Scott Gottlieb, MD: Policy Changes and Biosimilars

Transcript:

Well, I think a lot of the challenges with biosimilars weren’t necessarily related to the regulatory process. Certainly, trying to make it lower cost to enter the market, make it more efficient to get claims of interchangeability, or to extrapolate across different indications for biosimilars that were in biosimilar launches, they can launch with the full suite of indication that the reference product had. That’s all going to help facilitate I think a more competitive market, but a lot of the challenges were on the reimbursement side—on the coverage side—where it was hard for a biosimilar to enter the market.

I think one of the challenges was physician adoption—there was reluctance amongst physicians to adopt biosimilars. I don’t think that was unexpected. If you look back at the early days of Hatch-Waxman, there was a lot of physician reluctance to adopt small molecule generic drugs because of a perception that they weren’t the same as the branded drug. Eventually, physicians got comfortable with generic drugs and understood that they were just as safe and effective as the branded counterpart. I think we’re seeing the same evolution with biosimilars; it’s actually happening more quickly with biosimilars.

Another impediment is the rebates that exist on the incumbent biologic in some cases create an impediment to the biosimilar launching into the market. One thing we might look at is whether or not there should be rebates allowed on branded biologics once a biosimilar enters the market. So, we talked about doing away with the safe harbor for rebates in the context of all drugs in Medicare Part D. There was a rulemaking process to look at whether or not Medicare should basically eliminate the safe harbor from manufacturers to negotiate these rebate agreements with [pharmacy benefit managers, PBMs].

That ultimately didn’t go forward, as we saw in the press recently, but one place where we might reconsider reintroducing that concept, in doing away with the safe harbor for rebating, is in settings of the biologics when a biosimilar enters the market, because you could make an argument that in the setting of a market where there is an incumbent biologic, and there’s a new biosimilar entrant, the existence of a rebate, or the ability to rebate off of the incumbent biologic, truly is anticompetitive in that setting. So, we might look at narrowly tailoring that policy just for that specific setting.