FTC, FDA Sign Joint Statement Promoting Competition in Markets for Biologics

Federal Trade Commission Chairman Joseph J. Simons today joined Food and Drug Administration Commissioner Stephen Hahn in signing a joint statement promoting competition in biologics markets.

“Biologics are essential to the treatment of many serious illnesses. Practices in biologics markets are delaying the availability of biosimilar products, thereby depriving patients of the benefits of competition, including lower prices and increased innovation,” Chairman Simons said. “The FTC is committed to continuing to enforce the antitrust laws in healthcare markets, including those for biologics and biosimilars.”

“Competition is key for helping American patients have access to affordable medicines. While these therapies are critical for patients, biological products contribute significantly to drug costs, as they are often far more complex to develop than other drugs,” said FDA Commissioner Stephen M. Hahn, M.D. “Strengthening efforts to curtail and discourage anti-competitive behavior is key for facilitating robust competition for patients in the biologics marketplace, including through biosimilars, bringing down the costs of these crucial products for patients.”

Biologics treat serious medical conditions and comprise the fastest growing and one of the most expensive segments of prescription medicine. Unlike small-molecule drugs, which typically are manufactured through chemical synthesis, a biologic is manufactured in a microorganism or in plant or animal cells. Most biologics are very large, complex molecules, and many of them are produced using recombinant DNA technology. Similar to a generic drug, a biosimilar has no clinically meaningful differences from the original biologic, including safety and effectiveness.

The 1984 Hatch-Waxman Act created an abbreviated approval process for generic versions of small-molecule drugs, which fostered generic drug competition that has saved Americans hundreds of billions of dollars in drug costs. With these benefits in mind, in 2010 Congress enacted the Biologics Price Competition and Innovation Act to foster competition for biologics, including by biosimilars.

The FTC and FDA will coordinate to promote greater competition in markets for biologics and biosimilars; deter behavior that impedes access to samples needed to develop these products; take appropriate action against false or misleading communications about these products; and review patent settlement agreements involving them, according to the joint statement.

The FTC has worked for many years to preserve generic drug price competition through enforcement and advocacy, thereby gaining extensive expertise in the market dynamics that contribute to robust competition among pharmaceuticals. The FTC also has studied competitive issues affecting biologics.

A 2008 FTC workshop on competition issues involving follow-on biologic drugs, and the report that followed, cited the lack of automatic substitution for biosimilar products, potential chilling effects if products do not share the same nonproprietary names, and concerns about market acceptance of biosimilar drugs as market factors likely to limit biologic competition.

In 2014, the agency held a workshop on the impact of legislation and regulatory naming proposals on competition among follow-on biologics.

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