Keep the faith, the most amazing things in life tend to happen right at the moment you’re about to give up hope…
“Keep the faith, the most amazing things in life tend to happen
right at the moment you’re about to give up hope…”
The internet is awash with inspirational
quotes, often attributed to people who have never uttered such words. As the
title of this post suggests, one of my favourites concerns not giving up on
things before you’ve seen the benefits; learning a new language, getting fit,
dropping a golf handicap, learning how to make bread. It could be anything, but
unless you give it sufficient time and energy, you’ll very rarely see a result.
This is why I was stunned (and amazed, in
equal measure) to read comments from Peter Bach and Mark Trusheim (of MIT
Sloan), along with two of Bach’s associates at the Memorial Sloan Kettering
Cancer Center in the US, Preston Atteberry and Jennifer Ohn, suggesting that
the US should
give up on biosimilars.
In the first
part of a blog post in the Health Affairs journal, the key message from Bach
and colleagues is that the use of biosimilars in the US is a ‘flawed’ approach
that has ‘largely failed’ at increasing competition and lowering prices within
the US biologics market.
It would seem that the key reason for this is
that only a handful of biosimilars have been launched in the US, thereby
limiting the level of competition and price reductions. Biosimilars launched in
the US include Zarxio (Sandoz), Inflectra (Pfizer), Renflexis (Merck &
Co.), Retacrit (Pfizer), Nivestym (Pfizer), Udenyca (Coherus) and Fulphila
(Mylan). As a result, in many classes where there has been a biosimilar
launched in the US, the originator’s reference brand has retained the vast
majority of the market. The outlier is Zarxio which now has a larger market
share than Neupogen, according to comments
from Sandoz.
In the second
part of the blog post, Bach and colleagues suggest that a ‘regulatory
approach’ would be more effective at reining in biologics’
costs in the US. This approach could eventually generate net savings of
$250-$300 billion while incurring one-time costs of $10-$20 billion over five
years. These estimates are based on ‘the current 12-year exclusivity period and
an assumption that discounts approach the traditional generic discounts of
70-90 percent,’ while the one-time costs go toward compensating biosimilar
firms.
Critically, the policy would require
innovator biologic manufacturers to lower their prices after the period of
market exclusivity has expired. While the post says this price would be set by
an independent body that takes into account a number of variables, it doesn’t
say that this price adjustment would be mandatory, raising concerns that
innovator biologic manufacturers could use various tactics to manoeuvre around
it.
Perhaps one of the most high-profile
critics of this suggestion is former FDA commissioner, Scott Gottlieb. During
his tenure at the FDA, Gottlieb was a staunch advocate of a thriving and
sustainable biosimilars market in the US. The FDA’s Biosimilars
Action Plan, announced in July 2018, was one of Gottlieb’s attempts to
support the biosimilars in the US, due to them being seen as ‘key to reducing
costs and to facilitating more innovation.’
In a tweet,
Gottlieb said ‘it’s far too early to throw in the towel on biosimilars.’ Christine
Simmon, executive director of the Biosimilars Council, went even further and accused Bach and his colleagues of ‘tossing
out the baby with the bath water.’ Simmon added ‘marketed biosimilars
currently average 47% off the brand biologics’ price, providing access and
savings for patients and the US health care system’.
It’s perhaps easy to disregard what Bach
and colleagues have suggested. All you have to do is look at the success of the
European biosimilars market. When the stars align, and every single key
stakeholder gets behind the biosimilars concept in an effort to lower costs and
improve patient access to biologics via the use of biosimilars, the market can
flourish. Despite what Bach and colleagues suggest in their blog posts, the
European experience with biosimilars has not been a failure.
One must understand, however, that the US
and Europe are very different in terms of procurement policies for biologics
and biosimilars, as are the incentives that are in place to use the
lower-priced (often biosimilar) product. Once such commercial barrier to the
adoption of biosimilars in the US is the ‘rebate trap,’ an issue that Gottlieb
has been highly
critical of in the past. While drug rebates do exist in Europe, they are
not seen as significant a barrier to the
uptake of biosimilars as they are in the US.
Personally I think it would be premature to
give up on biosimilars in the US. The US biosimilars market is just over four
years old, following the approval of Sandoz’s Zarxio in March
2015. In contrast, the European biosimilars market is just beyond its 13th
anniversary, and in some ways is only just starting to deliver on the promise
of biosimilars. More time is needed before something so new can be deemed to be
a failure.