Market share is not the only measure of biosimilar success
MMarket share is often presented as the most relevant measure for the success of a class of biosimilars. I believe there are other metrics, like cost savings or signs of better patient access, that should also be used to define the success or failure of biosimilars.
In the United States, the first biosimilar was launched in September 2015. As of this writing, there are 38 FDA-approved biosimilars; 22 of them are commercially available. These 22 products compete in nine classes of molecules in the fields of oncology, rheumatology, diabetes care and now ophthalmology. According to the most recent “US Generic & Biosimilar Medicines Savings Report” from the Association for Accessible Medicines, biosimilar savings in the United States were $7.9 billion in 2020 (three times higher than 2019) and could reach $133 billion by 2025.
Biosimilars for oncology are among the most frequently cited success stories. Nearly 80% of biosimilars launched in the US have oncology indications, and market uptake has been strong for both therapeutic and supportive products. Biosimilars of Avastin (common name bevacizumab, used to treat various types of cancer) are approaching 80% market share; Rituxan biosimilars (common name rituximab, used to treat certain types of cancers and autoimmune diseases) exceeded 70% market share; and the biosimilars of Neupogen (generic name filgrastim, often used in combination with many cancer treatments to stimulate the growth of white blood cells to fight infection) began to stabilize in the low 90% range.
More impressive than adoption rates is the speed of adoption of many biosimilars. Although biosimilars for bevacizumab, trastuzumab and rituximab have only been commercially available since mid to late 2019, the rapid acceptance and uptake of these biosimilars in oncology is often seen as the primary driver of biosimilar savings in the US market.
In contrast, the market share of biosimilars to Remicade (infliximab, generic name, used to treat many autoimmune diseases including rheumatoid arthritis, psoriatic arthritis, Crohn’s disease, ulcerative colitis, ankylosing spondylitis and plaque psoriasis) has just crossed 40% in the last quarter, even though the launch of the first biosimilar Remicade took place in July 2016.
Does this apparently weak biosimilar competition against Remicade represent a failure? I say “No,” based on my analysis of data from the Centers for Medicare and Medicaid Services regarding beneficiary spending on Part B drugs – drugs administered in physicians’ offices and other outpatient facilities by physicians and other health care providers – dating back to 2012 The table below shows the total spend in the infliximab category from 2015 to 2020:
Although it took about two years before the Remicade biosimilars were used in Part B, the impact on the cost curve was quite striking. Over the past three years, total spending in the infliximab category has fallen 42% since peaking in 2017. Despite more than $300 million in new spending for infliximab biosimilars between 2018 and total spending in the category plummeted. Why? A significant portion of the decline comes directly from lower prices for the branded benchmark product, Remicade. In fact, Remicade sales in Medicare Part B fell $678 million (51%) between 2017 and 2020.
Rheumatology, unlike oncology and other therapeutic areas, has experienced fierce price competition between biosimilars and the reference product, Remicade, which has resulted in significantly lower costs for the entire class . Average selling prices for infliximab products show that Remicade’s have declined 58% since 2018, moving in line with its biosimilar competitors quarter over quarter.
In response to fierce price competition, Remicade manufacturer, Janssen Biotech, recently launched an unbranded version of Remicade called Infliximab, which comes with an incredible discount of nearly 60% off the list price, officially known as the wholesale acquisition cost. This unbranded version now has a lower list price than Remicade’s original average wholesale price in 1998.
In my analysis, the price erosion of branded Remicade, represented by the average retail price, and the launch of an unbranded version of infliximab at around 60% off, is unlikely to have occurred. without the launch of biosimilar competition.
The Biologics Price Competition and Innovation Act, which was enacted as part of the broader Affordable Care Act in 2010, was ultimately intended to create a pathway for manufacturers to develop and to launch organic products to compete with reference products after their loss of exclusivity. . Biosimilars were designed to help reduce the costs of high-priced biologics and also drive innovation in the next generation of therapeutic products, hence the inclusion of the word “innovation” in the name of the law.
In oncology, biosimilars have delivered significant cost savings by achieving high market share for modest price reductions. In rheumatology, Remicade’s biosimilars have caused its manufacturer to fiercely defend its market share and dramatically lower prices, making biosimilars a key factor in driving competition, lowering prices and increasing patient access to treatments. that change lives.
Although biosimilars in rheumatology do not yet represent half of the market share, they have not failed. On the contrary, I believe they were a huge success.
Going forward, market sustainability is a topic that deserves increased attention, especially for infliximab products. As average selling prices continue their aggressive downward trend, so will provider reimbursements under the buy-and-bill model, in which providers acquire drugs to administer to their patients, then bill the patient’s insurance to recover the cost of the drug. The economic benefit to a provider in this model is the margin between the cost of the drug they purchase and the value of the reimbursement they receive from the patient’s insurance.
Reimbursement is determined by the average selling prices of a product. If it declines faster than the supplier’s cost of acquiring the drug, the supplier’s economics are likely to turn negative – acquisition cost greater than reimbursement – and could create significant disincentives to convert to biosimilars with lower average selling prices. This dangerous cat-and-mouse game may ultimately require new political or economic models to change the dynamics, and merits further analysis to ensure a robust and competitive biosimilars market that is sustainable in the long term.
Jeff Baldetti is the Director of Biosimilars at Cardinal Health, a global healthcare services company and distributor that provides distribution access and solutions for a wide range of pharmaceutical products, including biosimilars.