Four years after the first biosimilar drug was approved in the U.S., the market for the copycat biologics is at a “precarious moment,” according to Food and Drug Administration Commissioner Scott Gottlieb.
“If there’s not a demonstration that you can launch a new biosimilar successfully commercially, you could have the risk that more manufacturers either pull out of this market, or don’t get into it in the first place,” he said in a wide-ranging interview with BioPharma Dive, a day before announcing his planned resignation on March 5.
In his two years as head of the FDA, Gottlieb has made drug competition a signature regulatory objective, sought principally through record levels of generic approvals.
While the agency has waved through increasing numbers of biosimilars, fewer than half of those biologic copies approved are available to patients — tempering hopes the lower-cost versions could curb rising spending on biologics in the U.S.
The next few years, Gottlieb said in a telephone interview, will be critical for a biosimilar market that he still expects to emerge strongly over time. The FDA’s leader also addressed other challenges that will likely test his successor, including the emergence of cell and gene therapies as well as the market distortion caused by anti-competitive tactics.
A progress report on shenanigans
“End the shenanigans,” the commissioner said in late 2017, criticizing steps taken by some branded drugmakers to artificially delay generic competition.
Topping his list were practices designed to block generic companies from accessing drug samples needed to develop their low-cost copies. Most notably, Gottlieb called attention to abuse of a system known as Risk Evaluation and Mitigation Strategy, or REMs, that’s used to ensure medicines are distributed and prescribed safely.
Now, more than a year later, Gottlieb told BioPharma Dive that examples of more egregious behavior have become rarer. But overall, drugmaker shenanigans haven’t disappeared, the agency chief said.
As Gottlieb explained it, companies continue to use specialty pharmacies to restrict the distribution of their products. In contracts with pharmacy benefit managers, drugmakers also enact provisions to make it more difficult for market intermediaries to sell the drug to other manufacturers.
“We’ll look and there’s no REMS,” Gottlieb said. “There’s nothing regulatory, so those are the instances where we know it’s some kind of commercial factor like a restricted distribution through a specialty pharmacy that’s impeding access.”
One step the FDA took under Gottlieb was to begin listing drugs for which it’s received supply-related inquiries from generic companies. The data from the agency support the commissioner’s point — slightly more than half of the 54 listed drugs do not have a REMS plan with components that would limit distribution for safety reasons.
The problem is present in markets for both small molecule drugs as well as a biologics, and Gottlieb said the FDA is looking into allowing biosimilar applicants to source products from overseas as a potential workaround.
The agency is working with the Federal Trade Commission on the issue, which could lead to joint action, and Gottlieb noted that Congress could mandate these sales through legislation as a fix as well.
Pharma company leaders indicated at a recent Senate hearing some support for the CREATES Act, a bipartisan bill that the industry had opposed. But it’s not clear if that would fully fix the problem. Previous legislative versions focused specifically on REMS but, as Gottlieb explained, the problem extends beyond REMS.
Without mentioning that specific bill, Gottlieb focused on solutions that will fix abuses currently present, “so we’re not designing policy for what was happening two years ago, but isn’t happening anymore.”
For biosimilars, the challenges don’t end with development. Commercial hurdles are significant, Gottlieb said.
“There are always things we can do to make the pathway more efficient, to lower the cost of development,” he added. “But the impediments are really on the commercial side and the physician acceptance side.”
Due to drugmaker rebates, for example, branded biologics can still make financial sense for insurers over a lower-priced biosimilar. As a result, biosimilar makers are pressured to price their products at levels that offset the rebates insurers lose from changing coverage preferences, the commissioner said.
“That’s a real impediment to market penetration, and I think it’s incumbent upon the health plans to take the long view here and try to do what they can to drive adoption of biosimilars,” he said.
Insurers answer to shareholders first, of course, not Gottlieb. While the former venture capitalist is well aware of that, he’s used his bully pulpit as FDA head to push for greater adoption.
A ‘Eureka moment’
Biologics were once the cutting edge of biopharma. Now, cell and gene therapies have moved to the forefront of science, forcing regulators to catch up.
Already, the FDA under Gottlieb has approved the first gene therapy for an inherited disease in Spark Therapeutics’ Luxturna, as well as two genetically engineered cell therapies for cancer.
The advent of reliable means to deliver gene therapies into the body has brought a “Eureka moment” for the field, Gottlieb said comparing it to how humanized antibody technology enabled the success of the large molecule drugs.
“I think we’re at an inflection point,” he predicted.
In a joint Jan. 15 statement, Gottlieb and Peter Marks, director of the agency’s Center for Biologics Evaluation and Research, set out ambitious expectations: a near future with 200 Investigational New Drug Applications a year by 2020, leading to approvals of between 10 and 20 cell and gene therapies each year starting in 2025.
To prepare, the two leaders outlined a plan to add 50 clinical reviewers while issuing a slate of guidance documents to shepherd drugmakers.
The drug review process for gene therapies will be fundamentally different, however. Typically, about 80% of an FDA review is on the clinical portion of a company’s application and about 20% on chemistry, manufacturing and controls, or CMC, Gottlieb said.
“With gene therapies, it’s almost inverted,” he added, with the most challenging questions on CMC. “We do need to think of a different regulatory paradigm.”
Spark CEO Jeff Marrazzo, for instance, recently told BioPharma Dive that its application with the FDA ran to roughly 60,000 pages, the vast majority of which was dedicated to CMC.
And with response to gene therapy potentially so much clearer, clinical questions may no longer be as paramount in the FDA’s initial review.
But gene therapies also bring new challenges, particularly over the longer term. Addressing issues like off-target effects could shift the FDA’s focus more toward post-approval assessments and data collection, Gottlieb said.
“If you think about, the regulatory paradigm that really lends itself to that kind of construct is accelerated approval,” the outgoing commissioner said.
Solutions to the questions posted by gene therapy could be part of a future FDA that looks much different than today’s regulator, as the agency adapts to keep pace with experimental therapies derived from cutting-edge science.
In that future, the lines between drugs, devices and biologics could dissolve further, Gottlieb predicted, calling those dividers “artificial separations.”
