Expectations for 2016: Drug Pricing, Biosimilars, LDTs and More

Regulatory NewsRegulatory News | 24 December 2015 |  By 

The end of 2015 saw the news spotlight shift to pharmaceutical pricing, with increased government scrutiny that could lead to actionable reforms in 2016, though other major stories expected in the coming year may steal some of that light, including how the US biosimilars market and regulation of lab-developed tests (LDTs) will develop, the fate of the 21st Century Cures bill and more.

Drug Pricing

When the New York Times broke the story of the now-infamous hedge funder turned pharmaceutical CEO Martin Shkreli catapulting the prices of a toxoplasmosis drug, outrage from Congress and the public erupted.

This, in turn, pushed candidates for president to release plans to lower drug prices, calls for the US Food and Drug Administration (FDA) to take action, a Senate investigation, an invite-only pharmaceutical pricing forum and a proposed bill seeking to allow HHS to negotiate with industry over Medicare Part D pricing.

And perhaps the most concrete change has come from Congress in the form of a new requirement that generic drugmakers under the Medicaid Drug Rebate Program pay higher rebates if generic prices rise too quickly.

The Centers for Medicare and Medicaid Services (CMS) also recently released a Medicare drug spending dashboard proving that prescription drug hikes aren’t just a Shkreli problem.

The year ahead is likely to see more of the same steady push from government and Congress to help bring these price hikes in check, though not without some healthy conversation. As part of that conversation (in case you missed it), Focus recently published two expert opinions on cancer drug pricing – one from an industry vice president and the other from an academic.


A number of the congressional plans to stem the rising tide of drug prices also look to help FDA approve more generic drugs and reduce the ANDA backlog. In addition to generics, FDA is working to bring a different category of drugs, known as biosimilars, to market, which also should offset the cost of some of the priciest biologics.

As CDER Director Janet Woodcock told Senators in September, the agency has quite a bit of work to do to release a number of delayed guidance documents, in addition to figuring out how biosimilars should be named in order to track their safety accurately. And as this list of biosimilars approvals from other countries shows, the US has its work cut out for it.


A showdown over how to regulate lab-developed tests (LDTs) is beginning to surface, with FDA issuing draft guidance in 2014 on how the regulations will shape up (leading to some questions over whether FDA can regulate based on guidance). And in October, the House Energy & Commerce Committee floated a draft bill laying out how the FDA regulations would be set up within FDA’s new Center for In Vitro Clinical Tests.

FDA also expects to release its draft LDT framework in 2016.

Despite FDA’s intention to push LDT regulation under its purview, some in academic medical centers are telling Focus that added barriers to develop LDTs (such as the cost of submitting a device for approval) could stifle innovation. More will be known when the committee introduces its bill.

21st Century Cures Bill, User Fees and Califf

Meanwhile, the House-passed 21st Century Cures Act is still looking to overhaul FDA in one of the biggest ways in years, though 2015 passed without any draft companion legislation from the Senate. And now with the omnibus law hiking the National Institutes of Health’s budget significantly, some are doubting if the bipartisan Cures bill will resurface in 2016.

According to Politico, the Senate HELP Committee still wants to put out a draft of its version of Cures in January, though no one seems certain that this will materialize, particularly as senators have missed a number of other deadlines.

FDA will also look to 2016 to re-negotiate all of its user fee programs (PDUFA, MDUFA, BsUFA and GDUFA) before they expire in 2017.

And a vote on making Robert Califf the next FDA commissioner is set for January.

Happy holidays and best wishes from RAPS' Regulatory Focus.



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