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Biosimilars Can Create Huge Savings, but Interchangeability Needs to Be Reviewed

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A new report from AHIP indicates that biosimilars have the potential to garner savings of $180 billion over 5 years, but there needs to be a review of the approval process for interchangeability to encourage more approvals.

Over the next 5 years, savings from biosimilars are expected to exceed $180 billion, representing a 4-fold increase over the savings from the previous 5 years, according to an AHIP report. However, considerations should be made for making it easier to achieve interchangeability after approval, according to the report.

The advocacy and trade association of health insurance companies released a new resource highlighting the cost savings of utilizing biosimilars over biologics. According to the report, biosimilars are part of the solution to the ongoing challenge of rising drug costs.1

“Health insurance providers are committed to supporting a competitive biosimilars market and our industry continues to engage in collaborative efforts to advance the shared goal of more affordable access to prescription drugs and biologics,” Matt Eyles, AHIP president and CEO, said in a statement.2

Since 2007, 30 biosimilars have launched in the United States and the market is picking up. By the end of 2023, another 10 approved biosimilars will hit the market. Currently, 14% of the market is facing biosimilar competition, and that is expected to grow by 15% in 2023, according to AHIP. This increasing competition with expensive biologics is expected to result in declines in cost overall, including driving down the cost of the originator product.

“Drug costs for biologic drugs with a biosimilar competitor are down between 18% and 50% per unit,” according to the report.

The report suggests making the approval process for biosimilars to achieve interchangeability easier if the biosimilar is already approved. Interchangeability is a distinctly US concept. The European Union deems all approved biosimilars automatically interchangeable. However, in the United States, companies have to conduct additional switching studies before they can gain the designation.

Having interchangeability status does not mean that the biosimilar is any safer or more effective than other biosimilars without the designation, and yet, the designation matters to prescribers. A Cardinal Health report3 found that specialists cited interchangeability designation was a very important attribute when prescribing an adalimumab (Humira) biosimilar:

  • 70% of dermatologists
  • 65% of gastroenterologists
  • 60% of rheumatologists

There have been calls in the United States to streamline the process for biosimilars to be considered interchangeable. In November 2022, Sen Mike Lee (R-Utah) introduced the Biosimilar Red Tape Elimination Act, which prohibited the FDA from requiring switching studies for the purposes of receiving an interchangeable designation.4

A month earlier, 2 Republicans and 2 Democrats had introduced a bill in the House of Representatives that would direct HHS to study how substitution of interchangeable biologic products is being impeded.5

However, experts writing for The Center for Biosimilars®, a site from The American Journal of Managed Care®, highlighted the concern that while interchangeability status has no bearing on a biosimilar’s safety or effectiveness, “the lack of an interchangeability designation may create an environment where there may be reduced uptake of biosimilars.”6

References

1. AHIP. Biosimilar competition can help lower drug prices for Americans. April 3, 2023. Accessed April 7, 2023. https://www.ahip.org/resources/biosimilar-competition-can-help-lower-drug-prices-for-americans

2. New resource: how boosting biosimilar medications can help lower drug prices for Americans. AHIP. News release. April 3, 2023. Accessed April 7, 2023. https://www.ahip.org/news/press-releases/new-resource-how-boosting-biosimilar-medications-can-help-lower-drug-prices-for-americans

3. Cardinal Health. 2023 biosimilars report: tracking market expansion and sustainability amidst a shifting industry. February 22, 2023. Accessed April 7, 2023. https://www.cardinalhealth.com/en/product-solutions/pharmaceutical-products/biosimilars/biosimilars-report.html

4. Joszt L. Senate bill would forbid switching studies to gain interchangeability status. The American Journal of Managed Care. November 23, 2022. Accessed April 7, 2023. https://www.ajmc.com/view/senate-bill-would-forbid-switching-studies-to-gain-interchangeability-status

5. House bill takes aim at barriers to biosimilar substitution. The American Journal of Managed Care. October 12, 2022. Accessed April 7, 2023. https://www.ajmc.com/view/house-bill-takes-aim-at-barriers-to-biosimilar-substitution

6. Popovian R, Winegarden W, Pitts P. Contributor: what is the value of the interchangeability designation for a biosimilar? The Center for Biosimilars. November 14, 2022. Accessed April 7, 2023. https://www.centerforbiosimilars.com/view/contributor-what-is-the-value-of-the-interchangeability-designation-for-a-biosimilar-

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