Regulatory Focus™ > News Articles > FTC Prepares to Weigh in on Biosimilar Substitution, Naming

FTC Prepares to Weigh in on Biosimilar Substitution, Naming

Posted 11 November 2013 | By Alexander Gaffney, RAC

In recent months, regulators, legislators and advocacy groups have all been grappling with two seemingly simple questions: Should biosimilar products be given the same generic name as the original biologics they reference in their regulatory applications, and are they substitutable for the originals as well?

Now US federal trade regulators say they're interested in these issues as well, observing that efforts by branded biopharmaceutical manufacturers to push for different names "may impact the development of, and competition for, follow-on biologics."


In the US, the Patient Protection and Affordable Care Act (PPACA) of 2010 first created the pathway by which biosimilars-sometimes referred to as follow-on biologics or similar biological medicines-could come to market. The intent was to create a pathway similar to the one used by generic manufacturers of chemical drugs, offering companies a quicker and cheaper way to bring a product to market by being able to rely in part on the clinical data of the original manufacturer.

Unlike chemical drugs, manufacturing biological products is a vastly more difficult and complex process whose outcome is highly contingent upon the exact steps, equipment and manufacturing variables involved. As industry analysts note, even minor differences in the final protein structure can result in a product that behaves differently than the original.

And because biosimilar manufacturers don't have access to any information regarding the processes by which the original drug is manufactured-that information is a trade secret-it is almost a foregone conclusion that the biosimilar product will be different from the original as well.


While the biosimilar regulatory pathway is still taking shape in the US, some biologic manufacturers and their allies have been taking a fight to various state legislatures, arguing that biosimilars should not be seen as being substitutable unless they are proven to be.

The concept of substitution is similar to-but different from-interchangeability. Drugs may be considered interchangeable even if they have minor differences. Substitutable drugs, however, are seen as having no discernible differences, and may be legally swapped out for one another, such as by pharmacists participating in a pharmacy benefit management (PBM) plan.

In other words, interchangeability is a regulatory concept; substitution is a legal one.

Many state programs, such as Medicaid, substitute high-priced brand-name chemical drugs for generic ones in order to keep costs down, and the authors of the biosimilar pathway had hoped similar substitutions would save taxpayers billions over the coming years. So with some companies fighting for states not to recognize the drugs as being presumptively substitutable, some critics say the changes could result in higher bills for taxpayers and higher profits for the branded companies.

Other groups have meanwhile argued that the names of the drug should be different in order to permit accurate reporting and tracking of adverse events, as side effects might hypothetically be unique to either the original or the biosimilar product.

The issue of naming is also being taken up by the World Health Organization (WHO) through its International Nonproprietary Name (INN) group, earning the ire of generic pharmaceutical groups.

Trade Issues?

But even as these issues continue to be debated in state legislatures and regulatory circles, other federal regulators are taking notice as well. In an 8 November 2013 announcement, the Federal Trade Commission (FTC) said it will soon hold a workshop to discuss "how state regulations and naming conventions may impact the development of, and competition for, follow-on biologics."

Referencing state legislative efforts, FTC said that, "Some commenters have raised concerns that state-level regulatory barriers may raise costs and lessen incentives to develop lower cost follow-on biologics, thus deterring the development of competition between reference and follow-on biologics."

Its workshop, it explained, would look to examine how both substitution and naming issues might affect competition and the incentives for innovation.

Questions the FTC will address will reportedly include:

  • How would the new state follow-on biologic substitution laws passed this year, or similar proposals pending in other states, affect the competition expected between or among biosimilar, interchangeable and reference biologic medicines?
  • What are the rationales behind new state proposals and laws for regulating follow-on biologic substitution?
  • What are the compliance costs associated with the new state requirements, and how are they likely to affect follow-on biologic competition?
  • Would it benefit competition if the FDA published an authoritative listing of follow-on biologics that are biosimilar to, or interchangeable with, reference biologics?  Would such a publication facilitate substitution?

The workshop will be held on 10 December 2013 in Washington, DC and available via webcast. Public comment will be accepted through 1 March 2014.

FTC Announcement

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