tag:theconversation.com,2011:/us/topics/biosimilars-21201/articlesBiosimilars – The Conversation2017-11-09T06:00:37Ztag:theconversation.com,2011:article/871762017-11-09T06:00:37Z2017-11-09T06:00:37ZTime for costly medicine monopolies to go from TPP trade talks<p>Negotiators from 11 countries have been racing to resurrect the near-dead Trans-Pacific Partnership Agreement before the Asia-Pacific Economic Cooperation (APEC) summit this weekend.</p>
<p>The latest plan to get the controversial trade deal up and running again after the withdrawal of the United States involves <a href="https://asia.nikkei.com/Politics-Economy/International-Relations/TPP-11-negotiators-make-headway-before-crucial-summit-next-week">freezing some of its controversial rules</a>. These include rules for biologic drugs, an expensive class of medicines often used to treat conditions such as cancer and rheumatoid arthritis.</p>
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Read more:
<a href="https://theconversation.com/explainer-what-are-biologics-and-biosimilars-45308">Explainer: what are biologics and biosimilars?</a>
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<h2>The market monopoly</h2>
<p>Biologic drugs are <a href="https://theconversation.com/explainer-what-are-biologics-and-biosimilars-45308">produced from living organisms</a> using certain types of cells to produce particular proteins. Biologics have the ability to bind to specific cells, which means they are often more effective and may have fewer side effects than broadly acting drugs. </p>
<p>They are very expensive, particularly when they are under monopoly protection. This is when the drugs can’t be legally copied for a certain amount of time. Governments have accepted the pharmaceutical industry’s proposition that they need this monopoly period to <a href="http://www.palgrave-journals.com/biosoc/journal/v6/n1/abs/biosoc201040a.html">recoup their research and development costs</a>.</p>
<p>For example, pembrolizumab (Keytruda), a drug for metastatic melanoma, <a href="http://www.abc.net.au/news/2015-06-28/melanoma-drug-listed-on-pbs-saving-patients-thousands/6578554">cost patients approximately A$150,000</a> for a year’s treatment before it was subsidised by Australia’s Pharmaceutical Benefits Scheme (PBS). </p>
<p>Once the period of monopoly protection ends, biosimilar medicines (generic versions) can be produced and sold at lower prices. Currently in Australia, once a biosimilar is on the market and listed on the PBS the market prices will drop by about 16% for all brands of the medicine.</p>
<p>Disagreement over the period of monopoly protection for new biologic drugs <a href="https://theconversation.com/how-the-battle-over-biologics-helped-stall-the-trans-pacific-partnership-45648">once brought the negotiations</a> over the Trans-Pacific Partnership (TPP) agreement to a standstill. The final text of the TPP, negotiated before the withdrawal of the United States, includes a controversial provision for monopoly protection for biologics known as data exclusivity.</p>
<p>During the period of data exclusivity, other drug manufacturers wanting to replicate the medicine can’t access the clinical trial data used to demonstrate the safety and efficacy of the original drug to the regulator.</p>
<p>This form of monopoly protection is separate to the period of patent protection. In Australia, the data protection period is currently five years for both biologics and conventional drugs.</p>
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Read more:
<a href="https://theconversation.com/why-biologics-were-such-a-big-deal-in-the-trans-pacific-partnership-48595">Why biologics were such a big deal in the Trans Pacific Partnership</a>
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<p><a href="https://ustr.gov/sites/default/files/TPP-Final-Text-Intellectual-Property.pdf">The final TPP text</a>, pushed by the United States, requires countries who ratify the agreement to provide for eight years of data exclusivity. Or alternatively five years of data exclusivity together with other (unspecified) measures that would still grant the original drug manufacturer a monopoly over the market.</p>
<p>While the industry argues this period is necessary to support innovation, there’s little evidence to validate this claim. <a href="https://www.researchgate.net/profile/Mike_Palmedo/publication/252931412_Do_Pharmaceutical_Firms_Invest_More_Heavily_in_Countries_with_Data_Exclusivity/links/00b7d51f582ee1caf5000000/Do-Pharmaceutical-Firms-Invest-More-Heavily-in-Countries-with-Data-Exclusivity.pdf">One international comparative study</a> found no relationship between the existence of data exclusivity and the amount of pharmaceutical industry investment in a country.</p>
<p><a href="http://www.pc.gov.au/inquiries/completed/intellectual-property/report">Two</a> <a href="https://www.ipaustralia.gov.au/about-us/public-consultations/archive-ip-reviews/pharmaceutical-patents-review">reviews</a> commissioned by the Australian government found no evidence exclusivity for biologic products need be extended.</p>
<h2>The prohibitive cost</h2>
<p>While there’s no evidence to support this form of monopoly protection, there is significant evidence of the costs for Australian taxpayers when there are monopolies on biologics.</p>
<p><a href="http://www.publish.csiro.au/AH/AH17031">New research in the Australian Health Review</a> shows biologic drugs cost Australia’s PBS over A$2 billion in the year 2015-2016 alone. If cheaper biosimilar versions of these medicines had been available in 2015/2016, at least A$367 million would have been saved.</p>
<p>Modelling shows annual PBS spending on biologics could be reduced by as much as 24% through the timely availability of biosimilars.</p>
<p>The TPP’s rules for biologic medicines could not only keep these biosimilars out of reach for longer, but also put hundreds of millions in PBS savings at risk. This is unless the negotiators agree to remove these rules completely from the revamped TPP.</p>
<h2>Intellectual property and the TPP</h2>
<p>TPP negotiators should also seek to drop <a href="http://journals.plos.org/plosmedicine/article?id=10.1371/journal.pmed.1001970">a suite of other intellectual property measures</a> that would extend pharmaceutical monopolies in several of the low- and middle-income countries participating in the remaining TPP-11 discussions. </p>
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<a href="https://theconversation.com/how-the-battle-over-biologics-helped-stall-the-trans-pacific-partnership-45648">How the battle over biologics helped stall the Trans Pacific Partnership</a>
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<p>These include measures to make it easier to obtain patents, extend patent terms, grant periods of data exclusivity for non-biologic drugs, and prevent drug regulatory authorities from approving generic drugs when patent holders claim potential infringement.</p>
<p>These provisions would likely delay generic medicines in several low- and middle-income countries participating in the negotiations. A <a href="http://journals.sagepub.com/doi/abs/10.1177/1468018117734153?ai=1gvoi&mi=3ricys&af=R">recent study</a> of the potential impact of TPP intellectual property measures for participating countries demonstrated different outcomes for high- and low-income countries. If these provisions remain in the TPP, low income countries would suffer, as they wouldn’t be able to provide cheaper medications to their people.</p>
<p>High-income countries, in contrast, would experience little change regarding access to medicines as a result of the TPP. Australia, for example, has already implemented these measures (aside from those affecting biologics) and would not have to make legislative changes. </p>
<p>But Australia and other high-income countries would become locked into these provisions, making it difficult for future governments to amend their domestic laws. Australia’s independent <a href="https://www.ipaustralia.gov.au/about-us/public-consultations/archive-ip-reviews/pharmaceutical-patents-review">Pharmaceutical Patent Review</a> panel recommended Australia should be working to reduce the length of patent term extensions.</p>
<p>The TPP-11 discussions provide an opportunity for negotiators to rectify some of the most contentious and politically unacceptable elements in the TPP, and drop them from the agreement.</p><img src="https://counter.theconversation.com/content/87176/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Belinda Townsend is a member of the People's Health Movement and the Public Health Association of Australia. She has been involved in the Public Health Association of Australia's advocacy on matters relating to trade agreements. </span></em></p><p class="fine-print"><em><span>Deborah Gleeson has received research funding in the past from the Australian Research Council. She has received funding from various national and international non-government (not-for-profit) organisations to attend speaking engagements related to trade agreements and health, including the TPP. She has represented the Public Health Association of Australia on matters related to trade agreements and public health.</span></em></p><p class="fine-print"><em><span>Joel Lexchin receives funding from the Canadian Institutes of Health Research. He is affiliated with Health Action International.</span></em></p><p class="fine-print"><em><span>Hazel Moir and Ruth Lopert do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Negotiators from 11 countries have been racing to resurrect the near-dead Trans-Pacific Partnership Agreement before the Asia-Pacific Economic Cooperation (APEC) summit this weekend.Belinda Townsend, Research Fellow, NHMRC Centre for Research Excellence in the Social Determinants of Health Equity, School of Regulation and Global Governance, Australian National UniversityDeborah Gleeson, Senior Lecturer in Public Health, La Trobe UniversityHazel Moir, Adjunct Associate Professor; economics of patents, copyright and other "IP", Australian National UniversityJoel Lexchin, Affiliate - pharmaceutical policy, University of SydneyRuth Lopert, Adjunct professor, Department of Health Policy & Management, George Washington UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/802582017-07-25T01:13:46Z2017-07-25T01:13:46ZBiologics: The pricey drugs transforming medicine<figure><img src="https://images.theconversation.com/files/179471/original/file-20170724-28293-q0p57w.jpg?ixlib=rb-1.1.0&rect=76%2C6%2C864%2C613&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The cells inside this bioreactor are the real pharmaceutical factories.</span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/sanofi-pasteur/5283861272">Sanofi Pasteur</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc-nd/4.0/">CC BY-NC-ND</a></span></figcaption></figure><p>In a factory just outside San Francisco, there’s an upright stainless steel vat the size of a small car, and it’s got something swirling inside.</p>
<p>The vat is studded with gauges, hoses and pipes. Inside, it’s hot – just under 100 degrees Fahrenheit. Sugar and other nutrients are being pumped in because, inside this formidable container, there is life.</p>
<p>Scientists are growing cells in there. Those cells, in turn, are growing medicine. Every two weeks or so, the hot, soupy liquid inside gets strained and processed. The purified molecules that result will eventually be injected into patients with Stage IV cancer.</p>
<p>Drugs that are made this way – inside living cells – are called biologics. And they’re taking medicine by storm. By 2016, biologics had <a href="http://www.imshealth.com/files/web/Global/white%20paper/QI_Disruption_and_maturity_The_next_phase_of_biologics.pdf">surged to make up 25 percent</a> of the total pharmaceutical market, bringing in US$232 billion, with few signs their upward trend will slow.</p>
<h2>Distinct from conventional drugs</h2>
<p>Common medicines such as aspirin, antacids and statins are chemical in nature. Though many were initially discovered in the wild (aspirin is a cousin of a compound in willow bark, the first statin was found in a fungus), these drugs are now made nonbiologically.</p>
<p>Conventional medicines are stitched together by chemists in large factories using other chemicals as building blocks. Their molecular structures are well defined and relatively simple. Aspirin, for example, contains just 21 atoms (nine carbons, eight hydrogens and four oxygens) bonded together to form a particular shape. A single aspirin tablet – even kid-sized – contains trillions of copies of the drug molecule.</p>
<p>Biologic drugs are a different story. This class of medication is not synthesized chemically – instead they are harvested directly from biology, as their name suggests. Most modern biologics are assembled inside vats – or bioreactors – that house genetically engineered microbes or mammalian cell cultures. Efforts are underway to <a href="http://doi.org/10.1002/bit.25352">make them in plants</a>.</p>
<p>Biologic drugs can be <a href="https://www.ncbi.nlm.nih.gov/pubmed/9446633">whole cells</a>, alive or dead. They can be the biomolecules produced by cells, like <a href="https://doi.org/10.1038/nbt1137">antibodies</a>, which are normally secreted by our immune system’s B cells. Or they can be some of the internal components of cells, like <a href="https://doi.org/10.1016/S0140-6736(10)60665-4">enzymes</a>.</p>
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<a href="https://images.theconversation.com/files/176165/original/file-20170629-10672-1hcosdd.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/176165/original/file-20170629-10672-1hcosdd.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/176165/original/file-20170629-10672-1hcosdd.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=341&fit=crop&dpr=1 600w, https://images.theconversation.com/files/176165/original/file-20170629-10672-1hcosdd.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=341&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/176165/original/file-20170629-10672-1hcosdd.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=341&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/176165/original/file-20170629-10672-1hcosdd.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=428&fit=crop&dpr=1 754w, https://images.theconversation.com/files/176165/original/file-20170629-10672-1hcosdd.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=428&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/176165/original/file-20170629-10672-1hcosdd.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=428&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Biologics can dwarf conventional drugs in size, and that gives them added specificity.</span>
<span class="attribution"><span class="source">Ian Haydon</span>, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/">CC BY-ND</a></span>
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<p>Biologics are typically much larger molecules than those found in conventional pharmaceuticals, and in many cases their exact composition is unknown (or even unknowable). You’re unlikely to find biologic drugs in tablet form – they tend to be delicate molecules that are happiest in liquid solution.</p>
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<span class="caption">Animals were the original producers of serums used in vaccines.</span>
<span class="attribution"><a class="source" href="https://commons.wikimedia.org/wiki/File:JimHorse.png">AAMiller</a></span>
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<p>While biologics are one of the <a href="https://doi.org/10.1016/j.amsu.2014.09.001">fastest-growing drug categories</a> in the U.S., they aren’t exactly new. The <a href="https://history.nih.gov/exhibits/history/docs/page_03.html">Biologics Control Act</a>, passed in 1902, was the first law aimed at ensuring the safety of some of the earliest biologics – vaccines. Congress was moved to pass the law after a contaminated batch of diphtheria shots left 13 children dead. Jim, the horse from which the diphtheria antitoxin had been extracted, <a href="https://www.fda.gov/AboutFDA/WhatWeDo/History/CentennialofFDA/CentennialEditionofFDAConsumer/ucm096141.htm">had contracted tetanus</a>.</p>
<p>Fortunately, scientists have dramatically <a href="https://www.fda.gov/aboutfda/centersoffices/officeofmedicalproductsandtobacco/cber/">improved the way they manufacture</a> biologic drugs since then. For starters, the recombinant DNA revolution of the 1970s means that drug makers no longer have to extract many of the most important biologics from whole animals.</p>
<p>The gene that codes for human insulin, for example, can be pasted into a microbe which will happily churn out the drug in bulk. After a <a href="http://doi.org/10.1007/978-3-642-59990-3">multi-million dollar purification process</a>, the injectable insulin that results <a href="https://www.fda.gov/aboutfda/whatwedo/history/productregulation/selectionsfromfdliupdateseriesonfdahistory/ucm081964.htm">is indistinguishable</a> from the version a healthy human body would produce. This is how some forms of insulin are made today.</p>
<h2>The biologic advantage</h2>
<p>Both conventional and biologic drugs work by interacting with our own biology. Most conventional drugs function as inhibitors – they’re just the right size and shape to jam themselves into some molecular cog in our cells. Aspirin’s pain-reducing power comes from its <a href="https://doi.org/10.1016/S0049-3848(03)00379-7">ability to disrupt an enzyme</a> in the body called cyclooxygenase, an important player in pain signaling.</p>
<p>Conventional drug discovery largely consists of finding new compounds that specifically disrupt only disease-associated processes. Because these drugs are quite small, and because the inside of any cell is a sea of other molecular components, finding a new small drug that blocks only problematic processes is tricky. Off-target interactions can <a href="https://doi.org/10.1002/cmdc.200700026">produce side effects</a> of all types.</p>
<p>The large size of biologic drugs can be an asset here. An antibody, for example, has lots of specific points of contact with its target. This enables therapeutic antibody drugs to bind with extreme precision – only their target molecule should be an exact match. This binding can lead to inhibitory effects, much like a conventional drug might. In some cases, therapeutic antibodies can also <a href="https://doi.org/10.1038/74704">stimulate the immune system</a> in a problem area, like at a tumor, prompting the body to <a href="https://theconversation.com/as-scientists-train-the-immune-system-to-fight-cancer-others-look-to-combat-costs-77364">take it out</a>.</p>
<p>Many biologics target molecular processes that no conventional drug can, and they can treat <a href="https://doi.org/10.12688/f1000research.9970.1">a growing list of diseases</a>. Cancer treatments <a href="https://doi.org/10.1016/j.biotechadv.2016.07.004">dominate the list</a>, but since 2011 the U.S. Food and Drug Administration has approved new protein-based biologics for the treatment of Lupus, Crohn’s disease, rheumatoid arthritis, multiple sclerosis, kidney failure, asthma and high cholesterol.</p>
<p>New types of biologic drugs continue to emerge as well. In late 2015, the FDA approved a first-of-its-kind treatment for patients with advanced <a href="https://www.cancer.org/cancer/melanoma-skin-cancer.html">melanoma</a>: an engineered herpes virus. Researchers genetically programmed the virus, called <a href="https://doi.org/10.1186/s40425-016-0158-5">T-VEC</a>, to target only cancerous cells, and it can also prompt the immune system to start wiping out cancer. <a href="https://doi.org/10.1111/cas.13027">Additional virus-based therapies</a> are currently working their way through the lengthy U.S. drug approval process.</p>
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<span class="caption">Biologics can be good news for patients, like this boy with Batten disease, but can also come with formidable price tags.</span>
<span class="attribution"><a class="source" href="http://www.apimages.com/metadata/Index/Associated-Press-Domestic-News-California-Unite-/91b4b13acfe1da11af9f0014c2589dfb/5/0">AP Photo/Sang H. Park</a></span>
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<h2>Crippling costs</h2>
<p>Amgen, the company that produces T-VEC, estimates it will cost an average of <a href="http://www.marketwatch.com/story/fda-approves-imlygictm-talimogene-laherparepvec-as-first-oncolytic-viral-therapy-in-the-us-2015-10-27">$65,000 per patient</a> – and that doesn’t come close to topping the list of priciest biologic medications. The most expensive drug ever made recently <a href="https://www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm555613.htm">won approval</a> by the FDA. Brineura, a biweekly enzyme replacement therapy produced by BioMarin Pharmaceutical, delays the loss of walking in individuals with a rare genetic disorder. Its price tag? $27,000 per injection, or <a href="https://www.bloomberg.com/news/articles/2017-04-27/biomarin-prices-orphan-drug-at-702-000-promises-big-discounts">more than $700,000</a> for a full year’s treatment.</p>
<p>The steep prices of biologic drugs are alarming to many patients, physicians and researchers. In an effort to drive costs down, provisions of the Obama administration’s <a href="https://www.fda.gov/drugs/guidancecomplianceregulatoryinformation/ucm215089.htm">Affordable Care Act</a> accelerated the approval process for new biologics intended to compete with already approved medicines. Like generic drugs, so-called biosimilars are designed to be interchangeable with the biologic they seek to replace.</p>
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<a href="https://images.theconversation.com/files/179475/original/file-20170724-24759-lk4sxj.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/179475/original/file-20170724-24759-lk4sxj.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/179475/original/file-20170724-24759-lk4sxj.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=401&fit=crop&dpr=1 600w, https://images.theconversation.com/files/179475/original/file-20170724-24759-lk4sxj.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=401&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/179475/original/file-20170724-24759-lk4sxj.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=401&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/179475/original/file-20170724-24759-lk4sxj.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/179475/original/file-20170724-24759-lk4sxj.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/179475/original/file-20170724-24759-lk4sxj.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Aryogen in Iran produces a biosimilar form of Blood Coagulation factor VII Novoseven called AryoSeven.</span>
<span class="attribution"><a class="source" href="https://en.wikipedia.org/wiki/File:Inside_Aryogen.jpg">Asemi</a>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span>
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</figure>
<p>Unlike generic versions of conventional drugs, however, biosimilar drugs are often only similar to – not identical with – their competition. This means these complex drugs still require lengthy and expensive trials of their own to make sure they’re effective and safe. Because of this, the Federal Trade Commission estimates that biosimilars may only produce an overall <a href="https://www.ftc.gov/sites/default/files/documents/reports/emerging-health-care-issues-follow-biologic-drug-competition-federal-trade-commission-report/p083901biologicsreport.pdf">10 to 30 percent discount</a> for patients.</p>
<p>Cost-cutting innovations in the biologic production pipeline are desperately needed. The FDA has <a href="https://doi.org/10.1038/ajg.2014.151">called on scientists and drug developers</a> to invent biosimilars that resemble FDA-approved medicines and to develop the tools needed to quickly demonstrate their safety.</p>
<p>As this promising class of drugs continues to grow in number and popularity, their lifesaving power will be limited if costs make them inaccessible to patients who need them.</p><img src="https://counter.theconversation.com/content/80258/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ian Haydon does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Rather than being designed by chemists, this class of pharmaceuticals is produced by living cells. Here’s where they come from and how they work.Ian Haydon, Doctoral Student in Biochemistry, University of WashingtonLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/485952015-10-06T02:49:29Z2015-10-06T02:49:29ZWhy biologics were such a big deal in the Trans Pacific Partnership<p>After five years of negotiations, a <a href="https://ustr.gov/about-us/policy-offices/press-office/press-releases/2015/october/trans-pacific-partnership-ministers">deal has finally been reached</a> on the Trans Pacific Partnership Agreement (TPP). But details are sketchy and the final text may not see daylight for several weeks, as it undergoes what’s quaintly referred to as “legal scrub” – the painstaking dotting of the i’s and crossing of the t’s by each of the participating countries’ lawyers.</p>
<p>Before this final round of negotiations in Atlanta, only a handful of issues remained in the way of concluding the massive 12-country trade and investment agreement. One of them – a potential deal-breaker for Australia – was intellectual property protections for <a href="https://theconversation.com/explainer-what-are-biologics-and-biosimilars-45308">biologics</a>, which are expensive medicines derived from living organisms.</p>
<h2>Market exclusivity</h2>
<p>In the United States, <a href="https://theconversation.com/explainer-what-are-biologics-and-biosimilars-45308">biologics</a> are protected from competition by follow-on products (known as biosimilars, which are akin to generic medicines) for 12 years from the time they’re first granted marketing approval by the nation’s drug regulator, the Food and Drug Administration (FDA). This form of protection from competition is distinct from a patent. It prevents a follow-on product from entering the market even when any patents on the originator product have expired. </p>
<p>These 12 years are known as the market exclusivity period. In the TPP negotiations, the biopharmaceutical industry has been insisting the United States push its potential partners to <a href="http://keionline.org/tpp/11may2015-ip-text">adopt a similar period of exclusivity</a>, together with a whole series of other onerous intellectual property provisions, such as requirements to allow patenting of diagnostic, therapeutic and surgical methods of treatment, and of new forms, uses, or methods of using medicines.</p>
<p>Importantly, Australia doesn’t currently have a market exclusivity provision for medicines. Instead, the local drug regulator, the Therapeutic Goods Administration (TGA), provides a “data protection” period of five years for all prescription medicines. During this time, a follow-on product can’t rely on the data submitted to the TGA to support the originator drug’s registration to gain marketing approval.</p>
<p>Without being able to rely on these data, follow-on manufacturers would be forced to repeat the often long – and always expensive – clinical trials required for marketing approval. Repeating the clinical trials would arguably be unethical, since the question of whether the drug is safe and efficacious has already been answered.</p>
<h2>Big savings</h2>
<p>Under existing legislation, the TGA can’t begin to evaluate a biosimilar application during the data protection period. So a follow-on product is unlikely to get to market until at least six years after the originator first enters it. Why then has all this been so important that it stalled the signing of a major trade agreement? </p>
<p>Biologics are used to treat various cancers, multiple sclerosis, a range of immunological conditions, as well as diabetes (insulin is a biologic). They’re the fastest growing segment of the pharmaceutical market globally. </p>
<p>When a biosimilar product is listed on Pharmaceutical Benefits Scheme (PBS) and becomes subsidised by the government, it automatically triggers a 16% price reduction on all versions of the product. Biologics are expensive, so this can amount to tens of millions of taxpayers’ dollars saved every year on just a single product.</p>
<p>Trade Minister Andrew Robb had <a href="http://trademinister.gov.au/releases/2013/ar_mr_131211.html">repeatedly said</a> Australia wouldn’t agree to any TPP provision that would undermine the PBS or go beyond the provisions of the Australia-US Free Trade Agreement (AUSFTA). And this meant holding the line at five years of data protection. </p>
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<img alt="" src="https://images.theconversation.com/files/97360/original/image-20151006-29251-aqhld.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/97360/original/image-20151006-29251-aqhld.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/97360/original/image-20151006-29251-aqhld.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/97360/original/image-20151006-29251-aqhld.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/97360/original/image-20151006-29251-aqhld.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=502&fit=crop&dpr=1 754w, https://images.theconversation.com/files/97360/original/image-20151006-29251-aqhld.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=502&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/97360/original/image-20151006-29251-aqhld.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=502&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Biologics are medicines derived from living organisms and include insulin.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/sriram/2219886844/">sriram bala/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/">CC BY-ND</a></span>
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<p>But <a href="http://www.citizen.org/documents/new-tpp-maneuvering-on-biotetch-drugs-september-2015.pdf">recent reports</a> have suggested negotiating countries have reached some form of compromise involving a formal period of data protection of five years (the status quo in Australia) with an additional period of up to three years of “safety monitoring” before a biosimilar can be registered. It’s unclear what precisely this would entail, other than representing a period of time in which a follow-on product would be prevented from entering the market. If it’s true, this would effectively become an eight-year market exclusivity period.</p>
<h2>No need</h2>
<p>The devil will be in the details of the agreement. But it’s difficult to see how any extension of monopoly protection could be accomplished without an amendment to Australia’s Therapeutic Goods Act. And that is likely to be politically challenging in an election year, particularly given widespread public concern over the potential for the biologics provision to increase PBS costs. </p>
<p>John Castellani, the president of PhRMA – the <a href="http://www.phrma.org/about#sthash.kfNux1E4.dpuf">Pharmaceutical Research and Manufacturers of America</a>, which represents that country’s biopharmaceutical researchers and biotechnology companies – is <a href="http://www.politicopro.com/financial-services/story/2015/10/the-tpp-deals-winners-and-losers-056514">reported to have said</a> that TPP ministers had:</p>
<blockquote>
<p>… missed the opportunity to encourage innovation that will lead to more important, life-saving medicines… This [12-year] term was not a random number, but the result of a long debate in Congress. </p>
</blockquote>
<p>The industry originally sought 14 years of exclusivity in the United States. 12 years was the outcome of prolonged political horse-trading. </p>
<p>But the industry has never put forward a convincing argument in support of longer periods of data exclusivity, nor any evidence that longer protection leads to new and better drug development. And the <a href="https://www.ftc.gov/sites/default/files/documents/reports/emerging-health-care-issues-follow-biologic-drug-competition-federal-trade-commission-report/p083901biologicsreport.pdf">US Federal Trade Commission said</a> as far back as 2009 that a market exclusivity period for biologics might not be warranted at all. It found there was no evidence of a lack of patentability of new biologic products, nor that market forces weren’t adequate to stimulate their development – two of the arguments often used to support longer data exclusivity. </p>
<h2>Horse trading</h2>
<p>The significance and endurance of the data protection issue in TPP negotiations can’t be overestimated. It was equally contentious in the <a href="http://dfat.gov.au/trade/agreements/ausfta/pages/australia-united-states-fta.aspx">2004 AUSFTA</a>, and it also went down to the wire then. </p>
<p>The issue then wasn’t about exclusivity for biologics, as the US hadn’t yet established a regulatory pathway for approval of biosimilars. Instead, the US pharmaceutical industry was pushing for an additional period of three years of data protection for new uses of existing medicines. This would have meant up to eight years of data protection for all prescription medicines in Australia. Had it been agreed to, it would have resulted in significant additional costs to the PBS. </p>
<p>Those who’ve waded through the <a href="http://dfat.gov.au/about-us/publications/trade-investment/australia-united-states-free-trade-agreement/Pages/chapter-seventeen-intellectual-property-rights.aspx">Intellectual Property Chapter of the AUSFTA</a> might be forgiven for thinking that Australia had actually agreed to the “five plus three” model. But a small footnote provides a kind of get-out-of-jail-free card for Australia, while still retaining the model in the negotiating template. </p>
<p>It refers to the fact that data protection in Australia is granted to combination products where at least one of the components has not been registered before. In the US, exclusivity is limited to combination products where none of the component products have previously been registered. The scope of protection in Australia is thus broader. This is retained as a quid pro quo for the extra data protection.</p>
<p>The obvious question then is whether there’s a similar “out” in the TPP text and, if so, what will the obligations be for other TPP countries? Another key question relates to the <a href="http://keionline.org/tpp/11may2015-ip-text">remainder of the TPP’s intellectual property chapter</a>, and which other expansions of intellectual property protection sought by the US have been agreed to. </p>
<p>Before we can begin to breathe more easily on biologics, we need to know what Australia has horse-traded in other chapters of the agreement to get an “acceptable” outcome on this issue. But it will be some weeks yet before we can find out.</p><img src="https://counter.theconversation.com/content/48595/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ruth Lopert does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Before the last round of negotiations, only a handful of issues remained in the way of concluding the TPP. A potential deal-breaker for Australia was intellectual property protections for biologics.Ruth Lopert, Adjunct professor, Department of Health Policy & Management, George Washington UniversityLicensed as Creative Commons – attribution, no derivatives.