On July 18, FDA released its long-awaited Biosimilars Action Plan (“BAP”). In prepared remarks to the Brookings Institution the same day, FDA Commissioner Scott Gottlieb described the BAP as “enabling a path to competition for biologics from biosimilars” in order to “reduc[e] costs and to facilitat[e] more innovation.” While the BAP is straightforward, the Commissioner’s remarks included unexpected jabs at innovator drug makers for what FDA believes is anticompetitive conduct.

The BAP consists of four “key elements”: (1) improving efficiency of the biosimilar development and approval process; (2) improving clarity of scientific and regulatory requirements; (3) developing biosimilar education initiatives; and (4) supporting competition by “reducing gaming of FDA requirements” or other means of delaying biosimilar market entry. Among the BAP’s concrete steps to carry out these objectives are developing new review templates for 351(k) applications, creating an index of critical quality attributes for biosimilars, developing pharmacodynamics biomarkers and in silico modeling to evaluate pharmacokinetic and pharmacodynamics response versus clinical response, strengthening FDA’s relationship with foreign regulatory bodies and harmonizing international approval standards, developing an enhanced Purple Book, and soliciting public input about the approval process. The BAP also references final biosimilar labeling guidelines, which were also released on July 18.

The Commissioner’s remarks struck a slightly different tone. Stressing the importance of biosimilars to cost savings, the Commissioner blamed the fact that cost savings from biosimilars have not been as large as expected on “anemic” competition in biologics markets. The cause of this anemic competition? According to the Commissioner, there is really only one: innovator drug manufacturers. The Commissioner leveled criticism at brand-drug makers for allegedly “split[ting] monopoly profits” with Pharmacy Benefit Managers and other members of the supply chain through “rebating schemes” and “long-dated contracts,” which he described as “toxin[s]” impeding market penetration of approved biosimilars.

The Commissioner also criticized patent litigation under the Biologics Price Competition Act (BPCIA), blaming alleged litigation “delays” and “patent thickets” for delayed biosimilar launches, and called out “dysfunctional clinical treatment pathways,” such as clinically unnecessary step-therapy or prior authorization on reference biologics before patients can access the biosimilar. As in the case of rebates, the Commissioner offered no analysis of the patents protecting innovator products or the litigations enforcing those patents. In all, the Commissioner said “we’re seeing the biosimilars version of ‘Groundhog Day’,” recalling strategic battles between small-molecule brands and generics following the Hatch-Waxman Act of 1984. He vowed that, this time, FDA would not play “regulatory whack-a-mole” with manufacturers.

The Commissioner’s remarks are surprising in that FDA does not regulate patent litigation or oversee rebate agreements between private market participants. The speech was also striking for what it did not mention: for example, that the price tag set by biosimilar makers for biosimilars in the US is not much cheaper than that for innovator drugs even though biosimilar makers piggy-back on years of innovators’ costly research and development and clinical trials, reaping enormous financial benefit – a subject FDA is well acquainted with. Likewise, the Commissioner did not discuss the impact of the prices set by biosimilar makers on biosimilar market penetration, or the fact that reimbursement policies have incentivized biosimilar makers to keep prices high. While the speech was likely driven by the Trump Administration’s American Patients First plan, which sets as a top FDA priority the reduction of prescription drug prices, including by reducing “gaming” of regulatory requirements, what the speech achieves given the role of FDA remains unclear.