The US Food and Drug Administration’s (FDA’s) pilot scheme to expedite the review of US-made generic medicines is welcomed but there must be a change in market dynamics for it to succeed, an expert said.
The programme announced in October which falls under the long-standing abbreviated new drug application (ANDA) framework, is designed to facilitate the rapid review of generic or biosimilar medicines that are tested and manufactured in the US.
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Upon announcing the scheme, the FDA claimed that its creation would “strengthen the domestic pharmaceutical supply chain,” which has seen significant shortages in recent years.
While the pilot prioritisation scheme could offer benefits to generics companies with US operations, Giuseppe Randazzo, senior VP of sciences and regulatory affairs at the Association for Accessible Medicines (AAM) told Pharmaceutical Technology that clarifications are needed before the industry can fully utilise this framework.
Addressing disparities in US drug pricing
While the US healthcare system is highly reliant on generics, which make up over 90% of all prescriptions filled in the US, Randazzo believes that drug pricing does not always reflect this.
“The last commissioner at the FDA would often talk about the drug pricing problem we have in the US, where we pay too much for branded drugs and not enough for generics; I think that’s an accurate statement,” he commented.
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By GlobalDataThis led him to warn that the generics business could become unsustainable if this imbalance is not corrected, as “the industry needs to earn enough so it can continue to reinvest in R&D,” which can help get affordable medicines to patients.
To achieve this, Randazzo stated that incentives like contracts with fixed prices and a set amount of medicines to be produced could benefit manufacturers by “offering predictability”.
In a bid to influence US drug prices, President Donald Trump has requested that the industry engages with his administration to reduce costs. Thus far, he has shook hands with Pfizer, AstraZeneca and MSD, known as Merck in the US, providing cash-paying patients with cheaper branded medicines.
Though there has been talk of Trump’s drug pricing reforms impacting all corners of the pharmaceutical industry, Randazzo believes that the impact of this on the generics market remains unknown.
However, he did caveat that negotiations on biosimilar drugs could make it commercially inviable for companies to produce these medications. “If you were to negotiate pricing for a biosimilar, and you take the price down lower than the development cost, a business is not going to make the drug,” Randazzo noted.
“The market dynamics around generic products need to improve, as you can pay less than a cup of coffee for a month’s supply of certain drugs,” he added.
Need for clarity around the priority scheme’s details
Aside from drug pricing concerns, Randazzo supports the ANDA generic prioritisation scheme. He does, however, raise questions about the first element of the eligibility criteria, which requires companies applying under the scheme to conduct bioequivalence testing on US soil.
“It is currently unclear if a company will have to perform all bioequivalence studies in the US to fit the pilot, as some will run multiple rounds of testing in differing locations. This would be a helpful clarification from the FDA,” noted Randazzo.
Randazzo also called for further explanation on elements two and three of the generics prioritisation scheme, as he believes that the industry “does not yet have a full understanding” of these requirements.
Elements two and three state that companies which manufacture both active pharmaceutical ingredients (APIs) and finished drugs in the US are deemed eligible for priority review under the pilot scheme.
Before the ANDA generics pilot scheme was introduced, the FDA debuted the PreCheck initiative. This programme aims to bolster communication and collaboration earlier in the development process to encourage drug manufacturing onshoring.
While Randazzo also commends the PreCheck scheme, he caveated that the sector is yet to see how it will be implemented. What we ideally need is clarity on of the programme only applies to new facilities, or if it will be suitable for US facilities sitting idle,” Randazzo said.
Prioritising resilience
Though Randazzo supports the expansion of generics companies in the US, he notes that supply chain resilience should still be a key consideration.
“A lot of companies are investing in their US manufacturing capabilities, but they are not necessarily shutting down facilities in other parts of the world,” Randazzo stated.
While the Trump Administration is looking to onshore pharmaceutical manufacturing in a bid to establish “a domestic, resilient and affordable supply chain for American patients,” Randazzo does not believe that this will have a sizable mid-term impact on generics companies worldwide.
“I don’t anticipate India shutting down its manufacturing facilities,” he said. “Neither can I imagine Trump’s onshoring efforts having an immediate, dramatic impact on other economies,”
“There are enough facilities in other parts of the world, meaning this will likely not be an issue in the short-term,” Randazzo added.
He also touted the necessity of global manufacturing operations: “We can’t put all our eggs in one basket and achieve supply chain resilience. We need manufacturing sites worldwide to ensure that – if anything does happen to a facility – medicines can still be produced and distributed,” Randazzo concluded.
