The market for insulin and certain other biological products may change in the coming months and years, as a provision in Biologics Price Competition and Innovation Act (BPCIA) goes into effect on March 23, 2020 changing how these drugs are reviewed and approved. The Food & Drug Administration (FDA) has stated this change could ultimately “increas[e] patient access to insulin products used daily by millions of Americans to maintain stable blood glucose levels, as well as certain other biological products…” by “bring[ing] down prices and help[ing] patients have access to more choices for these life-saving drugs.”
U.S. law typically treats “drugs” and “biologics” differently—drugs are approved under the Federal Food, Drug, and Cosmetic Act (FD&C Act) as New Drug Applications (NDAs), and biologics are approved under the Public Health Service Act (PHS Act) as Biologics License Applications (BLAs). Because they are regulated under different statutes, drugs and biologics enjoy different protections and are subject to different rules. For example, most new drugs (specifically, new chemical entities (NCEs)) can enjoy 5 years of market exclusivity, while new biologics currently enjoy 12 years of market exclusivity. Also, different abbreviated regulatory pathways are available for drugs and biologics: generic drugs are approved under the Hatch-Waxman Act, while biosimilars and interchangeables of biologics are approved under the BPCIA.
Yet, a small subset of biologics—including insulin and human growth hormones—historically had been approved under the statute for drugs, the FD&C Act. Because these biologics were not approved under the PHS Act, sponsors could not seek approval of biosimilars or interchangeables of these products under the BPCIA. That will change on March 23, 2020, however, when all “biological product” applications approved under the FD&C Act will “transition” to being regulated by the PHS Act.
The March 23, 2020 transition has been ten-years in the making. When the BPCIA was enacted on March 23, 2010, it required marketing applications for biological products (that previously could have been submitted under section 505 the FD&C Act) be submitted under section 351 of the PHS Act. However, the BPCIA also provided a ten-year transition period for certain biological products to allow time to prepare for the change in law. That transition period ends on March 23, 2020, when any approved drug application for a transition biological product will be “deemed” to be a biologics license application. After the transition, sponsors will be able to seek approval of new biosimilars and interchangeables of the transition products under the BPCIA.
Which Products Are Affected?
Whether a product will transition to the PHS Act depends on the statutory definition of “biological product,” which has recently changed. In 2010, the BPCIA amended the definition of “biological product” in the PHS Act to include a “protein (except any chemically synthesized polypeptide).” On December 20, 2019, the Further Consolidated Appropriations Act, 2020, further amended the definition of a “biological product” to remove the parenthetical “(except any chemically synthesized polypeptide)” from the statutory category of “protein,” meaning that such chemically synthesized products are now within the definition of “biological product” and subject to the statutory transition. As amended by the BPCIA and the Further Consolidated Appropriations Act, a “biological product” is defined, in relevant part, as “a virus, therapeutic serum, toxin, antitoxin, vaccine, blood, blood component or derivative, allergenic product, protein, or analogous product . . . applicable to the prevention, treatment, or cure of a disease or condition of human beings.”
On February 21, 2020, FDA issued a final rule that aligned the regulatory definition of “biological product” with the statutory definition (i.e., a “biological product” includes a “protein”). (See 85 FR 10057 (Feb. 21, 2020).) FDA interpreted “protein” to mean “any alpha amino acid polymer with a specific defined sequence that is greater than 40 amino acids in size.” FDA also clarified that when two or more amino acid chains in an amino acid polymer are associated with each other in a manner that occurs in nature, the size of the amino acid polymer will be based on the total number of amino acids in those chains, and will not be limited to the number of amino acids in a contiguous sequence.
FDA explained that insulin, for example, will transition to the PHS Act because it is an “alpha amino acid polymer with a specific defined sequence that is greater than 40 amino acids in size.” Although insulin is composed of two subunits with 21 amino acids and 30 amino acids, the subunits are associated with each other in a manner that occurs in nature. By adding together the number of amino acids in each of the two amino acid chain subunits that comprise insulin, FDA concluded that insulin is an alpha amino acid polymer with a specific, defined sequence of 51 amino acids.
FDA released a preliminary list, current as of December 31, 2019, of approved “biological product” applications that will be affected by the transition. FDA stated that it intends to post a final list of transition products “shortly after” March 23, 2020.
What Does the Transition Mean for Approved Applications?
On March 5, 2020, FDA issued guidance on the upcoming transition. On March 23, 2020, an approved NDA of a biological product will be “deemed” to be a BLA by operation of the statute, without any affirmative steps by the application holder. That is, the NDA for the biological product will cease to exist. Instead, the application holder will receive a license that authorizes the holder to manufacture the biological product within the meaning of the PHS Act, and to introduce the biological product or deliver the biological product for introduction into interstate commerce. The biological product will also be removed from the Orange Book and added to the Purple Book.
According to a December 2018 FDA guidance document, the transition may truncate the exclusivity periods of some biological products. FDA has stated that because NDAs for the biological products will no longer exist on March 23, 2020, any unexpired exclusivity period associated with the NDAs (e.g., 5-year exclusivity or 3-year exclusivity) would cease to have any effect as well. (Any unexpired period of orphan drug and pediatric exclusivity would continue to apply to a deemed BLA after the transition date, provided that the conditions in the PHS Act are met.)
At the same time, according to this same FDA guidance, the transitioned products will not have any additional exclusivity under the PHS Act. Specifically, FDA has stated they would not be entitled to the PHS Act’s 12-year exclusivity period. FDA reasoned that these biological products have already obtained exclusivity under the FD&C Act, and “[a]llowing such products to obtain a separate 12-year period of reference product exclusivity would inappropriately impede biosimilar or interchangeable product competition in several product classes.” Further, FDA has interpreted the PHS Act and the BPCIA to “bar supplements to deemed BLAs and, where applicable, subsequent BLAs from being eligible for their own periods of reference product exclusivity.”
Moreover, the transitioning biological products will no longer be eligible for the exemptions for compounded drugs under the FD&C Act, as the PHS Act lack comparable exemptions. Currently, compounders use four bulk drug substances that are affected by the transition: human chorionic gonadotropin, hyaluronidase, follicle stimulating hormone (FSH or urofollitropin) and menotropins. However, FDA has announced in a guidance that it would not take enforcement actions against all cases of compounding.
What Does the Transition Mean for Pending Applications?
After March 23, 2020, FDA will continue to review a pending application for a biological product submitted under section 505 of the FD&C Act, so long as the application was filed not later than March 23, 2019, and was not approved as of March 23, 2020. If such an application is approved before October 1, 2022, it will be deemed to be a license for the biological product under section 351 of the PHS Act upon approval.
FDA stated in its December 2018 guidance that other pending applications for a biological product may be withdrawn and submitted under the PHS Act. FDA also stated that it intends to administratively convert any pending supplements to an approved NDA to a pending supplement to the “deemed” BLA, and to review such supplements under applicable standards for BLAs.
What Does the Transition Mean for Biosimilar Sponsors?
In its 2018 guidance, FDA recognized the challenge of pursuing a generic version of a biological product through the ANDA pathway: “Given the complexity of protein molecules and limitations of current analytical methods, it may be difficult for manufacturers of proposed protein products to demonstrate that the active ingredient in their proposed product is the same as the active ingredient in an already approved product, and thus ANDAs are not a focus of this guidance. There are no currently marketed biological products that were approved through the ANDA pathway.”
Beginning on March 23, 2020, applicants can pursue biosimilar versions of transition biological products through the BPCIA pathway. Under the BPCIA pathway, sponsors need only show that the biosimilar product is “highly similar to the reference product” and that there are “no clinically meaningful differences between the biological product and the reference product in terms of safety, purity, and potency of the product.” Sponsors can further prove that the biosimilar product is interchangeable with the reference product, which could allow it to be substituted for the reference product without the intervention of the prescribing health care provider (subject to state-specific laws).
FDA Commissioner Stephen M. Hahn, M.D., stated that the “transition will open new pathways for manufacturers to bring biosimilar and interchangeable versions of insulin and other transitioning products to market, facilitating greater competition in the marketplace.” Commissioner Hahn specifically focused on the potential benefits for insulin users, as “life-saving” insulin carries a “heavy price tag” and has increased in cost over the last decade. This transition comes at a time when both FTC and FDA are taking active steps to increase biosimilar competition in 2020 and beyond, as a part of FDA’s Biosimilars Action Plan. Whether insulin and other transitioning products will meet robust competition remains to be seen.
Authors: Michael Anderson, Jenny Shmuel, Cheryl Wang
The opinions expressed are those of the authors on the date noted above and do not necessarily reflect the views of Fish & Richardson P.C., any other of its lawyers, its clients, or any of its or their respective affiliates. This post is for general information purposes only and is not intended to be and should not be taken as legal advice. No attorney-client relationship is formed.
Cheryl Wang’s intellectual property litigation practice spans a wide range of technology, including life sciences, pharmaceuticals, biotechnology, software, hardware, and medical devices. Ms. Wang has worked on a variety of technologies, including pharmaceutical formulations, antibodies, biologics, immunotherapy, CRISPR, sleep apnea devices,...
Dr. Jenny Shmuel represents clients on a range of intellectual property matters, with an emphasis on medical device and pharmaceutical technologies. She has extensive experience in pre-suit diligence, case management, expert and fact discovery, and brief writing, and has examined and...