• The monoclonal antibody revolution

    Generic entry for small molecule drugs is controlled by Hatch-Waxman, allowing generic entry 10 – 20 years after FDA approval. For monoclonal antibodies and other large molecule biological products, a different law applies, which may never result in effective generic competition, even after patent expiration.

    Can you guess the top 5 drugs are in Medicare Part B? None are small molecule drugs subject to Hatch-Waxman in the US:

    5 highest

    Effective generic competition may never trouble these drugs. Indeed, Amgen’s base patent on epoetin alfa expired years ago. Payment reform should be considered, as a backstop to the biosimilar pathway.

    n.b. – this data is Part B, not C or D.


    • A couple of points.

      1) Epogen, with its two billion in Medicare costs, was approved as an orphan drug. The innovator found a condition that Epogen could treat, knowing full well that other uses of the drug, once approved, would be orders of magnitude more profitable. This is a failing of the orphan drug law.

      2) The point of generic drug laws is to relieve the generic manufacturers from the obligation to conduct clinical trials on their products. This is sensible for small-molecule drugs, since it is possible to devise analytical chemistry tests that demonstrate that the generic is the same molecule as the innovator.

      For biologics, you can’t use lab tests to demonstrate equivalence. However, I don’t think the future is really that bleak. Yes, you need clinical trials to prove equivalence. But, the costs of those trials are far lower than a typical phase III program, and the likelihood of success is dramatically higher. I think that the generic industry will eventually figure this out, and bring some products to market. Probably not as dramatic a price drop as with small molecules, but still meaningful.

    • A minor point of information. Part B drugs are administered by physicians in physicians’ offices. Usually intravenously.

      I think this means that some physicians may be making a lot of money selling and administering these drugs. I am not very familiar with Part B drugs, though.