FDA Accelerates Biosimilar Approvals to Lower Prescription Costs
The U.S. Food and Drug Administration (FDA) has introduced a new framework designed to simplify and speed up the approval process for biosimilar drugs — generic versions of complex biological medicines used to treat conditions such as cancer, autoimmune disorders, and rare diseases. This initiative seeks to reduce the cost and time required to bring biosimilars to market, potentially saving the healthcare system billions of dollars annually.
Biologic drugs, which are produced from living cells such as bacteria or yeast, have long been a key driver of rising healthcare costs. Although they account for only about 5% of prescriptions in the United States, biologics represent more than half of total drug spending. The FDA’s new approach allows developers to rely more heavily on analytical testing rather than costly comparative clinical trials, which can take years and cost up to $100 million per product.
FDA Commissioner Dr. Marty Makary highlighted the potential for major savings, noting that streamlining biosimilar development “opens the door for faster access to affordable treatments.” The agency estimates that drugmakers could bring biosimilars to market in nearly half the time currently required.
Biologics and Biosimilars: A Growing Market with High Stakes
The expansion of the biosimilar market is a crucial step toward reducing pharmaceutical expenses in the U.S., where drug spending continues to outpace inflation. Biologics like Humira — used to treat rheumatoid arthritis and other chronic conditions — have dominated sales for years, generating tens of billions in annual revenue.
Since 2016, the FDA has approved ten biosimilars for Humira, though market adoption has been gradual. Recent data from Truveta Research shows that roughly 13% of patients on Humira have switched to a biosimilar since 2023. However, nearly 40% of those who switched later returned to the original drug within a month, highlighting ongoing patient hesitation and the importance of trust in biosimilar efficacy.
Under the new FDA guidance, the agency plans to remove certain regulatory barriers — such as the requirement for “switching studies” — that have historically delayed approvals for interchangeable biosimilars. This could enable pharmacists to substitute approved biosimilars more easily, encouraging price competition and improving accessibility for patients.
The Biotechnology Innovation Organization (BIO) has applauded the FDA’s science-driven approach, emphasizing that reducing redundant studies will make the biosimilar pipeline more efficient and attractive to investors.
A Step Toward Fair Competition and Affordable Medicine
The FDA’s decision reflects a broader effort to rebalance a pharmaceutical market that has often favored brand-name manufacturers. Lowering biosimilar development costs will likely lead to increased participation from smaller biotech companies and generic drugmakers. According to John Murphy, president of the Association for Accessible Medicines, this shift could also incentivize innovation in niche biologic products for smaller patient populations.
Meanwhile, health policy experts stress that biosimilar expansion must be matched by insurance reforms that prevent pharmacy benefit managers (PBMs) and other intermediaries from blocking competition through rebate and pricing structures. Trade organizations such as PhRMA have called on policymakers to eliminate these misaligned incentives that inflate costs for consumers.
The FDA’s latest move follows a series of national initiatives aimed at tackling the high cost of prescription drugs, including executive actions promoting transparency and direct-to-consumer pricing. With biologics representing the fastest-growing area of healthcare spending, the agency’s biosimilar reforms mark a significant milestone in the ongoing effort to ensure that advanced treatments remain affordable and accessible to all Americans.
