Supreme Court ruling gives biosimilars more flexibility as review continues

A narrower reading of the notice rule

The Supreme Court’s unanimous ruling changes when a biosimilar manufacturer may notify the maker of a reference biological product that it plans to begin commercial marketing. The decision reversed the Federal Circuit’s divided opinion and addressed a central provision of the Biologics Price Competition and Innovation Act.

The dispute involved a mandatory 180-day notice period. The Federal Circuit had interpreted the rule to mean that a biosimilar applicant could give commercial marketing notice only after receiving final agency licensure. That interpretation delayed the process and gave the reference product sponsor what amounted to an additional six months of market exclusivity.

Justice Thomas wrote the opinion for the court and rejected that interpretation. He explained that the statute contains one timing condition, rather than two. If Congress had intended to allow notice only after licensure, the opinion said, it would have added that restriction to the law.

The ruling allows biosimilar applicants to submit commercial marketing notices earlier in the FDA drug regulatory process. Applicants no longer have to wait for final licensure before providing notice. As a result, reference product sponsors lose the timing advantage that the Federal Circuit’s interpretation had provided.

What changes in practice

The ruling does not mean that every biosimilar will reach patients six months sooner. Its direct effect is narrower: a developer no longer has to wait for final agency licensure before giving notice. That removes a legal barrier to earlier market planning and may prevent an unintended extension of a reference product sponsor’s market exclusivity.

For biosimilar developers, the decision makes earlier market entry possible in principle. Companies have more discretion over when to provide notice during the regulatory process. The ruling changes what applicants may do, but it does not require them to give notice as early as possible.

The timing question remains complicated. A company could provide notice with its initial application, but the review process can change as the application moves forward. The agency may identify deficiencies that delay final licensure, and an applicant may not know at the outset how long the review will take. Very early notice may therefore be less useful than notice given closer to approval.

That uncertainty may make manufacturers reluctant to adopt the most aggressive strategy allowed by the ruling. The court removed the delayed-notice requirement, but it did not make early notice commercially necessary. Each company will still need to decide when notice is most useful based on the progress of the regulatory review and its market plans.

The approval pathway keeps moving

The court’s ruling came as federal health regulators continued to review and advance additional biological products. The agency approved a second biosimilar alternative to Remicade. That approval indicates that the administrative process for these products is becoming more established.

Advisory committees are evaluating other applications. An oncology advisory panel voted in favor of recommending the first biosimilar version of Epogen for full approval. The same committee is scheduled to review applications for products targeting Herceptin and Avastin.

These developments show why biosimilar competition depends on more than a favorable court ruling. A product must still pass through the agency’s drug review process, where officials may identify deficiencies before licensure. The review can limit how quickly a product moves forward, but it is also the process used to determine whether the product can be approved.

The distinction also matters in other FDA policy discussions, including off-label marketing and the First Amendment. When considering what is and is not established about GLP-1 side effects, a similar question arises when a product reaches patients without an equivalent approval review. Compounded GLP-1s are not approved products. No equivalent review has produced a safety profile for the specific preparation in a patient’s vial. Removing review is different from making review more efficient.

States shape substitution policy

Federal court rulings and agency decisions are only part of the factors that affect competition. State legislative sessions have concluded, and changes to pharmacy dispensing rules are under review. Those laws may create new requirements for substituting interchangeable biological products. The requirements can affect how prescriptions are filled after an alternative becomes available.

The relationship between federal approval, court decisions and state pharmacy rules will help determine how quickly competition leads to actual dispensing choices. A biosimilar may complete the federal approval process, but substitution practices can still differ under state requirements.

For patients and payers, the possible benefit is greater access to biological therapies at lower prices. That result is not automatic. Manufacturers must decide whether and when to enter the market. Pharmacies must follow the applicable substitution rules. Regulators must continue to distinguish products that have completed the approval process from products that have not.

The Supreme Court removed one barrier to earlier biosimilar competition. Ongoing agency reviews, advisory committee recommendations and state dispensing laws will determine how that legal change affects the market.