FDA Budget Matters: Infrastructure to Support Robust Generic Drug Competition

By: Scott Gottlieb, M.D.

The FDA launched its Drug Competition Action Plan more than a year ago, with the aim of advancing policies that would promote robust generic drug entry as a way to foster competition and lower drug prices. Access to drugs is a matter of public health. And among the best ways to help consumers get broader access to medicines is through policies that help ensure branded drugs are subject to timely generic competition.

Dr. Scott GottliebOur work is far from finished. But the policies we’ve advanced are already showing benefits toward these goals. The benefits we’ve seen reinforce the fact that policy can be used as a vehicle to advance these purposes.

New resources have also helped advance our work. Owing in large measure to the FDA’s implementation of the Generic Drug User Fee Amendments of 2012 (GDUFA), which funded critical enhancements to FDA’s generic drugs program, our staff eliminated the backlog of generic drug applications. In 2017, we also approved the largest number of generic drugs in the FDA’s history.

As part of GDUFA, as well as through our own new efforts, the FDA also has put policies in place to promote generic drug development in areas where there’s inadequate competition. This includes a focus on developing new guidance aimed at promoting development of generic versions of complex drugs. These are drugs that are often harder to copy. By advancing clear, objective, science-based guidance for developing generic copies of complex drugs, we hope to foster more competition.

And the FDA also has improved the efficiency and predictability of the generic drug review process to help promote more robust generic drug competition. For example, we’re prioritizing the review of generic drug applications for which there are no blocking patents or exclusivities. The aim is to promote competition so that there are at least four approved applications for each product (including the brand drug). Our data shows that there are significant price decreases once there are at least three generic drugs on the market. Our new policy will help ensure that there is robust competition across the market that will drive down drug costs to consumers.

In addition, we’re taking other new steps to curtail various forms of “gaming” by brand companies, where some sponsors sometimes adopt tactics that seek to delay entry of generic competition.

But we know that we need to do even more to promote access and competition. And so we’ve put forward a broader plan, as part of the President’s Budget, to achieve these aims.

Toward these goals, the President’s fiscal year 2019 Budget Request included $37.6 million to fund two initiatives that will help modernize aspects of our generic drug review process.

The first initiative will create a new review platform — the Knowledge-aided Assessment & Structured Application (KASA) platform — to modernize generic drug review from a text-based to a data-based assessment. The KASA will enable a structured review that will make the application review process more efficient, and allow deficiencies to be spotted earlier. This will allow the FDA to provide earlier feedback to generic drug makers that will, in turn, help to reduce multiple cycles of application review, one of our key aims and a primary focus of our overall efforts to speed market access to new generic medicines. Going through multiple review cycles is one of the primary reasons why the approval of generic drug applications is sometimes delayed many years. The new KASA system will help sponsors submit high-quality and more complete applications on the first submission. It will decrease the risk that applications will be refused for receipt and reduce the number of review cycles that applications undergo.

We anticipate that the new platform will allow more generic applications to be approved after the first cycle. This will promote timely generic entry and increase overall competition.

The new platform will also enable more efficient and robust knowledge management across different aspects of the FDA’s review process, helping reviewers capture and manage all of the information about products allowing for more seamless and effective product surveillance based upon quality and risk. This system will benefit both the agency and generic drug sponsors by increasing overall speed and efficiency of the pre- and post-market processes.

Having a structured template that completely replaces the current largely narrative-based review will allow for more consistent and predictable entry and analysis of data. Current assessments require manual review of the entire application. KASA will enable automated analysis of some portions of the application, which will save time, and ensure consistency.

The second initiative is aimed at promoting the more widespread use of existing generic drugs by looking for ways to keep generic drug labeling up-to-date with the latest information about each medicine’s risks and benefits. Generic drugs are generally required to have the same labeling as the brand drug they reference. And the burden to update the labeling with new safety and effectiveness information is typically born by the brand company.

However, when brand reference drug companies voluntarily withdraw their marketing applications, they also stop updating their labeling. When this happens, the FDA loses a key mechanism that the agency relies on as a way to update generic labeling. This can stymie the ability to modernize generic labels. In turn, when labels become out-of-date, providers may not have complete information about the full range of benefits and risks of the product. This can serve to diminish the use of these lower cost alternatives.

Consistent with our current authorities, which allow for certain types of labeling changes to continue to be made for generic drugs after the brand drug is withdrawn, this budget request will provide the funding to allow the FDA to assume more responsibility to help bring these drug labels up to date. We intend to launch this initiative initially for oncology products.

Our goal is to help ensure that doctors and patients have up-to-date information for these products. This will better inform clinical decisions regarding these medicines, and help promote more widespread use of low-cost, generic alternatives. By ensuring generic product labels are up to date, we’ll promote wider and more clinically optimal use of these drugs, which can save patients money.

We appreciate that the appropriations committees of both chambers of Congress supported this budget request in their appropriations bills. Congress has long recognized the need for — and importance of – investments in our generic drug program and efforts to promote generic drug use. The benefits of these initiatives are significant to the FDA’s modernization and efficiency. They’ll help advance a robust generic drug market that drives product competition and lowers drug prices.

Scott Gottlieb, M.D., is Commissioner of the U.S. Food and Drug Administration 

Follow Commissioner Gottlieb on Twitter @SGottliebFDA

Reducing the Hurdles for Complex Generic Drug Development

By: Scott Gottlieb, M.D.

Earlier this year, I announced our Drug Competition Action Plan to advance new policies aimed at bringing more competition to the drug market. My goal was to improve access consumers have to the medicines that they need. I consider access to medicine a matter of public health. If consumers are priced out of the drugs they need, that’s a public health concern that FDA should address, within the scope of its mandate and authorities.

Dr. Scott GottliebWhile FDA doesn’t control drug pricing, our policies do affect competition in the market. This is the nexus of our current efforts on drug pricing.

Our plan has a number of different domains. Among them is a compilation of efforts to improve the efficiency of the generic drug approval process; and another is a group of policies aimed at closing loopholes that allow branded drug companies to game our rules in ways that forestall the generic competition that Congress intended. One important group of policies is aimed at making it easier to bring generic competition to a category of branded drugs known as complex drugs. Today we’re announcing a major new set of policies to advance these goals.

Complex drugs comprise high cost medicines like metered dose inhalers used to treat asthma, as well as some costly injectable drugs. These medicines generally have at least one feature that makes them harder to “genericize” under our traditional approaches. As a consequence, these drugs can face less competition. In some cases, costly, branded drugs that are complex drugs have lost their exclusivity, but are subject to no generic competition.

The new policies we’re announcing today are aimed at ensuring that we provide as much scientific and regulatory clarity as possible with respect to complex generic drugs. This focus is critical because, first and foremost, these drug products provide important therapies to patients. They are also becoming increasingly significant to the economic health of the generic drug industry. Being able to “genericize” a complex drug can be a high-value opportunity for a generic drug maker that helps underwrite the costs of other generic applications. In other words, because brand-name versions of complex drug products are often higher-priced than many other brand name drugs, any steps we can take to encourage the development of generic competitors to complex drugs will have an outsized impact on access, and prices.

When considering the scope of complex drugs, people often first think of drug products where the active ingredient itself is complex. Glatiramer acetate injection, a drug used in the treatment of multiple sclerosis, is a good example. However, the terms “complex drug product” and “complex generic drug” are used to refer to a much larger and diverse group of drug products. In addition to drug products with complex active ingredients, or sites of action, complex drug products also include complex drug-device combination products.

Together, this diverse collection of drug products has one or more elements that are more complex than an average drug product. This complexity, in turn, means that the scientific and regulatory pathways for approval of generic versions of these drug products are not as well traveled by generic drug developers. In some cases, use of another established regulatory pathway may be appropriate to streamline development.

We’re undertaking a number of efforts to ensure that the pathways for approval for generic versions of complex drug products are as efficient as possible, including a number of new steps that I’m announcing today and others that we’ll be working on in the coming months.

We know that our regulatory requirements impact both the direct and indirect costs of drug development. These include costs associated with the time it takes to develop a drug and gain its regulatory approval, as well as those associated with the research and development of experimental products that ultimately do not make it to market.

Manufacturers of complex generic drugs face a number of challenges in developing their products and demonstrating that their products meet the approval requirements for generic drug applications (abbreviated new drug applications or ANDAs), including establishing that they are bioequivalent to and have the same active ingredient as the brand-name drug.

Bioequivalence for complex generic drugs can be challenging with complex drug products that can’t be easily measured in the blood, or when the drug’s therapeutic effect is delivered locally to a particular organ, rather than systemically, through the bloodstream.  In other instances, showing active ingredient sameness can be challenging when the drug product contains an active mixture of components and not a single active molecule.

These challenges – and resulting regulatory uncertainties – may deter generic manufacturers from beginning development. It can mean these ANDAs undergo more review cycles than other generic drugs. These hurdles, in turn, may result in limited competition and higher prices.

We recognize these problems and are taking a number of new steps to support the development of high quality ANDAs for complex generic drugs.

First, FDA is issuing a draft guidance to assist ANDA applicants and prospective ANDA applicants in creating and submitting pre-ANDA meeting requests, including meeting package materials, so FDA can give better advice to sponsors looking to develop complex generic drugs.

The guidance provides information on requesting and conducting product development meetings, pre-submission meetings, and mid-review cycle meetings with FDA. These meetings will allow for enhanced communication between generic drug applicants and FDA early in the generic drug development process, allowing for more efficient generic drug development, review, and approval pathways. We’ve found from analyzing our new drug program, that early and better meetings between FDA and sponsors can improve development timelines. We want to bring these same types of opportunities to developers of complex generics.

Second, we’re issuing a draft guidance  to help applicants determine when submission of ANDAs for certain complex products, known as peptides, would be appropriate. Peptides are compounds made up of 40 or fewer amino acids, the building blocks of proteins. There are a number of branded medicines that are peptides, where exclusivity has lapsed, but these drugs face little or no competition. This new guidance applies to ANDAs for certain specific synthetic peptides, namely, glucagon, liraglutide, nesiritide, teriparatide, and teduglutide, that reference brand-name versions of these peptides manufactured using recombinant DNA technology.

This guidance represents how advances in regulatory science — when coupled with careful policy considerations — can enable generic drug development that was previously infeasible.

In this case, advances in technology for peptide synthesis and characterization allow an ANDA applicant for one of these products to demonstrate that its product meets the “sameness” requirements for generic drug approval. The recommendations in the new guidance will help ensure that the risk of an immune response from the generic due to differences in impurities will not differ from that of the reference drug.

We’re doing all of this without sacrificing the scientific rigor of the process one bit. A central aspect of our approach, and our efforts to spur innovation and generic competition, is focused on adopting more rigorous and sophisticated science, including sophisticated quantitative methods and computational modeling, in drug development, evaluation, and review.

We’ll soon release other important policies aimed at spurring competition to complex drugs. But we know that better guidance isn’t the only answer. Some drugs lack generic competition because they cannot be measured through traditional in vivo bioequivalence methods and there’s no efficient and convincing bioequivalence test method available.

In these instances, an applicant needs to conduct more extensive clinical endpoint testing to show bioequivalence of a generic drug to a brand-name drug. This can be burdensome and discourage generic product development. A further barrier to generic competition for certain complex drug products is the lack of established methods for showing the sameness of the active ingredient of a proposed generic drug to a brand-name drug for certain complex drugs.

Over the next year, FDA’s generic drug regulatory science program will work to identify gaps in the science and develop more tools, methods, and efficient alternatives to clinical endpoint testing, where feasible. To help with this task, we’re holding a series of important scientific workshops, beginning today, that will identify opportunities for complex generic drug development, discuss quantitative modeling approaches and principles and aid product-specific guidance development. The workshops will also help in the development of new analytical tools that will help overcome the unique development and regulatory challenges for demonstrating active ingredient sameness in complex products. We intend for these efforts to speed product development, reduce development costs, and improve access to these products.

Our announcements today are part of a broader effort by the administration to address the high and rising cost of drugs and in the coming months, we’ll advance other policies aimed at enabling generic competition to complex drugs. Some of these will be product specific guidance documents; others will deal with more crosscutting aspects of our process. And we’ll advance more new policies to help bring more competition to other aspects of the drug market. We’re just getting started. Drug access is a matter of public health concern. We know that enabling more generic competition, where Congress intended, helps reduce prices, enable more access, and improve public health.

Scott Gottlieb, M.D., is Commissioner of the U.S. Food and Drug Administration

Follow Commissioner Gottlieb on Twitter @SGottliebFDA

FDA Working to Lift Barriers to Generic Drug Competition

By: Scott Gottlieb, M.D.

Too many patients are being priced out of the medicines they need. While FDA doesn’t have a direct role in drug pricing, we can take steps to help address this problem by facilitating increased competition in the market for prescription drugs through the approval of lower-cost, generic medicines.

Dr. Scott GottliebOver the last decade alone, competition from safe and effective generic drugs has saved the health care system about $1.67 trillion. When generics are dispensed at the pharmacy, the immediate savings to each of us are clear. We could see even greater cost savings if we helped more safe and effective generic drugs get to market sooner, after patent and statutory exclusivity periods have lapsed, by addressing some of the scientific and regulatory obstacles to generic competition across the full range of FDA-approved drugs. These barriers may delay and, in some cases, ultimately deny patient access to more affordable drugs.

That’s why we’re working on a Drug Competition Action Plan. As part of this effort, today, we’re announcing in the Federal Register our intent to hold a public meeting on July 18, 2017, to solicit input on places where FDA’s rules – including the standards and procedures related to generic drug approvals – are being used in ways that may create obstacles to generic access, instead of ensuring the vigorous competition Congress intended.

Innovation in pharmaceutical development is essential because it creates new and sometimes life-saving therapies. But access to lower-cost alternatives, once patent and exclusivity periods lapse, also is critical to the nation’s health.

We know that sometimes our regulatory rules might be “gamed” in ways that may delay generic drug approvals beyond the time frame the law intended, in order to reduce competition. We are actively looking at ways our rules are being used and, in some cases, misused.

One example of such gaming is the increasing unavailability of certain branded products for comparative testing. To perform the studies required to develop a generic alternative to a branded drug, a generic sponsor generally needs 1,500 to 3,000 doses of the originator drug. I understand that generic sponsors are willing to buy these products at fair market value; but, in some cases, branded companies may be using regulatory strategies or commercial techniques to deliberately try to block a generic company from getting access to testing samples.

This might occur, for example, when branded companies might use restrictions they place in their commercial contracts or their agreements with distributors to make it hard for intermediaries in the drug supply chain to sell the drugs to generic drug developers.

We also see problems accessing testing samples when branded products are subject to limited distribution – whether the company has voluntarily adopted limitations on distribution, or the limitations have been imposed as part of a Risk Evaluation and Mitigation Strategy, or REMS, a program that FDA implements to help ensure the safe use of certain drugs. I have been made aware that, in some of those cases, branded sponsors may use these limited distribution arrangements, whether or not they are REMS-related, as a basis for blocking generic firms from accessing the testing samples they need.

Besides limiting access to testing samples, some branded companies may be using the statutory default requirement to have a single shared REMS across both the branded and generic versions of a drug as a way to block generic entry. They might prolong negotiations with the generic firms over the implementation of these single shared systems, which could delay the entry of safe and effective generic drugs onto the market.

I want to take steps to address these concerns, to make sure that we are facilitating appropriate competition in circumstances where Congress intended. The forthcoming public meeting is intended to solicit public comment to inform us of circumstances where generic competition may be thwarted by these and other techniques.

As we solicit additional information, we also are going to be looking at policy and programmatic changes to address these issues. Some of these steps may be actions we can take by using our own authorities more forcefully. Other steps might involve our need to collaborate with sister agencies.

We’re also going to be looking hard at how best to coordinate with the Federal Trade Commission in identifying and publicizing practices that the FTC finds to be anti-competitive. FDA is not the FTC. It is the FTC’s responsibility to prevent anticompetitive business practices. But Congress set out certain laws that are meant to strike a careful balance between pharmaceutical innovation and access to lower cost generic products, and FDA has an important responsibility to enforce those laws in a manner that adheres to the balance struck by Congress.

We’ll be unveiling additional aspects of our larger Action Plan and providing updates, as these initial elements are implemented. I’m confident that these actions and the dedicated work of the outstanding staff in our generic drug program will help to address the issues patients are facing today when they’re priced out of buying the drugs they need. At the meeting on July 18 we want to hear from the public about ways our current rules may not be having their intended effects, and where current policies are falling short in ensuring the careful balance between new innovation and patient access.

Our goal is to broaden access to safe and effective generic drugs that can improve access to medicines and help consumers lower their health care costs. As in all of the things we do, we will steadfastly maintain FDA’s gold standard for rigorous, science-based regulation.

Over the past five years our generic drug program staff has evolved and grown remarkably, while implementing the first generic drug user fee program. The staff has demonstrated that they can rise to new challenges and they have my full support. Their hard work will serve as a strong foundation for the program as it moves forward. I want the policy framework they operate under to be as efficient, fair, and robust as the review program that they’re operating.

Scott Gottlieb, M.D., is Commissioner of the U.S. Food and Drug Administration

Follow Commissioner Gottlieb on Twitter @SGottliebFDA