Federal regulators have approved the first biosimilar drug to be sold in the U.S., a move that could lower treatment costs as biosimilars compete with what historically had been more expensive medications.
“Biosimilars will provide access to important therapies for patients who need them,” Food and Drug Administration Commissioner Dr. Margaret Hamburg said in a written statement.
The FDA on Friday approved Zarxio, a cancer drug produced by Sandoz, a unit of Novartis, as a biosimilar alternative to Amgen's biologic drug Neupogen.
Unlike generic drugs, biosimilars are biologics meant to work the same way as their brand-name counterparts.
The approval could mean greater access to biologic medications under the premise that biosimilars will be less expensive than brand-name biologics, which can cost several thousand dollars. A RAND Corp. study released in November estimated that the introduction of biosimilars could save up to $44 billion in drug costs over the next decade.
Currently, the FDA has four other biosimilar applications under review, including drugmaker Celltrion's version of Johnson & Johnson's arthritis treatment Remicade and Hospira's biosimilar version of Amgen's anemia medication Epogen. Canadian pharmaceutical firm Apotex has submitted applications for its biosimilar version of Neupogen, as well as one for Amgen's long-acting formulation of Neupogen, Neulasta.
Experts estimate Zarxio could initially be sold at a discount of up to 35% of the current price of Neupogen, which can run more than $3,000 for 10 injections. Other approved biosimilars could initially be sold at a 20% to 30% discount over their brand-name counterparts, said Mark Ginestro, a principal at tax and advisory firm KPMG. But in time, the price of biosimilars could go even lower as physicians, payers, pharmacy benefit managers and patients become more comfortable with the products, he predicted.
When asked whether the arrival of Zarxio to the market would compel Amgen to consider lowering the price of Neupogen to compete, Amgen spokeswoman Kelley Davenport said in a written statement, “We will continue to promote the robust clinical data of Neupogen, 24 years of experience and will utilize our commercial capabilities to compete effectively.”