The Lynx Group

Biosimilars and the Road Ahead

December 2021, Vol 12, No 6

Currently, 31 biosimilar products have been approved by the FDA, 20 of which have been launched in the United States. As the biosimilar markets become more competitive, so should pricing, said Sean McGowan, Senior Director, Biosimilars, AmerisourceBergen, Philadelphia, PA, who moderated a panel discussion on the gateway and watershed opportunities ahead for biosimilar innovation adoption in oncology at the 11th Annual Summit of the Association for Value-Based Cancer Care in 2021.

Trastuzumab, bevacizumab, and rituximab biosimilars have achieved 70%, 69%, and 55% market share, respectively, against the innovator products in less than 2 years, with a parallel decline in the average sales price (ASP) of reference products and biosimilars, Mr McGowan pointed out.

“I think you’ll find that a lot of the major stakeholders (ie, the payers) are becoming much more receptive to biosimilars,” said Chrys Kokino, MBA, President, US Specialty, Accord BioPharma, Far Hills, NJ. “Of course, there’s a cost to that, whether it be in the form of a rebate or a discount, whatever the pricing is. As time goes on, what happens at the end of the cycle when the average selling price hits a very low bottom? Does that mean that the next biosimilar entrant coming in at a higher price starts that cascade over again? My fear is that as more manufacturers bring these products to market, some of these products may be left by the wayside.”

Provider resistance was an early barrier to biosimilar adoption, said Chris Marcum, PharmD, Vice President, Enterprise Pharmacy, Cancer Treatment Centers of America, Cleveland, OH. “I think we’re working through that,” he added, noting the upward of 90% biosimilar conversions for the 3 oncology biosimilar products in the US market.

Tesh Khullar, MBA, Co-Founder and President, HouseRx, San Francisco, CA, believes in a cost-sharing or revenue-sharing model between the provider and the payer in which perhaps a rebate is offered to a provider when a payer selects a preferred biosimilar. The management effort can be substantial when multiple versions of a biosimilar must be loaded into the electronic health record, he explained. “They would have to manage a bunch of inventory, and it doesn’t make sense when they’re not getting paid for that,” he said. “We’re figuring out how we can make the provider and the payer aligned around the utilization of biosimilars. Unless we change the way we incentivize physicians, we’re not going to see drastic movement to the 90% adoption that we see in the European Union and other areas.”

Formularies containing an innovator product and 1 or 2 preferred biosimilars are slowly becoming more popular, said Mr McGowan, with parity coverage and the decision on which to use residing with the provider.

Cost-Savings Realized

The Association for Accessible Medicine released its biosimilar and generic savings report, revealing that the use of biosimilars has led to $7.9 billion in savings in the United States in 2020, or approximately 3 times greater the savings realized in 2019.1

“I looked at this for years, even before the oncology space, and the savings really occur, not with the first biosimilar, but with the second, the third, the fourth, the fifth,” said Dr Marcum. “I know we’re focused on the cost-savings of the biosimilars, but for the innovator products, we’ve seen the ASPs fall as well. For those providers that are still unwilling to use biosimilars, for whatever reason, they’re reaping the benefits of increased competition.”

As more biosimilars enter the market, manufacturers launching the next wave of these products must consider whether they are making a wise investment considering the cost of clinical trials and the additional rebates and discounts that must be offered, said Mr Kokino.

“Ultimately, the fundamental concept is to save money. But how much can you save as a manufacturer when you consider all the elements that go into developing that product?” he asked. “It’s tricky.”

“For the providers, it has never been more complex to figure out which drug is going to be covered for a patient. If I’m a doctor in the room with a patient, the last thing I want to worry about is which drug which plan covers,” said Dr Marcum. “Without the parity coverage by payers, the physicians or the providers will be forced to continue to try to manage that.”

The challenge is satisfying the various stakeholders while keeping the patient front and center and at the same time generating cost-savings from the use of biosimilars, said Mr Kokino.

Ironically, as the ASP declines, it creates a disincentive for use of biosimilars as the economic benefit to providers narrows, said Mr McGowan. The concept of “white bagging,” in which a specialty pharmacy delivers the product, cutting out the physician clinics and a revenue stream, creates even more of an economic disincentive to adopt biosimilars, he said.

“Unless we change the way that we reimburse in this country, not based on drug, it’s going to be very difficult,” said Mr Khullar. “I think that in the next 5 to 7 years, we’re not going to pay our oncologists any more on the price of the drug. Unless you change that fundamental reimbursement system, you’re not going to truly change adoption because it won’t have any effect at the patient level. One of the innovative things I saw a payer do, in a pocket, is to eliminate the burden of preauthorization when a physician chooses a biosimilar.” s

Reference

  1. Association for Accessible Medicine. The U.S. generic & biosimilar medicines savings report. October 2021. https://accessiblemeds.org/sites/default/files/2021-10/AAM-2021-US-Generic-Biosimilar-Medicines-Savings-Report-web.pdf. Accessed November 15, 2021.

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