BOSTON, Massachusetts—Biopharmaceutical products are beginning to lose patent protection [Figure 1]. The prospect of generic competition for expensive biotech drugs is welcomed by patients, insurers, and national health programs, but is a headache for regulators.

The US Food and Drug Administration (FDA) is behind European regulators in deciding how to deal with these drugs, which the FDA calls "follow-on biologics" to emphasize that they are generally not identical to the original branded drug; the generics industry calls them "biogenerics." In fact, the first such drug approved in the US (Sandoz's Omnitrope® human growth hormone) got through the pipeline only after a federal judge ordered the FDA to proceed with the request for approval. Upon approval, the agency specifically did not designate Omnitrope as therapeutically equivalent to (and therefore substitutable for) previously approved human growth hormone preparations.

Era of biogenerics dawns

The era of follow-on biologics clearly has arrived. Competition might drive down the sky-high prices of some of the branded biologics, but regulators are concerned over how to encourage such competition without driving the major pharmaceuticals out of business. They worry about depriving brand-name biologic makers of the returns needed to support the massive research and development costs associated with new drug development (>$800 million per FDA-approved new drug).

Regulators also face the difficulty of judging products that are likely not to be identical to the brand-name product. Biologics also require much more elaborate manufacturing processes and oversight than conventional drugs and belong to a class of therapeutic agents that is hugely heterogeneous.

Richard G. Frank, PhD, recently considered regulation of follow-on biologics in an editorial in the New England Journal of Medicine.¹ Dr. Frank discussed the present situation in an interview with CIAOMed. His initial concern is the slowness with which the FDA is addressing the problem of regulating follow-on biologics.

"Many analysts have expressed concern that without new US regulations, patent expirations may not be accompanied by the introduction of competing, lower-cost biologic agents—or that imitator products might be approved without sufficient proof of efficacy and safety, posing threats to public health." He told CIAOMed that the system currently regulating generic drugs under provisions of the Hatch-Waxman Act of 1984 is far from adequate to cope with the challenges of follow-on biologics.

Problems include

• differences between biologics and follow-on biologics that arise from slight variations or changes in manufacturing processes
• lack of established protocols for judging bioequivalence, efficacy, and safety
• manufacturing based on living cells as opposed to chemicals
• widespread use of mammalian cells and tissues, requiring additional safety procedures to prevent  introduction of pathogens into the production process

Dr. Frank said that a multitier process of approval for follow-on biologics is likely. The first tier will require basic data for approval. The second tier will require more rigorous testing for interchangeability with the branded biologic. The FDA has raised concerns that this might require large comparative studies to establish interchangeability.

Congress to the rescue

As might be expected in the run-up to an election year, Congress entered the fray with the "Access to Life-Saving Medicine Act" (HR 1038/S 623), sponsored by Rep. Henry A. Waxman, Sens. Charles E. Schumer and Hillary Rodham Clinton, among others. This bill authorizes the Secretary of Health and Human Services (HHS) to approve abbreviated applications for biological products that are "comparable" to and "interchangeable" with previously approved (brand name) biologics. Comparable products would have the same "principal molecular structural features" and mechanism of action.

The HHS secretary is given the power to determine on a case-by-case basis which studies are needed to establish comparability and interchangeability and which may require clinical trials.

To encourage the extra investment that would be required to establish interchangeability, the bill gives the first biogeneric authorization to obtain approval as interchangeable a period of "exclusive marketing" during which no other interchangeable products could be approved. The bill also requires the patent holder of the branded drug to "disclose relevant patents in response to a request to encourage early resolution of patent disputes which might otherwise delay competition."

How long is too long?

When this bill was first proposed, biotech companies wanted 14 years of market exclusivity for new biologics, whereas the generic manufacturers wanted them to have only 5 years. The senate compromised with 12 years.

Dr. Frank pointed out that there is little evidence to support this arbitrary time limit. "It is premature to assume that 12 years of exclusivity will be needed to preserve innovation in the biopharmaceutical arena, and putting off price competition is risky because of pressures on public budgets and the expanded role of the Medicare program in purchasing biopharmaceuticals," he said.

The Biotechnology Industry Organization (BIO) weighed in early in opposition to HR 1038 and has lobbied against the bill to such effect that a graphics slide from BIO lobbyist (and former congressman) James C. Greenwood's presentation also turned up in a comment by Rep. Thomas Davis III during an April hearing on the bill, according to the Boston Globe.

A key argument for shorter patent protection is the hope that competition from follow-on biologics will reduce costs. Dr. Frank warned that this difference between traditional branded drugs and traditional generics is likely to be much smaller. "The cost of imitation is much higher with the biologics, and it is much more costly for a generic manufacturer to get into the game. That suggests that there will be less of a rush into the market than for traditional drugs."

"The conflicting goals of bolstering price competition in biopharmaceutical markets and preserving the incentives for innovation call for a nuanced policy that must be based on the best current science and key features of the economics of biopharmaceutical markets—not on the impassioned claims of the interested parties," Dr. Frank continued.

India, China join in

Dr. Frank told CIAOMed that subsequent to the publication of his New England Journal of Medicine editorial, he was contacted by several readers who felt that he was altogether too pessimistic about the potential for competition from biogenerics. "Some fair-minded people think that China and India will be huge competition, and I now think that is a distinct possibility," he said.

CIAOMed looked into this and found that Indian companies are indeed moving ahead quickly with follow-on biologics, including one which might eventually compete with Rituxan® [Figure 2].

Figure 1

Biologics Now or Soon to Be Off Patent

Brand Name	2006 Global Sales ($, billion)	Patent Expiration
Human insulin (Novo Nordisk)	$1.8	Expired
Intron®-A (alpha interferon)	$2.5	Expired
Procrit® (erythropoietin)	$4.3	Expired
Epogen® (erythropoietin)	$2.5	EU 2004; US 2012, 2013, 2015
Neupogen® (filgastrim)	$1.4	EU 2006; US 2006, 2013
Enbrel® (etanercept)	$2.8	US 2009, 2012
Synvisc® (Hylan G-F20)	$0.3	US 2012
Rituxan® (rituximab)	$2.3	US 2014-2015

Figure 2

Follow-On Biologics Produced by Indian Pharmaceutical Companies

Drug Name	Original Drug or Chemical Name	Generic Company
Redituxâ„¢	rituximab	Dr. Reddy's Laboratories Ltd
Grafeelâ„¢	filgastrim, G-CSF	Dr. Reddy's Laboratories Ltd
GeneVac B®	hepatitis B vaccine	Serum Institute of India
STPaseâ„¢	streptokinase	Cadila Pharmaceuticals Ltd
Wosulin	recombinant human insulin	Wockhardt Ltd
Recosulinâ„¢	recombinant human insulin	Shreya Life Sciences Ltd
Insugenâ„¢	recombinant human insulin	Biocon
Erykineâ„¢	recombinant human erythropoietin, EPO	Intas Pharmaceuticals Ltd

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