California Governor Jerry Brown Vetoes Biosimilar Bill

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Governor Jerry Brown cites physician notification requirements for dispensing biosimilars as premature in the absence of FDA specifications for interchangeability.

California Governor Jerry Brown has vetoed biosimilar legilsation (SB-598) that would have specified requirements under which pharmacists could substitute biosimilars for brand-name products. The legislation was passed by the California Assembly in August and by the California State Senate in September 2013. The biopharmaceutical industry offered mixed views on the veto with opinion divided between the innovator-drug sector and the generic-drug sector.

The bill, which the governor had vetoed, would have amended California’s state pharmacy law to specify that a pharmacist filling a prescription order for a prescribed biological product could select a biosimilar only if the product was approved by FDA, was determined to be interchangeable with the prescribed biologic, and the prescriber (i.e., the doctor) does not personally indicate “do not substitute” for the product. For prescriptions filled prior to Jan. 1, 2017 for a biological product or interchangeable biosimilar, the pharmacist would have to notify the prescriber (i.e., doctor) whether the prescription dispensed was a biological product or interchangeable biosimilar or have entered the information in a patient-record system shared by the prescriber. The bill also prohibited a pharmacist from selecting a biosimilar unless the cost was the same or less than the cost of the prescribed biological product. The bill further required that the substitution of a biosimilar be communicated to the patient.

Brown offered support of the legislation that would have allowed biosimilar substitution for interchangeable biologics once interchangeable biologics would have been approved by FDA, but felt that it was premature to require physician notification. " It [The bill] requires pharmacists to send notifications back to prescribers about which drug was dispensed. This requirement, which on its face looks reasonable, is for some reason highly controversial. Doctors with whom I have spoken would welcome this information. CalPERS and other large purchasers warn that the requirement it self would cast doubt on the safety and desirability of more cost-effective alternatives to biologics. The FDA, which has jurisdiction for approving all drugs, has not yet determined what standards would be required for biosimilars to meet the higher threshold for “interchangeability. Given this fact, to require physician notification at this point strikes me as premature,” said Brown, in a statement.

The Biotechnology Industry Organization (BIO) issued a press release on Oct. 13, 2013 describing its disappointment in Brown's decision to veto the bill. "The vetoed bill aligned with all five of BIO’s principles on biologic substitution, properly preserved patient access to accurate prescription information, maintained incentives for innovation and promoted a competitive market for biologic therapies," said BIO in its statement. "The bill included full transparency in the substitution process – providing patients and their physicians the right to know what biologic medicine the patient receives from the pharmacy. While the U.S. Food and Drug Administration (FDA) oversees approval of biologic medicines, policies governing whether one product may be substituted in place of a doctor's prescription and whether a pharmacist must notify a consumer is covered by state law. The FDA is currently developing a pathway for the development and approval of safe and effective biosimilar products in the United States. However, there is still a major role for states to play in ensuring substitution practices remain transparent and physicians remain engaged in the process.

Ralph Neas, president and CEO of the Generic Pharmaceutical Association (GPhA), issued a statement on Oct. 12, 2013 supporting the veto. “This Amgen and Genentech-promoted bill was designed to drive their profits and thwart competition from biosimilars, newer versions of biotech drugs that offer patients the promise of cutting-edge medicines without the hefty price tag. But with one stroke of his pen, the Governor has preserved access for millions of patients and will save California taxpayers billions of dollars.”

According to GPhA, more than 30 organizations support the governor's veto, including CalPERS, the California Pharmacists Association, AARP, Walgreens, the California Retailers Association, the California Association of Health Plans, CVS Caremark, the California Correctional Health Care Services, Pacific Business Group on Health, nine state labor unions, Express Scripts Inc., and Kaiser Permanente.

For related stories see the following:

California State Senate Passes Biosimilars Bill (Pharmaceutical Technology, Sept. 6, 2013).