AstraZeneca appears set to follow Merck into the market for “bio-similars.” (See AstraZeneca may join generic rush.) Congress and the media tend to portray biosimilars are analogous to generic chemistry-based pharmaceuticals, and therefore believe that they will lead to much lower prices as a result of the commoditization of these products. If all goes according to plan, that should cut the price of biologics by 50 to 95 percent as has been the case for generic versions of traditional pharmaceuticals.
Pharma and biotech companies aren’t seeing it this way and neither am I. Although they won’t say so, pharma companies are starting to realize that biosimilars –which unlike traditional generics cannot be subsituted by a pharmacist for a branded product– are really like me-too products within a class of drugs. That’s exactly the model that’s enabled multiple blockbusters within a given class in the mainstream pharma business, and led to higher spending overall. Biosimilars are unlikely to be a lot cheaper than the products they copy, and they will have all the sales and marketing costs associated with a branded product, plus some of the development costs. Don’t be surprised if some biosimilars are actually priced higher than the original products, based on some real or perceived improvement in efficacy or safety. That’s what happened when me-too drugs like Lipitor entered the statin market. (See Generic biologics — or Me Too Drugs 2.0? for more details.)
AstraZeneca won’t be the last company to pursue this strategy. If a regulatory pathway for bio-similars is established in the US, every big pharma will jump on the bandwagon.
If policymakers want to control the cost of biologics, there’s a much simpler and easier way. Simply regulate the price of biologics once their patents expire. That would have several advantages:
It wouldn’t even be that bad for biologics companies. They’d already have earned their profits during the patented life of the product, and would retain 100 percent market share post-patent expiration. They can’t really complain about the government interfering with the free market, considering that patents are granted by the government in the first place.
The only real losers in this plan would be generic biologics companies. Since the industry doesn’t even really exist yet, now is a good time to implement my scheme.
The Potential Fallacies Associated With Me-Too Medications
“But corruption is neither need based nor greed based. It’s simply opportunity based.” -----Billy Tauzin, president and C.E.O. of PhRMA, the pharmaceutical industry’s most powerful lobbying group, as Mr. Tauzin stated in Boston recently.
It has been said by others that the pharmaceutical industry should not have government regulation or interference from our government at all because that would drastically limit if not eliminate innovation as well as our health care choices and options, both from the perspective of the doctor and the patient, so the public has been told often by others. Also what has been stated by this industry that their internal controls prevent wrongdoing? So, according to some, the public’s health would be limited and possibly harmed without the copious innovation of this industry. As with other issues we face as citizens, this is another attempt by these others to apparently install fabricated fear in our minds- void of any proof or reason, and is a fallacy.
As it has turned out, the pharmaceutical industry’s lack of innovation in particular has happened and they have appeared to do this on their own, overall, those innovators and lifesavers.
Over the past several years, those few meds created and FDA approved with true therapeutic advantages happened by discovery with government involvement in over half of these meds with clear clinical advantages for certain patients. Conversely, of the new chemical entities approved lately and developed by drug companies, over 50 percent of these have microscopic therapeutic advantage for patients, so I understand upon information and belief. This inefficient drug development by the pharmaceutical industry has created what is now the dominant development strategy of drug companies, and this strategy is known as the intentional development of what are phrased, ‘me too’ drugs.
These drugs essentially are small molecular variations of the original molecule in a particular class of medications. In other words, they tweak the original molecule in order to obtain patent rights for their now new drug project. This me too objective of drug companies now accounts, I believe, for about 80 percent of the research budgets of drug companies. And because the FDA only requires a potential med to be superior to a placebo in their mandatory clinical trials, usually these me too meds are approved- regardless of their necessity for others, or the need for such drugs.
And me too drugs are selected by the drug company for their potential blockbuster status as well as the speculated growth of a particular market, which means making over 1 billion dollars a year on such a drug, at least. For example, statin drugs, for high cholesterol patients, is a multi- billion dollar market. As a result, there are several statin meds now available for use by doctors to prescribe to their patients. Yet, arguably, me too drugs are all essentially very similar in regards to safety, efficacy, and cost, regardless of the class referred to so often saturated with me too meds, with few exceptions. The differences overall are minor once again with most me too drugs, overall. As aggressive marketers, the makers of these meds are suspected of doing a bit of publication planning, it is suspected, to falsely claim superiority of their newly approved me too drug over all the other drugs in a particular class both during and after the creation of these me too meds. Also, other classes of meds with several me too drugs may include SSRI anti-depressant drugs, as well as those meds for hypertension. There may be a dozen drugs in a particular class of medications that are all essentially the same in regards to their treatment abilities for patients with such disease states that they treat.
Now, there may be cases where a patient tolerates one drug in a class over another for unknown reasons, so in these few cases, some me too drugs occasionally are beneficial for patients for some reason or another, but should absolutely not be a primary objective of the drug companies to create them as often as they do. Instead, true innovation and discovery should be the focus of pharmaceutical companies, and it does not appear to be the focus of the pharmaceutical industry, presently. It appears that, thanks to the Bayh-Dole Act of 1980, they license molecules from those in the academic world, and then proceed with development of another’s creation they claim as their own.
Further vexing is that competition in the pharmaceutical industry amazingly does not and has not been of any financial benefit for the consumer, as competition normally does create. This fact is greatly demonstrated with other industries and is the apex of business operations. This pharmaceutical industry model is an exception, and the reason for this remains an unknown, as far as the etiology of being deprived of this costly environment of drug spending, yet it can be speculated that the me too drug makers claim uniqueness of their me too drug, which is rather deceptive.
This progressive marketing paradigm of the pharmaceutical industry, such as the creation of me too meds solely for their own profit, clearly illustrates their focus on these issues over true research and science, so it seems. Innovation, along with ethics, use to define this pharmaceutical industry. Sadly, it seems this is not the case today, which ultimately and potentially deprives potential treatment methods potentially for the public health if the objectives were focused on their true purpose. Yet hopefully, such historical qualities of drug companies will return some time, in time.
“Most people are other people. Their thoughts are someone else’s opinions, their lives a mimicry, their passions a quotation.” --- Oscar Wilde
Dan Abshear
Author’s note: What has been written was based on information and belief.
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