The US Food & Drug Administration has approved the country's first biosimilar product, a move observers say will open the door for lower cost, generic-like biological drugs.

The newly approved product sold as Zarxio, or Zarzio outside the US (filgrastim-sndz), was developed by Sandoz, the generics arm of Novartis, as a cheaper alternative to Amgen's Neupogen (filgrastim), a biologic drug prescribed to boost white blood cells in cancer patients.

In 2010, the US Congress paved the way for the FDA to approve the prescription of biological generics under a provision of the Affordable Care Act (known colloquially as Obamacare) in an attempt to boost competition.

The FDA's approval of Zarxio marks a significant milestone for the United States healthcare system and for patients who might suffer from neutropenia," said Carol Lynch, global head of Biopharmaceuticals & Oncology Injectables at Sandoz, which claims to be the largest producer of biosimilars.

To accelerate the launch of biosimilars, the FDA has developed a path to approval that requires companies to submit fewer clinical and preclinical data than for new biologics. At the same time, manufacturers must show that there are no "clinically meaningful" differences between these and a previously approved reference product for that indication.

Currently, the FDA is said to have at least four applications for biosimilars under review.