Under the Biologics Price Competition and Innovation Act (BPCIA), a “biosimilar” product is one that is demonstrated to be “highly similar” to the reference product with “no clinically meaningful differences [from the reference product] in terms of the safety, purity, and potency of the product.” “Interchangeability” requires a product to not only be biosimilar to its reference product, but to also be “expected to produce the same clinical result as the reference product in any given patient” and, “if the biological product is administered more than once to an individual, the risk in terms of safety or diminished efficacy of alternating or switching between the use of the biological product and the reference product [must not be] greater than the risk of using the reference product without such alternation or switch.” Interchangeable biosimilars may be eligible for pharmacy-level substitution, subject to state law.

Although this heightened statutory standard for interchangeable biosimilars remains in place, FDA, the Centers for Medicare and Medicaid Services (CMS), and the Biden administration have taken actions in recent months that may signal a move away from distinguishing non-interchangeable biosimilars from interchangeable biosimilars:

• In September 2023, FDA released a revised draft guidance on “Labeling for Biosimilar and Interchangeable Biosimilar Products,” which notably dispensed with any recommendation that interchangeable biosimilars include an “interchangeability statement,” as we described at the time online here. FDA instead recommended that labeling both for interchangeable biosimilars and non-interchangeable biosimilars include the same “biosimilarity statement.” The agency has stated that the interchangeability statement was creating confusion and a false impression of a separate safety and efficacy standard for interchangeable biosimilars.

• In October of last year, an FDA team, including Dr. Yim, published a PLOS Journal article with the results of a meta-analysis on the clinical risks associated with switching between biosimilars and their reference products. The paper concluded that the switching was not associated with major safety concerned and that these findings “support reducing the regulatory burden of switching studies as the default approach for addressing the switching standard for the interchangeable designation.” This conclusion may have signaled the authors were anticipating a regulatory framework under which the default position would be that a biosimilar is automatically determined to satisfy the switching standard and is interchangeable with the reference product, even without any additional data from switching studies. However, the article disclosed important limitations in the meta-analysis, such as the small number of patients considered for the analysis. Not disclosed in the article, but also of concern, is whether the conclusions of the study can be more generally applied to all biological products beyond those reviewed for the meta-analysis. As reflected in the text of the BPCIA, Congress specifically contemplated the potential for reduced safety or diminished efficacy when switching or alternating between a reference product and a biosimilar. More extensive regulatory findings or a statutory change may be needed for FDA to change its default approach for all biosimilars to one where switching studies are presumed unnecessary to establish interchangeability.

• In March of this year, President Biden’s FY-2025 budget request to Congress proposed permitting biosimilar substitution without an FDA determination of interchangeability. The Department of Health and Human Services (HHS) proposed budget included a provision to “amend section 351 of the Public Health Service Act to no longer include a separate statutory standard for a determination of interchangeability and to deem all approved biosimilars to be interchangeable with their respective reference product.” HHS said the distinction between biosimilars and interchangeable biosimilars has led to confusion about whether interchangeable biosimilars are safer or more effective than other biosimilars and that the proposed change would make the U.S. biosimilar program more consistent with current scientific understanding.

• In April 2024, CMS announced as part of its CY-2025 Medicare Advantage and Part D Final Rule that Medicare Part D plan that sponsors are now permitted to immediately substitute all FDA-approved biosimilars as formulary “maintenance changes.” Previously, this was a regulatory flexibility only permitted for interchangeable biosimilars.

• FDA also published its revised Q&A draft guidance titled “Promotional Labeling and Advertising Considerations for Prescription Biological Reference Products, Biosimilar Products, and Interchangeable Biosimilar Products” in April. The revised draft guidance largely mirrors the 2020 version of the guidance, but now explicitly includes interchangeable biosimilars within the scope of the guidance and addresses unique considerations applicable to interchangeable biosimilars, which were not included in the 2020 draft. The guidance now includes an example explaining that suggesting an interchangeable biosimilar to be superior in safety and effectiveness to a non-interchangeable biosimilar would be misleading. The guidance also adds that it is “normal and expected for biological products to have minor differences between batches,” advising against promotional communications for reference products that suggest a licensed biosimilar product is less safe or less effective than the reference product because it is not or may not be identical to the reference product.

• Most recently, in an FDA podcast released early May, Dr. Yim seemed to suggest that FDA could be preparing for a shift to a regulatory framework in which all biosimilars are interchangeable with their reference products. Dr. Yim stated there exists “a lot of confusion about interchangeable biosimilars” and emphasized that interchangeable biosimilars are not a “higher” level than biosimilars. Dr. Yim further stated that “all FDA approved biosimilars are as safe and effective as the reference product to which they are compared. It’s just that in certain states, that interchangeability status may allow pharmacists to substitute the biosimilar product for the reference product without first consulting the prescriber. Since many biosimilars are not dispensed at the pharmacy, and are physician administered, say in a hospital or in an outpatient facility, pharmacy level substitution may not really be relevant for those products.” When asked about potential reservations regarding switching between a reference product and the biosimilar, Dr. Yim referenced the October 2023 PLOS article, stating, “these findings hopefully provide additional evidence to reassure [providers] . . . that switching between biosimilars and their reference product is not associated with any major safety concerns.”

Next steps

These actions may indicate FDA is preparing for a regulatory framework under which all biosimilars are interchangeable. However, there still remain many unanswered questions on how such a framework would operate. For example, it is unclear whether the agency would, under this potential framework, consider a biosimilar interchangeable only with its reference product or also with other biosimilars for the same reference product. Further, the existing statutory language continues to reflect a distinction between non-interchangeable and interchangeable biosimilars, and FDA has expressed its understanding that new legislation would be necessary before that distinction can be eliminated entirely from the regulatory framework.

Bills proposing to categorize all biosimilars as interchangeable have been introduced in the Senate on the topic, most recently in the Biosimilar Red Tape Elimination Act introduced in July 2023 by a bipartisan coalition of senators led by Sen. Mike Lee (R-UT) and co-sponsored by Sens. Mike Braun (R-IN), Ben Ray Lujan (D-NM), and JD Vance (R-OH). A prior version of the bill was voted down in Congress in 2022. Nevertheless, the incremental changes described above may have a significant impact on the promotion and substitution of non-interchangeable biosimilar products.