Transcript Title Slide Goes Here

Overview of Drug
Development: From Lab to
Market to Generic
Presented by Scott Gottlieb, M.D.
American Enterprise Institute for Public Policy
Research
Avalere Health LLC | The intersection of business strategy and public policy
Session Objectives
In this session, we will
 Discuss the usual process a product undergoes from development through to launch
» Laboratory Research
» Pre-clinical Testing
» Investigational New Drug Approval
» Clinical Trials
» New Drug Application Approval
» Post-Marketing Commitments
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The Path from Test
Tube to Patient
The intersection of business
strategy and public policy
The Typical Path Requires Several Testing Stages, FDA
Approvals, and Commercialization
~ 10 to phase 1
Pre-clinical Testing
~ 250 to pre-clinical testing
Research
IND
Phase 1 Trials
~ 3 to phase 2
Phase 2 Trials
Phase 4 Studies
Millions of compounds
~ 2 to phase 3
Phase 3 Trials
FDA Approval
Pharma Activity
NDA/
BLA
Product Launch
~1
approved
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The Process Starts with Laboratory Research*
Basic (Bench) Research
Target Identification
Target Validation
 Understand normal and abnormal body functions
 Understand mechanism underlying disease with unmet need
 Develop concept for a potential drug
 Identify mechanism associated with disease (target)
 Assess target association with disease
 Assess target ability to regulate compounds in the body
 Confirm that interactions are associated with desired change
in diseased cell behavior and have potential for intervention
with a drug
 Identify compounds that effect target
*Specific to drugs; biologics undergo a similar process
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The Process Starts with Laboratory Research (continued)*
Compound Selection
Compound Optimization**
 Discover or invent compound that alters the target
 Compare to known substances to estimate likelihood of
success
 Develop potential leads as collections, or libraries, of
molecules and test each to confirm effect on the drug target
 Compare various compound properties to assist in selection
 Alter compounds to increase potential efficacy and minimize
potential side effects, adjust PK/PD parameters
*Specific to drugs; biologics undergo a similar process
**Pre-clinical studies often occur concurrent with compound optimization
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Potential Drugs Undergo Pre-clinical Testing*
 Pre-clinical testing assesses how much compound is absorbed, how the body breaks it
down, and how it reacts to, or excretes, break-down products, how it hits its intended
target
 Uses two or more species of living animals because the potential compound may affect
species differently
 Determines the potential drug’s safety at different doses
 Identifies any toxic side effects, latent toxicities (carcinogenicity)
 Assesses on target effects, off target effects
 Provides information for the design of proposed human studies
*Specific to drugs; biologics undergo a similar process
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The FDA Must Approve Progression to Clinical
Testing
Investigational
new drug (IND)
application
process
The FDA reviews
 Pre-clinical test results
 Manufacturing information
 Human test plans
Local institutional review
boards (IRBs)
concurrently review the
clinical trial protocols
30 days for review
Chart is from http://www.fda.gov/cder/handbook/ind.htm
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Clinical Trials* Establish Safety and Efficacy in Humans
Phase One
Phase Two
Phase Three
Assess Safety (and
sometimes efficacy)
Assess Efficacy
Further Assess Safety
and Efficacy
20-80 healthy volunteers
6-12 months
50-300 subjects
12-24 months
100s-1000s of subjects
18-24 months
Most frequent side effects
How the drug is broken
down & excreted
Sometimes done in
patients with condition being
studied (cancer)
In people with the disease
or condition compared to
those receiving a placebo
Short-term side effects
Basis for discussion with
FDA on how to conduct
Phase 3
Different populations
Different dosages
Combinations with other
drugs
*Specific to drugs; biologics undergo a similar process
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The FDA Must Approve the Drug Before Launch
New drug application
(NDA) process*
60 days to decide if
file is ready for review
10 month review
Assess
 Approved: Can be
marketed in the US
 Safety & efficacy
 Appropriate drug
labeling
 Adequate
manufacturing
methods
 Approvable: Not
officially approved;
can probably be
approved after
resolving specific
issues
Consider reviewer
assessments
Chart is from http://www.fda.gov/cder/handbook/nda.htm
*Some biologic products must submit a biologic license application (BLA) instead
 Not Approvable:
Deficiencies that
make it unclear that
it can be approved in
the future
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The Company Prepares for Product Launch
During FDA Review and Approval
 Define the current market and target customers
 Set prices, have some advance discussions with payers where permissible
 Determine distribution strategy, REMS, post market safety management
 Determine strategies to address reimbursement hurdles
 Define label strategy (life-cycle planning, follow-on studies and indications)
 Execute launch plan*
*Company launches drug at a time they determine appropriate, not necessarily immediately after FDA approval
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Post Launch Consists of Life-Cycle Management
 Monitor product performance, e.g. revenue and market share
 Tackle barriers to adoption, compliance
 Address market or competitive changes
 Incorporate new clinical findings, expanded indications, new formulations
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Some Drugs Take a Different Path
New drugs may undergo an expedited review* process
 Drugs classified as a real advance over available treatments undergo a 6 month “priority
review” instead of the 10 month “standard review”
 Drugs that treat a range of serious diseases and fill an unmet need may request and
receive a “fast track” designation at any point during drug development
 Fast track drugs are eligible for accelerated approval or rolling review
 Accelerated approval uses findings that are likely to predict clinical benefit rather than
direct measurements & results
 Rolling review allows companies to submit completed NDA sections individually rather than
the entire application all at once, allowing earlier resolution to potential problems
*Accelerates review but does not guarantee approval
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Phase 4 Studies Monitor and Gather Additional Data
Post-marketing commitments can occur when:
» FDA requests phase 4 studies, often before approval, and sponsor agrees (most phase
4 studies, authority to require studies under FDAAA)
» Approved drug that underwent accelerated approval
» Approved drug not adequately labeled for children or with incomplete pediatric testing
» Approved drug with only animal data or that could not ethically be tested in humans
Phase 4 studies provide more information, e.g. about risks, benefits, efficacy, new
indications, and optimal use
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FDA Has Regulatory Authority to Approve Innovator and
Generic Small Molecule Drugs Through the FDCA
 Approval via the 505 (b)(1)
pathway requires submission of
significant clinical trial data, in
three phases, proving drug safety
and effectiveness; drug chemistry
information; labeling; description
of manufacturing
Abbreviated New
Drug Application
(ANDA)
505 (j)(1) pathway
Generic Small Molecule Drug
New Drug Application
(NDA)
505 (b)(2) pathway
New Drug Application
(NDA)
505 (b)(1) pathway
Innovator Small Molecule Drug
 Applicants rely on data from
bioequivalent drugs approved by
an NDA for expedited approval
»Typically, existing drugs used to
gain approval for new therapeutic
indications or new dosage forms,
or for use in combination with
another drug
FDCA= Federal Food, Drug, and Cosmetic Act
NOTE: Further detail on strategies for bringing biosimilars to market are included in Task D: Evaluation of Alternative Strategies for
Bringing Biosimilars to Market
 Requires proof of
bioequivalence to
demonstrate that
the proposed
product is identical
to a previously
approved product
based on safety
and efficacy
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Policy and Marketplace Challenges Facing Drug Developers
 Rising cost of development, and a frontloading of clinical development process
 Increasing data demands post market
 Slowing sales ramps, tougher launches
 Declining venture investments, shrinking R&D budgets as drug margins come
down, and consolidation of facilities, manufacturing
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Drug Shortages: No Single Cause, or a Single Solution
 Market for parenteral generics has been squeezed by declining profits, margins
 At the same time manufacturing requirements have been tightened following
safety issues
 End result: about 30% of U.S. manufacturing capacity is now offline with no clear
resolution
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Prior to the ACA, FDA Approval Pathway Existed Only for
Innovator Biologics
Manufacturer Submits Biologics
License Application (BLA) via 351(a) to
FDA
 BLA was created under the US
Public Health Service Act (PHSA)
Review by Center for
Drug Evaluation and
Research (CDER)
Review by Center for
Biologics Evaluation
and Research (CBER)
CDER reviews
monoclonal antibodies
and recombinant proteins
CBER reviews gene
therapies, blood and
blood components, and
venoms
Pending positive clinical
evidence, approved under
PHSA, but regulated as “drug”
under FDCA
 Trials, in three phases, proving
safety, purity, and potency; product
information; labeling;
manufacturing/ packaging
 Particular emphasis on
manufacturing process and
licensing of facilities
 FDA states that no regulatory
authority exists to approve
generics under PHSA
Note: Some older types of biologics are approved under FDCA pathways, primarily insulin and human growth hormone.
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Several Uncertainties Remain for Biosimilars
FDA failed
to release
guidelines
by end of
2011
ACA passes creating the
pathway for biosimilars
1Q10
Vehicle
2Q10


3Q10-3Q11
4Q11
FDA draft guidance
regulations released
Final FDA regulation will likely
follow a 60-day comment
period
1Q12


FDA released draft guidance regulations to govern the biosimilar pathway
CMS may release guidance on how the agency will treat biosimilars for HCPCS coding assignments
linked to payment rates
CMS also could release a NCD on biosimilars even in the absence of a biosimilar coming to market
and/or in the absence of external requests for a NCD
In the absence of a NCD, local contractors could enact LCDs once a biosimilar enters the market
Private payers and Medicaid programs likely will evaluate each biosimilar on a case-by-case basis
Drivers Affecting
Implementation


Companies legally challenging biosimilars or the legislation could slow the release of final regulation
Looming questions remain on interchangeability standards despite the release of draft guidance
Opportunity to
Influence
 Interested parties will be able to comment on the draft FDA regulation
 FDA held a public meeting in December 2010 to hear from interested stakeholders and may hold other
meetings in the future
 Stakeholders can also work directly with individual private payers and Medicaid programs

HCPCS=Health Care Common Procedure Coding System; NCD=National Coverage Determination; LCDs=Local Coverage
Decisions
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