Breaking High-Cost Drug Trends

September 1, 2022
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Why biosimilars save billions

The US spent $407 billion on prescription drugs in 2021. But a big blow to the pharmaceutical industry is fast approaching. By 2025, 17 big name pharma molecules will lose their exclusivity, sunsetting their $60 billion annual sales trends. To take advantage, competing pharma companies created “biosimilars” – equally safe, effective and less expensive drugs comparable to their brand names.

What is a biosimilar?

A biosimilar is a biological product that is “highly similar” to and has no clinically meaningful differences from the reference product in terms of safety, purity, and potency. This is generally demonstrated through human pharmacokinetic (exposure) and pharmacodynamic (response) studies, as well as an assessment of clinical immunogenicity. To be considered “highly similar,” the biosimilar manufacturer must compare characteristics of both products, such as purity, chemical identity, and bioactivity. Minor differences between the reference product and the proposed biosimilar product in clinically inactive components are acceptable, which is why they are not required to be “identical” or “generic.” These can include differences in a product’s stabilizing agent or buffers.

Why use biosimilars?

While biosimilar “specialty” drugs make up only two to three percent of prescriptions, they account for between 40 and 50% of total drug spending. To reign in these unsustainable trends, provider adoption of biosimilar agents may help alleviate financial pressures and access challenges felt by patients and the industry.

At the pharmacy counter, preferred biosimilar products can provide less expensive copays than their reference counterparts. They also aim to lower overall cost, decreasing patient premiums and the PBM burden on employers. This expansion of options, combined with emerging high-volume biologics, such as adalimumab and etanercept, could potentially save patients and industry service providers $38.4 billion between 2021 and 2025.

In a recent Drug Channels blog written by Adam Fein, PhD, he states that “pharmaceuticals are the only part of the U.S. healthcare system in which the difference between list and net prices is monetized as rebates and redistributed by PBMs to payers. The distortions associated with this industry structure have been well reported.” (For example, see Section 9.3. 2021 Economic Report on U.S. Pharmacies and Pharmacy Benefit Managers .)

Biosimilars address two big challenges patients and providers face globally in healthcare – affordability and access. These alternative drugs thwart out-of-control brand name drug costs, and therefore give patients more options and better access to life-changing treatments for these six complex conditions:

  • Diabetes
  • Cancer
  • Chronic skin diseases like psoriasis
  • Digestive diseases like Crohn’s ulcerative colitis
  • Kidney diseases
  • Arthritis

What can you do now?

Start discussions with your patients currently on specialty agents, like Humira, to reduce issues or confusion in the future.


FDA: Biosimilar and Interchangeable Products

Express Scripts: The $250 Billion Potential of Biosimilars$250-billion-potential-of-biosimilars Medicine use and spending in the U.S.: a review of 2017 and outlook to 2022

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