Now is the time to push for a pathway for biogenerics

August 6, 2007

At the recent Pharmaceutical Care Management Association symposium, David Snow (Medco Health Solutions) told the audience why now is the time to push for a pathway for biogeneric drugs.

Now is the time to support and push for a pathway for biogenerics.

Snow pointed out that in 1984, when the Drug Price Competition & Patent Term Restoration Act-otherwise known as the Hatch-Waxman Act-was passed, critics argued against a pathway for generics, citing the following: enormous long-term cost; fewer new medicines, meaning curtailment of innovation; and higher prices.

The innovation around the science of chemistry is now at maturity and going into decline, Snow continued. While the pipeline is "pretty shallow," he maintained, there is innovation in the science of chemistry and branded drugs. "Big blockbusters are now going off patent to the benefit of everybody. There is new opportunity where the new innovation went. You can call it the disruptive play, but it's really an added play with a new science that's biotechnology. We're in the rapid growth phase right now."

Maturing categories

Snow mentioned several therapeutic categories that are nearing maturity. They include insulin, heparins, and the growth hormones. "For most of the drugs in these classes, patents have expired, but we are still paying brand prices because there is no [biogeneric] roadmap. In Medco's book of business, 16% of specialty spending is tied to drugs that have already gone off patent, but we're still paying branded prices because we can't bring a generic to market." He cited the following statistics:

What will the future hold?

"The rate of growth in total specialty spending is very much tied with what comes out of the pipeline, but it's a safe bet that a large number of oncologic drugs-a more disproportionate share of new drugs-coming out will be in the oncologic space, driving that spend up. The biotech companies that bring these new drugs to market should be rewarded," Snow said.

Society can't recycle capital to invest in the new sciences without a generic pathway, contended Snow. "When we talk about the generic pathway, we are talking about follow-on biologics, which could include 'biogenerics' or 'biosimilars,'" he said.