Combine flour, baking powder, salt and pepper in large bowl. Cut in 1 cup cheese and butter using pastry blender or fork. Add milk; mix just until all ingredients are moistened.
Knead gently on floured surface 8 times. Roll out to 1/2-inch thickness; cut with 2-1/2-inch biscuit cutter. Re-roll and cut scraps. Spray baking sheet with non-stick cooking spray; place biscuits. Sprinkle with remaining cheese. Bake in preheated 450°F oven 10 minutes or until biscuits are golden brown.