FDA Regulatory Innovation

FDA Moves to Streamline Biosimilar Development and Reduce Drug Costs

The U.S. Food and Drug Administration (FDA) has announced new steps to simplify the development pathway for biosimilar medicines, a move intended to reduce development costs and improve patient access to lower-cost biologic therapies.

In a new draft guidance released March 9, 2026, the agency recommends eliminating certain clinical pharmacokinetic (PK) studies when they are not scientifically necessary. According to FDA estimates, this change could reduce biosimilar developers’ PK study costs by as much as 50 percent, or roughly $20 million per program.

FDA Commissioner Marty Makary, M.D., M.P.H., said the change reflects the agency’s growing confidence in advanced analytical testing methods that can demonstrate biosimilarity without relying on redundant clinical studies.

Reducing Unnecessary Clinical Testing

The draft guidance, titled “New and Revised Draft Q&As on Biosimilar Development and the BPCI Act (Revision 4),” updates FDA recommendations for demonstrating biosimilarity under the Biologics Price Competition and Innovation Act (BPCI Act).

One of the most significant changes involves how biosimilar applicants may use comparator products approved outside the United States. Under the new recommendations, developers may rely on clinical data generated using non-U.S.-licensed comparator products without necessarily conducting a three-way PK study comparing the proposed biosimilar, the U.S.-licensed reference product, and the non-U.S. comparator product.

In certain scientifically justified situations, the agency now indicates that a direct PK comparison with the U.S. reference product may no longer be required.

This shift reflects FDA’s growing reliance on analytical similarity and totality-of-evidence approaches, rather than requiring duplicative clinical studies.

Continuing FDA Efforts to Accelerate Biosimilars

The new guidance builds on earlier FDA actions aimed at reducing development burdens for biosimilars. In October 2025, the agency issued draft guidance recommending the elimination of certain comparative clinical efficacy studies, which can take one to three years to complete and cost approximately $24 million.

Together, these policy changes signal a broader regulatory strategy to replace costly clinical studies with advanced analytical and pharmacological evidence when scientifically justified.

Evolution of FDA Thinking on Biosimilars

As part of the announcement, FDA also withdrew its 2015 guidance “Scientific Considerations in Demonstrating Biosimilarity to a Reference Product.” When that guidance was issued, FDA had approved only one biosimilar product. Since then, the agency has accumulated significant regulatory experience.

To date, FDA has approved 82 biosimilars, covering treatments for conditions like cancer, autoimmune diseases, diabetes, Crohn’s disease, and osteoporosis. This expanded regulatory experience has allowed the agency to refine its scientific expectations for demonstrating biosimilarity.

Why Biosimilars Matter

Although biologics represent only about 5% of prescriptions, they account for approximately 51% of total drug spending in the United States. Many biologic therapies cost hundreds of thousands of dollars per year.

By lowering development barriers, FDA hopes to encourage more biosimilar competition and expand patient access to these therapies.

The Bottom Line

FDA’s latest biosimilar guidance reflects a continuing shift toward more efficient, science-based regulatory pathways. Rather than requiring large and expensive clinical studies in every case, the agency is increasingly relying on advanced analytical testing and a totality-of-evidence approach to demonstrate biosimilarity.

For biosimilar developers, the new guidance could significantly reduce development costs and timelines while potentially expanding competition in one of the most expensive areas of modern medicine.