HealthTrust survey pinpoints the obstacles to adoption of less-expensive drug alternatives

If two products are equally effective at treating a condition, choosing the less-costly option might seem obvious. But that’s not what’s happening in the fraught competition between pricey biologics and their less-expensive alternatives, known as biosimilars.

A biosimilar is a biological product with no clinically meaningful differences from a reference biologic product approved by the Food and Drug Administration (FDA)—such as monoclonal antibodies, vaccines or therapeutic proteins. While biosimilars comprise the same safety, purity and potency, payer preferences have limited broad adoption of them in the U.S. market.

Only about 2% of Americans use biologic drugs for conditions ranging from rheumatoid arthritis to low blood cell counts seen in treatment of various cancers, yet these therapies represent 40% of the nation’s total spend on all prescription drugs. By comparison, a biosimilar typically enters the market at a discount ranging from around 15% to 30% off the price of its reference biologic.

Kyle, Herndon, PharmD, MBA, BCPS

“Biosimilars introduce a massive savings opportunity, not only for the consumer but the healthcare system as well,” explains Kyle Herndon, PharmD, MBA, BCPS, PGY-2 Corporate Pharmacy Leadership Resident in HealthTrust Pharmacy Services. But slow adoption is getting in the way of realizing these savings, and the reasons are complicated. “Why wouldn’t people want to adopt the means to save the healthcare system money? There is a lot of mystery as to why some biosimilars can’t come to the market in a more timely manner.”

Delayed launches

To delve into these dynamics, Herndon recently focused on biosimilar payer preferences and perspectives surrounding adoption as his PGY-2 research project. He accomplished this by surveying members across HealthTrust, including health systems and physician practices, in addition to pharmaceutical manufacturers.

Herndon’s report details the launch of various biosimilars over the years, contrasting the approval date with the lag time before the biosimilars were actually available on the market. As of April 2020, 17 of the 26 FDA-approved biosimilars (65%) had come onto the U.S. market—eight of which had done so within the prior six months.

The average time between FDA approval of a biosimilar and its launch date is around 13 months, with many taking much longer. (Some of these molecules have been FDA approved since 2016 and will not be coming to market until 2023 or later.) Herndon found this to be a stark contrast to the one-month separation time that’s typical for a biologic.

Slow adoption

Even after launch, biosimilars face an array of adoption challenges, including:

  • Providers’ concerns surrounding safety and efficacy
  • Missing indications
  • Lack of interchangeability
  • Whether the product is intended for chronic versus episodic therapy
  • Preferred payer status

The No. 1 hurdle in adopting biosimilars? Rebates. Manufacturers of biologic drugs often offer rebates to payers that list their drug as the preferred therapy rather than a competing biosimilar. According to Herndon’s survey results, these rebates are the biggest barrier.

Nine of 15 top payers, for example, listed Remicade (infliximab) as the preferred drug for rheumatoid arthritis, rather than favoring one of the less-expensive biosimilars, Inflectra or Renflexis. Biosimilars, however, tend to gain favor with payers the longer they’re on the market, based on Herndon’s results.

The survey also found that biosimilars for acute care products, such as Zarxio (filgrastim), have shown the quickest adoption, while outpatient infusion centers—along with outpatient specialty and retail classes of biosimilars—have seen the slowest adoption.

Looking ahead

Federal action supporting biosimilar use has included two pieces of legislation from 2010 and 2018 meant to facilitate biosimilar competition and adoption.

“The federal government is all about spending less, if it can,” Herndon says. “So it can get the best deal on a product, the government has negotiations with pharmaceutical companies, just like a third-party payer would. At the end of the day, it’s all about cost.”

Overcoming adoption obstacles could be achieved in a variety of ways, Herndon explains. For one, biosimilar manufacturers could make their products available at an even greater discount while still being profitable. Another path toward overcoming obstacles rests with the FDA, Herndon adds. If the FDA offers “interchangeability status” to more biosimilars, this may increase use by allowing the substitution of biosimilars for reference biologics. Currently, the FDA requires additional study data to grant interchangeability status. “I think it starts with calling out what the actual savings would be, even if you compared the strict wholesale cost of the reference drug to the biosimilar,” he says.

As for his research, Herndon adds: “We hope to gain recognition among other healthcare professionals and the government through publication in a nationally recognized pharmacy journal. By using this platform to reach a broad audience, we hope to effect change and increase the use of biosimilars to reduce spending across the U.S. healthcare system.”

To learn more about biosimilars, contact Jason Braithwaite, PharmD, MS, BCPS, Senior Director, HealthTrust Clinical Pharmacy Services

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