Regulations sought for generic biologics
Dec. 28, 2000, in the San Jose Mercury News
BY ANDREW POLLACK
New York Times
Most lucrative brand-name drugs eventually lose their patent protection, opening the market to generic products with lower prices, but one class of drugs, which includes some of the most expensive products in the world, are insulated from such generic competition.
These drugs are made using genetic engineering, and at present there are no regulations allowing for generic versions.
But, with patents on many of the biotechnology industry's best-selling drugs set to expire in the next few years, companies that make generic drugs are pushing to change that, hoping to invade new turf.
Generic drugs can sell for a fraction of the price of the equivalent brand-name drugs. Their low prices stem in part from the fact that generic drugs can be approved for sale without lengthy clinical trials to show they are safe and effective. Drug makers need to show only that generics are the same chemical and act the same in the body as the brand-name equivalent.
But this applies only to drugs made using chemistry -- most of the pills sold by big drug companies. There is no procedure for quickly approving generic versions of so-called biologics -- drugs made from living cells like vaccines, blood factors and genetically engineered proteins -- because these drugs are regulated under a different law.
"What we need to do is get a regulatory pathway for generic biologic approval," said William Nixon, president of the Generic Pharmaceutical Association, which has about 150 members.
The timing could be right. Sen. Orrin Hatch, R-Utah, has indicated an interest in updating the Hatch-Waxman Act, the 1984 statute he co-wrote that governs generic drugs. Moreover, surging drug prices have provoked a public outcry.
"Some of the most expensive drugs in the world are biologics," said Abbey Meyers, president of the National Organization for Rare Disorders, which represents patients and also supports new regulations for generic biotechnology drugs.
Cerezyme, for example, a drug made by Genzyme for a rare disorder called Gaucher's disease, can cost more than $200,000 a year. An anemia drug, erythropoietin, or EPO, made by Amgen and given to patients undergoing kidney dialysis, sells for millions of dollars an ounce and is one of Medicare's biggest pharmaceutical expenditures.
But biotechnology companies plan to fight any new rules. The industry maintains that its products, mainly proteins made by implanting genes into bacteria or hamster cells, are hundreds or thousands of times larger and more complex than chemical drugs. This makes it virtually impossible for a generic drug maker to show that its product is the same as another biotechnology drug.
Living things cannot be easily standardized like chemical processes, the industry argues. What is more, even slight differences among drugs can have a big impact on their safety and effectiveness. The Food and Drug Administration has approved two versions of beta interferon, used to treat multiple sclerosis, because slight changes mean that one has fewer side effects than the other.
"Do we jeopardize public safety by assuming those minor differences are irrelevant to the clinical impact of the product?" said Lisa Raines, Genzyme's representative in Washington.
The FDA also has reservations about generic biologics.
"There are significant unresolved scientific issues about how to show 'sameness' between complex biological macromolecules so that FDA can be assured that any generic biologic is safe, pure and potent as well as 'equivalent' to an innovator product," Margaret Dotzel, associate commissioner for policy, said in a statement.
Some agency officials refer to an incident in the 1950s when a slight change in the production process led to a failure to completely inactivate the virus used in the Salk polio vaccine. Some people got the disease from the vaccine.
Quirks in regulation
But the FDA has in effect already approved one generic biologic. Because of quirks in drug regulation, hormones are regulated as chemical drugs, not biologics. And in 1997, the FDA approved Ferring Pharmaceuticals' generic version of Pergonal, an infertility treatment sold by Serono that consists of two hormones isolated from the urine of post-menopausal women.
Serono sued to block the approval, citing slight differences between its drug and Ferring's, a unit of Ferring BV Group Holding of the Netherlands. But an appeals court sided with the FDA, saying that the drugs do not have to be chemically identical, only identical in terms of their clinical effects.
The market for generic biologics could be sizable. EPO has sales exceeding $4 billion a year by Amgen and its licensee, Johnson & Johnson.
Other drugs that could lose patent protection in the next few years include human insulin for diabetes, beta interferon for multiple sclerosis, alpha interferon for hepatitis and cancer, and growth hormone for dwarfism and other conditions. Each of these drugs has worldwide sales exceeding $1 billion.
Some generic drug companies are linking up with biotechnology companies to acquire the expertise they need.
Teva Pharmaceutical Industries, an Israeli company, has an agreement with Biotech General. Ivax, another major generic producer, signed an agreement last year with Indiana Protein Technologies. Barr Laboratories said it is working on one biotechnology drug and is looking for others. Sicor Inc. is building a factory in Mexico to produce biologics. For competitive reasons, all the companies declined to say which drugs they are developing.
Even so, some experts said most generic companies will not be pursue biotechnology drugs because the manufacturing will be costly and difficult. Biotechnology is "fraught with levels and levels of patents," said John Langstaff, president and chief executive of the Cangene Corp., of Winnipeg, Canada, which is developing its own generic biologics. "It's really a dog's breakfast."
If the American market proves tough to crack, some generic companies are likely to sell their drugs first in Asia, Europe and Latin America, where biotechnology companies generally have fewer patents.
Brand-name drug companies may try to protect themselves from competition by developing improved versions of their drugs that render the originals somewhat obsolete. Both Roche and Schering-Plough have developed longer-lasting versions of alpha interferon that would require fewer injections, and Amgen has developed a longer-lasting EPO.
In addition to competition from generic drug makers, biotechnology companies are facing new challenges from others in their industry.
Some generic industry officials said that if costly and protracted trials are required, competition will be limited and the resulting drugs will not be priced significantly below the originals. Also, they said, if the generic drugs are not considered fully equivalent to the brand-name drug, doctors and pharmacists will not be able to easily substitute the generic for the original.
Some experts said that it should be possible to show equivalence between two biologics, though the tests are likely to be more complicated than for chemical drugs. U.S. Pharmacopeia, a non-profit organization that sets quality standards for pharmaceuticals, has set up a committee to explore how the comparisons could be done.
"What do you think
about a 747 -- pretty complicated, right?" said Roger Williams, executive
vice president and chief executive of U.S. Pharmacopeia. "Do you think
somebody could make a 747 beyond Boeing? Of course they could."