[Ip-health] WSJ editorial on generic biologics bills

[Mike Palmedo]

Dr. Waxman's Drug Lab

Wall Street Journal
April 10, 2007

Congress is rumbling to life on pharmaceutical prices, and the cause du
jour is biotechnology medicine. Both chambers are considering
legislation that would allow for the manufacture of lower-cost "generic"
copies of biopharmaceuticals. Proponents of the plan speak a language of
easy certainties, but the issues -- and potential consequences -- are
vastly more complex.

Biopharmaceuticals, or biologics, are proteins made by splicing genetic
material into living cell cultures. Many biologics are breakthrough
therapies, from Avastin, which chokes off the blood supply to cancerous
tumors, to Cerezyme, which treats the rare genetic disorder Gaucher's
disease. These drugs are expensive: Some can run to thousands of dollars
a year. According to IMS Health, the total cost reached $52.7 billion in
2005, some 13% of U.S. drug spending. That figure is expected to rise to
$90 billion by 2009.

California Representative Henry Waxman has introduced the Access to
Life-Saving Medicine Act because, he claims, all this is "too
expensive." The reference point is the law Mr. Waxman co-authored in
1984 allowing the Food and Drug Administration to approve cheaper,
generic versions of conventional drugs once the patents on the originals
expire. When the Hatch-Waxman act went into effect, however, biologics
were barely on the medical horizon. The new bill -- also sponsored by
Senators Hillary Clinton and Chuck Schumer -- would establish a similar
regulatory chute for approving "biogenerics."

But this is an attempt to fit a new problem into a framework for which
it wasn't designed. The pharmaceuticals currently covered under
Hatch-Waxman are "small-molecule" drugs made through distinct and
replicable chemical syntheses. Simple tests can show that a generic is
chemically identical to the original. The same can't be said for
biologics: Because they are made from living cells, a generic will not
be biochemically identical to the original. For this reason,
"biogenerics" are called "follow-on biologics" by the FDA. The FDA's
European counterpart calls them "biosimilars."

The long protein chains in biologics are less well understood than
traditional drug molecules. Protein folding, glycosation or impurities
introduce variation, sometimes with adverse side-effects. In the late
1990s, Johnson & Johnson sold a licensed version of Amgen's dialysis
drug Epogen, called Eprex in Europe. Several hundred patients developed
a serious immune reaction called pure red call aplasia due to a minor
change in the manufacturing process.

Follow-on versions of some of the most basic biologics, like human
insulin and human growth hormone, are either on market or undergoing FDA
review. As the science becomes more sophisticated, the same will be
possible for more complex biologics. Right now, it isn't.

Nevertheless, the Waxman legislation would establish
"interchangeability," or therapeutic equivalence, as the FDA standard: A
prescription for expensive Avastin, say, could be filled by a cheaper
generic product, even though the two might function differently in the
body. The legislation also enforces an abbreviated FDA review process,
circumventing the multiyear clinical trials and postmarket studies
required of the original drugs. It even restricts the FDA's authority to
require postmarket tests, in effect assuming into the process facts not
in evidence.

While some of the concerns about the potential side-effects of
biosimilars may be overstated, doctors and patients ought to have access
to the clinical data that would allow them to evaluate for themselves
the risk-reward trade-offs. In that regard, it would be useful to ease
the FDA's onerous safety and efficacy regulations. But Mr. Waxman's
proposal to do so selectively, only in the case of biosimilars, suggests
other motives.

The animus at work here seems to be to tilt advantages away from Bio
Pharma toward the generics. Mr. Waxman's bill would weaken intellectual
property protections such as clinical trial data exclusivity, and also
establish compulsory licensing. Further, it offers incentives for
generics to work around the many patents that cover complex biologics
before they expire. Even the EU provides more stringent patent
guarantees for biosimilars.

The high prices of biologics reflect the difficulty and expertise
required to develop these medicines. It should be possible to preserve
incentives to innovate while advancing legitimate public health goals
like increased access. And generics can play a useful role in spurring
the reformulation of existing medicines in more efficacious ways. The
challenge is to strike a balance between access and innovation, which
Mr. Waxman and his allies fail to do. The real costs of this agenda
might well be fewer new biological therapies.

--
Mike Palmedo
Research Coordinator
Program on Information Justice and Intellectual Property
American University, Washington College of Law
4910 Massachutsetts Ave., NW Washington, DC 20016
T - 202-274-4442 | F 202-274-0659
mpalmedo@wcl.american.edu