California Bill to Require Notification Prior to Biosimilars Substitution Vetoed

Governor Jerry Brown of California vetoed a bill last week, one that had passed both houses of the state legislature with overwhelming bipartisan support, that would have regulated how pharmacists can dispense cheaper, near-generic versions of biotechnology drugs, which can cost tens or hundreds of thousands of dollars a year.  These drugs, known as biologics, include blockbuster drugs that treat conditions from rheumatoid arthritis to cancer.

Until now, biologics, which are complex proteins made in living cells, have been insulated from the generic competition eventually faced by simple chemical formulations. However, the 2010 Patient Protection and Affordable Care Act directed the FDA to approve “generic” versions of biologics. These “generic” versions are labeled as biosimilars, because they are not exact duplications of the original drug.

As typically found in the brand and generic drug realm, states independently regulate whether pharmacists within their jurisdiction may  substitute a generic drug for the brand-name drug. Likewise, states have begun to address pharmacists’ substitution, and more importantly, interchangeability of biosimilars with the reference biologic. As a result, some biotechnology companies with the reference products began an intensive lobbying effort in 2013 to pass laws like the bill in California.

The California bill would have allowed biosimilars to be substituted by pharmacists only if the FDA deemed the biosimilar “interchangeable” with the reference product, a higher standard than merely being similar. It also would have required pharmacists to tell the patient’s doctor whether a biosimilar or the brand-name drug had been dispensed and to notify the patient if a substitution had been made. Supporters of the bill contended that notification would allow doctors to know which drug was being used in case problems arose. Opponents of the bill argued that the notification process would likely curtail or discourage the use of biosimilars. Not surprisingly, where pharmaceuticals stood on the issue fell on whether the manufacturer in question produced the reference product or the biosimilar.

In vetoing the bill, Gov. Brown noted that state notification requirements prior to any FDA determination of interchangeability was premature.