NC West Virginia News

A legal scholar from West Virginia University has raised concerns about the current laws governing the exclusivity periods for biologic drugs compared to traditional small-molecule drugs. In a recent article published in the Journal of the American Medical Association, Sean Tu, a professor at WVU College of Law, questions whether biologics require longer protections than their small-molecule counterparts.

Tu explains that "small molecule drugs are chemical compounds that are relatively easy to make," and contrasts this with biologics, which are produced in living organisms and can be affected by various factors during production. He notes that both types of drugs take approximately 12-13 years to develop, but biologics cost more on average and have stronger patent protection.

The Food and Drug Administration (FDA) grants 12 years of market exclusivity to biologics before copycat versions can be approved, while small-molecule drugs receive five years. Additionally, under the Inflation Reduction Act of 2022, biologics are exempt from Medicare price negotiations for 11 years compared to seven years for small-molecule drugs.

Biologics such as Humira, Keytruda, and Stelara represent about 5% of all drugs but account for 40% of total pharmaceutical spending. Despite their high costs, Tu argues they are not necessarily more effective than small-molecule drugs.

"We wrote this paper because the small-molecule folks say nobody’s going to invest in small molecules now — everybody’s going to invest in biologics because they get longer protections and they make more money," Tu said. He highlights that some small-molecule drugs can cure diseases like hepatitis C in just 12 weeks.

Tu collaborated with researchers from institutions including the London School of Economics and Harvard Medical School. Their analysis suggests that patents on biologics may delay biosimilar entry more effectively than those on small-molecule drugs delay generic entry. Biologic manufacturers often obtain new patents as exclusivity periods expire, creating uncertainty for biosimilar firms.

The study found little justification for granting longer legal protections to biologics since they already benefit from stronger patent protection and higher revenues. "The Biologic Price Competition and Innovation Act granted biologics 12 years of exclusivity based on assumptions that have proven incorrect," Tu stated.

He suggests that Congress should consider reducing the exclusivity period for biologics from 12 years to five years to align it with small-molecule drugs, potentially lowering drug costs.