Academic journal article Harvard Journal of Law & Public Policy

Biologics in the Practice of Law

Academic journal article Harvard Journal of Law & Public Policy

Biologics in the Practice of Law

Article excerpt

Biologics have come to occupy an increasingly important role in the medical industry, accounting for well over $200 billion in worldwide sales in 2014. Not surprisingly, biologics also occupy a prominent place in the practice of life-sciences law. Before expanding on how biologics and the law interact, however, it is important to first define "biologics." Most treatments for chemotherapy and autoimmune disorders are biologics. In contrast to a drug, which is a mixture of chemicals according to a set recipe, a biologic comes from a living organism. (1) Rodents, for example, might be a possible source. (2) Because no two biologics will be identical, there can be no "generic" biologic. Rather, a competing biologic may be deemed "biosimilar" or, if heightened requirements are met, "bioequivalent" to a reference biologic. Until recently, the concept of biosimilars was not recognized or approved in the United States. This changed with a little-known provision of the Patient Protection and Affordable Care Act, which is revolutionizing the pharmaceutical industry.

This Essay begins by discussing the recently implemented legislative pathway for marketing biosimilars in the United States, and the intersection of this pathway with the Leahy-Smith America Invents Act's mechanism for inter partes challenges to patents. The Essay then explores the competitive strategies at play in, and the initial economic effects arising from, the burgeoning biosimilars market, and ultimately concludes that the societal effect will be beneficial, if less dramatic than proponents of the Patient Protection and Affordable Care Act intended. Strong demand and high prices for biologics have created a robust black market in which smugglers enable physicians to obtain and administer to unknowing patients delicate, temperature-sensitive, non-FDA-approved biologics intended for use on the other side of the world. Drawing in part on the Author's personal experience as a federal prosecutor, the Essay explains why this black market is dangerous for patients who were neither informed of nor consented to treatment with non-FDA-approved biologics. The Essay concludes by exploring how both the legal and illegal markets for biologics are affected by the relationship between doctors and insurance providers, including federal and state governments and formularies, in which patients are merely passive participants.

I. THE LEGISLATIVE PROCESS FOR MARKETING BIOSIMILARS

Historically, the Hatch-Waxman Act (3) provided a legislative pathway to obtain FDA approval of generic drugs. (4) This legislation was enacted in 1984 and signed into law by President Ronald Reagan. (5) However, until the Patient Protection and Affordable Care Act (6) (PPACA) was passed in 2010, no equivalent pathway existed for biologics. (7) This legislative vacuum effectively insulated biologics manufacturers from competition, no doubt contributing to biologics' high prices and profit margins. The PPACA changed this competitive landscape through the Biologics Price Competition and Innovation Act (BPCIA). (8) The BPCIA allows companies that wish to introduce "biosimilar" or "bioequivalent" (per a heightened standard) pharmaceuticals to obtain FDA approval and enter the market. (9)

These "generic" biologics are aptly called "biosimilars," as they are derived from living organisms and are similar, but not identical, to the biologics for which they will be substituted. (10) This stands in stark contrast to a generic drug, which involves mixing chemicals according to a set recipe. (11) The comparative complexity of biologics makes the process of manufacturing and testing biosimilars much more expensive and time-consuming than the equivalent stages for generic drugs. (12) Yet the vast majority of the most profitable medications in recent years have been biologics, not drugs. (13) As such, everyone from generic drug companies to competing biologics manufacturers is eager to capture a slice of the biosimilars market. …

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