Politics & Policy

The FDA’s Slow-Roll on New Generic Drugs

Big Pharma backs a rule that would stifle competition from companies that make low-cost “biosimilars.”

What’s in a name? As far as affordable access to lifesaving drugs is concerned, plenty. Unfortunately, big pharmaceutical companies, their lobbyists, and the special interests on their payroll are working to convince the Food and Drug Administration (FDA) to stifle the competition by imposing a new naming rule that could cost consumers, in both dollars and health outcomes.

Biologics are drugs developed using DNA technology and grown within plant or animal cells. Unlike traditional drugs, which combine different chemicals to create medicines, biologics must be developed through organic growth. The DNA technology is cutting-edge, but biological medicine is as old as the prehistoric use of herbs.

Biologics are similar to traditional drugs, though, in that they, too, have been followed by generic equivalents. “Biosimilars,” as the biologics’ equivalents are called, cost much less and would provide strong competition in the free market. Such competition could lower costs by up to 40 percent, according to the Congressional Budget Office.

However, the FDA, in league with special interests, has slow-rolled its approval of biosimilars. FDA’s inaction could keep biosimilars out of the U.S. marketplace altogether, even though the European Union approved their sale more than a decade ago. Well-funded groups that have the FDA’s ear argue that the process that creates biologic medicines is too complex to allow for equivalents, and that any change in the manufacturing process creates an entirely new drug with different healing properties and effects — necessitating unique names.

But the FDA fails to follow the spirit of an important section of the 2010 Biologics Price Competition and Innovation Act. If a biosimilar is found to be “highly similar” to the original product, and if “no clinically meaningful differences” appear, then the FDA should approve the less costly equivalent. Forcing biosimilars to have unique names is an attempt to throw up barriers to the use of biosimilars as they get approved.

The World Health Organization (WHO) administers the International Non-Proprietary Naming (INN) system, granting non-proprietary names based on specific molecular characteristics and the pharmacological class of proposed active ingredients. Drugs in this country also receive a United States Adopted Name (USAN) as the non-proprietary name, but we almost always follow the lead of the INN.

While the FDA, pharmaceutical companies, and lobbyists play the name game, Europeans have used biosimilars with the same non-proprietary names for more than eight years, and potential product confusion has not been a problem. Moreover, the U.S. National Drug Code tracking system, unavailable in Europe, ensures even higher accuracy in America than in Europe. If evidence points to new side effects or if a recall occurs, the American system can easily alert medical professionals, leading pharmacy organizations attest.

The FDA would actually cause more confusion if it required biosimilars to have unique names. Generic-product substitution, common with traditional drugs that have the same name, would be difficult. Physicians and pharmacists could have trouble keeping track of which biosimilar is equivalent to which biologic.

Unfortunately, pharmaceutical companies are waging an expensive scare campaign to obscure these facts. This well-oiled machine of lobbyists, legislators, and activist allies has had great success doing the pharmaceutical industry’s bidding in recent years — almost always in favor of government regulation and to the detriment of free-market competition. The FDA is just the latest target of this well-financed fear-mongering.

A New York Times exposé found that biotech giants Amgen and Genentech proposed bills that would restrict the ability of pharmacists to substitute biosimilars for brand-name products. Biotech’s backroom dealings included giving tens of thousands of dollars in donations to state legislators who sponsored legislation drafted by pharmaceutical lobbyists.

The question now remains: Will the FDA fall for the industry’s latest ploy, the biosimilars name game?  

The use of biosimilars could save one-quarter of a billion dollars in U.S. national health-care costs over the next ten years, but the crony capitalists’ battle over naming could stifle their benefits. Major pharmaceutical companies fear competition from biosimilars and stand poised to convince the FDA to put up as many barriers to competition as possible. But opening up the market to responsibly and fairly named biosimilars is the best way to increase access to lifesaving drugs for patients who rely on them the most.

— Erik Telford is senior vice president at the Franklin Center for Government and Public Integrity.


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