On 29 Oct. 2025, FDA released a new draft guidance (on the need for demonstrating comparative clinical efficacy studies) signaling a major shift in biosimilar regulation. After more than a decade of experience reviewing biosimilar applications, the agency is now openly embracing a streamlined, analytics-first approval pathway; one that significantly reduces reliance on comparative clinical efficacy studies. This marks a turning point in how biosimilars will be developed, reviewed, and commercialized in the United States.
For in-house counsel at pharmaceutical companies, this shift brings both opportunity and complexity. Reduced regulatory burdens may accelerate development timelines and lower costs but they also reshape patent strategy, contract structuring, milestone allocation, and regulatory risk management.
Why FDA Is Reducing Requirements: Lessons From the First Generation of Biosimilars
When biosimilars were first introduced, FDA took a deliberately conservative approach. The agency demanded extensive testing: in vitro, in vivo, PK, immunogenicity, and comparative clinical efficacy studies. Those heightened requirements served an unspoken purpose: they taught FDA how biosimilars behave.
A decade later, FDA is armed with a wealth of data from real-world biosimilar development and post-marketing experience. That accumulated knowledge enabled the agency to confidently:
- Rely more heavily on analytical and functional comparisons.
- Interpret PK and immunogenicity data with greater scientific nuance.
- Reduce or eliminate clinical efficacy studies for many therapeutic proteins.
- Lean on modeling, in vitro assays, and advanced analytics rather than large human trials.
Impact on the Biosimilar Marketplace
- Lower development costs: The Guidance will likely speed up approvals and make the approval process overall cheaper. The cheaper price should lead to better market penetration, increased competition, and potentially more choices for patients.
- More crowded patent challenges: If development is cheaper, biosimilar applicants may file applications earlier, thereby increasing the number of applicants challenging patents of the reference product. Biosimilar applicants may also deal with less patents in the challenges because later patents have not yet issued.
- Interchangeability exclusivity and narrowed first mover advantage: By eliminating switching studies, this can affect the interchangeability exclusivity available to the first biosimilar that is deemed interchangeable. By reducing the regulatory evidence, more applicants may qualify for interchangeability status. If biosimilar approvals are clustered, the first mover advantage might be narrowed.
What This Means for In-House Counsel: Contracting, Risk, Governance, and Strategy
For in-house counsel, deal terms might be altered. With less regulatory burden, milestones payments under development contracts could be accelerated. Similarly, the contract terms will include milestones for meetings or FDA confirmations about the development pathway. Contract terms typically allocate risk, which under the Guidance might shift the risk profile to the analytical/PK/immunogenicity steps. The Guidance does not preclude FDA from requiring full clinical efficacy studies, so contracts many need to account for that contingency. For example, termination clauses may now account for the contingency that suspends or terminates the contract if FDA requires the heightened studies.
Practical Checklist for In-House Counsel
Regulatory Strategy:
- Build early FDA meetings into project timelines.
- Prepare internal briefing protocols around analytics-first packages.
Contracting & Deal Terms:
- Redesign milestones around analytical, PK, and immunogenicity steps.
- Add contingencies for FDA requiring clinical efficacy trials.
Patent & Litigation Strategy:
- Anticipate earlier biosimilar filings.
- Prepare for challenges involving fewer issued patents.
Conclusion
FDA’s move to streamline biosimilar development is not simply a scientific evolution; it is a legal, commercial, and strategic inflection point. The agency’s accumulated experience with first-generation biosimilars has finally enabled it to reduce regulatory burdens, lean on modern analytics, and accelerate approvals. This shift promises greater competition, lower development costs, and broader patient access.
For in-house counsel, the message is clear: update your contracts, rethink your risk allocation, and prepare for a faster, more analytics-driven biosimilar world.
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