WHAT HAPPENED

On July 18, 2018, US Food and Drug Administration (FDA) Commissioner Scott Gottlieb delivered a speech at The Brookings Institution in Washington, DC, discussing how to bolster competition from biosimilars while maintaining innovation.

The Commissioner noted the absence of true competition among biologics from biosimilar products in the United States, similarly to what the country experienced 30 years ago with respect to generics. The Commissioner said that this situation is caused, in part, by what he views as anticompetitive practices implemented by branded manufacturers, such as:

• Rebating schemes in which drug manufacturers bundle discounts to health insurers and employers across different pharmaceutical products;
• Multi-year contracts granting important rebates to payors, often entered into right before the entry of a biosimilar on the market;
• Volume-based rebates;
• Tying rebates, i.e., when rebates are offered if a product is bought together with a biologic;
• Patent thickets, i.e., when branded manufacturers’ own dense portfolios of overlapping intellectual property rights cover biologics; and
• Bundling biologics with other products, i.e., when a product is sold together with a biologic.

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