BILL ANALYSIS �
SB 598
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Date of Hearing: June 25, 2013
ASSEMBLY COMMITTEE ON BUSINESS, PROFESSIONS AND CONSUMER
PROTECTION
Richard S. Gordon, Chair
SB 598 (Hill) - As Amended: June 20, 2013
SENATE VOTE : 29-4
SUBJECT : Biosimilars
SUMMARY : Permits a pharmacist to substitute a biological
pharmaceutical with a "biosimilar" pharmaceutical in the same
manner as generic drugs are substituted, and for prescriptions
filled prior to January 1, 2017, requires the pharmacist to
notify the prescriber. Specifically, this bill :
1)Permits a pharmacist to substitute a biosimilar for a
prescribed biological product only if all of the following
conditions are met:
a) The product selected as a biosimilar has been approved
by the federal Food and Drug Administration (FDA) and has
been determined to be interchangeable with the prescribed
biological product;
b) The prescriber does not personally indicate, either
orally or in his or her own handwriting, "Do not
substitute," or words of similar meaning, as specified;
and,
c) For prescriptions filled prior to January 1, 2017, the
pharmacy notifies the prescriber or enters the appropriate
information in a patient record system shared by the
prescriber within five business days of the selection.
2)Prohibits a biosimilar substitution if the prescriber
personally indicates, orally or in writing, "Do not
substitute," as specified.
3)States that substitution is within the discretion of the
pharmacist, unless the prescriber indicates otherwise.
4)States that the pharmacist who selects the biosimilar to be
dispensed according to this bill shall assume the same
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responsibility for substituting the biosimilar as he or she
would incur by filling a prescription for a biosimilar
prescribed by name.
5)States that there shall be no liability on the prescriber for
an act or omission by a pharmacist in selecting, preparing, or
dispensing a biological product pursuant to this bill.
6)Prohibits the pharmacist from substituting a biosimilar unless
the biosimilar costs the patient the same or less than the
prescribed biological product, as specified.
7)States that the provisions of this bill shall apply to all
prescriptions, including those presented by or on behalf of
persons receiving assistance from the federal government or
pursuant to the Medi-Cal Act.
8)Requires the substitution of a biosimilar to be communicated
to the patient.
9)Requires the Board of Pharmacy (BOP) to maintain on its public
Internet Web site a link to the current list, if available, of
biosimilar products determined by the FDA to be
interchangeable.
10)States that nothing in this bill prohibits the administration
of immunizations, as specified.
11)States that nothing in this bill shall be interpreted to
prohibit a disability insurer or health care service plan from
requiring prior authorization or imposing other appropriate
utilization controls in approving coverage for any biological
product.
12)Defines the following:
a) "Biological product," "biosimilar," and
"interchangeable" have the same meanings that apply to
those terms under the federal Public Health Service Act, as
specified;
b) "Prescription," with respect to a biological product,
has the same meaning as used in the Federal Food, Drug, and
Cosmetic Act, as specified; and,
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c) "351(k) pathway" refers to the licensure of a biological
product as a biosimilar or an interchangeable biosimilar by
the FDA pursuant to the federal Public Health Service Act,
as specified.
13)States that no reimbursement is required by this act pursuant
to Section 6 of Article XIIIB of the California Constitution
because the only costs that may be incurred by a local agency
or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the
meaning of Section 17556 of the Government Code, or changes
the definition of a crime within the meaning of Section 6 of
Article XIIIB of the California Constitution.
EXISTING STATE LAW :
1)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. (Health and
Safety Code (HSC) Section 1600.1)
2)Defines "drug" to include articles intended for use in the
diagnosis, cure, mitigation, treatment, or prevention of
disease in human beings or other animals. (Business and
Professions Code (BPC) Section 4025)
3)Creates the California Board of Pharmacy (BOP), which
regulates the practice of pharmacy. (BPC 4000 et seq.)
3)Permits a pharmacist filling a prescription order for a drug
prescribed by its brand name to substitute a generic version
or a different form of medication with the same active
chemical ingredient, unless the prescriber personally
indicates, either orally or in his or her own handwriting, not
to substitute. (BPC 4052.5, 4073)
4)Absolves the prescriber from any liability for an act or
omission by a pharmacist in selecting, preparing, or
dispensing an alternate generic drug or a different form of
medication with the same active chemical ingredient. (BPC
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4073)
5)Prohibits a pharmacist from substituting a generic drug or a
drug with the same active chemical ingredient unless the drug
costs the patient less than the prescribed drug. (BPC 4073)
6)Permits pharmacists to administer immunizations pursuant to a
protocol with a prescriber. (BPC 4052)
7)Requires all records or other documentation of the acquisition
and disposition of dangerous drugs by any entity licensed by
the Board of Pharmacy to be retained on the licensed premises
in a readily retrievable form for a period of three years from
the date of making. (BPC 4105)
EXISTING FEDERAL LAW :
1)The Food, Drug and Cosmetics Act requires drug manufacturers to
obtain approval of new drugs from the FDA. (21 United States
Code (USC) Section 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. (42 USC
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 (BPCI). (42 USC 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
USC 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 USC 262(i)(2)(a) and (b))
FISCAL EFFECT : Unknown
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COMMENTS :
1)Purpose of this bill . This bill will allow pharmacists to
substitute FDA-approved interchangeable biosimilar
pharmaceuticals for biological pharmaceuticals in the same way
that pharmacists currently substitute generic drugs for name
brand drugs. SB 598 will also require pharmacists to notify
prescribers of the change until 2017. This bill is
author-sponsored.
2)Author's statement . According to the author's office, "SB 598
updates the law so when the FDA approves interchangeable
biosimilars, California pharmacists can substitute the lower
cost biosimilars for brand name biologics.
"SB 598 proposes a 'don't ask, just tell' policy and it does
not restrict a physician's prescribing choices. Notification
to the prescribing physician AFTER dispensing does not alter
the policy goal of offering alternative, lower cost options
for patients. The purpose of a prescriber notification
provision is to provide a record of the substitution, in the
event of an adverse reaction, or other clinical responses to
the biologic."
3)Understanding biologic and biosimilar drugs . A "biologic"
drug is one that is created by biological rather than chemical
processes. Biologics have been available for more than 20
years and include enzymes, human growth hormones, human
insulins, interleukins, and vaccines. Many biologics are
among the most costly medicines available, ranging from $1,000
to $50,000 per treatment.
Biologic drugs represent a fast-growing segment of the
pharmaceutical market, constituting 32% of products in the
development pipeline and accounting for around 10% of
pharmaceutical expenditures (as of 2011). The biologic market
is expected to grow more than 20% per year.
A "biosimilar" is a biologic drug that is designed to be
comparable to a particular existing biologic drug, known as
the biologic "reference" drug. Some manufacturers will seek
"interchangeable" status for their biosimilar, a designation
granted by the FDA that means those biosimilar drugs may be
substituted for the biologic reference drug without any
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expected change in clinical outcomes.
There are currently no biosimilars approved by the FDA for use
in the United States, and FDA has not yet received any
applications for a biosimilar. However, as of February 6,
2013, FDA's Center for Drug Evaluation and Research had
received 50 requests for an initial meeting to discuss
biosimilar development programs for 12 different reference
products, held 37 initial meetings with sponsors, and received
14 Investigational New Drug applications for biosimilar
development programs.
It is anticipated that biosimilars will substantially reduce
pharmaceutical costs once they are introduced. Industry
studies and academic articles indicate a potential cost
savings of 10-40% for a biosimilar compared to a biologic
reference drug, which would potentially expand access to these
important but expensive medications.
This bill will require BOP to maintain on its Web site a link
to the current list, if available, of biosimilar products
determined by the FDA to be interchangeable.
4)Current law on generic substitutions . In practice, this bill
would allow a pharmacist to substitute an interchangeable
biosimilar for a prescribed biologic to save money, in the
same way a pharmacist may currently substitute a generic for a
brand name drug.
Currently, a pharmacist filling a prescription order for a
drug prescribed by its brand name may substitute a generic
drug instead, unless the prescriber personally indicates
verbally or in writing not to substitute. The prescriber is
not liable for the pharmacist selecting, preparing, or
dispensing a generic drug, and a pharmacist may not substitute
a generic drug unless it results in cost savings for the
patient.
These existing provisions of law would apply to the
substitution of interchangeable biosimilars as well, except
that a biosimilar may be substituted which costs the patient
the same or less than the prescribed biological product.
5)Prescriber notification . This bill would require a pharmacist
to inform the prescriber of the interchangeable biosimilar
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substitution within five business days of the selection, until
January 1, 2017. The pharmacist has the option of notifying
the prescriber by entering the information in a patient record
system shared by the prescriber.
The three-year sunset on the notification provision was added
in the Senate Business, Professions, and Economic Development
Committee with the understanding that "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."
6)Comparing biosimilars with generic drugs . According to the
FDA, a generic drug is identical -- or bioequivalent -- to a
brand name drug. However, a biosimilar is not, and cannot be,
the exact bioequivalent of a biologic reference drug because
of minor variations in the product caused by the high level of
complexity involved in making it.
According to the Biotechnology Industry Organization, "a drug
is typically manufactured through chemical synthesis, which
means that it is made by combining specific chemical
ingredients in an ordered process." In contrast, "[a]
biologic is manufactured in a living system such as a
microorganism, or plant or animal cells.
"The living systems used to produce biologics [and
biosimilars] can be sensitive to very minor changes in the
manufacturing process. Small process differences can
significantly affect the nature of the finished biologic and,
most importantly, the way it functions in the body. To ensure
that a manufacturing process remains the same over time,
biologics manufacturers must tightly control the source and
nature of starting materials, and consistently employ hundreds
of process controls that assure predictable manufacturing
outcomes.
"Process controls for biologics are established separately for
each unique manufacturing process/product, and are not
applicable to a manufacturing process/product created by
another manufacturer. These process controls may also be
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confidential to the original manufacturer. Therefore, it would
be difficult or impossible for a second manufacturer to make
the 'same' biologic without intimate knowledge of and
experience with the innovator's process."
Because of these complexities, the FDA has established a new
pathway to approve biosimilar drugs.
7)Biologics Price Competition and Innovation Act . The Biologics
Price Competition and Innovation Act (Act) was enacted as part
of the federal Affordable Care Act on March 23, 2010. The Act
created an abbreviated licensure pathway for biosimilars.
The Act defines "biosimilarity" to mean that "the biological
product is highly similar to the reference product
notwithstanding minor differences in clinically inactive
components" and that "there are no clinically meaningful
differences between the biological product in terms of the
safety, purity, and potency of the product."
FDA sets an even higher standard for biosimilar drugs that a
manufacturer wants to deem "interchangeable" with a biologic
reference drug. To attain interchangeability, according to
the FDA, "a [manufacturer] must provide sufficient information
to demonstrate biosimilarity, and also to demonstrate that the
[interchangeable biosimilar] can be expected to produce the
same clinical result as the reference product in any given
patient and, if the [interchangeable biosimilar] product is
administered more than once to an individual, the risk in
terms of safety or diminished efficacy of alternating or
switching between the use of the biological product and the
reference product is not greater than the risk of using the
reference product without such alteration or switch."
In other words, a patient should not experience a difference
between an interchangeable biosimilar and its reference
biologic. The Act expressly states that a pharmacist or other
dispenser may substitute an interchangeable biological product
for the reference product without consulting the prescribing
doctor.
8)Questions for the Committee . Given that the purpose of
prescriber notification and a three year record maintenance
requirement is to collect data that may help to identify
potential adverse reactions, the Committee may wish to inquire
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of the author as to why there is no provision about reporting
adverse events to the FDA's MedWatch program. MedWatch is
FDA's voluntary reporting database used to maintain safety and
surveillance of drug products. Adverse drug reports may
prompt FDA to order a modification in the use or design of a
drug product, which would improve drug safety and lead to
increased patient safety.
If the FDA deems certain biosimilars to be interchangeable, it
will be because those drugs are supposed to have no clinically
meaningful differences from the original biological product.
If there is sufficient concern regarding adverse reactions to
biosimilar drugs that have met the FDA's interchangeability
threshold to merit prescriber notification, then it would seem
logical to also require that the nation's drug regulator be
notified of adverse effects as well.
According to the FDA, MedWatch reporting is voluntary.
However, the author may wish to consider requiring pharmacists
who substitute interchangeable biosimilars to notify MedWatch
within 10 days of learning of any adverse effects.
9)Related legislation . AB 1139 (Lowenthal), of 2013, was
virtually the same bill as SB 598, but would not have required
prescriber notification and did not require BOP to maintain a
list on its Web site of interchangeable biologics. AB 1139
was held in the Assembly Business, Professions, and Consumer
Protection Committee.
SB 294 (Emmerson) would revise requirements related to sterile
compounding pharmacies and includes a provision requiring that
any adverse effects reported or potentially attributable to a
pharmacy's sterile drug product be immediately reported to BOP
and the MedWatch program. SB 294 is currently pending in the
Assembly Rules Committee.
10)Double-referred . This bill is double-referred to Assembly
Health Committee.
REGISTERED SUPPORT / OPPOSITION :
Support
AIDS Institute
AIM Melanoma
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Abbvie, Inc.
Alliance for Patient Access
Alliance for Safe Biologic Medicines
Alliance of Specialty Medicine
American Academy of Facial Plastic & Reconstructive Surgery
American Association of Neurological Surgeons
American Association of People with Disabilities
American Autoimmune Related Diseases Association
American College of Mohs Surgery
American Council on Science and Health
American Gastroenterological Association
American Society of Cataract and Refractive Surgery
American Society of Echocardiography
American Society of Plastic Surgeons
American Urological Association
Amgen
Association of Black Cardiologists
Association of Clinical Research Organizations
Association of Gastrointestinal Motility Disorders, Inc.
BayBio
BIOCOM
Biotechnology Industry Organization
Blue Ribbon Advocacy Alliance
California Healthcare Institute
California Medical Association
California Coalition of State Rheumatology
Organizations
California Prostate Cancer Coalition Advocates
Colon Cancer Alliance
Colorectal Cancer Coalition
Congress of Neurological Surgeons
CONNECT
Genentech
Global Healthy Living Foundation
Health HIV
Interamerican College of Physicians and Surgeons
International Cancer Advocacy Network
International Myeloma Foundation
International Union of Operating Engineers
Jenny's Quest - Cure for Pediatric Brain Stem Cancer
Kidney Cancer Association
MANA
MedImmune
Merck & Co., Inc.
National Alliance on Mental Illness
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National Kidney Foundation
National Physicians Biologics Working Group
North American Spine Society
Pharmaceutical Research and Manufacturers of America
RetireSafe
Silicon Valley Leadership Group
Society for Cardiovascular Angiography and Interventions
Society for Excellence in Eyecare
State Building and Construction Trades Council
TechNet
UCB, Inc.
Western States Council of Sheet Metal Workers
Opposition
America's Health Insurance Plans
Anthem Blue Cross
Association of California life & Health Insurance Companies
Blue Shield
Boehringer Ingelheim
California Association of Health Plans
California Board of Pharmacy
California Conference Board of the Amalgamated Transit Union
California Conference of Machinists
California Retailers Association
California Society of Health System Pharmacists
California State Board of Pharmacy
CVS/Caremark
Engineers & Scientists of California, IFPTE Local 20, AFL-CIO
Express Scripts
Generic Pharmaceutical Association
International Longshore and Warehouse Union
Kaiser Permanente
National Association of Chain Drug Stores
Novartis
Professional and Technical Engineers, IFPTE Local 21, AFL-CIO
Teamsters
Teva Pharmaceuticals
UNITE HERE, AFL-CIO
United Food and Commercial Workers Union
Utility Workers Union of America, AFL-CIO
Walgreens
Analysis Prepared by : Sarah Huchel / B.,P. & C.P. / (916)
319-3301
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