From Cahan, Kocher, and Bohn in the Health Affairs blog:
Since passage of the 2010 “Biosimilars” Act aimed at stimulating non-inferior innovation and competition in therapeutics markets, only 17 agents have been approved, and only seven have made it to market.
Why haven’t biosimilars been more attractive? Blackstone et al. (2013) cites 3 key issues:
The lack of automatic substitutability, the relatively small price savings, and the reluctance of physicians to use biosimilars
For instance, Teeple et al. (2019)’s survey of rheumatologists, dermatologist and gastroenterologists found that 84% did not want to switch stable patients a biosimilar for cost reasons alone. Similarly, 85% of patients did not want to switch to a biosimilar if they were stable on disease with a branded product.
In short, while payers may be very interested in increased used of biosimilars, physicians and patients are less excited about this prospect.
Also very complex to institute from an operations side as payers have often struck deals with drug companies to keep their reference product as preferred.
Dear Jason,
Thanks for sharing. I do not agree with all of the points, such as the perspective on disruption and the usual criticism of entrenched entities. As well, I am quite certain value-based bureaucracies do not add efficiency and actually corrupt the clinical decision-making process. As you’ve heard from me previously, I believe the Hatch-Waxman regime imposes an artificial dichotomy into the clinical space that disrupts the balanced approach that the vast majority of patients and physicians desire. How can I be frugal if I have to switch a statin intolerant patient with vascular disease to a PCSK9 inhibitor? How can I reduce my costs and be more efficient when every third party wants to make me switch year to year which diabetes agent or monitoring tool is on formulary this time?
The redundancy of the Biosimilar Act is just an extension of the Hatch-Waxman model. It is an unnecessary complexity based upon the principle that cost competition by multiple makers of the “same” agent will bring down costs. The downstream costs of this (bureaucratic tangles, the whole rationale for PBM’s, formulary restrictions serving intermediaries much more than anyone else) mitigate the benefits. The 85% survey results you cite reflect the obvious desire on the front-line not to be manipulated and experiment when there is no clinical rationale to support this.
In the setting of a pandemic, it is clear that extraneous administrative steps have not served us well. Even now, I am hassled as consistently as ever. A solution that allows new agents and old agents to be utilized as clinically dictated is what we need. We do need innovation, but the perversions of reimbursement lead to many with limited return. Old and new cannot exist on an equal playing field, where one system is a “mortgage” model and one is “rental.” I continue to impatiently wait for a unified licensure structure where formularies can be open and patients and physicians can make clinical decisions without the price coercion model so selfishly manipulated. For now, I must frustratingly comply with the coercive hassles and hope for better.