FDA Considers Drug Pricing: Leadership Cites Consumer Cost as a Driver for Changes to Biosimilar Recommendations

“By streamlining the biosimilar development process and helping advance interchangeability, we can achieve massive cost reductions for advanced treatments for cancer, autoimmune diseases, and rare disorders affecting millions of Americans.” – FDA Commissioner Martin Makary, October 29, 2025.

The U.S. Food and Drug Administration (FDA) has traditionally refrained from considering drug pricing — and for good reason. Scientific determinations of whether a regulated product meets the legal standard for approval should be separated from future considerations of potential cost. The Federal Food, Drug, and Cosmetic Act contains no provision for FDA to evaluate pricing during the approval process, although historically pricing deliberations have occurred at other federal agencies, such as the Centers for Medicare & Medicaid Services (CMS), which directly pays for covered products through Medicare.

Congress also plays a role by enacting legislation that allows FDA to approve drugs and biologics via abbreviated pathways with the stated goal of increasing competition and lowering prices. For biological products, the abbreviated licensure process, codified in section 351 of the Public Health Service Act (PHSA) (42 U.S.C. § 262(k)), requires an application to demonstrate biosimilarity to a reference product based on data, including “clinical studies…sufficient to demonstrate safety, purity, and potency” in approved conditions of use. The PHSA permits FDA to determine that certain data requirements may be unnecessary for specific applications (42 U.S.C. § 262(k)(2)(A)(ii)). In 2015, FDA issued guidance outlining considerations relevant to comparative clinical studies. 

On October 29, 2025, FDA released a new draft guidance with updated recommendations on assessing the need for comparative efficacy studies (CES). This four-page document indicates a shift, based on the agency’s decade of experience, that favors comparative analytical assessments (CAA) conducted outside the human body over CES for therapeutic protein biologics, as FDA has concluded that CAA is generally more effective at demonstrating biosimilarity.

The draft’s new “streamlined” framework for assessing when CES are necessary does not account for costs to U.S. consumers, though FDA Commissioner Makary cited the expense of CES as a primary reason for the new framework for assessing when CES should be conducted for biosimilars.

While advances in analytical science improve sensitivity, and the law allows FDA to specify data requirements for biosimilarity, the degree to which FDA leadership considers the cost implications for consumers in interpreting statutory requirements warrants further discussion. Cost considerations are important, but FDA’s primary mandate remains ensuring that products are safe, pure, and potent.

In our view, FDA should focus solely on the scientific merits of an application or, if consumer value is considered, the Department of Health & Human Services (HHS) agencies should transparently and collaboratively evaluate scientific merit and consumer benefit throughout the regulatory process rather than operating somewhere in between.

We will continue to monitor how price considerations influence the review and approval of biologics, biosimilars, pharmaceuticals, and medical devices.

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