HHS Secretary Alex Azar Expresses Hope in Biosimilar Uptake, Notes Positive Momentum

Despite discouraging numbers and challenges, hope that biosimilars will cut total healthcare costs has been amplified by recent HHS actions according to Secretary Alex Azar, at the Biosimilars: Breaking Through the Barriers symposium in Washington, DC.

Forty percent of US prescription drug spending is on biologics, although these represent just 2% of all drugs on the market. In addition, there is only 1 biosimilar product that has a greater market share than the reference product, symposium participants noted.

The FDA’s actions provide the framework for the future success of biosimilars, Azar said. “Efficient review and earlier marketing of approved biosimilars have been the direct result of actions by the FDA under its Biosimilars Action Plan [BAP],” Azar explained. The FDA is a division of HHS.

In the past 3 months, the FDA has released draft guidelines to help support the development of biosimilar and interchangeable insulin products, finalized its rule around the definition of biological product that will allow more products to qualify for biosimilar status; and updated the Purple Book to make information about FDA-licensed biological products available through an online, searchable database.

The FDA also signed a joint statement with the Federal Trade Commission (FTC) agreeing to take procompetitive steps, including deterring behavior that impedes access to biosimilar development, taking appropriate action against misinformation around biosimilars, and having the FTC review patent settlements regarding antitrust violations for biologics.

Additionally, on March 23, a new provision under the Biologics Price Competition and Innovation (BPCIA) Act will go into effect that allows certain new biologics, such as insulins, to be approved under the biosimilar pathway.

“This is an opportunity for more competition and lower costs because it will create the first ever application pathway for products that are proposed as biosimilar to or interchangeable” with established biologics, Azar said.

In 2018, the FDA announced new policies that will make it harder for innovator drug companies to use citizens petitions to prevent biosimilars and generics from coming to the market, “thereby extending a drug’s monopoly beyond what Congress intended.”

Azar highlighted the Grassley-Wyden bill, which is currently awaiting congressional action and could help speed biosimilar adoption. The bill would increase Medicare Part B reimbursement for biosimilars from average sales price (ASP) plus 6% to ASP plus 8% for the first 5 years following introduction. This enhanced payment is intended to encourage use by providers.

Azar assured that HHS has sought out solutions to economic and payment incentives that pose challenges for biosimilars. These solutions include the addition of individual payment codes for biosimilars within Medicare Part B and allowing beneficiaries in Medicare Advantage Plans to start biosimilar products before trying the corresponding branded reference products.

Other major sources for hope stem from the United States’ success in overcoming similar challenges for generic drugs and the European Union’s substantial healthcare savings generated by their successful biosimilar market, Azar said.

“It took a great deal of time, provider education, and gradual cultural acceptance for generic drugs to have the dominant market share that they have today in the United States. When we surmount these barriers for biosimilars, the benefits will be huge,” Azar predicted.

Azar encouraged audiences to tell the HSS and President Trump their ideas on how to lower drug costs. “I believe, when you combine the president and his administration's commitment with the clear consensus around the importance of biosimilars from Congress and healthcare payers, that we're nearing an inflection point,” he said.