Arizona Becomes 21st State to Pass a Law Restricting Biosimilar Substitution at Pharmacies

Arizona Gov. Doug Ducey (R) late last week signed into law a bill that would restrict which types of biosimilars pharmacists in the state can substitute biologics for.

Hailed as a victory by industry group BIO, the law, like the 20 similar laws passed before it, is helping to create a patchwork of regulations governing how biosimilars are dispensed, even before biosimilars have hit the market en masse in the US.

In the EU, however, the uptake of biosimilars, much like the uptake of generic drugs in their early days, has led to significant savings for some of the most expensive treatments in the world.

So far, the US Food and Drug Administration (FDA) has approved only two biosimilars (compared to nearly 20 in the EU), neither of which were approved as “interchangeable,” meaning that in states that have passed these new laws, pharmacists cannot switch a patient to a less expensive biosimilar version of the brand-name biologic.

FDA has yet to even issue guidance on what interchangeability means, though some expect substantial clinical data will need to support such a designation. The agency has also previously criticized state substitution laws and other efforts to “undermine trust in these products,” which FDA called “worrisome and represent a disservice to patients who could benefit from these lower cost treatments.”

New Arizona Law

Like the 20 states before it and the dozens of states that have considered such legislation, Arizona’s new law would require pharmacists to only be allowed to substitute a biosimilar for its reference product biologic, if FDA has determined the biosimilar to be interchangeable if the prescriber doesn’t prohibit such a substitution, if the pharmacy informs the patient of the substitution and if the pharmacy retains a record of the biosimilar dispensed, and within five business days of dispensing a biosimilar, the pharmacist records what specific product was provided to what patient, including the name of the product and the manufacturer.

The law also requires the pharmacist “notify the person presenting the prescription of the amount of price difference between the biological product prescribed and the interchangeable biological product, if: a) the medical practitioner does not indicate an intent to prevent substitution with an interchangeable biological product; and b) the transaction is not subject to third-party reimbursement.”

The law further prohibits a pharmacist from making a substitution unless the manufacturer or distributor of the interchangeable biosimilar has ensured that “all products dispensed have an expiration date on the original package; and b) the manufacturer or distributor maintains recall and return capabilities for unsafe or defective biological products.”

Top biologics - which at some point in the not too distant future will compete with interchangeable biosimilars in states like Arizona and others, and with non-interchangeable biosimilars in the 29 other states – reap tens of billions for companies that are driving the push for these new laws, according to IMS Health.

Arizona’s HB 2310