SENATORS ANNOUNCE BIPARTISAN PROPOSAL TO BRING GENERIC BIOLOGIC DRUGS TO MARKET, SAVING BILLIONS IN MEDICARE COSTS
Biologics, which are also known as biotech drugs or biopharmaceuticals, are made from living cell cultures, rather than synthesized chemically. They are among the most expensive varieties of pharmaceuticals on the market, but generic versions of these drugs are rare because the Food and Drug Administration (FDA) currently lacks a formalized process, or "pathway," for approving them. The senators' legislation would solve this problem by establishing just such a pathway.
Consistent with the standard established by the landmark Hatch-Waxman Act of 1984, brand-name biologics would be entitled to five years of exclusive marketing under the bill introduced today. This five-year window would not begin at the time of the bill's enactment, but rather from the time when the brand-name drug was first approved. So, in the case of some biologic drugs that have been on the market for 20 years with no competition, generic companies can seek approval for more affordable versions almost right away.
"It's past time we created a way for generic versions of these expensive drugs to come to market. We have a bipartisan plan that we know consumers will support and we believe the President will, too. The savings reaped from this will be a down payment on health care reform," Senator Schumer said.
"Biologic drugs provide effective treatments for some of our most devastating diseases," said Senator Collins. "Unfortunately, however, these drugs are often prohibitively expensive and can cost tens of thousands of dollars a year. For example, the cancer drug Avastin has an annual cost of up to $100,000. People who need these drugs should not be denied access solely on the basis of cost. Using competition to bring generic versions of these medicines to the market will help offer patients, employers, and federal and state health programs cost savings."
The senators said that FDA approval for generic biologics would bring patients much needed relief from the high costs of the brand-name versions of these medicines. One of the most popular biotech drugs is Avonex, which treats multiple sclerosis. It costs almost $20,000 a year even though its patent expired in 2003. Avastin, which treats colorectal cancer, costs $43,000 per course of treatment. And Enbrel, a drug for rheumatoid arthritis, can cost up to $25,000 per year.
Under the senators' bill, an application for a generic version of a biological drug must demonstrate to FDA that there are no clinically meaningful differences between the two products. The application must also show that the two products are highly similar in molecular structure and share the same mechanisms of action, if known. Importantly, the legislation establishes tracks for two different types of generic drugs: "biosimilars," which means the generic is "like" the brand drug, and "biogenerics," which means a doctor will be able to substitute it for the brand.
