The FDA wants to kill the interchangeable biosimilar. It’s not waiting on Congress to start the burial preparations

Buried within FDA’s budget request for this upcoming fiscal year was a proposal for Congress: Please eliminate the legal distinction between biosimilars and interchangeable products.

• At present, federal law treats biosimilar and interchangeable products as related, but separate. Under the Patient Protection and Affordable Care Act (better known as Obamacare), Congress established a pathway for the approval of products that are either highly similar to – or effectively identical to – existing biological products. Biosimilars were defined as products that are “highly similar to the reference product, notwithstanding minor differences in clinically inactive components” and for which there are “no clinically meaningful differences between the biological product and the reference product in terms of the safety, purity, and potency of the product.”
• Meanwhile, interchangeable products are defined as those that are both biosimilar to the reference product and “can be expected to produce the same clinical result as the reference product in any given patient.” For a subset of biologics – those intended to be administered more than once to an individual – the law also requires that an interchangeable product not introduce a safety risk or diminish efficacy when patients are switched between the reference biologic and the interchangeable product. To produce this type of data, sponsors must conduct clinical switching studies, in which a subset of patients are switched between the reference and interchangeable product, adding another layer of time and expense to the development process.
• In theory, interchangeable products were intended to represent a sort of higher standard for sponsors to achieve, with rewards given to developers capable of achieving that standard. New interchangeable products would be eligible for periods of marketing exclusivity upon their approval by the FDA, with up to 42 months of protection from competition. And because many state legislative bodies passed laws preventing the pharmacy-level substitution of reference biologics for biosimilars unless it had been determined to be interchangeable by the FDA, sponsors similarly had an incentive to seek interchangeable status.
• But in practice, the FDA hasn’t seen many interchangeable products approved. At present, there are just 11 interchangeable products that have been approved by the agency (although some are approved for multiple doses).

In recent months, the FDA has taken a new stance that there is no clinical distinction between biosimilars and interchangeables and is now seeking to de-emphasize the language

• In a January 2024 statement on the FDA’s website, SARAH YIM, the director of FDA’s Office of Therapeutic Biologics and Biosimilars – the office which regulates biosimilars and interchangeable products – wrote that “there may be inaccurate perceptions that interchangeable biosimilars are safer or more effective than biosimilars that are not approved as interchangeable. The interchangeability designation does not indicate a higher level of biosimilarity.” Yim clarified that both designations indicate that the products are “as safe and effective as their reference products.”
• That statement was supported by research conducted by Yim and a group of FDA staff which found effectively no additional safety concerns in patients who were switched between reference biologics and biosimilars. Published in October 2023, the findings of this analysis were particularly important from a policy standpoint. If switching between the reference product and approved biosimilars – including those that had not been found to be interchangeable – did not produce clinically meaningful differences as compared to the reference product, then FDA may not need to require biosimilar sponsors to conduct switching studies to demonstrate interchangeability. As the study authors explained, “The findings reported here support reducing the regulatory burden of switching studies as the default approach for addressing the switching standard for the interchangeable designation.”
• Speaking about this study in a May 2024 interview, Yim highlighted her personal take-away: “[N]o matter if there were additional [switching] studies or not, it’s really important to emphasize that an interchangeable is not safer or more effective than a biosimilar that hasn’t gone through that process.”
• The FDA moved to operationalize these findings in September 2023 (before the publication of the study) with a revised draft guidance document which proposed to eliminate any mention of the interchangeable designation from product labeling. In its stead, FDA recommended that all biosimilar products – whether biosimilar or interchangeable – be referred to as “biosimilar” and no longer make any reference to the term “interchangeable” in the product labeling. Instead, the guidance recommended that sponsors make use of a unified statement regarding biosimilarity. [ Read AgencyIQ’s analysis of this guidance here.]
• Industry reactions to the guidance were mixed. Some industry groups, such as the Association for Accessible Medicines (AAM), which represents developers of generics, biosimilars and interchangeable products, said it favored the elimination of the interchangeability statement, and would in fact favor the removal of the biosimilar statement in its entirety. “Removal of these statements from labeling also would align with generic drug labels, which do not include comparable statements or therapeutic equivalence ratings,” it wrote.
• But biopharmaceutical trade groups were strongly opposed to the change. The industry group PhRMA argued against the changes, saying it felt the interchangeability statement should be “retained and refined.” The group also expressed concerns that while the interchangeability statement would be retained in the FDA’s Purple Book – an online database of all approved biologics and their equivalents – product labeling is “the source to which prescribers are most likely to turn.” The Biotechnology Innovation Organization (BIO) told the FDA that the change “undermines the statute [the Biologics Price Competition and Innovation Act] by standardizing the label to ‘biosimilar’ thereby encouraging the perception that all biosimilars can be considered as interchangeable at the pharmacy.” One potent argument that wasn’t mentioned in either company’s comments: The cost incurred by some companies to pursue interchangeable status is considerable; and changing the status quo would both harm companies that obtained the status and open up branded biologics to more rigorous competition.

But the FDA is moving much more quickly on its draft recommendations – and research findings – than some industry stakeholders might realize

• As AgencyIQ first reported in December 2023, the FDA moved to implement the aforementioned guidance – which was still in draft form and in its comment period – almost immediately. An AgencyIQ review found that the labeling statements of all interchangeable biosimilar products approved by the FDA (including labeling changes) after the release of the September 2023 guidance no longer contained any mention of the word “interchangeable.” The search addressed Abrilada (adalimumab; interchangeable with Humira), Byooviz (ranibizumab; interchangeable with Lucentis) and Wezlana (ustekinumab; interchangeable with Stelara). [ Read AgencyIQ’s analysis here.]
• The FDA has since approved five additional interchangeable products, and they, too, lack all mention of interchangeability on the products’ respective labels. The FDA-approved labels for Bkemv (eculizumab-aeeb; interchangeable to Soliris), Yesafili (aflibercept-jbvf) and Opuviz (aflibercept-yszy; both interchangeable to Eylea), Jubbonti (denosumab-bbdz; interchangeable to Prolia), and Wyost (denosumab-bbdz; interchangeable to Xgeva) all make no mention of product interchangeability. Curiously, while the labels don’t mention interchangeability, the FDA highlighted the products’ interchangeability in the respective press releases announcing the approvals.
• Also notable: The FDA’s Yim is now articulating the difference between biosimilars and interchangeable products in a new way, focused less on regulation and more on pharmacy practice. Speaking as part of an FDA interview in May 2024, Yim said she wanted “to emphasize that interchangeables are not a ‘higher level’ of biosimilar. You don’t have to wait for a biosimilar product to be approved as interchangeable to prescribe that product to patients. And because the level of product quality and similarity, and of safety and efficacy is the same, biosimilars and interchangeables both can be used for patients. In fact, all FDA approved biosimilars are as safe and effective as the reference product to which they are compared. It’s just that in certain states, that interchangeability status may allow pharmacists to substitute the biosimilar product for the reference product without first consulting the prescriber.”
• In April 2024, FDA also released a revised draft guidance document on promotional labeling, indicating that even if sponsors have obtained interchangeable status, they are not to imply that their product is safer or more effective than a biosimilar competitor in promotional materials. “When multiple products are licensed as biosimilar to and interchangeable with or biosimilar to but not interchangeable with the same reference product, promotional communications should avoid representing or suggesting that any of these products (i.e., the reference product, any interchangeable biosimilar product(s), or any non-interchangeable biosimilar product(s)) are less safe or effective than each other for their approved uses based on their licensure pathways,” the guidance states. That is likely to make it difficult to promote a product’s interchangeable status using anything other than a legal definition of the term ”interchangeable.” [ Read AgencyIQ’s analysis of this guidance here.]
• The extent to which the FDA seeks to pursue this approach is most apparent, however, in its Fiscal Year 2025 budget proposal, which for the first time contains a request for Congress to “eliminate the statutory distinction between the approval standard for biosimilar and interchangeable biosimilar products.” As the agency explained in the request, “The statutory distinction between biosimilars and interchangeable biosimilars has led to confusion and misunderstanding, including among patients and healthcare providers, about the safety and effectiveness of biosimilars and about whether interchangeable biosimilars are safer or more effective than other biosimilars.” It asks Congress to eliminate the separate statutory standard for a determination of interchangeability “and to deem all approved biosimilars to be interchangeable with their respective reference products.”

Analysis

• While the FDA is asking for new authority, its actions make clear that it isn’t waiting on Congress to start making changes. Recent steps from the FDA indicate that it is moving to de-emphasize interchangeability in significant ways, including in product labeling, in public-facing communications, and potentially in regulatory approval standards as well. And this is highly unusual. Typically, the FDA doesn’t enact major policy changes as draft guidance documents; rather, it waits for industry comment and the document to be finalized. That FDA is moving ahead so quickly and forcefully indicates that its position on this issue is quite firm and unlikely to change.
• At a practical level, will this FDA policy shift spell an end to switching studies? If these studies are no longer required to demonstrate interchangeability, biologics sponsors may no longer need to plan – and budget – for these cumbersome and often costly trials. This, in turn, could result in less expensive biosimilars reaching patients more quickly.
• This shift in policy is also likely to raise novel regulatory policy questions. If the FDA de-emphasizes the importance of interchangeable products, is there any reason why companies would go to the time and expense of demonstrating interchangeability to the FDA? If the FDA doesn’t believe there are differences between biosimilars and interchangeable products, could this lead states – many of whom passed legislation requiring interchangeability as a precondition to allowing substitution soon after the passage of the Affordable Care Act in 2010 – to reconsider their legal requirements for prescribing? If FDA believes there’s no difference between an approved biosimilar and the interchangeable for the same condition – and even other biosimilars for the same condition – how might that affect its standards for approval for subsequent indications for the same biosimilar product (i.e., if the product was found biosimilar for one indication of the reference biologic, but subsequently seeks approval for other indications) and formulary decisions by insurers?
• Will Congress give the FDA what it wants? For now, that’s less clear. In the leadup to the Presidential election, there is likely little chance that FDA’s request will be acted upon since legislators already have a full agenda and none have yet introduced legislation to this effect. However, long-term it’s possible that FDA’s request could be packaged together with other efforts to lower drug prices (and, in fact, this was the driving premise behind the Biosimilar Red Tape Elimination Act, introduced to the Senate last year, which sought to eliminate the need for switching studies to demonstrate interchangeability). FDA’s argument in its proposal is that eliminating the interchangeable distinction would be “expected to increase uptake of biosimilars, with potential downstream effects of increasing competition, access, and affordability.” That could be a winning argument for legislative support – assuming that safety-related concerns from manufacturers and patient advocacy groups don’t outweigh them.

Featuring prior research from Chelsey McIntyre and Rachel Coe.
To contact the author of this research, please email Alexander Gaffney ( agaffney@agencyiq.com).
To contact the editor of this research, please email Kari Oakes ( koakes@agencyiq.com)