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While many believe biosimilars have great potential, challenges remain.
Although biosimilars have been on the market in Europe for nearly a decade, the United States just celebrated the arrival of its first with the approval of Sandoz’s Zarxio last March. It did not hit the market, however, until September 3, five years after FDA created a pathway for biosimilars.
Sandoz developed Zarxio as an alternative to Amgen’s Neupogen (filgrastim), a blockbuster drug that fights off infection when a patient’s immune system is compromised by chemotherapy causing neutropenia. Sandoz already markets Zarxio in more than 40 countries.
Biosimilars must have the same mechanisms of action, routes of administration, dosage forms and strengths as their reference products but need only be highly similar rather than identical (as generics and their branded counterparts must be). They also have to show that indications for use have been previously approved for reference drugs.
MillerAlthough Zarxio is not identical to Neupogen, it has proved to have the same efficacy and safety, enough evidence to be used in place of the reference product. However, when used as a substitute by a pharmacist, a physician must approve its use because it is not interchangeable.
“For several years, Express Scripts has advocated strongly for biosimilars in the U.S. market, and we remain hopeful that Zarxio’s entrance to the market will help break down barriers to the approval and adoption of future biosimilars,” says Steve Miller, MD, chief medical officer for Express Scripts, a pharmacy benefits manager.
Express Scripts believes that biosimilars can expand patient access to critical treatments and create headroom for payers so they can afford the new breakthrough medications in the development pipeline, but only if the industry stops impeding their success, Miller says.
CrawfordHe estimates that $250 billion can be saved over the next decade if the 11 biosimilars poised to enter the market-many of which target cancer-do so successfully.
Jeffrey Crawford, MD, chair of the National Comprehensive Cancer Network Guidelines Panel on myeloid growth factor, believes biosimilars could reduce costs-especially as the price of biologics grows-and increase access fueling research, education and the discovery of new molecules for studying various conditions.
Brion Randolph, MD, chief of medical oncology, Cancer Treatment Centers of America, agrees with his colleagues that biosimilars would have the potential to be mass-produced at a lower cost if safety and efficacy are validated.
LassenAlthough David Lassen, PharmD, chief clinical officer, Prime Therapeutics, a PBM, is optimistic about the recent advent of a biosimilar to the marketplace, he questions whether biosimilars will prove to be viable alternatives except as a replacement for blockbuster specialty pharmacy drugs.
He predicts that the market for biosimilar development will shrink, as sales from blockbuster biologics decline.
A report sponsored by Prime includes three empirical models that predict the amount of sales needed to offset the cost of developing a biosimilar and bringing it to market. Basing the scenarios on biosimilars with lower R&D costs, average annual sales and diminished market share because of unfavorable regulatory barriers, needed sales ranged from $626 million to 1.3 billion.
Lassen is concerned that the pricing of biosimilars-about 15% to 30% lower than the reference biologic, according to the Centers for Medicare and Medicaid Services-might not be enough to ensure their success. Instead, he says, the pricing might only be an incentive for manufacturers to further discount their products.
LucioSteven Lucio, senior director of clinical pharmacy solutions for Novation, a healthcare services company, disagrees. He believes that based on the high cost of biologics, even a 15% to 20% savings would be substantial.
In Europe, the price discount on Zarxio is 26% when compared to Neupogen. Sandoz has not yet released its price in the United States at press time.
According to Amgen’s "2015 Trends in Biosimilars Report," most payers expect greater pricing discounts within two to three years of launch for both biosimilars and their reference products.
Although many stakeholders agree on the value of biosimilars, they are also aware of the challenges. “Their approval has not yet lived up to expectations because of market risk, unclear regulatory and statutory rules about naming and coverage by insurers and lack of a pathway for interchangeability,” Lassen says.
After debate over what to name biosimilars to distinguish them from their reference products, FDA released draft guidance last August. It recommends that biosimilars and reference drugs add an FDA-designated suffix of four lowercase letters without any meaning to identify each product, helping to prevent inadvertent substitutions of products.
The Zarxio/Amgen case is a prime example of regulations standing in the way. Amgen unsuccessfully tried to keep Zarxio off the market by claiming that Sandoz failed to provide Amgen with a copy of its biosimilar application and to follow the patent dispute resolution procedures created by the Biologics Price Competition and Innovation Act. Amgen also said that Sandoz did not provide a 180-day notice before making the product commercially available.
Because biosimilar manufacturers are able to forgo proving their drugs have efficacy and safety but rather, must show they are comparable to reference drugs in those two areas, they are expected to be approved more quickly and reduce R&D costs.
Randolph“We understand speed to market but not by sacrificing patient safety and outcomes; we need more rigor in clinical data,” Randolph says.
A final challenge is the inevitable debate about whether a new drug should be placed on formulary. Lucio says payers will have to decide if Zarxio will be the sole product in its category on formulary or will share space with its reference product. If the latter, payers will have to decide which product is preferred, he says.
Miller says Express Scripts has not yet made a decision.
Pharmaceutical companies have reported that they are beginning to develop other biosimilars for some cancer drugs, such as Herceptin (trastuzumab) to treat HER2-positive breast cancer. Amgen currently has four biosimilars for a variety of cancers underway.
More than 20 companies are developing a biosimilar for rituximab, a monoclonal antibody targeting lymphomas, leukemia, transplant rejection and autoimmune disorders. Unlike Zarxio, that was approved for use for all five indications served by the originator drug through extrapolation from its efficacy and safety in targeting one indication, Crawford says rituximab only could be measured by patient clinical outcomes in terms of disease control, making extrapolation much more difficult.
“Zarxio doesn’t treat cancer but serves as a supportive drug so approval for future cancer drugs could be different,” Lucio says.