In the small-molecule drug area, which covers chemical drugs, the Food & Drug Administration (FDA) has provided generic drug makers with an expedited approval process—and incentives for companies to take advantage of them—since the 1984 Hatch-Waxman Act. The pathway changed the market, creating a generic drug industry that in 2011 accounted for more than 70 percent of all prescriptions in the U.S., according to IMS Health, a pharmaceutical intelligence company.

Hatch-Waxman didn’t cover the $30 billion biological products market, however. Biologics are drugs and treatments that are far more complex than small-molecule drugs. They require much more complicated manufacturing processes and often are derived from living cells or tissues. The most widely used biologics treat diabetes, cancer, rheumatoid arthritis and multiple sclerosis. When a drug has no clinically meaningful difference from a reference product, it is biosimilar.

But there was no abbreviated FDA approval pathway for biosimilars until the Biologics Price Competition and Innovation Act of 2009 (BPCI Act) was enacted on March 23, 2010, as part of the Patient Protection and Affordable Care Act.

“With small-molecule drugs, there was an incentive for companies and an expedited approval process, which was lacking in the biosimilars space,” says John Garretson, a partner at Shook, Hardy & Bacon. “The 2009 legislation was the first step toward addressing that issue.”

On Feb. 9, the FDA released three draft guidance documents on biosimilars that raise many questions but mark a major step toward implementing the law. The BPCI Act amended Section 351(k) of the Public Health Service Act to create an abbreviated pathway for the biosimilar, or a so-called 351(k) application, and the recent guidances start to sketch out what the 351(k) process will be.

Quality Considerations

The key of the three documents is titled “Scientific Considerations in Demonstrating Biosimilarity to a Reference Product,” and establishes the three categories of information the FDA will require: physical/structural analyses, animal testing and clinical studies.

The FDA recommends that sponsors use a step-wise approach to gathering and developing this data in part to avoid unnecessary testing. “At each step,” the regulation says, “the sponsor should evaluate the extent to which there is residual uncertainty about the biosimilarity of the proposed product and identify next steps to try to address that uncertainty. Where possible, studies conducted should be designed to maximize their contribution to demonstrating biosimilarity.” The Scientific Considerations guidance also says the FDA will take a “totality of the evidence” approach to reviewing applications.

The agency has signaled that it will consider, as part of an overall package, testing data generated abroad for submission to foreign regulatory agencies, Garretson says.

The second guidance document, “Quality Considerations in Demonstrating Biosimilarity to a Reference Protein Product,” lays out in what the FDA has called “excruciating detail” how it will analyze biologics for biosimilarity. It lists a number of factors it will consider in its assessments, including manufacturing process, assessment of physiochemical properties, functional activities, receptor binding and immunochemical properties, impurities and stability.

The third document addresses common questions regarding the new process. The FDA plans to update the document as it receives additional questions.

Wait and See

Overall, the guidance gives a helpful but generalized view of how the biosimilar approval process will work.

“There’s a lot of stuff in there,” Garretson says, “but it raises more questions than it answers. It’s good in that there is flexibility in terms of the agency looking at particular instances of how drugs are made and whether they should be approved. But it is hard to discern any bright-line rules for how decisions are going to be made in particular instances.”

Instead, companies will have to wait and see how the FDA applies the regulations in individual cases.

John Manthei, a partner at Latham & Watkins, says the industry shouldn’t expect much further detail through future proposed regulations because of the highly fact- and product-specific nature of the biosimilar approval process.

“This is a very important first step, but this is going to be a long, long process that the industry’s going to have to actively watch and participate in,” Manthei says. “This is the first big chapter in a long story, and you’re not really going to know how viable of an option it is until companies start going through with it” (see “Avoiding Burdens”).

The Holy Grail

Perhaps most notable about the guidances is what they do not cover: interchangeability, which could shake up the biosimilars market.

“Interchangeability is the holy grail of the biosimilar world, and we’re not there yet,” says Jeffrey Lewis, a partner at Patterson Belknap Webb & Tyler. “It could possibly be years until we have interchangeability.”

When biologics are determined to be biosimilar, physicians will decide which of two proteins to prescribe. “It’s still going to be a marketing issue, fighting for a doctor’s prescription,” Lewis says. “Business is going to change when it comes to interchangeable biosimilars.”

Interchangeability would mean that, like generic small-molecule drugs, pharmacists would be able to switch out the innovator drug for the biosimilar, which would boost biosimilar sales with minimal marketing expense. The FDA has indicated that it will not release guidelines on interchangeability until it determines biosimilarity for the first time. Assessing for interchangeability would come only after a biologic is deemed biosimilar to a reference product. As of a Feb. 9 FDA press conference, the agency has had 35 pre-IND (Pre-Investigational New Drug Application) meeting requests for proposed biosimilars, 21 pre-IND meetings and 9 INDs in-house. But the agency had received no 351(k) applications.

The statute broadly outlines what applicants must do to meet the higher standard required for interchangeability: After demonstrating biosimilarity, applicants will have to show that patients could switch between the reference and biosimilar products without heightened safety or efficacy risks. The FDA has said this will require additional clinical study. That alone indicates the FDA will set a high bar to clear, but the industry is wondering just how high, Garretson says.

“Is it effectively going to be that you have to recreate a full biologics license application with separate clinical testing data in order to get approval?” he says. “I think people will try to extrapolate from the guidelines to get a feel of how difficult it will be in individual cases and what kind of timeframe the agency is realistically going to operate on.”