Providing the Food and Drug Administration power to approve bio-similar versions of high-tech biologic drugs would be an efficient way to bring lower-cost alternatives to market, according to a Federal Trade Commission report.
Savings seen in giving FDA power to OK bio-similar drugs
The report, Follow-on Biologic Drug Competition, also determined, however, that while increased competition in the biotech arena is likely to lower drug costs, consumers and hospitals arent likely to see the same types of rapid price reduction that exists when generic versions of nonbiologic drugs are introduced. Thats because biologics are made from living cells, and a manufacturer that proposes making a generic version of an off-patent biologic drugalso called bio-similarhas to create their own cell line in order to manufacture a replication of the original drug.
Because a new cell line would not be an exact replica of a brand-name drugs active ingredient, patients may not be as willing to switch to a bio-similar and the original manufacturer is likely to retain 70% to 90% of the market share even after competitors enter the market. The report also concluded that biologic drug innovators dont need extended patent protection, such as the 14-year term being pushed by pharmaceutical lobbyists, in order to recoup innovator research and development costs.
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