The Food and Drug Administration (FDA) on Wednesday approved Novartis generics unit Sandoz’s Erelzi, a “biosimilar” version of Amgen’s top-selling drug Enbrel that will be cheaper than the original product. Enbrel, which treats inflammatory conditions such as rheumatoid arthritis and plaque psoriasis, brought in sales of $5.1 billion in the U.S. last year and is among the top five best-selling drugs in the world.
Biosimilars are essentially generic versions of “biologic” drugs (which are derived from biological matter of some sort). But unlike generics of chemical drugs, biosimilars aren’t exact molecular copycats—and so their approval largely depends on their ability to show that they are as safe as and perform similarly enough to the original branded products they’re trying to emulate.
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This class of drugs is pretty new to the U.S. In fact, Erelzi is just the third FDA-approved biosimilar. The other ones are Novartis’ Zarxio, a copy of another Amgen drug for boosting bone marrow which was approved just last year, and Pfizer’s (pfe) and Celltrion’s Inflectra, which emulates Johnson and Johnson’s (jnj) top-selling anti-inflammatory Remicade and was approved earlier in 2016.
The FDA’s growing willingness to approve competitor products for pricey biologics for a number of different conditions underscores the ongoing outcry over high drug prices in America.
“The biosimilar pathway is an important mechanism to improve access to treatment for patients with rheumatic and autoimmune diseases,” said the FDA’s Dr. Janet Woodcock in a statement, adding that patients and doctors can be confident that there are “no clinically meaningful differences in safety and efficacy” between Erelzi and Enbrel.
It’s still unclear just how much cheaper biosimilars will be compared to their branded counterparts. Estimates range from a 15% to 30% discount in the U.S., although price cuts have been steeper in Europe and other countries, where biosimilars have been around for about a decade. There’s also another snag for Novartis’ Enbrel competitor—Amgen has challenged its introduction into the U.S. market in court, meaning that it could take some time before it actually lands at discounted prices.
Novartis has had at least one setback in its quest to leech off sales from top-selling biologics. In July, the company revealed that the FDA had rejected its biosimilar of a different Amgen product called Neulasta. For its part, Amgen is working on its own biosimilars, including for the top-selling drug in the world: AbbVie’s (abbv) Humira. That experimental product got a unanimous recommendation from an FDA advisory committee the same week that Erelzi did.