Lessons for Biosimilars From the Generic Drug Industry

The utilization of generics in the US is vast, upwards of 86% of all prescriptions in 2017, according to the latest research by IQVIA. The pace of generic drug approvals by the Food and Drug Administration is also impressive, with 767 last year. This does not ensure the future of the generic drug industry, however, said Doug Long, MBA, IQVIA’s Vice President of Industry Relations. If we’re not careful, biosimilars in the pipeline could suffer a fate similar to that for newly approved generics.

Doug Long, IQVIA
Doug Long, IQVIA

In his yearly update presented at the Academy of Managed Care Pharmacy 2018 annual meeting on April 25, Mr. Long said that despite near-record numbers of generic approvals over a three-year period, “only 30% of these generics were actually launched. That’s not happened before.” The reason is that the manufacturers, upon receiving approval, reevaluate the marketplace prospects for their product and the competition. “They decide not to throw additional money into a losing proposition,” he stated. In fact, of the 767 generic approvals, only 73 were first-time generics. Ninety percent were simply piling competition onto already crowded drug categories.

He terms it a race to the bottom, but not a death spiral for generics. That is, “we’ve already reached the bottom, and we will come off of it” at some point. Generic drug manufacturers’ reticence to launch will help change the market direction.

Biosimilars have vast potential to save health care dollars, but only if they are launched. In a couple of instances, manufacturers have reviewed their biosimilar positions (Shire, EMD Serono) while early in the pipeline. Though it is reasonable to expect a paring back of prospective biosimilar drug makers, we hoped this would happen once the marketplace becomes saturated. That of course has not happened.

More Evidence of Value in Generics

Although several generic drugs have been associated with steep price increases, the net price change in 2017 for generics was -7.2%, according to Mr. Long. Most of this was the result of large rebates. Despite 86% generic drug prescribing, generics account for only 13% of the revenues. “I think there will be more generic drug shortages as a result of this revenue picture. People are refusing to launch after receiving approval, based on the dynamics of the marketplace,” he said. There will be more patent expirations and opportunities for first-time generics, “but I have less optimism on the biosimilar side.”

“Of 9 biosimilar approvals, we have only 3 launched products,” emphasized Mr. Long, “accounting for just $1 billion in total value of US marketplace in biosimilars.” He was hopeful that biosimilars for Remicade would have “broken the dam,” but this hasn’t happened. “Instead, payers have chosen to take the rebates, not the biosimilars. That resulted in only a 3% marketshare as a result for infliximab biosimilars.”

He noted that the average rebates given to payers and pharmacy benefit managers is 25% for biologics overall. Rebates in the autoimmune area averaged 20%, but payer market research routinely confirms that Janssen’s Remicade® rebates well exceed this figure.

Note: IQVIA is the child of the marriage between Quintiles and IMS.


Will the Final Guidance on Biosimilar Naming Be Reversed?

Judging from the comments at the Academy of Managed Care Pharmacy’s (AMCP’s) annual meeting March 27–30 in Denver, there is some hope and expectation that the Trump Administration will review and possibly revoke the naming convention for biologics and biosimilars that was finalized just recently.

The Academy’s position on the naming convention has not changed, according to Mary Jo Carden, VP of Government and Pharmacy Affairs. She characterized the naming convention chosen by the Food and Drug Administration (FDA) as unnecessary and confusing. Therefore, AMCP is still in favor of using the government-approved name and international nonproprietary name to biosimilars (and no new suffixes to existing originator products). In previous comments to the FDA, the Academy wrote, “AMCP supports a biosimilar naming convention using the same INN that has proven safe and effective globally for small molecule drugs and for biological products in Europe, and therefore it should be the standard in the United States. Using the same INN for biosimilars would also alleviate the need for multiple product identifiers in biosimilar labeling and therefore eliminate the potential for confusion by health care providers and patients.”

Doug Long, MBA, VP of Industry Relations at QuintilesIMS, in answer to a question from the audience, said he “might mention it to Scott Gottlieb,” newly nominated FDA Commissioner, to revisit it after his confirmation. Image result for Doug Long IMSEspecially in light of the present administration’s statements to streamline the drug approval process and improve public access to less-expensive medications, this would seem to make sense. Mr. Long also said that he had difficulty fathoming the reasons behind the decision making on biosimilar naming.

Drug consultant C. Douglas Monroe, RPh, MS, pointed out that there is hope. The Office of Management and Budget has asked the FDA to postpone implementation, and public comments from numerous organizations railed against the policy. Mr. Monroe cited publisher Wolters Kluwer as saying that the “…FDA’s proposed naming approach is a solution in search of a problem.” And several organizations, such as NCPDP and drug manufacturers, complained of the time and billions in cost of applying suffixes to all existing biologics.

Although it may be appealing for the Trump Administration to simply scrap the existing final guidance on naming. If they do not simply revert to the basic INN nomenclature for biologics, do we really want to start the entire process of considering a new system from scratch again?