The U.S. Food and Drug Administration has officially signed off on a generic version of the biotech drug Neupogen, which boosts blood cells in cancer patients — a move that could open the door to more generic biotech drugs and save the health care industry billions of dollars.
In a massive first, the FDA has approved Novartis’ generic version of Neupogen, which will be marketed as Zarxio, and authorities believe it could save the U.S. health system $5.7 billion over the next decade, according to an Associated Press report.
Biotech drugs tend to be extremely expensive: Neupogen cost $3,500 on average last year for a 30-day supply, according to Express Scripts Holding Co., the largest prescription benefit manager in the country. The reason why they are so expensive is because, unlike most drugs which are based on chemicals and compounds, biotech drugs are produced within living cells, and were so complex that the FDA didn’t have a mechanism for approving copies of biotech drugs, also known as “biosimilars.” Without any competition, biotech companies have made big bucks off these drugs. Neupogen alone had sales of $839 million last year, according to the report.
Biosimilars would result in a significantly lower price. Novartis would not provide specific pricing for Zarxio until it is available on the market later this year, but the company said the drug would be competitively priced.
The drug will be sold through Novartis’ Sandoz subsidiary, and it has been approved for several types of patients, including those receiving chemotherapy or bone marrow transplants, according to the report.
Neupogen is pricey, but some biotech drugs go even beyond that, costing up to $100,000 per year, which is why the FDA’s decision paving the way for future biosimilars could result in a massive savings for the U.S. economy. Spending on biotech drugs amounts to 30 percent of the spending for drugs overall in the United States.
Biotech companies have fought against efforts to make generic versions of their drugs, arguing that they are too complex to be copied, but the FDA in 2012 approved a regulatory pathway that would allow biosimilars to get approval.
The United States is actually behind the rest of the world in this category, as Novartis has been selling a generic version of Neupogen in Europe for years, and sells biosimilars in 60 countries around the world.
