FDA to review lower-cost biotech drugs

WASHINGTON (AP) - The Food and Drug Administration is preparing to review the first lower-cost versions of biotech drugs, expensive medications which have never before faced generic competition.

The guidelines issued by the FDA on Thursday are the final step in a decades-long effort to lower the price of biotech drugs, high-tech injectable medications that cost the nation billions of dollars each year.

"These draft documents are designed to help industry develop biosimilar versions of currently approved biological products, which can enhance competition and may lead to better patient access and lower cost to consumers," FDA's drug division director Dr. Janet Woodcock, said in a statement.

Since their introduction in the 1980s, biotech drugs have never faced generic competition because the FDA did not have power to approve copies of such medications. For years the biotech industry successfully argued that their drugs, often made from living cells, were too complex to be duplicated by competitors.

That finally changed with the Obama administration's 2010 health overhaul, which ordered the FDA to create a system for approving so-called "biosimilar drugs." The industry term arose because biotech scientists insisted it would be impossible to produce exact copies of biotech drugs.

Efforts to design a pathway for competition were held up by years of squabbling between the biotech and generic drug industries and their allies on Capitol Hill.

The FDA's draft guidelines, posted online, reflect a final agreement that was largely shaped by the biotech industry's demands. As a result, new biotech drugs will enjoy a 12-year period of exclusive, competition-free marketing before a rival medication can launch. Additionally, companies seeking to market biosimilars will have to submit extensive chemical and biological testing data to show that their product functions similarly to the original product. The FDA will only approve products that are biologically and clinically similar to the original.

The agency said it has not yet determined when products will be declared "interchangeable," a key point of contention between branded drugmakers and their would-be competitors. Allowing pharmacists to switch patients to a generic version of a drug would significantly cut into sales of the original products.

Examples of biotech drugs include specialty cancer drugs like Roche's Avastin, which costs more than $100,000 for a year's supply, and the diabetes staple insulin, which costs closer to $1,000 per year.

Analysts disagree over how much of a discount biosimilars will provide in the U.S. In Europe, which has had a biosimilars market for several years, knock-off versions of biotech drugs are generally about 20 to 30 percent cheaper than the original products.

The FDA said it would take comments on its guidelines for 60 days, before finalizing them.