Efforts will be made "over the next few months" to bring House Energy and Commerce Committee members to a consensus on a follow-on biologics bill, according to committee staffer Ann Witt.

How long that will take "is very difficult to say at this point," the health counsel for committee Chairman Henry Waxman, D-Calif., acknowledged during a recent audioconference on FOBs sponsored by Avalere Health.

While health care reform and climate change "are probably the highest priorities for the committee," she noted, Waxman has a personal interest in FOBs and "will be pushing hard to keep that issue alive."

Waxman and Sen. Charles Schumer, D-N.Y., first proposed a follow-on bill (H.R. 1038) in 2006 and reintroduced the measure, with a few changes, in 2007 (¹ Also see "Generic Biologics Bill’s Key Battleground May Be Senate Health Committee" - Pink Sheet, 19 February, 2007., p. 3).

Focused on speedy introduction of generics into the marketplace, the legislation provides no data exclusivity for brand companies and gives FDA flexibility with regard to setting requirements for FOB approval and testing.

Eshoo Bill Redux, But Who Will Sign On?

A brand-friendly bill from Reps. Anna Eshoo, D-Calif., and ranking committee Republican Joe Barton, Texas, will be reintroduced by Eshoo with only technical amendments, an aide said (² Also see "Biosimilars Bill From Reps. Eshoo, Barton Gathers Steam In House Cmte." - Pink Sheet, 24 March, 2008., p. 17).

Introducing that bill will not interfere with Waxman's efforts to find a consensus, Eshoo's office suggests. In fact, the chairman's willingness to move toward a consensus may be measured by how many congressmen, including Barton, sign on to Eshoo's biosimilars bill over the next few months. If progress is being made on a compromise, there will be no need to stake out the Eshoo bill as an alternative to a Waxman proposal.

Sen. Orrin Hatch, R-Utah, continues to maintain that legislation reported out by the Senate Health, Education, Labor and Pensions Committee in 2008 is a bipartisan agreement and represents the doable (³ Also see "Senate Biosimilars Bill Readied For Take-Off In Next Congress" - Pink Sheet, 25 November, 2008.).

He acknowledged that "of course the bill isn't perfect. We need to perfect a few areas of the legislation, especially the very complex patent resolution provisions."

The difficulty of that issue was underscored during a November Federal Trade Commission workshop on FOBs and competition at which representatives from brand and generic firms agreed on the need for patent dispute resolution in legislation, but differed on the details (⁴ Also see "Follow-On Biologic Stakeholders Agree On Patent Resolution, Differ On Details" - Pink Sheet, 8 December, 2008., p. 22).

Patent Issues Need To Be Resolved Quickly

Waxman believes there must be early resolution of patent disputes, Witt told the audioconference.

If at all possible, she said, patent questions should be resolved before the FOB reaches approval. "We don't want to see patent disputes tacked onto the end of the exclusivity period."

Waxman is looking for options to ensure "the brand name company has an incentive to file infringement cases earlier rather than later." One option being considered is the assessment of penalties for late filing of such actions.

He also "wants to avoid the documented pitfalls in the Hatch/Waxman patent notification scheme" that have been exploited to delay market-entry of generic products, she said.

The bills in the 110 Congress prescribed different patent schemes and "we'll be trying to look at all of those to come up with something that everyone is happy with," Witt said.

Data Exclusivity Difficulties

Another major issue confronting legislators as they develop a pathway for FOB approval is the data exclusivity period - the time during which generic manufacturers cannot cite brand company data to justify their claims.

Although H.R. 1038 provides no data exclusivity, Waxman has conceded that a final measure will, if brand companies justify such a move. S. 1695 provides 12 years of exclusivity, while the Eshoo bill allows as much as 14.5 years.

As the House Energy and Commerce Committee tries to develop a consensus measure to take to markup, staff and members will be sorting through all the economic assessments from stakeholders on the length of time necessary to ensure that brand companies continue to fund innovation, Witt pointed out (see ⁵ Also see "War Of The White Papers: Grabowski Returns FOB Fire In Debate On Exclusivity" - Pink Sheet, 9 February, 2009.).

The committee is "very hopeful" that the FTC report on the impact of FOBs on competition "will help us understand the arguments made both for and against the 14 years of exclusivity," Witt said.

The date for releasing the FTC report remains uncertain, according to commission staff.

The 14 years of data exclusivity suggested by the biotech industry is more than twice that provided by Hatch/Waxman for approving generic copies of small-molecule drugs, Witt noted.

Waxman "feels very strongly that there must be adequate evidence to support any period of exclusivity, certainly very strong evidence to support such a long period," she added.

In designing an FOB approval pathway, Witt said, Waxman also believes that:

There must be flexibility so FDA can "decide on the basis of sound science which biotech drugs can be safely copied and what studies need to be done to establish that the copy and original drug are clinically indistinguishable."

Allowances must be made for improvements in scientific knowledge and technology, so a bill "must not inappropriately freeze 2009 scientific requirements into law."

Congress should not impose unnecessary procedural hurdles to FOB approval by requiring rules or regulations "whose primary purpose is to delay generic competition."

Single Market Protection Term

During the Q&A portion of the conference, Robert Armitage, General Counsel at Lilly, supported a suggestion that drug innovators be given a set period of market exclusivity.

"That's something Congress may well wish to take a look at," he said.

The important thing for an innovator company is to know that a product has an adequate life, he explained. Whether this is by congressional fiat, through patent or data protection is not important, he said, noting that he had made a similar proposal to the Institute of Medicine in 2005 (⁶ Also see "Drugs Should Get Longer Patents In Exchange For More Safety Data – Wood" - Pink Sheet, 14 November, 2005., p. 11).

"For us, it is predictability, efficiency in the interface and adequacy of the period of protection" that allows innovation.

What is needed is a market period of 15 to 20 years, he proposed, explaining that this would make it worthwhile to further develop drugs after they reach market. There should be a means of facilitating generic entry at the end of the set period, he added.

The generics approval process created by Hatch/Waxman has one "overwhelming defect," he said. "It's based on contentious patent litigation that harms generics by being very unpredictable when a product will ultimately get to market," and by raising the brand companies' risk, which "patients have to pay for in a way that is totally unnecessary."

Payers Fail To Drive Savings

Alexis Ahlstrom of Avalere pointed out that the company's research has found that payers currently do not extract as much savings as they could from competition among biologics.

Even if plans assign some products a high co-pay, they tend to treat biologics across a class equally, she said. They are placed on the same formulary tier and therapeutic substitution is not encouraged. Even Sandoz's follow-on human growth hormone Omnitrope is not put on a lower tier to drive its utilization, she pointed out.

The reason is probably that "biologics tend to be complex enough so plans feel they have to put all options on a formulary."

The same response probably will occur when FOBs enter the market, she predicted. When follow-ons "are truly identical, they are truly generic," then payers will "change their behavior and really drive the most savings."

- Cathy Dombrowski (c.dombrowski@elsevier.com)

Waxman To Seek Consensus On FOBs, Incentives For Early Patent Resolution

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