On June 1st, the FDA published two
new "draft guidance" documents, which are recommendations for
review and comments to address one of the many complex obstacles to timely
generic and biologic drug launches.
Some of these obstacles are related to the current Risk Evaluation and
Mitigation Strategies (REMS) program developed by the Brand
manufacturer. After 60 days, the "draft guidance" comments
will be evaluated and new policies will be voted on and become effective with
the goal to bring lower cost generics and biologics to the market sooner.
Currently the FDA requires certain Brand
medications to have a REMS program provided prior to the approval of the
drug. The REMS document outlines serious safety concerns and
employs tools beyond prescribing information to ensure that the benefits of a
medication outweigh its risks.
The FDA may also require certain "Elements To Assure
Safe Use" (ETASU) such as requiring the provider to have specific training
or experience, that patients using the drug be monitored, or that the drug is
dispensed to patients with evidence of other documentation of safe-use
conditions. The ETASU may also include a system for the applicant to
monitor, evaluate and improve a subscribed drug implementation.
Lastly, a REMS document must have a timetable for submission of assessments of
the strategy. https://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM609045.pdf
Once the period of Brand patent protection or exclusivity has
lapsed, it seems that generic and biosimilar drug competition is not
materializing judiciously. Sometimes this is due to Brand drug
manufacturers' tactics before and after the generic or biologic drug
manufacturer seeks approval for market entry. One example is restricting
the sale of the Brand drug to the generic or biologic manufacturer, which typically
requires an estimated 5,000 doses in order to run bioequivalence and
bioavailability studies to prove that the generic is the same as the Brand.
Mylan, one of the largest generic manufacturers, recently
sued Celgene over their refusal to share samples of Revlimed, which costs
approximately $180,000 per year. In
2016, its third year on the market, Revlimed had $6.97B in sales, and given the
initial $800M on research and development, Celgene continues to reap a
significant ROI. The expiration date for the patent will be 2019, but Celgene’s
delay strategies could allow the company to put off unrestricted competition
from generics until 2026, which could cost an extra $45B to patients who need
this cancer drug. https://www.bloomberg.com/news/features/2017-12-20/the-loopholes-drug-companies-use-to-keep-prices-high
After bioequivalency has been determined, Brand manufacturers
make the negotiation time between the Brand and generic or biologic drug
applicant a lengthy process often resulting in litigation. This causes delays in the approval of the
generic or biologic. Brand manufacturers have used this litigation
to their advantage delaying market entry.
The FDA's new "draft guidances" are an effort to
address these issues currently delaying generic and biologic drug competition.
The two new FDA "draft guidances" are: 1) "Development
of a Shared System REMS Guidance for Industry" and 2) "Waivers
of the Single, Shared System REMS Requirement Guidance for Industry". The objective is to shorten the time that a
generic or biologic can launch. In the first "draft guidance" Brand
and generic/biologic applicants are encouraged to use an industry working
group (IWG) or third party to expedite negotiations and develop a shared
REMS Guidance and ETASU. The second "draft
guidance" allows the generic manufacturer an option to seek a waiver
to obtain a separate and comparable REMS policy with ETASU in certain
situations where the Brand manufacturer is not cooperating. https://www.fda.gov/downloads/Drugs/GuidanceComplianceRegulatoryInformation/Guidances/UCM609048.pdf
These guidance reports are expected to translate to new
policies and will be a major opportunity for client and member savings as they
will allow lower cost generics and
biosimilars to come to market earlier. High
cost biologics continue to represent not only 40%-50% of total pharmacy benefit
dollars, but also a large percentage of medical costs i.e. infused drugs and
drugs bought and billed by physicians. However,
physicians will have to agree that biologics are safe and that patients equally
feel comfortable being prescribed a biologic versus the Brand reference or
originator drug.
At the same time Pharmacy
Benefit Managers have a tremendous amount of control given that they develop
formularies with preferred drugs from manufacturers who provide the highest
rebate including some of the currently few biosimilars approved in the United
States. As biosimilars come to market
sooner, losers will be the clients who are not using an independent pharmacy
benefit consulting firm, thus leaving thousands of dollars as PBM profits for
shareholders because they signed a three year PBM agreement, which has language excluding biosimilars
from
rebates.
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information, please visit www.pbirx.com or call (888) 797-2479.
