Why Biologics and Biosimilars Remain So Expensive: Despite Two Wins for Biosimilars, the Supreme Court’s Recent Rulings do not Solve Fundamental Barriers to Competition

Abstract

Biologics and biosimilars are medicines made from living cells that treat common and serious diseases such as cancer, diabetes, rheumatoid arthritis, and other inflammatory diseases. They are highly targeted, efficacious, and represent an increasingly important part of physicians’ armamentaria in the combat against these medical conditions. Yet they are extremely expensive, costing on average $10,000–$30,000 per year and exceed $500,000 for the most expensive biologics. The advent of biosimilar drugs, or high similar copies of biologics, was supposed to help reduce costs, but thus far the cost of treatment with biologics or biosimilars has not fallen sharply in the USA. We argue that a primary hurdle is the extent of patent protection for the reference biologics that impedes greater numbers of biosimilars entering into the market. To date, of the 12 biosimilars approved for marketing by the US Food and Drug Administration (FDA), only five are commercially available. All but one of the remaining biosimilars are withheld from commercialization due to patent disputes. We argue that the market for biologics and biosimilars will become price competitive only if more biosimilars are available to patients. To this end, the process to eliminate marginally inventive patents held by the reference drug makers must be streamlined and improved. In this perspective article, we suggest actions to improve the pre-FDA approval patent resolution process known as the patent dance, the streamlined patent invalidation process known as Inter Partes Reviews, and the process of granting patents.