A biosimilar is a biological product that has been assessed by the Food and Drug Administration (FDA) to be similar to an existing FDA-approved biologic. Generics are a replication of FDA approved synthetic branded drugs.

The Hatch-Waxman Act of 1984 allows other companies to create generics, or identical but less expensive versions of the original, branded drug, once the patent expires. In 2010, Congress passed the Biologics Price Competition and Innovation (BPCI) Act, which established an abbreviated regulatory process for biosimilars and paved the way for their approval.¹

Generic drugs were created to help offset the cost of branded medications and the same impetus of cost reduction is what led to the BPCI Act for biosimilars. BPCI Act is particularly important given the shift in development to immunotherapy and targeted therapy drugs, which have heftier price tags than synthetic treatments

Biosimilar drugs are often confused with generic drugs because they share many similarities. Generics and biosimilars are marketed as cheaper versions of brand-name therapies and they only become available when a drug companies’ exclusive patents expire. Generics and biosimilars have the same clinical efficacy as branded therapies but while generic drugs are identical in chemical composition to the original drug, biosimilars are “highly similar.” Biosimilars cannot be identical to the reference drug because they are modeled after drugs that use living organisms (e.g. microorganisms, plants or animal cells). However, biosimilars are duplicated closely enough to achieve the same therapeutic and clinical result. ²

Generic drugs generally cost 40-50% less than the brand product and biosimilars are usually 15-20% cheaper than the reference product.¹ As of March 2021, the twenty-nine biosimilars were approved by the FDA.³

The first generic drug applicant to submit a substantially complete FDA application that includes a challenge to the brand-name drug’s patents and that meets certain regulatory and legal requirements may be eligible for a 180-day exclusivity.⁴

1. What's the difference? Biosimilar and generic drugs. Cancer Center 360. 2018. https://www.cancercenter.com/community/blog/2018/12/whats-the-difference-biosimilar-and-generic-drugs.

2. Biosimilars Vs. Generics.. Quartz https://quartzbenefits.com/docs/default-source/providers/newsletters/biosimilars-vs-generics.pdf?sfvrsn=82c7e315_2.

3. Stewart J. How many biosimilars have been approved in the United States?. Drugs.com. https://www.drugs.com/medical-answers/many-biosimilars-approved-united-states-3463281/. Published 2021.

4. Exclusivity And Generic Drugs: What Does It Mean?. U.S. Food and Drug Administration; 2021. https://www.fda.gov/files/drugs/published/Exclusivity-and-Generic-Drugs--What-Does-It-Mean-.pdf.