Lawmakers weigh path to generic biologic drugs

By Susan Heavey

WASHINGTON (Reuters) - Cheaper versions of biologic drugs can be made safely, a U.S. Senate panel heard on Thursday, but brand-name makers of the pricey therapies for cancer and other diseases warned substitutes could be risky.

Legislation that would give the Food and Drug Administration legal authority to approve alternative versions of biologic drugs after patents expire is being considered by the Senate Health, Education, Labor and Pensions Committee.

Congress allowed the FDA to clear generic versions of conventional drugs more than 20 years ago but did not address medicines derived from living cells that can cost patients tens of thousands of dollars annually.

Such biologics include Genentech Inc.'s cancer drugs Herceptin and Avastin as well as anemia drugs such as Amgen Inc.'s Epogen/Aranesp and Johnson & Johnson's Procrit.

At issue is whether generic versions of biologics can undergo an abbreviated approval process without first conducting expensive clinical trials.

Jay Siegel, head of research for Johnson & Johnson's biotechnology business, told lawmakers any bill should require extensive clinical testing and post-approval studies for the rival products, also known as follow-on biologics.

"You just can't take a molecule that you don't know what it is and market it to the people. It's too risky," he said.

New York Democratic Sens. Hillary Clinton and Charles Schumer, sponsors of the bill, said their plan allows the FDA to decide how much testing is needed on a case-by-case basis.

A similar measure has been introduced in the U.S. House of Representatives by California Democrat Rep. Henry Waxman.

Ajaz Hussain, who oversees biological drugs for Novartis AG's generics unit Sandoz, said science shows follow-on biologics can treat the same conditions as their more expensive counterparts.

"FDA already has the expertise" to review them, he told the panel. "What you need to do is to empower them to act."

Employers and insurers see clearing a path for generic biologics as a way to curb skyrocketing health care costs.

Sid Banwart, vice president for human services at Caterpillar Inc., told lawmakers biologics accounted for 3 percent of employees' prescriptions last year, but made up 12 percent of the manufacturer's $151 million in drug costs.

"This is our single fastest growing category of health costs, and the trend is simply not sustainable," Banwart said.

The U.S. government, which runs the Medicare and Medicaid insurance programs for the elderly, disabled and poor, also stands to save millions of dollars.