Biologics' share of medicine chest grows, and so do the pricing concerns

Print 20 January 2016
Mari Serebrov / BioWorld

With biologics making up a larger share of the new drugs approved by the FDA, the pricing of drugs, and the impact of those prices on the U.S. health care budget, is poised to become a bigger issue going forward.

The number of new biologics being approved each year has quadrupled since 2004-2008, when the FDA's Center for Drug Evaluation and Research (CDER) licensed an average of about three new biologics per year. That average grew to about six new biologics in 2009-2013. But in the past two years, CDER licensed 11 and 12 new biologics, respectively.

Yes, the number of new molecular entities (NMEs) approved in the small-molecule world also has increased over time, but the magnitude isn't nearly as great as it is with biologics. NMEs approved from 2004-2008 averaged about 21 per year; the annual average for 2009-2013 was nearly 23; and the average number for the past two years was 31.5. That's a 51 percent growth in NME approvals over the past 12 years.

What perhaps is more telling when it comes to drug prices is the proportion of biologic approvals each year as compared with NMEs, especially since biologics tend to have heftier price tags due to their higher cost of development and manufacturing. For the past two years, nearly 27 percent – more than a quarter – of the new drugs approved by CDER were biologics. Only 13 percent of the new drugs approved from 2004-2008 and 20 percent of those approved from 2009-2013 were biologics. (See CDER NEW BLA APPROVALS, below.)

Other factors that can increase the price of a drug are innovation and the size of the targeted patient population. Innovation generally costs more in terms of development, and drugs indicated for rare diseases, and thus fewer patients, are likely to have higher prices.

Nine of the 12 biologics approved last year, 75 percent, were first in class. Nine of the 12 also had rare disease indications. However, of the 33 NMEs, only seven, 21 percent, were first in class, and 12, 36 percent, were approved as orphan therapies. (See CHARACTERISTICS OF OF BLAS APPROVED IN 2015, below.)

SMOOTHER, SWIFTER REVIEW

Despite the innovation and the complexities of developing large molecules, the biologics approved by the FDA in 2015 seemed to have a smoother, swifter journey through the review process, a fact that could help offset some of their development costs.

All 12 of the new biologic license applications (BLAs) were approved in the first cycle. That means sponsors didn't have to spend more resources trolling through the data or generating new data to respond to CDER requests for more information. And they had no regulatory delays in getting to market. About 82 percent of the NMEs approved last year made it through on the first cycle.

Half of the new crop of BLAs also enjoyed a six-month priority review, which is reserved for drugs that could potentially provide a significant advance in medical care. Two of the BLAs – Genmab A/S' Darzalex (daratumumab) and Boehringer Ingelheim GmbH's Praxbind (idarucizumab) – were among the six new drugs granted accelerated approval.

A third of the new BLAs received fast track designation, which speeds development and review for drugs with the potential to address unmet medical needs. And five BLAs, nearly 42 percent, were considered breakthrough therapies, another designation that shortens development time for drugs that may offer substantial improvement over existing therapies. Both designations provide early input from the FDA, a fact that probably contributed to the first cycle review rate.

In comparison, 54 percent of the NMEs received priority review and four were granted accelerated approval. While 10 of the NMEs, 30 percent, were granted fast track designation, only five, 15 percent, were deemed breakthrough therapies.

STARS OF THE SHOW

Darzalex emerged as the biologics star of 2015, receiving fast track and breakthrough designations, as well as accelerated approval and priority review. Initially developed by Copenhagen, the Netherlands-based Genmab, the anti-CD38 antibody was approved in November, nearly four months ahead of its PDUFA date and just two months after CDER accepted the BLA for review. The first monoclonal antibody to be approved for multiple myeloma, Darzalex is indicated as a single agent to treat patients who have received at least three prior lines of therapy. Despite its fourth-line indication, Darzalex is expected to become a blockbuster drug. (See BioWorld Today, Nov. 17, 2015, and Jan. 4, 2016.)

In 2012, Genmab granted Janssen Biotech Inc., a subsidiary of New Brunswick, N.J.-based Johnson & Johnson, an exclusive worldwide license to develop, manufacture and commercialize the antibody in a deal with a total potential value of more than $1.1 billion. (See BioWorld Today, Sept. 5, 2012.)

In the wake of Darzalex's approval, CDER licensed a second antibody for multiple myeloma – Bristol-Myers Squibb Co.'s Empliciti (elotuzumab) – as a second-line treatment to be combined with Revlimid (lenalidomide, Celgene Corp.) and dexamethasone. (See BioWorld Today, Dec. 1, 2015.)

In addition to the two myeloma drugs, the FDA considers six of the other new biologics "notable" or "noteworthy":

• Kanuma (sebelipase alfa, Alexion Pharmaceuticals Inc.) – the first drug approved to treat lysosomal acid lipase deficiency, a rare genetic disorder that keeps the body from producing an enzyme responsible for breaking down fats, potentially leading to life-threatening organ damage;

• Praluent (alirocumab, Regeneron Pharmaceuticals Inc.) – a PCSK9 inhibitor approved for hard to treat heterozygous familiar hypercholesterolemia;

• Praxbind – an antidote developed to reverse Boehringer Ingelheim's widely used anticoagulant Pradaxa (dabigatran) in emergency situations;

• Repatha (evolocumab, Amgen Inc.) – a PCSK9 inhibitor approved for homozygous familial hypercholesterolemia, a rare disease, as well as for hard to treat heterozygous familiar hypercholesterolemia;

• Strensiq (asfotase alfa, Alexion) – long-term enzyme replacement therapy for patients with infantile- and juvenile-onset hypophosphatasia, a serious, and sometimes fatal, bone disease;

• Unituxin (dinutuximab, United Therapeutics Corp.) – the first therapy approved by the FDA to treat neuroblastoma.

The newly approved BLAs represent a 12 percent increase in the total number of biologics approved by CDER. As more biologics hit the market, the need for less expensive follow-ons to older biologics will grow. To date, CDER has licensed 114 new biologics; all but two of those are still on the market, according to the FDA's Purple Book.

While a handful of biosimilar applications were awaiting review last year, CDER approved only one – Sandoz Inc.'s Zarxio (filgrastim-sndz), a follow-on to Amgen's Neupogen. (See BioWorld Today, March 9, 2015.)

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