Biologic drugs are used to treat a number of serious, life
threatening diseases and save countless lives.
They are, however, exceedingly expensive. The average daily cost of a biological in the
U.S. ($45) dwarfs that of chemical drugs ($2).
Annually, some of these drugs can cost patients as much as
$400,000. The question becomes “how do
we make these treatments more sustainable?”
The short answer to that question centers around biosimilars as one study estimates they have the
potential to save north of $250 billion from 2014 to 2024.
The long answer to that question, however, is not as
straight forward. Manufacturers of
biological drugs can continue to charge monopoly prices as long as those drugs
remain under patent protection. Even as
these medications begin to come off patent, many over the next few years, the
road for biosimilars to enter the market is not exactly paved. While many other countries (Australia,
Canada, and the EU specifically) have had a market for biosimilars since 2006,
the US policy for entry of these drugs remains ambiguous.
A big part of this delay can be attributed to the FDA’s lack
of progress in establishing guidelines for the approval of biosimilars. Although they did accept their first
biosimilar application last week, there still lacks a definitive set of regulations. Tentative guidelines had
been provided both in 2012 and 2014 but a final set is still in progress.
This uncertainty in the regulatory process has caused
apprehension among many drug companies and left fewer players vying for a place
in the market. Said one pharmaceutical executive,
“I would like absolute clarity before we make a large investment. The quality
of the decision is worth more than speed.”
While the FDA wavers in putting a process in place,
biologics manufacturers have engaged in stall tactics. The longer biosimilar drugs stay off the
market, the longer these companies can continue to enjoy massive profits—reportedly as much as $100 million a
month for some drugs. The latest
strategy employed involves disputing the naming
system to be put into place for these drugs. Biologics manufacturers have lobbied to
maintain separate names, and the equity that goes with those names, from competing
biosimilars.
While this dispute carries on, patients are missing out on
billions of dollars in savings. Many
have called for the FDA to re-calibrate their priorities and fast track a set
of guidelines that would allow biosimilars to hit the market sooner. Other countries have had regulations in place
for almost eight years while we wait for officials to perfect ours. Until then, drug companies will continue to
pad their pockets with massive profits from these drugs.
Biosimilars
is projected to be a lucrative industry. Can you afford to miss out? We’ll have
the latest industry news and trends at the Business of Biosimilars conference. Join us October 20-22
in Boston, MA. Download the agenda here
to see what’s on tap.
SAVE
$100. Register here and
use code XP1986BLOG.
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