Nonetheless, as much as these agents have improved the health of patients, it comes at a price. Biologic medicines are amongst the most expensive drugs, due to the R&D needed to discover as well as develop them, and because of the cost to manufacture these compounds. Rather than being chemically synthesized, biologics are made in live organisms, thus requiring significantly more rigor to produce. These types of efforts demand a substantial cost, requiring the high price tag charged by companies who develop these products to recoup their investment.
In 2005, the European agency responsible for regulating market authorization of medicines [Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA)] published Regulation CHMP 437/04, which provided a pathway for the development of biologic copy medicines (of the original product, called the “reference product”), termed “biosimilars”. While not generics per se (which, as noted, are produced chemically) they are analogous in that these would be copies of the reference products, to be sold after patents from such originators were no longer in effect. To date, the EMA has approved 22 biosimilar products.
The US was a laggard in the development of regulations for biosimilars, but Congress did pass in 2010 the Biologics Price Competition Innovation Act (BPCIA) creating the regulatory pathway for these types of drugs. However, the FDA has only approved one biosimilar product since the introduction of the pathway five years ago. That product still has not been launched, due to litigation on the process of the pathway articulated in the BPCIA. Moreover, the FDA still has not issued guidelines on extrapolation (granting additional indications from data on one indication for which a reference product is licensed) nor interchangeability (substituting the biosimilar for the originator product), or even regarding naming of the product (whether to use the International Nonproprietary Name, INN, as in Europe). Nonetheless, it is anticipated the FDA will release at least draft guidances in these areas by end of the year.
Of particular note, the US has yet to move forward with a decisive system for assigning Healthcare Common Procedure Coding System (HCPCS)/National Drug Code (NDC) codes to biosimilars with respect to medical reimbursement and insurance. In order to allow for reimbursement and coverage for specialty drugs, drugs are given a code used by the pharmacy and/or administering physician to file for Medicare and insurance purposes. Different drugs have different codes to ensure consistency for services provided or agents/devices delivered or used. Again, while biosimilars are not generics, they offer a reasonable analogous surrogate for description. A specific generic medication is given a single reference code, used for all of the same type of generic medication; this reduces error and confusion for healthcare providers when prescribing or administering a drug. Moreover, there are drugs such as growth hormone, even though produced by live organisms, have because of historical reasons been put into this generic class (rather than being a biosimilar). I have prescribed this agent for a number of my patients in the past; the various versions of growth hormone all fall under the same code, and are not separated into a multitude of codes dependent on the manufacturer. This allows for less confusion and more administrative clarity, particularly when compared to a requirement to find different codes for different versions of the same medication.
Biosimilars, as copies of biologic drugs, are similar in nature to growth hormone in being produced in living organisms. This past week, the Center for Medicare and Medicaid Services (CMS) released draft guidance on coding for biosimilars drugs, stating biosimilars should receive a different HCPCS code than the reference product. We believe this would be a mistake and create significant confusion for healthcare providers, and would hinder the potential of these drugs to both maximize access for patients as well as create a cost-effective environment. It has already been noted that examples exist where a single code has shown consistency in practice and use by physicians. Increasing the number of codes for the similar products (the reference and biosimilar product) would artificially create complexity for agents that show, as FDA has defined biosimilars, “no clinically meaningful differences between the biologic product [biosimilar] and the reference product in terms of the safety, purity and potency of the product.” Having the same code for the reference and biosimilar products creates a simpler, less error prone system, one which many physicians are already accustomed.
The other key aspect of having the same coding for the reference product and the biosimilar revolves around cost effectiveness and increased access for patients to these potentially lifesaving drugs. Using the same code will foster competition in the marketplace, and provide an even playing field between the reference product and the biosimilar. This will allow healthcare providers a choice to administer the biosimilar within the same reimbursement model, decreasing costs and ensuring more patients across the healthcare system have the ability to access these important products. As an example, since the introduction in the UK of biosimilar filgrastim (a white blood cell supportive care agent to prevent infections), a 2013 survey showed patient access had been expanded by 33% from the period before the biosimilar was available. As a physician who has prescribed and administered this drug to patients receiving chemotherapy, I understand both the benefits of the agent in primary prophylaxis against infection in these immune suppressed patients – as well as the potential undesirable consequences (infection, hospitalization, increased risk of death) if unavailable.
The US has entered late into the regulation and development of biosimilars. Other nations, particularly in Europe, have shown biosimilar products to be safe and effective, and have expanded access to patients needing these medications. To be able to achieve the same (or broader) success in the US, it is imperative that governmental policies allow both for transparency in regulatory expectations, and a fair and equal market formation to create competition. Within a vigorous scientific standard, regulatory agencies such as the FDA should support extrapolation as the rule and provide clarity on requirements for interchangeability. We should harken to the decade of experience in the EU and utilize the INN system of naming which has been implemented successfully with the ability to robustly maintain post-approval market surveillance. And finally, we should ensure maximum patient access to these medications, by utilizing a consistent code for the reference and biosimilar products. In this way, we may achieve the promise afforded by biosimilars seen in other parts of the world.
Dr. Bert Liang is the founding and current CEO of Pfenex Inc., a biologics company focused on biodefense and providing access to biosimilars. He is formerly a practicing oncologist and neurologist.