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Payer perception towards biosimilar formulary management and interchangeability
05 Jul 2023
After waiting almost 7 years since receiving FDA approval, Amgen launched Amjevita, the first biosimilar for Humira in the US this February. Amgen launched the drug utilizing a dual pricing strategy at both 55% and 5% below Humira’s list price1. This strategy was also utilized by Viatris when they launched Semglee in November 2021 as both a branded and unbranded insulin biosimilar to Lantus; the branded Semglee version being the higher list price.
The basis behind Amgen’s dual pricing strategy is the ability to have multiple formulary options in both Pharmacy Benefit Manager (PBM) and non-PBM-managed market segments. PBMs and plan sponsors tend to prefer the higher list-priced product due to the higher rebates earned, which reduce administrative fees and plan premiums. Contrarily, the lower-priced product is favorable to the price-sensitive Medicaid and the uninsured population2.
Another highly discussed topic in the biosimilar marketplace is regarding product interchangeability. Manufacturers often must make the decision as to whether it is beneficial to conduct additional clinical studies to demonstrate product interchangeability, that may facilitate achieving preferential formulary access.
To understand payer perception towards biosimilar formulary management and interchangeability, Indegene’s Pricing, Reimbursement, and Market Access (PRMA) business division conducted a survey of 48 active US payers/decision makers. The survey respondents were composed of a mix of 18 medical and 30 pharmacy directors that accounted for approximately 140 million and 320 million covered lives respectively. Payers were asked how they would manage biosimilars if manufacturers were no longer required to conduct additional animal testing needed to demonstrate interchangeability to the originator biologic.
How would you manage biosimilars if manufacturers were no longer required to conduct additional animal testing to demonstrate interchangeability to the originator biologic?
At a similar tier to an originator brand
At a higher or similar tier as the originator brand
Tier placement decision is based on the net price of the biosimilar
n=48 (mix of 18 medical and 30 pharmacy directors accounting for approximately 140 million and 320 million covered lives respectively
According to our research, 60% of payers representing 48% of covered lives are expected to treat a biosimilar showing interchangeability similar to an originator brand, likely putting it on a preferred tier if the net price is competitive to the originator’s net price. In contrast, 25% of payers, representing 43% of covered lives, are expected to place the biosimilar on a higher or similar tier as the originator brand, assuming the net price is competitive to the originator. The remaining 15% of payers expect to make their tier placement decision based on the net price of the biosimilar. The majority of the decisions regarding rebate and net pricing were driven by PBMs, which represented at least half of the covered lives in our research.
While the reimbursement landscape is constantly evolving, it appears that interchangeability status alone may not achieve the desired lower or preferred tier formulary access for biosimilar manufacturers. As an additional 7 Humira biosimilars are expected to launch this year3, Indegene continues to monitor payer formulary decisions and the impact on manufacturers.
Learn how a US biopharma gained payer insights across multiple countries.
References
Authors
William Lobb
Amit Patel
Atin Patel