State biosimilars legislation in the US: What the situation in California reveals about the nuances of the substitution debate

03 Sep 2013 Cameron Lockwood

As outlined in my colleague Milena's post back in May, the biosimilars debate is quickly heating up on the US political scene. Just recently, California became the latest state to inch closer to passing its own biosimilars substitution legislation. Now that the California State Assembly Committee on Appropriations has voted overwhelmingly in favour of the bill (which would require pharmacists to notify physicians of any substitution), the legislation will go back to the Senate and ultimately the governor for approval. With some supporters of the bill claiming it will improve access to cost-effective biosimilars--and yet with traditionally pro-biosimilars stakeholders standing in opposition--it may be worth digging a bit deeper to fully understand the stances different parties have taken on this piece of legislation.

Pro or con? Senate Bill No. 598, as California's piece of legislation is known, was introduced by Senator Jerry Hill, a Democrat. In her post, my colleague Milena raised the interesting prospect that we could see states split along political lines in terms of endorsement of biosimilars substitution. Indeed, at last count, 10 states have rejected biosimilars substitution outright, seeming to run counter to the aims of the Affordable Care Act, which gave the FDA powers to review and approve biosimilars.

And yet, in the case of California, Republicans and Democrats alike have lent their support to the bill arguing that it will facilitate substitution. And indeed, some manufacturers of generics and biosimilars are joined by the California Public Employees' Retirement System (the largest public pension fund in the country) in opposition. So what is going on?

The fine print While the bill would enable substitution--and therefore be a completely different kettle of fish than an outright substitution ban--opponents worry that the bill's physician notification requirements could prove burdensome for both pharmacists and physicians, potentially prompting the latter to default to the "do not substitute" box on the prescription.

Paul Bisaro, CEO of Actavis (one of the world's largest generics manufacturers, and one collaborating with Amgen in the biosimilars space), has weighed into the debate strongly in favour of SB 598. In a letter addressed to members of an Assembly committee earlier this summer, he argued that with regards to physician notification requirements, the extra burden will amount to two extra faxes per pharmacy per month. He also stressed that the notification provision does not mean pharmacists need to wait for physician approval, only that they must notify the physician within five days of substitution.

Still, opponents would argue that similar US policies with regards to generic substitution have stymied efforts by payers to increase penetration of these cheaper small molecules, leading to concerns that the potential cost savings of biosimilars will be compromised.

With the blurring of the lines that we are seeing between originator and biosimilar players (of which Amgen is only one example), the debate over biosimilars access continues to evolve in an interesting manner. In some cases, we are seeing a debate that hinges not on the concept of substitution itself, but rather the conditions and fine print associated with that substitution.

All this is taking place in the absence of any biosimilars having yet entered the US market. Indeed, the FDA has yet to approve any of these products in the country. Still, as a populous and influential state, California's policies can carry weight, making SB 598 an important one to watch.


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