Generic versions of small molecule drugs have generated a trillion dollar-plus in savings, by some accounts. People who care about health care costs are hoping that biosimilars might also ratchet down the country’s health care bill by a notch or two—maybe not in that trillion dollar range but by enough to make a notable difference.
But obstacles loom in the way of a biosimilar windfall, as outlined today in an opinion piece in JAMA by Amitabh Chandra, director of health policy research at Harvard’s Kennedy School of Government, and Jacqueline Vanderpuye-Orgle, director of research operations at Precision Health Economics. They mention two. First, biosimilars are, in fact, merely similar to their brand-name counterparts, argue Chandra and Vanderpuye-Orgle, so they can’t necessarily be marketed as producing the same results as their referenced products. Second, the manufacturing process for biologics is complex—more complex than it is for small molecule drugs—and the costs are high, so entry into the market won’t be easy. Difficult market entry may mean less competition.
Lower your expectations, say Chandra and Vanderpuye-Orgle:
"The likely preference for the approved original biologic product (or reference biologic) and limited competition suggest that biosimilars will have less effect on the marketplace than generic products did for branded small molecule drugs."
And expect prescribing physicians to be wary of biosimilars:
"This unease [of prescribing physicians] with using biosimilars is likely large; amplified by risk aversion, status quo bias, and malpractice concerns given the unknown toxicity of the agents; and reinforced by financial considerations if payment to physicians is a fixed percentage of the price of the drug (as in Medicare Part B)."
But Chandra and Vanderpuye-Orgle build a case that at least some of the reluctance of physicians could be overcome—and the odds of biosimilars gaining a cost-saving foothold in the market improved—with “traceability,” which they defined as “the process of tracking a particular dose to a specific manufacturer, facility, and manufacturing batch.”
If biosimilars are traceable, any problems with variability or quality can be more easily investigated and identified, they assert. That might be a problem for a particular manufacturer but, the JAMA authors suggest, it could salvage the reputation of other biosimilars in the market and, perhaps, biosimilars in general.
Another plank in Chandra and Vanderpuye-Orgle’s traceability platform is that it would help with formulary design and cost-sharing because identifying a biosimilar as a biosimilar means it can be priced differently and offered on a different (presumably less expensive) tier than its brand-name counterpart.
Chandra and Vanderbuye-Orgle point to two ways that biosimilars could be made traceable. First, the product can be tagged with some kind of identifying code that comes after the name of the biologic; for example, Sandoz/Novartis’s copy of Amgen’s Neupogen is named, for now, filgrastim-sndz. (The FDA described that as a placeholder and is drafting a policy that will determine whether that kind of naming convention will be required.) Alternatively, National Drug Codes (10-digit numbers that identify the labeler, produce, and package size) could be used, although the authors note that pharmacists, not doctors, are familiar with National Drug Codes.
They don’t go into it, but the World Health Organization has proposed a four-letter identifier for biosimilars. The Pharmaceutical Journal , published by the Royal Pharmaceutical Society, the professional organization for pharmacists in Great Britain, described the WHO proposal this way:
"However, under the WHO naming proposal, the BQ [biological qualifier] would consist of a four-letter code suffix assigned at random, resulting in names such as ‘filgrastim-bcdf’ and ‘filgrastim-wxyz’. The code would also be attached to the manufacturing site where the biosimilar is made, which has been criticised by industry groups. For instance, a company could have two different codes for the same biosimilar product manufactured at two different sites."
Chandra and Vanderpuye-Orgle float the idea of using postmarket surveillance to decide how biosimilars should be named and made traceable. Names that distinguish the biosimilar from the reference product would be used at first. Data from postmarket surveillance would then be used to determine if the biosimilar was, for practical purposes, bioequivalent to its reference drug. If it were, then shared names could be used.
Chandra and Vanderpuye-Orgle’s takeaway is the importance of postmarket surveillance . They point to the experience in Australia as instructive. After epoetin biosimilars were allowed on the market there, almost all (95%) of the adverse events could be attributed to particular manufacturers. But when biosimilars to filgrastim were sold, just 55% of the adverse events could be traced to particular manufacturers. The difference was that filgrastim biosimilars had an identical naming policy, whereas the epoetin biosimilars were subject to a distinguishable naming policy, according to Chandra and Vanderpuye-Orgle.