BIO’s Evergreening Project: CEO Greenwood Discusses Cost-Effectiveness And The “Inevitability” Of Follow-On Biologics

James Greenwood joined the Biotechnology Industry Organization as president and CEO in January 2005 after 12 years in Congress. His priorities early on were to prevent drug safety worries from slowing approvals and to ensure the quality of BIO as an advocacy organization. Editors from "The Pink Sheet" spoke with Greenwood earlier this year about the challenges and opportunities facing the biotechnology industry in 2006.

"The Pink Sheet": What are your priorities for 2006?

Greenwood: Let me give you a sort of general philosophical framework for starters. I view healthcare as a room with four walls, and they are access, cost, quality and innovation. I think it is our challenge is to keep all of them strong. The Europeans have done a very good job of bringing universal access and affordability to a system that produces less in terms of quality and innovation. [In the U.S.] we have a system that's first in the world in terms of quality and innovation, but we don't have universal access and we have cost issues. Those are the tensions that describe everything that tends to happen at the federal and state level.

Our goals for 2006: We will continue negotiating out a [Prescription Drug User Fee Act] reauthorization bill - one that protects the existing structure of user fees. There are those in the Congress and outside of the Congress who view user fees as somehow unfairly influencing the FDA; we don't think that's true. We think it's actually been very successful with helping the FDA to have the resources it needs to expeditiously approve our products. We also think - in terms of improving PDUFA - that we can achieve additional user fees to expand postmarket surveillance. But in exchange for that, we want a uniform set of standards for postmarket surveillance, so we don't have an individual reviewer deciding two minutes before approval that a company has to do a postmarket surveillance program and it has to look like such and such, without a fair dialogue about what that should look like. So we think we want best practices with regard to postmarket surveillance.

We want to pass our [Small Business Innovation Research grant] reform bill. [Sam] Graves (R-Mo.) in the House and Kit Bond (R-Mo.) in the Senate have introduced the Save America's Biotechnology Innovative Research bill. We think the administrative law judge did not correctly get Congress' intent with regard to the SBIR bill and it's preventing good companies that have been sufficiently successful to attract venture capital from getting these important grants. We want to get that through.

I will be able to go up to the Hill now and Scott Whitaker, my COO, will be able to go back too, soon...to his old haunt over at HHS. Those two facts should significantly increase our already substantial advocacy capacity.

I want to reconstitute an ethics committee at BIO. We have one - it consists exclusively of members of our board and their staff and it really had been...for monitoring bioethics issues. I want to build a committee that not only has our board members on it but also distinguished bioethicists from around the country. I want its primary function to be to anticipate, to the extent possible, the potential unintended consequences of biotechnology so that we can prevent and then head them off - so we don't have setbacks that could slow the progress and the potential of our industry.

Another goal is to enhance very significantly our communications capability. In my first year, while I visited 87 cities, I was largely preaching to the choir because I was visiting companies and speaking at state affiliates and speaking at a dozen or so of our own conferences, but largely talking to the experts in the field - getting to know them, them getting to know me. Now in this year and beyond...I want BIO to speak to the public at large and to those who are uninitiated, including just explaining what biotechnology is to Congress and state legislators and other policy-makers who really, I can tell you from experience, don't know what biotechnology is.

We want to advance the Critical Path initiative at the FDA. We want it funded. We think that's an important avenue for expeditious approval of very important drugs. We had a huge success late last year with the passage of a good pandemic bill that had important liability protections in it. Now we need to focus on implementation, make sure the job gets done and the monies get distributed appropriately - so that our companies are prepared to protect the nation from pandemic flu and other biological attacks.

And we want to continue to work the drug safety issue in ways that don't impose draconian slowdowns on the FDA nor create new ways to pull products off the market wholesale. Rather, to build on what [Administrator] Mark McClellan is doing over at CMS, and that's correlating prescribing data, as they are going to now with Part D, with treatment data so that we can have a robust, essentially real-time, personalized approach to drug safety that we can build on, eventually even outside of the four walls of CMS.

"The Pink Sheet": What's going to be the greatest obstacle to accomplishing those goals?

Greenwood: Go back to my paradigm, if you will, of the four walls. Those who are most focused on access and cost tend to believe that the way to expand access and reduce cost is to sort of beat it out of the companies, either by pushing for reimportation or price controls or passing bills like the District of Columbia did with its excessive pricing act. We think that the experience of Europe is very clear, that when you do that you lose access to good quality, and you kill innovation.

It's my objective to try to get the polarization, the partisanship out of these issues and create a sense that we're all in this together. [It does] not do us any good to have full access to a cheap system that doesn't have quality, nor is it any good to have terrific innovation and quality that's only available to a few. We think there are win/win solutions, and I'd like to spend some time talking to some of my former colleagues who tend not to be the best friends of our industry and see if we can develop mutually-agreeable goals.

"The Pink Sheet": Cost-effectiveness is a big buzzword now in healthcare. Does that pose a challenge to the price of biologics, which are often considerably more expensive than small-molecule drugs?

Greenwood: We're not afraid of cost-effectiveness in its purest form. Obviously what is good for the patient and for the healthcare system as a whole is to make sure that money is not wasted. Having said that, the beauty is in the eye of the beholder. What we don't accept is the notion that bureaucrats, rather than healthcare providers, will be making decisions about what's in the best interest of the patient.

We think that the system should be one in which the physician decides, based on his or her expertise, which medications are right for which patients and letting the patient and the doctor decide how much healthcare to acquire. I think the notion that we'll have bureaucrats saying, "Well this medication will only extend your life six months so it's not worth the cost," would be intolerable.

"The Pink Sheet": You mentioned CMS/FDA data sharing vis-a-vis safety. A lot of people thought of that as sort of setting a framework for measuring cost-effectiveness questions. Is that an appropriate way to gather that kind of data?

Greenwood: With CMS collecting, I think it's 17 data points on every drug prescribed under Part D and putting that in a databank that can be correlated against the treatment data for those very same Medicare beneficiaries is a huge advancement. It's something that we advocate very strongly and that we'd like to see expanded to the healthcare system as a whole. In the wake of the Vioxx etc. phenomena, there were those both within the Congress and outside of the Congress whose quick reaction was, "We need to slow down the approval process." We think that would be disastrous for patients who are waiting for cures.

What we do think is that the current system of gathering data with regard to adverse effects, is quite haphazard. It relies on doctors observing adverse effects. It relies on them reporting to the manufacturers and that information getting to the FDA in a way that FDA policymakers can get their heads around. Because it's haphazard...is the reason the precautionary principle is to pull drugs off the market.

We think that being able to robustly collect data, as McClellan is in the process of doing, will enable us to have virtually real-time data [on] adverse effects and very good data as to what subsets of patients are experiencing them.

"The Pink Sheet": Do you think there is any sort of objective benchmark that physicians could use for measuring cost-effectiveness?

Greenwood: I think there should be objective data. I think it's quite appropriate for government agencies to be able to provide data to the healthcare system that says, "Here's an analysis of 100,000 patients who took medication A as opposed to medication B or treatment C and here are the outcomes." That's useful information for healthcare providers and I think obviously good doctors will want to know that information and they'll want it to enter their prescribing thinking. But I don't think it's a good idea for CMS to say, "Based on this analysis we will be the ones who determine what coverage decisions to make on the basis of that data."

"The Pink Sheet": Follow-on biologics remain an emerging debate in the U.S. Do you think the EU has taken the right approach to their regulation?

Greenwood: I can't speak with great authority to the EU approach. I do think that they will get there before we do. Generally speaking, our view is that obviously a biological is not a chemical pill. It's a much more complicated molecule. We use the term "biosimilar" because we understand that generic manufacturers may be able to produce very similar proteins and biologicals, but they won't be precisely identical, and for that reason, and because those variations can have significant health consequences and consequences on effectiveness, we believe that you need a full complement of data. Generally speaking, I believe that the Congress is moving down the road of getting into this issue.

We continue to hear conversations from the House and Senate about follow-on biologics. I want BIO to be at the table, providing the expertise that resides in our companies to this debate. I think the worst thing that could happen to us would be for us to be absent from the discussion and suddenly have legislation put together by congressional staffers who may not have the expertise that some of our scientists have and then have us be in the position of trying kill the bill and looking to all the world like we're simply against lower-priced biologicals.

I want us to be part of the solution and working with the Congress.... There's a big job to do here because members of Congress for the most part do not know what a biological is. I don't say that disparagingly. I spent 12 years on the Health Subcommittee of the Energy & Commerce Committee and if you asked me two years ago to define a biological I could not have done that.

The first thing that...our staff has been engaged in, and I will now be engaged in this year, is just going to the Hill and talking to the critical members of Congress and walking them through what a biological is and what the difference is between it and a pharmaceutical product and the kinds of concerns that we have in making sure that products that follow-on are just as safe and just as effective.

"The Pink Sheet": Do you think it would ever be possible to have a pathway that allowed for less expensive biologics, in a sense that most people see ANDAs as having allowed for cheaper drugs?

Greenwood: There's an inevitability to there being follow-on biologics. I think that it will happen and the question is whether we follow the science or not. Our commitment is to follow the science. It would be a mistake...for us to deny the scientific evidence about one's capacity to build, to create follow-on biologics. And it would be irresponsible for the Congress to not pay attention to the science with regard to how difficult it is to do that.

"The Pink Sheet": Some products that are essentially biologics, say insulin or human growth hormone, are not regulated under BLAs but NDAs. Do you think that's an adequate or appropriate way for them to be regulated?

Greenwood: I can't quote you chapter and verse as to the history of how that is. I know that there's a whole legal argument that says that the FDA therefore can make decisions in those classes of drugs with regard to follow-on biologics, if they don't have the statutory authority for the rest of the products. Of course that's the subject, I believe, of a lawsuit that Novartis [Sandoz] has filed claiming that the FDA does have that authority.

"The Pink Sheet": Turning back to your comments on PDUFA and the idea of post-marketing fees, what kind of fee structure were you envisioning? Something based on sales or more of a flat fee per product?

Greenwood: Generally speaking, I think the deal is that we're looking for $25 mil. for post-market surveillance to come from companies. What we want is for post-marketing surveillance to be somewhat standardized, so that it's predictable, as opposed to the current situation in which individual reviewers can make last-minute calls about what post-marketing surveillance they're going to require prior to approval.

"The Pink Sheet": About the ethics committee that you're going to be reforming, were there specific events within the industry that triggered this initiative?

Greenwood: You had, for instance, Jesse Gelsinger at the University of Pennsylvania. I think [that] was a pretty classic example of issues of conflict of interest, where a researcher had a financial interest in a product and was testing it and all the questions that that raised about whether the therapy was ripe enough to be used in human trials. You've had some of the investigations that I've done when I was over at the Commerce Committee on the potential conflicts of interest with scientists who work for [the National Institutes of Health] and work for FDA and their work on the side for private companies. Those are just a couple of examples.

"The Pink Sheet": Do you think there is a need for more fundamental changes to basic R&D and the approval pathways, in order for companies to survive in the environment of escalating research costs?

Greenwood: Absolutely that is the case. There are a lot of folks thinking about how to rethink the whole clinical trial process so that it takes less time and costs less money, so that we can move products efficiently to the marketplace.

There's a lot of hope and expectation to move more and more into an era of personalized medicine - that we're going to be able to design trials around specific populations so that the trials don't need to be as large in the future. But I think there's a lot of thinking that has to go into that, and no one's come up with the holy grail of a new paradigm for clinical trials yet.

"The Pink Sheet": What is BIO looking for in the next FDA commissioner?

Greenwood: Confirmation. It's important to have a confirmed FDA commissioner because it has turned out to be more difficult to confirm an FDA commissioner than a Supreme Court justice because the [John] Roberts and [Samuel] Alitos of the world can actually tell the members of the United States Senate that they're not going to answer all of their questions. FDA commissioners don't have that privilege.

There are enough highly divisive and controversial issues that it makes it very difficult to confirm a commissioner and that does cause conservativism at FDA. There can be paralysis that results from that process.

We do want to have an FDA commissioner confirmed. [Acting Commissioner Andrew] von Eschenbach would be an excellent candidate. I think that he'll bring the right balance to the FDA and that is both as a doctor and as a cancer survivor, understanding the importance of getting products to the market as efficiently as possible and balancing that against the gold standard of safety and efficacy that no one wants to alter.

I think Andy's level head, his sense of optimism, his belief, for instance, that we can prevent cancer in 15 years and that sort of thing is the kind of optimism that we hope to get at FDA.

John Rancourt