Towards the end of last year, I contributed a couple of articles to Bristows’ Biotech Review publication. One article looked at the new TTBER, something that we have already explored in depth on this blog. The other (written with colleague Maria Georgiou) was a round-up of competition law developments in the pharma sector over the last couple of years, with some crystal-ball gazing as to how these may be applied in the biotech sector.
Our conclusion in the article noted that:
“it cannot be excluded that the regulators’ stance [in relation to the pharma industry] will spill over into the biotech sector given that the market dynamics have some similarities. The importance of such products for consumers and the unrelenting pressure on national health budgets makes it worthwhile for regulators to keep the sector under review.”
I now note that the OECD’s newly published report on Generic Pharmaceuticals and Competition appears to endorse this view, stating as follows:
“Looking ahead, bio-similar medicines may also represent a major competitive pressure in the pharmaceutical sector in respect of biological drugs. Biological drugs are a fast growing industry branch. They are more complex and usually more expensive than the small chemically synthesised molecules, that form the basis of originator drugs and their generic substitutes. Competition authorities have voiced concerns regarding regulations that may restrict bio-similar entry and competition against reference biologic drugs. Such regulations consist notably in restricting the principle of substitutability or therapeutic equivalence of bio-similars, or disproportionate authorisation and registration conditions.” (Executive summary, p.3 – strangely, the detailed summary of the discussion does not mention biologics or bio-similars at all)
It is, however, to be hoped that the competition authorities will also recognise the significant differences between generic pharmaceuticals and bio-similar drugs. While there are certain similarities in the market dynamics, there are also important differences. As we noted in our Biotech Review article: “a company launching a biosimilar product will have incurred a significant amount of time and money in the development of its product, typically on a completely different scale from where a generic of a traditional pharmaceutical is launched. This is likely to result in smaller price differences between the original biotech and the biosimilar products, compared to the difference between original and generic medicines”.
We hope to comment on the OECD report on Generics more generally in the near future (I’ve already spotted a number of nice comments about the need to balance promotion of generic entry with incentives for innovation, which chime with one of the perennial themes on this blog), as well as on its companion piece on Competition Issues in the Distribution of Pharmaceuticals…