Pointing Fingers On Biosimilars: FDA Versus FTC

US FDA is talking tough on antitrust enforcement. But is there any reason to think FTC is listening?

The US FDA’s “Biosimilar Action” plan includes 11 “key actions” and 16 “priority deliverables.”

So it is all the more remarkable that, in unveiling the plan during a Brookings event July 18, FDA Commissioner Scott Gottlieb spent more time discussing potential actions that could be taken by other agencies – notably the Centers for Medicare & Medicaid Services and the Federal Trade Commission – than on the steps FDA says it will take. (Also see "Avoiding ‘Groundhog Day’: US FDA’s Biosimilar Action Plan Applies Lessons From Generic Competition" - Pink Sheet, 23 Jul, 2018.)

In his prepared remarks in particular, Gottlieb focused on possible concerns about anti-competitive tactics and seemed to suggest the possibility of an antitrust case in the near future.

“We’re going to be taking new steps to challenge some of the gaming tactics I talked about earlier,” Gottlieb said. “This includes new efforts to coordinate with FTC to address anti-competitive behavior. We look forward to participating in additional forums with the FTC to jointly identify ways that we can deter anticompetitive behavior in this space.”

“Stay tuned,” Gottlieb added.

The Risks For AbbVie

Gottlieb’s emphasis on antitrust enforcement is nothing new: he has been a champion for more aggressive interventions in the generic drug field as well. But his emphasis in the context of biosimilars caught the attention of at least one audience: investors interpreted it as a threat to AbbVie Inc. and its defense of the world's top-selling biopharmaceutical brand, Humira (adalimumab).

In context, Gottlieb sounded more focused on potential barriers to marketed biosimilars, like some of the infliximab contracting issues that are already the subject of private sector litigation. (Also see "Biosimilar Antitrust Pressure On J&J Grows As Walgreen, Kroger Sue Over Remicade Contracts" - Pink Sheet, 7 Jun, 2018.)

Still, given the sheer size of Humira, it is understandable that investors would wonder what stepped up antitrust enforcement actions might mean for Abbvie.

As it stands, Abbvie has settled with several potential biosimilar competitors to its TNF blocker, with the first approved version – to be marketed by
Amgen Inc. – now set to enter the market at the start of 2023. Others would follow later that year. That five-year delay has attracted plenty of notice, with industry critics in Congress routinely now citing Abbvie’s “patent thicket” and aggressive defense tactics on the litany of patent abuses that need attention in the pricing debate. (Also see "Does AbbVie Have 'Unclean Hands' From Building Humira Patent Thicket? Judge Allows Discovery" - Pink Sheet, 20 Jun, 2018.)

But is the FTC really about to make dramatic moves to accelerate biosimilar competition? That’s not how it sounded once Gottlieb’s presentation was over and the Q&A began. If anything, the prospect of immediate intervention by antitrust authorities seemed to recede each time it was raised.

First, Gottlieb noted an upcoming meeting with the new FTC commissioner as a near-term event, but added, “I don’t want to get too far ahead of myself.”

Then he acknowledged different perspectives between FDA and FTC on the value of litigation. “We have worked with them to provide information where we think there is anticompetitive behavior,” he said. “We’ve handed them some pretty good sets of facts in the past.”

"Airtight" vs. Testing The Boundaries

However, sometimes “prosecutors want airtight cases,” while policy makers would “prefer to test the boundaries” and then follow-up with requests for legislative fixes if necessary. “I don’t have to be the one to lose the case in court,” Gottlieb added, but “I think there are a couple more that we could bring.”

Finally, Gottlieb bristled when asked about FTC’s advice to FDA on biosimilar naming conventions. The commission agrees with payor groups that FDA’s insistence on a “nonsense” suffix is a barrier to uptake. 

“I disagree,” Gottlieb said, arguing that the naming issue “is a bit of red herring.” The advocates to apply the same non-proprietary name are often “people who want more inadvertent substitution,” Gottlieb said. “I’m not in favor of inadvertent substitution. I want fully substitutable products.”

As for FTC’s position on the issue: “I wish they would focus more on the legal activity and less on the scientific nomenclature we use for pharmacovigilance,” Gottlieb said. One could imagine an FTC staff attorney making a similar statement, but with the wish reversed.

After all, it isn’t like the agency hasn’t brought any cases involving patent defense strategies and delayed launch dates for competitors. In fact, it has brought them against Abbvie – and the agency recently won a court decision ordering a record-setting $448 million penalty against Abbvie over claims that it filed “sham litigation” as part of a patent defense strategy for the Androgel brand. (Also see "FTC Wins $448M Ruling Against AbbVie For Sham Litigation Rather Than Pay-For-Delay Deal" - Pink Sheet, 2 Jul, 2018.)

FTC's Mixed Record

But let’s face it: FTC’s record in bringing cases involving claims of delaying generic entry is – to put it generously – mixed. And even when it does win, it generally does so only long after the brand exclusivity has ended.

That was certainly the case in the Androgel ruling, which only came at the start of July – four years after the onset of generic competition to Androgel and the collapse of the broader “low T” market under safety scrutiny.

And bear in mind that the product itself is a gel formulation of testosterone – an ingredient marketed in the US since the 1950s and devoid of patent protection. Androgel was launched in 2000 with three years of new formulation exclusivity – but Abbvie successfully fended off generic competition until 2014.

Now Abbvie may have to pay a penalty for its success. The court set the fine at a level intended to match the unjustified profit received by the delayed generic launch, but it bears noting that it still amounts to less than six months of sales at the peak of the brand. And Abbvie is appealing the verdict – so there is no guarantee the company will pay that much, or anything at all.

FDA may be talking tough on antitrust enforcement. But that is a long way from FTC bringing an enforcement action – and even a longer way from FTC winning a case that meaningfully changes the launch date for biosimilar competition.

From the editors of the RPM Report