Increasing Competition in the Biologic Market Through Truthful Advertising

This past week, FTC and FDA have taken further steps to encourage robust biosimilar competition in 2020 and beyond, this time with a particular focus on truthful and non-misleading advertising.

Biosimilars have still not reached their full potential in the United States marketplace. In 2018, then-FDA commissioner Scott Gottlieb characterized the biosimilar market as "anemic." (See here.) In 2019, policy thinkers argued that "biosimilar entry into the US market has been slow, rare and minimally effective" and advocated "throwing in the towel" on biosimilars as a method to address growing biologic-related healthcare costs. At the end of 2019, IQVIA reported a "slow start" for biosimilars, noting, for example, that nearly 30 months after launch, infliximab's biosimilar share in the U.S. was only 8%. (Arias, Future Biosimilar Opportunities, IQVIA blog, December 23, 2019.)

Many lay at least partial blame on reference product sponsors (RPSs), who they see as unlawfully stymieing the U.S. biosimilars market. Stakeholders have used a range of tools to address a variety of alleged anticompetitive behavior.

For example, biosimilar manufacturers and other private parties have filed antitrust suits against the RPSs of the high-selling drugs Remicade^® and Humira^®. Several class action complaints, currently in litigation, allege improper exclusionary "patent thickets," illegal market division agreements, exclusionary contracts, anticompetitive bundling, and/or coercive rebate schemes.

Lawmakers have also targeted a range of anticompetitive behaviors of RPSs. Under the Patient Right to Know Drug Prices Act, enacted on Oct. 10, 2018, the Federal Trade Commission (FTC) obtains and reviews patent settlement agreements between reference product and biosimilar manufacturers for anticompetitive reverse payments and other antitrust violations. Various pending bills seek to further address "pay-for-delay" agreements, as well as "product hopping," abusive or sham citizen petitions, and patent "evergreening."  (See, e.g., the Affordable Prescriptions for Patients Act of 2019 (S. 1416), the Protecting Consumer Access to Generics Act of 2019 (H.R. 1499), the Preserve Access to Affordable Generics and Biosimilars Act (H.R. 2375), the Stop STALLING Act (S. 1224/H.R. 2374), the STOP GAMES Act of 2019 (H.R. 2387), the TERM Act (H.R. 3199) and the Second Look at Drug Patents Act of 2019 (S. 1617).)

FDA is likewise involved. In July 2018, FDA released its "Biosimilars Action Plan" (BAP) for balancing innovation and competition, seeking to, inter alia, reduce "gaming" of FDA requirements that may delay competition. In support of this goal, FDA released final guidance in September 2019 on "Citizen Petitions and Petitions for Stay of Action Subject to Section 505(q) of the Federal Food, Drug, and Cosmetic Act." The guidance seeks to lessen the impact of certain citizen petitions on pending approval actions involving a biosimilar application. In particular, the guidance addresses the factors that FDA will consider in determining whether a petition is submitted with the primary purposes of delaying the approval of a drug application.

Biosimilar manufacturer Pfizer brought attention to a different type of alleged anticompetitive activity by RPSs: misleading communications and advertising. In a Citizen Petition filed in August 2018, Pfizer urged FDA to issue guidance "to ensure truthful and non-misleading communications by sponsors concerning the safety and effectiveness of biosimilars, including interchangeable biologics, relative to reference product(s)." Pfizer provided examples of several types of allegedly "false and misleading" statements by RPSs Genentech, Amgen, and Janssen in websites, tweets, patient brochures, and YouTube videos. For example, Pfizer flagged an Amgen tweet starting with the potentially misleading claim "Biologics or biosimilars? It's not just apples to apples."

The petition garnered nine comments from industry and other groups. For example, in a February 2019 comment, Janssen accused Pfizer of "blur[ring] the line between biosimilarity and interchangeability." Janssen argued that "sponsor communications that accurately reflect the differences between biosimilars and interchangeable biosimilars…are entirely appropriate…" In contrast, Boehringer Ingelheim supported Pfizer's petition, further encouraging "increased FDA collaboration with FTC to '€˜prevent injury and deception of the consumer.'" Boehringer Ingelheim warned that the biosimilars market is seeing "a '€˜Precautionary Principle' panic reaction being actively fostered by some originator sponsors and their partners."

Now, FDA and FTC have taken heed and have turned their attention to biologic and biosimilar advertising and promotional materials. On February 3, 2020, FTC and FDA signed a joint statement regarding a collaboration to advance competition in the biologic marketplace. Among other issues frustrating the biosimilar market, the agencies expressed "serious concerns about false or misleading statements and their negative impacts on public health and competition." The joint statement identified four action items to accelerate biosimilar competition, one of which was taking "appropriate action against false or misleading communications about biologics, including biosimilars…." As a part of the agencies' public outreach effort, the agencies plan to hold a public workshop, "FDA/FTC Workshop on a Competitive Marketplace for Biosimilars" in March 2020. One of the purposes of the workshop is to "discourage false or misleading statements about biosimilars."

Along with the joint statement, FDA published a draft guidance on promoting biosimilars and reference products in a "truthful and non-misleading way." FDA indicated that a promotional material may be false or misleading if it represents or suggests that there are clinically meaningful differences between the reference product and its biosimilar in terms of safety, purity, or potency, that one is safer or more effective than the other, or that the two products are not highly similar. FDA also advised against using individual statements of accurate information to create a misleading representation in a comparative context, such as comparing the number of licensed indications of the reference product and the biosimilar product in a manner that suggests the biosimilar product is in general less safe or less effective. It may also be misleading to suggest that a biosimilar product is less safe or effective than its reference product because it is not identical to the reference product or because it is not licensed as interchangeable with the reference product. As an example, the guidance states that if a promotional material states that the reference product produced a numerically higher overall response rate than the biosimilar product in a clinical study, but did not disclose that the difference in response rate was not statistically significant, the material has misleadingly implied that the reference product is superior to the biosimilar product. The draft guidance does not address considerations unique to interchangeable biosimilars, as FDA is still seeking input on that issue. Comments are due on April 2, 2020.

On February 4, 2020, FDA responded to Pfizer's Citizen Petition, granting it in part to the extent that Pfizer requested a draft guidance regarding promotional labeling and advertising considerations for biologics and biosimilars. FDA denied Pfizer's request to include specific content in the guidance, because the specific content in the final FDA guidance will be determined after considering public comments on the draft guidance. FDA encouraged Pfizer to review and comment on the draft guidance.

Agency oversight of advertising and promotional materials is now included in the multi-pronged effort to strengthen competition in the biosimilars market. The anticipated comments to FDA's guidance and the upcoming public workshop should provide additional insight into how important this issue is to stakeholders in the industry.

We will continue to monitor developments and update accordingly.

Authors: Jenny Shmuel, Cheryl Wang