BILL ANALYSIS �
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|Hearing Date:April 8, 2013 |Bill No: SB |
| |598 |
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SENATE COMMITTEE ON BUSINESS, PROFESSIONS
AND ECONOMIC DEVELOPMENT
Senator Curren D. Price, Jr., Chair
Bill No: SB 598Author:Hill
As Introduced: February 22, 2013 Fiscal:Yes
SUBJECT: Biosimilars.
SUMMARY: Authorizes pharmacists to substitute a biosimilar for a
biologic under specified circumstances.
Existing Federal law:
1)The Food, Drug and Cosmetics Act (FDCA) requires drug manufacturers
to obtain approval of new drugs from the federal Food and Drug
Administration (FDA). (21 U.S.C. Sec. 355)
2)Prohibits a person from delivering for introduction into interstate
commerce any biological product unless a license is issued pursuant
to the Public Health Service Act (PHSA). (42 U.S.C. Sec. 262)
3)Creates an abbreviated pathway for biological products that are
similar to or interchangeable with licensed biological products,
known as the Biologics Price Competition and Innovation Act of 2009
(BPCIA). (42 U.S.C. Sec. 262 (k))
4)Requires that, for a biological product to be considered biosimilar
to a reference product, data must be derived from analytical, animal
and clinical studies as specified. (42 U.S.C. Sec. 262 (k)(2)
5)Clarifies that a product is biosimilar to a reference product under
the BPCI if the proposed biosimilar product is highly similar to the
reference product notwithstanding minor differences in clinically
inactive components and that no clinically meaningful differences
exist between the proposed biosimilar product and the reference
product in terms of safety, purity and potency. (42 U.S.C. Sec.
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262(i)(2)(A) and (B))
6)Clarifies that state law governs how and when pharmacists may make
prescription drug substitutions. (1 Food and Drug Admin. Sec.
13:197 (2011))
Existing California law:
1)Establishes the Food and Drug Branch (FDB) within the California
Department of Public Health (CDPH) to assure that foods, drugs,
medical devices, cosmetics and certain other consumer products are
safe and are not adulterated, misbranded nor falsely advertised; and
that drugs and medical devices are effective.
2)Defines biologics as human whole blood; human whole blood
derivatives specified by regulations; serum, vaccine, live vaccine,
killed vaccine, tissue vaccine, autogenous vaccine, live virus,
killed virus, live bacterial culture, killed bacterial culture,
bacterin, hormone, tissue extract, gland extract, gland preparation,
insulin, and similar products made from human or animal tissues or
micro-organisms. (HSC � 1600.1)
3) Under the Pharmacy Law, provides for the licensure and regulation
of pharmacies, pharmacists and wholesalers of dangerous drugs or
devices by the Board within the Department of Consumer Affairs
(DCA).
4) Specifies certain requirements regarding the dispensing and
furnishing of dangerous drugs and devices, and prohibits a person
from furnishing any dangerous drug or device except upon the
prescription of a physician, dentist, podiatrist, optometrist,
veterinarian or naturopathic doctor. (Business and Professions
Code (BPC) � 4059)
5) Authorizes pharmacists filling prescription orders for drug
products prescribed by their trade or brand names to substitute
generic drugs for orders if the generic contains the same active
chemical ingredients of equivalent strength and duration of
therapy, subject to a patient notification and bottle labeling
requirement, unless the prescriber specifies that a pharmacist may
not substitute another drug product by either indicating on the
form submitted for the filling of the prescription drug orders "Do
not substitute" or words of similar meaning or selecting a box on
the form marked "Do not substitute." (BPC � 4073)
6) Authorizes pharmacists filling prescription orders for drug
products prescribed by their trade or brand names to substitute a
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drug product with a different form of medication with the same
active chemical ingredients of equivalent strength and duration of
therapy as the prescribed drug product when the change will improve
the ability of the patient to comply with the prescribed drug
therapy, subject to a patient notification and bottle labeling
requirement, unless the prescriber specifies that a pharmacist may
not substitute another drug product by either indicating on the
form submitted for the filling of the prescription drug orders "Do
not substitute" or words of similar meaning or selecting a box on
the form marked "Do not substitute." (BPC � 4052.5)
This bill:
1.Updates permitted functions for pharmacists to allow a pharmacist to
substitute a biosimilar for a prescribed biological product if:
a) The product is approved by the FDA under the BPCIA.
b) The prescriber has not indicated "Do not substitute."
c) The pharmacist notifies the prescriber of the
substitution or enters information about the substitution in a
patient record system shared by the prescriber within five
days.
d) The pharmacy keeps a record of the biosimilar
substitution for three years.
2)Clarifies that "Do not substitute" means a biosimilar may not be
substituted for a biologic product and that physicians are not
liable for biosimilar substitution by a pharmacist.
3)Requires a patient to be notified when a biosimilar is substituted
for a biologic and requires the full name and manufacturer of the
biosimilar to be listed on the prescription label.
4)Requires the Board to maintain a list of interchangeable
biosimilars, if available, on its website.
5)Defines biological product, biosimilar and interchangeable according
to their definitions within the federal PHSA.
6)Defines prescription for purposes of a biological product according
to the definition under the federal FDCA.
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7)Clarifies that 351(k) pathway refers to the licensure of a
biological product as a biosimilar or an interchangeable biosimilar
under the federal BPCIA.
8)Clarifies that a pharmacist may still give immunizations pursuant to
a protocol with a prescriber.
9)Adds all of the above provisions to the Pharmacy Law section
specifying actions for substitution of a generic drug.
FISCAL EFFECT: Unknown. This bill is keyed fiscal by Legislative
Counsel.
COMMENTS:
1.Purpose. This bill is sponsored by the Author . According to the
Author, "SB 598 updates current law so when the FDA approves
interchangeable biosimilars, California pharmacists can substitute
the lower cost biosimilars for brand name biologics." The Author
believes this bill is necessary because biosimilars are not defined
in California law and existing definitions for generic pills do not
apply to these unique medicines. The Author states that this bill
mirrors patient protections for substitutions of generic pills and
that adverse reactions with biologic medicines, which occur when a
patient's body rejects a biologic medicine, will be more easily
tracked through accountability measures like notifying a physician
when a biosimilar is substituted for a biologic, requiring that
records of substitutions are kept and requiring the Board of
Pharmacy to keep a list on of interchangeable biosimilars on its
website.
According to the Author, notifying the prescribing physician after
dispensing does not alter the policy goal of offering alternative,
lower cost options for patients. The Author believes that this
notification provides a record of the substitution, so that in the
event of an adverse reaction, which may not manifest until many
months after the biosimilar was administered, health records can
reflect these contraindications. The Author intended to allow
flexibility in how notification is provided and as such, SB 598
does not specify how a notification must be transmitted or noted in
a patient's record.
1.Background. Biologic medicines are sensitive medications that
typically treat very serious diseases and conditions, including
blood conditions, cancers, immune disorders like Rheumatoid
Arthritis, Psoriasis and Crohn's Disease and neurological disorders
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like Multiple Sclerosis. These treatments are almost exclusively
administered in physician's offices, oncology clinics, specialty
pharmacies, hospitals or dialysis centers. Biological products are
generally derived from living material, human, animal, or
microorganism and FDA regulations specify that biological products
include blood-derived products, vaccines, in vivo diagnostic
allergenic products, immunoglobulin products, products containing
cells or microorganisms, and most protein products. These
treatments are not widespread but rather used as specialty drugs to
treat very ill patients; according to information provided by the
Author from a MarketScan report, there were almost 380 million pills
dispensed in California in 2011, with only 1.7 biologic
prescriptions dispensed per week from the over 5,000 retail
pharmacies in California, representing just .13 percent of all
prescriptions dispensed by retail pharmacies.
According to the FDA, biologics are regulated under the federal PHSA
while drugs, including insulin and other hormone therapies, are
regulated under the FDCA. Both the FDA's Center for Drug Evaluation
and Research and Center for Biologics Evaluation and Research have
regulatory responsibility for therapeutic biological products,
including premarket review and oversight. Following initial
laboratory and animal testing that show the use of a particular
biological product in humans is reasonably safe, biological products
(like other drugs), can be studied in clinical trials in humans
under an investigational new drug application. If trials and
studies demonstrate that a product is safe and effective for its
intended use, the FDA may then approve the market of a biologic by
granting a biologics license.
The FDA defines a generic drug as the same as a brand name drug in
dosage, safety, strength, how it is taken, quality, performance, and
intended use. Before approving a generic drug product, FDA requires
many rigorous tests and procedures to assure that the generic drug
can be substituted for the brand name drug. According to the FDA,
it bases evaluations of substitutability, or "therapeutic
equivalence," of generic drugs on scientific evaluations. Generic
drug products must contain the identical amounts of the same active
ingredient(s) as the brand name product. A drug that is determined
to be "therapeutically equivalent" can be expected to have equal
effect and no difference when substituted for the brand name
product.
3.Biosimilars. According to background information provided by the
Author and stakeholders, both in opposition to and support of this
bill, biologics are large, complex protein molecules used in the
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treatment, diagnosis or prevention of disease. These are quite
different from small molecule drugs, pills, which are not as
structurally complex and are instead relatively simple, organic
substances produced by chemical methods. Biologic medicines, on the
other hand, are made in living organisms to produce proteins by
genetically modifying cell constructs or cell lines. Biologics are
grown, cultivated and purified and are typically administered as
injectables.
Biosimilars are similar but not identical versions of the original
biologic. The active ingredient of a biosimilar is expected to
closely resemble that of the original biologic and unlike generic
pills which require the active ingredient to be identical, the
exact manufacturing process of an original biologic cannot be
exactly duplicated. Biosimilars are not clinically identical to
their reference products. Biosimilars have been defined by the
World Health Organization as "a biotherapeutic product which is
similar in terms of quality, safety and efficacy to an already
licensed biotherapeutic product," by the European Medicines Agency
as a "copy version of an already authorized biological medicine
product with demonstrated similarity in physiochemical
characteristics, efficacy and safety, based on a comprehensive
comparability exercise," and by the FDA as a biological product
which is "highly similar to the reference product notwithstanding
minor differences in clinically inactive components and for which
there are no clinically meaningful differences between the
biological product and the reference product in terms of safety,
purity and potency of the product".
In response to increases in an aging population and larger numbers
of patients suffering from chronic disease, there has been a rise
in use of biologics, and accordingly a rise in the production
efforts of biosimilars. Biosimilars go through an extensive review
process and manufacturers are required to submit immense studies
and data demonstrating a products' efficacy and ensuring it is safe
for use by consumers. Manufacturers also have to establish ongoing
monitoring programs to ensure the safety of biosimilars. While
biosimilars are currently available in the EU, and other nations
are in the process of adopting guidelines and regulatory processes,
biosimilars are still a relatively new option in the larger health
care delivery and treatment conversation.
A pathway for biosimilar regulation in the U.S. was established as
a provision of the Patient Protection and Affordable Care Act (ACA)
and in 2012 the FDA issued draft guidelines for biosimilars. The
guidance included which types of studies manufacturers should
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undertake in order to ensure product safety, potency and purity.
However, there is no definitive timeline or date by which
biosimilars will be available and on the market in the U.S. due to
the complexity involved in their development and production.
4.The Prescription Drug Pinch on Californians' Wallets. Costs of
prescription medication have skyrocketed over the past number of
years. According to a 2008 report issued by the Kaiser Family
Foundation on prescription drug trends, spending in the U.S. for
prescription drugs was $216.7 billion in 2006, more than 5 times the
$40.3 billion spent in 1990. In response, many consumers are
turning to a variety of methods to reduce their prescription costs
including requesting cheaper drugs or generic drugs from their
physicians and pharmacies, using the Internet and other sources to
make price comparisons, using the Internet to purchase drugs, buying
at discount stores, buying over-the-counter instead of prescribed
drugs, buying drugs in bulk and pill-splitting, using mail-order
pharmacies, and using pharmaceutical company or state drug
assistance programs. The report stated that
62 percent of physicians say they switch patients to less expensive
drugs after discussing out-of-pocket costs of medicines with
patients. This financial burden leads to many patients with
legitimate chronic illnesses to forgo prescribed medications and
adversely affect their health.
According to information provided, Biosimilars will provide an
important, cost-effective alternative to very expensive originator
biological products and are anticipated to play a key role in the
treatment of illnesses and chronic conditions in the U.S. A recent
New York Times article found that drugs account for about 15 percent
of the nation's health care expenditures and that while there appear
to be small decreases in spending on prescription drugs, costs
associated with specialty drugs like biologics increased almost 20
percent. Out-of-pocket costs to patients are typically higher to
receive biologics than for generic drugs and while biosimilars may
provide significant cost savings, they will not be discounted at
near the rate as generic drugs.
5.Similar Legislative Efforts. Sixteen states have, or are in the
process of considering, legislation similar to this measure in the
current legislative session. The bills and surrounding conversation
mirror what is pending in California. As reported in a recent New
York Times article, this effort is also connected to conversations
at the federal level about whether biosimilars, when they are
available on the market, will have the same name as originator
products. If they do not, pharmacists may then not be able to
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substitute the biosimilar for the biologic even if states allow the
substitution. Specifically, bill sponsors and supporters throughout
the nation believe that measures like those contained within SB 598
are not unreasonable and are needed to protect patient safety, as
biosimilars are not identical to originator drugs, thus applying
generic laws to these drugs is not safe, prudent or advisable.
Opponents believe that the bills impose unnecessary restrictions
that do not apply to chemically produced bills and believe that once
the FDA has identified something as interchangeable, that standard
is high enough to allow for substitution without notification to
prescribers.
AB 1139 (Lowenthal), in this Session, authorizes a pharmacist to
substitute a biosimilar for a biological product if the product is
deemed by the FDA to be interchangeable with the biological product.
The bill is scheduled to be heard in the Assembly Committee on
Business, Professions and Consumer Protection later this month.
6.Arguments in Support. Supporters of this bill include biologic and
biosimilar manufacturers, representatives of chronically ill
patients, alliances of physician and research groups, as well as
organizations for California's life sciences community who believe
that it is a common sense measure which will ensure patient safety
without delaying the introduction of biosimilars to the California
market. Supporters highlight the differences between biosimilars
and other generic drugs, resulting in a need for prescriber
notification to ensure accurate patient records are maintained.
Supporters believe that substitution of biosimilars for biological
products will improve patient access to these often life-saving
medicines, but note that there need to be certain accountability
measures taken, given the unique and very sensitive nature of these
drugs. Supporters agree that the prescriber notification guarantees
that physicians maintain knowledge about what medication their
patients receive.
BayBio and Biocom write in support, noting that physicians are
individuals with the closest relationship to patients and the most
knowledge about a patient's medical condition and treatment regimen,
thus should know about a substitution of a prescribed biological
product. The organizations believe that biosimilars will provide
patients and prescribers with cost savings options and that the
provisions in SB 598 will guarantee patient safety and promote
transparency.
Labor groups like the International Union of Operating Engineers and
State Building and Construction Trades believe that biologics have
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improved the quality of life for many members and that their good
health will be further promoted with the protections set forth in SB
598.
The Pharmaceutical Research and Manufacturers of America (PhRMA)
believes this bill contains important safeguards that will protect
patients and properly inform physicians in the event of an adverse
reaction or change in a patient's chronic condition.
7.Arguments in Opposition. Opponents to this measure, including
manufacturers of generic drugs, health plans and retailers, argue
that this bill creates barriers to biosimilars entering the
California market, will restrict insurers' ability to provide
affordable options to patients and that California is unnecessarily
making changes before the FDA has weighed in on the issue of
substituting biosimilars.
Hospira , Teva Pharmaceuticals, Inc ., Boehringer Ingelheim and the
Generic Pharmaceutical Association believe that SB 598 is premature
and is intended to create doubt about the safety and effectiveness
of affordable biosimilar drugs and will prevent patients from
accessing more cost-effective, lifesaving medications.
Kaiser Permanente notes that the organization would be able to
comply with the provisions of SB 598 but that it does not support
public policy which provides artificial and unnecessary barriers to
safe and low cost alternatives for patients.
Health Access California writes that the use of generics has helped
to control health costs even as prescription drugs have become an
even bigger share of health care costs and that there is no reason
to create additional barriers to the prescribing of biosimilar
drugs beyond those in place for generic drugs.
The California Retailers Association and CVS Caremark are concerned
that there is not a clear public policy rationale for pharmacies
being required to keep records of biosimilars dispensed and that
physician notification increases pharmacist workload.
8.Policy Issues:
a) Is this measure premature? While biosimilars are not
yet available to consumers in California and California
pharmacists are not yet facing the option of substituting a
biosimilar for a biological product, efforts at the federal
level have made it clear that these products will be on the
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market in the near future. The FDA may eventually alter its
draft guidance and may eventually better clarify what
constitutes interchangeability, making the question of
appropriate substitution clearer, but California's Pharmacy
Law will still have to be updated to ensure that patients can
receive biosimilars and these can be substituted for
biologics.
b) Do the provisions contained in this bill create a
barrier to substituting biosimilars for biologics and are the
notification and record keeping requirements burdensome? This
measure requires prescriber notification of substitution of a
biosimilar for a biologic within five days after a patient
receives the product from a pharmacy. The bill does not
require physician consent for a substitution, but it does
specify that it is the pharmacist providing notification. It
is not clear if pharmacists will truly face workload
challenges that deter substitution, given the relatively
limited frequency with which biologics, and it can be assumed
biosimilars in the future, are dispensed. The California
Pharmacists Association has not taken a position on the bill.
However, changing the requirement of "pharmacist" notification
to "pharmacy" notification may help to deal with workload
issues .
Also, many decisions about dispensing at the pharmacy level
will be made according to drug lists and formularies
established by health plans, including a preference to provide
coverage for biosimilars when they are deemed interchangeable
with originator biologics. More affordable options should
always be available to patients, particularly in light of
tremendous costs for these therapies and the notification
requirements in this bill might not interfere with prescribing
and dispensing trends.
Even though California is making strides toward implementing
track and trace requirements for drugs delivered in this
state, there is still no mechanism to completely monitor
biologics and biosimilars once they are dispensed, thus
quality assurances and accountability for these products may
be necessary by ensuring patient records are complete and
physicians are aware of substitutions at the pharmacy level.
In the event that something does go wrong with a biosimilar,
as was seen in Europe with a biologic that stimulated red
blood cell growth where patients developed antibodies to the
different formulation of that product and many died, it may be
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helpful for medical professionals to have a way to go back and
determine what their patients received.
c) The FDA should determine safety. An underlying
component of conversations surrounding the issue of
substitution are perceived safety risks of biosimilars.
Similar conversations took place when generic drugs became
available and eventually proliferated the market. Biosimilars
may be high quality and safe, originator biologics may result
in adverse patient reactions and vice versa. The preference
to use biosimilars over biologics might naturally be
determined once they are prescribed by physicians and used by
patients in California. The state relies on the FDA to assure
that products are safe for use and in the event they are
determined to no longer be safe, remove the products from the
market. The market may naturally give an advantage to
certain, more preferable types of drugs that help treat
patients which of course would ideally be cost-effective
treatments, accessible to all patients. Affordable treatments
should be promoted and pursued whenever possible; however, the
specialty nature of these products places the safety
conversation squarely in the jurisdiction of the FDA.
1.Suggested Amendments:
a) Pharmacy Notification. Rather than just requiring a
"pharmacist" to notify the prescriber, allow the "pharmacy"
to provide the notification which would provide more choices
within the pharmacy of persons responsible for notifying the
prescriber.
b) Sunset the Notification Provisions Contained in this
Measure. While updating California Pharmacy Law to allow
substitution of biosimilars is necessary to ensure the
availability of these products to California patients when
the FDA deems them safe and ready for market, it may not be
necessary for the notification and record keeping
requirements of this bill to remain in perpetuity.
Accountability for biosimilars may be achieved when
California's e-pedigree law, creating a track and trace
system for drugs in this state, is implemented, or in the
event that Congress creates a national track and trace
system. Accountability may also be heightened through
processes created by the FDA for biosimilars and through
natural market channels once biosimilars are utilized more
frequently. The Author may want to consider including a
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3-year sunset on the requirement that physicians are
notified when a substitution of a biosimilar for a biologic
occurs and the requirement that records of substitution of a
biosimilar for a biologic are maintained by pharmacists.
2.Suggested Technical Amendment. In its current form, the bill
requires the full name and manufacturer of the biosimilar to be
listed on the prescription label, mirroring current law allowing for
substitution of generic drugs. This language may be duplicative of
current regulations establishing standards for what information must
be included on a label. Suggest the following amendment to delete
this requirement:
On page 3, strike lines 17-19 "and the full name and manufacturer
of the dispensed biosimilar shall be indicated on the prescription
label, unless where the prescriber orders otherwise. "
SUPPORT AND OPPOSITION:
Support:
AIM Melanoma
Alliance for Patient Access and the National Physicians Biologics
Working Group
Alliance for Safe Biologic Medicines
Alliance of Specialty Medicine
American Autoimmune Related Diseases Association, Inc.
AMGEN
BayBio
BIOCOM
Blue Ribbon Advocacy Alliance
California Healthcare Institute
Coalition of State Rheumatology Organizations
CONNECT
Global Healthy Living Foundation
Health HIV
International Myeloma Foundation
International Union of Operating Engineers
Kidney Cancer Association
Merck & Co., Inc.
National Kidney Foundation
Pharmaceutical Research and Manufacturers of America (PhRMA)
RetireSafe
State Building and Construction Trades Council
TechNet
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UCB, Inc.
Western States Council of Sheet Metal Workers
One individual
Opposition:
America's Health Insurance Plans (AHIP)
Anthem Blue Cross
Boehringer Ingelheim
California Association of Health Plans
California Retailers Association
CVS Caremark
Express Scripts
Generic Pharmaceutical Association (GPhA)
Health Access California
Hospira, Inc.
Kaiser Permanente
Pharmaceutical Care Management Association
Teva Pharmaceuticals Industries, Ltd.
Walgreens
Consultant: Sarah Mason