce its intention to compete in the follow-on biologics market. The Merck announcement was made last fall—almost three years after Sandoz won European approval for Omnitrope, its first biosimilar product!

Until next time...

Good Luck and Good Job Hunting!!!!!!!!

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A much-anticipated Federal Trade Commission (FTC) report was released on Wednesday that will likely help House Energy and Commerce Chairman Henry Waxman bolster support for his fledgling follow-on biologics (FOB) bill. For those of you who haven’t been closely following the debate over proposed legislation to create a regulatory framework for approval of FOBs in the US, I provide a brief synopsis.

The Promoting Innovation and Access to Life-Saving Medicines Act (H.R.1427) introduced by US Representatives Henry Waxman (D-CA), Frank Pallone (D-NJ) and Nathan Deal (R-GA) calls for an abbreviated development pathway (at the discretion of the agency), the possibility of substitution or interchangeability (if the follow-on biologics manufacturer can prove a high degree of structurally similarity and an identical mode of action) and five years of data exclusivity. In contrast, The Pathways for Biosimilar Act (H.R. 1548) introduced by US Representatives Anna Eshoo (D-CA), Jay Inslee (D-WA) and Joe Barton(R-TX) requires clinical data, rigorous immunogenicity testing and limits on interchangeability and substitution provisions for follow-on biologics. Further, it calls for a minimum of 12 or up to 14 years of data exclusivity for innovator companies—a period during which FDA can’t rely on innovator data to approve follow-on biologics. For example, if a biotechnology drug was approved in 2009, the earliest that FDA could consider and approve an application for a competing follow-on product is 2021.

The FTC report concluded that a 12- to 14-year wait is unnecessary because follow-on biologics will not be offered at the same steep discounts as traditional generic drugs. It also pointed out that no evidence exists that biologic patents will not hold up. The agency estimates follow-on biologics would be sold at discounts ranging from 10 percent to 30 percent. Not surprisingly, the FTC did not recommend a specific number of exclusivity years. This allows legislators to continue to squabble and debate the point ad nauseum, until concessions are made by both innovator and follow-on biologics proponents.

The measure by Eshoo and Barton has garnered 88 co-sponsors, while Waxman and Deal's bill has 11. In the Senate, the Health, Education, Labor and Pensions Committee reached a bipartisan compromise on follow-on biologics in 2007 that allowed for 12 years of exclusivity, but that deal seems unlikely. Democrats are trying to address generic firms' concerns that brand companies could make slight changes to their products and start the exclusivity period over again. Some senators introduced a more generic-friendly bill like Waxman's earlier this year.

Conventional wisdom suggests that the data exclusivity provisions in the final legislation will be five years—a period identical to that provided stipulated in the 1984 Hatch Waxman Act, which created the US generic pharmaceutical industry. 

Stay tuned for new updates on this unfolding drama!

Until next time...

Good Luck and Good Job Hunting!!!!!!!!!! 

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Previously, the US Congress proposed legislation to create a regulatory approval process to allow the Food and Drug Administration (FDA) to approve generic versions of blockbuster biotechnology drugs known as follow-on biologics (FOBs). While a regulatory pathway exists for approval of generic versions of small molecule drugs (as outlined in the Hatch-Waxman Act) there is no legally-approved regulatory pathway to bring FOBs to market in the US. In contrast with the US, the European Union crafted legislation five years ago that allows biosimilars —the name given to FOBs in Europe—to be approved and sold in EU member states. Since 2004, the European Medicines Agency (EMEA), the EU regulatory body, has approved the sale of six biosimilar drugs with many more in the queue awaiting regulatory review.

The debate over FOB legislation started in the US about 10 years ago when patent expiry of many  multi-billion blockbuster biotechnology drugs was fast approaching. From the beginning, many so-called innovator companies (the companies that produced the original branded biotechnology drugs) and the trade associations that represent them on Capital Hill, the Biotechnology Industry Organization (BIO) and the Pharmaceutical Manufacturing Association (PhRMA), aggressively lobbied against any form of FOB legislation. However, late last year, several senators introduced legislation that would permit FDA to approve generic versions of many blockbuster biopharmaceutical products following patent expiry. The proposed legislation stipulated that FOB manufacturers would have to wait 12 years —after patent expiry of previously approved biotechnology drugs—before generic versions of those drugs could be sold in the US. That legislation, which unabashedly favored innovator drug manufacturers, passed the Senate health committee but died without being voted on. The new measure, introduced Thursday, cuts by more than half — to 5 years, from 12 — the time allowed before cheaper versions of biotechnology drugs could compete with the originals. A similar bill was introduced two weeks ago in the House by Representative Henry A. Waxman, Democrat of California and chairman of the Energy and Commerce Committee.

While the proposed reduction in the so-called “FOB waiting period” is commendable, I don’t think that any waiting period is necessary before FOBs can be sold in the US. It is difficult to understand why innovator companies require an additional patent protection—beyond the 20 years already afforded to them under US patent law—to continue to sell their blockbuster products! To that end, Jeff Joseph, a spokesman for the BIO said that the FOB waiting period reduction, “.... Would jeopardize patient safety and undermine our ability to develop future cures and therapies.” I believe that the FOB waiting period being championed by innovators companies is nothing more a thinly veiled attempt by them to continue to maintain monopolistic control over lucrative multibillion dollar biopharmaceutical drug franchises. Biotech executives have vowed to vigorously fight the new legislation, saying it could result in unsafe medicines, fewer cures and fewer jobs in biotechnology centers like Boston, California and elsewhere. Interestingly, similar arguments were put forward by the pharmaceutical industry before the Hatch-Waxman act was passed by Congress in 1984..

Despite the claims that FOBs will stifle innovation and may jeopardize the safety of Americans, the current high costs and lack of access to affordable healthcare will almost certainly leave Congress no choice but to pass legislation that permits the marketing and sale of FOBs in the US. While FOB legislation is a likely fait accompli, US drug manufacturers remain steadfastly opposed to any FOB legislation. I believe that innovator company opposition to FOB legislation is really a “red herring” that serves to detract attention away from the real issue that the drug industry is deathly afraid of federal regulation of drug prices. Interestingly, the US is one of the only countries in the world where drug prices are not regulated or controlled by the government. This permits drug manufacturers to set prices based exclusively on “what price the US market will bear.” In other words, they can charge as much as they want for their drugs, as long as third party payors, insurance companies and Medicare and Medicaid agree to continue to cover the costs of the drugs that they manufacture (it should come as no surprise to anyone that the American pharmaceutical and biotechnology markets are the largest and most financially lucrative in the world).

I have no doubt that innovator companies will continue to fight hard and as long as possible prevent adoption of legislation regulating the approval of FOBs. After all, there are huge sums of money and corporate profits at stake. Like it or not, FOBs will ultimately be sold in the US—the current costs of drug and healthcare are simply too high to sustain. Despite a fierce decade-long struggle, most American drug makers will privately concede that sale of FOBs in the US is inevitable. Nevertheless, innovator companies will likely not publicly endorse FOB legislation until the US government provides them with assurances that it will not seek to regulate American drug prices for the foreseeable future.

Until next time...

Good Luck and Good Job Hunting!!!!!!

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We in America have grown accustomed to the constant barrage of direct-to-consumer (DTC) advertising of prescription drugs provided to us daily by pharmaceutical and biotechnology companies. That said, some of you may be surprised to learn that DTC advertising of prescription drugs is only permitted in two countries in the world: New Zealand and the US.

According to William Burns, an executive at Roche Pharmaceuticals, “Direct-to-consumer promotion was the single worst decision for the industry." He added, "When industry says we're spending all the money on R&D but actually it's spending it on TV advertising to preserve margins, it doesn't get much credibility." It may not provide much credibility to the industry but is sure does help sales.  reported that a total of $4.2 billion was spent on DTC drug ads in the U.S. in 2005, up 330 percent from 1996.

Apparently Mr. Burns is not alone in his opinion. Angus Russell, chief executive of Britain's Shire Pharmaceuticals also condemned DTC.  As many of you know, I ‘m not a big fan of DTC nor am I flag-waving American but I find it rather curious that after almost 12 years of DTC advertising that European pharma executives are suddenly speaking out against the practice. Could this be little more than a ploy to get the European Commission to re-examine and possibly loosen it restrictions on the way prescription drugs are promoted in the EU? Quite coincidentally, the European Commission is in the process of drawing up legislation that would allow a degree of information to be disseminated about medicines by their makers, although advertising pharmaceuticals would remain banned. The legislation was initially expected to be unveiled by the European Union's executive arm last week but has been delayed.

Drug makers have long campaigned against rules that prevent them from talking directly to consumers in Europe, despite a wealth of often unreliable information being available on the Internet. I think this statement by Mr. Burns sums up the situation "You've got the two extremes on the planet, where we (drug makers) are given access to the public in America, which is too much, and in Europe we're not given access to information" (sounds like sour grapes to me).

Maybe a compromise between the two extremes would be a solution acceptable to both American and European regulators? 

Until next time…

Good Luck and Good Job Hunting!!!!!!!

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The Pharmalot blog reported today that this coming Friday, the US Federal Trade Commission (FTC) will conduct a workshop on the issue of follow-on biologics. The roundtable will apparently be organized into five panels to discuss: 1) the price and market share effect of entry by both biosimilar and biogeneric drugs, 2) the likely competitive effects of reference product regulatory exclusivity, 3) biotechnology patent issues, 4) the likely competitive effects of follow-on biologic regulatory incentives, and 5) the patent resolution process.

The first thing that comes to mind is “beating a dead horse” (euphemistically of course). Call me crazy but these very issues have been bandied about and discussed ad nauseum and  for the past decade or so. I am not sure what new revelations will come to light at this Friday’s FTC roundtable meeting. 

Here’s a thought. Maybe industry representatives, FDA regulators and the insurance companies ought to ask the European Union how they were able to craft their version of a regulatory pathway for approval of these products way back in 2004. Nah…let’s let the lobbyist duke it out and see which side wins!

Until next time…

Good Luck and Good Job Hunting

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Just when you thought the obvious couldn’t be anymore obvious to US lawmakers, the Congressional Budget Office (CBO) today released a long-awaited assessment of the cost of a biogenerics bill and found that the legislation, if enacted, would reduce total expenditures on biologics in the US by $25 billion over the next decade—duh!!!  

According to a post over at Pharmalot, “The report comes as a growing group of drugmakers, insurers and employers agitate over the high cost of biologics, which may only be rectified if Congress passes legislation that would give the FDA guidance on creating a so-called pathway to approve biogenerics, or follow-on biologics. Two House bills have been proposed that are similar to the Senate bill reviewed by the CBO, although the looming summer recess and election-year politics suggest passage may not occur this year.”

Unfortunately, as I suggested in a previous post, the bills currently under consideration are flawed and would give unwarranted patent exclusivity to innovator companies if enacted. Nevertheless, as Kathleen Jaeger, head of the GPHA (a generic manufacturing trade group) aptly stated “We are still reviewing the analysis, but we are pleased that CBO agrees that significant savings will be achieved by bringing biogeneric medicines to consumers and that even greater savings will result from removing harmful barriers to access, including brand evergreening and unprecedented market exclusivity provisions. With Americans growing increasingly concerned about health care costs, we should be increasing access to affordable medicines while fostering competition in the pharmaceutical marketplace. “

By the time that a US approval pathway for biogenerics is divined, European and Asian biogeneric manufacturers will already control the market and the “new” (what took you so long) American legislation will provide little financial incentive for US companies to enter the biogenerics market space.

Until next time…

Good Luck and Good Job Hunting!!!!

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Despite what the American public has been led to believe, the scientific, regulatory and safety issues related to biogenerics aka follow-on biologics, biosimilars, or subsequent entry biologics have been clearly investigated and are no longer controversial issues. All of the aforementioned "issues" have been analyzed and carefully vetted. This allowed EMEA, the European Medicines Agency in 2006 to craft a comprehensive regulatory approval pathway for biosimilars. For those of you who may not know, several biosimilar products are currently are the market and sold in all European Union member states. This begs the question–what is taking the US so long?

From the beginning, big pharma and big biotech have unequivocally and steadfastly opposed any legislation that would allow biogenerics to be approved and sold in the US. The trade groups BIO and PhRMA have literally spent millions of dollars lobbying members of Congress to oppose any legislation that would allow approval of biogenerics in the US. Now, in a sudden and unprecedented about face, big biotech and pharma have thrown their collective weight behind proposed biogenerics legislation that will be introduced in the near future by Representative Anna Eshoo (D-CA).

As far as I can tell, the primary reason for this sea change is the market exclusivity that may be afforded to innovator companies by the legislation. A quick perusal of the bill reveals that innovator companies will be granted 12-year market exclusivity for a product after its initial licensure. Further, under certain circumstances, this period of market exclusivity for an innovator product may be extended to 14.5 years. Also, reference product sponsors (innovator companies), as well as interested third parties (most notably universities) that own patents on the reference product may sue a biogeneric applicant for patent infringement. Under certain circumstances, such litigation could delay or prevent approval of the biogeneric product.

So what does the proposed legislation mean for biogeneric manufacturers seeking regulatory approval for their products in the US?  Unfortunately, it means that a biogeneric product application may not be approved or made effective until 12 to14 years after the original date of licensure of the innovator (reference) product. It also opens the door for patent litigation against biogeneric manufacturers to hinder or delay approval of their products. In my opinion, the proposed legislation is extremely one-sided and biased toward innovator companies. More importantly, it seems to me that the real intent of the legislation is to discourage (rather than encourage) biogeneric manufacturers from seeking US approval for their products, i.e. there are no real financial incentives or inducements for these manufacturers to seek approval because of the excessively-long market exclusivity period for innovator products.

On the surface, the proposed legislation would appear to be a long sought victory for biogeneric advocates and the American public which would benefit from less costly versions of potentially life-saving biotechnology drugs. That said, it seems to me that the proposed legislation is nothing more than a disingenuous attempt by big biotech and pharma to placate biogeneric advocates and the American public. In reality, the legislation provides innovators companies with a legally-binding regulatory approval pathway that will allow them to maintain or extend their monopolistic stranglehold on blockbuster biotechnology products. I think that the US Congress can do better when it comes to biogeneric legislation–the American public not only deserves it but demands it!

Until next time…

Good Luck and Good Job Hunting!!!!!!!!!!!

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The Bush administration's proposed 2009 fiscal year budget for the FDA includes not only a 5.7 percent increase but a plan to seek authority to allow the agency to approve abbreviated applications for follow-on biologics.

As part of the budget package, the administration said it is seeking regulatory authority for the FDA to approve follow-on biologics, also called biosimilars or biogenerics, which would be financed through user fees.

The House and the Senate both introduced follow-on biologics legislation in 2007, with the Senate's bill moving the furthest by achieving passage by the Health, Education, Labor and Pensions Committee. Lawmakers have pledged to move the legislation forward in 2008.

Jim Greenwood, CEO of the Biotechnology Industry Organization (BIO), said "BIO strongly believes that the FDA should have a pathway for the approval of follow-on biologics, which protects patient safety and promotes continued innovation," Greenwood added that "The creation of a pathway for follow-on biologics is a top legislative priority for BIO, and we are meeting with members of the House and Senate to encourage them to consider and pass follow-on biologics legislation this session." This is quite a policy turnaround for BIO which over the past 8 years has spent tens of millions or more lobbying against allowing follow-on biologics in the US.

Even more shocking than the BIO turn around, was the first ever plea last week by the Whitehouse to pass legislation to craft legislation to create a regulatory approval pathway for follow-on biologics-what’s up with that? I guess Bush and his big biotech buddies finally realized that large sums of money can be made in the follow-on biologics/biogenerics business. This possibility was not lost on the Europeans, who created a regulatory pathway for approval of biosimilars (what follow-on biologics are called in Europe) several years ago! Biosimilars are already on the European market–who said that Europeans were less entrepreneurial than Americans?

Contrary to statements made by FDA officials last week, which suggested that FDA would craft the follow-on biologics legislation, it now appears that FDA will  work closely with Congress to draft a legislative proposal for approval of  follow-on biologics. I don’t think that Congress’s involvement is a good idea given the political wrangling, deal-making and concessions that must be made in order to get legislation passed. As the old adage goes, something is better than nothing.

It looks as though follow-on biologics may become a reality in the US. As I mentioned in previous posts, I don’t think Americans will see follow-on biologics on the market before 2010 or 2011. That said, it gives us Americans something to look forward to!

Until next time…

Good Luck and Good Job Hunting!!!!!!!!!!!

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