At long last, the first two biosimilar medications – lower-cost alternatives for treating the most complex and chronic conditions – are poised to reach the American market.
The two medications will save patients and payers nearly $22.7 billion between now and 2024, according to Express Scripts research, and signal the beginning of a wave of new products that should reduce prescription drug spending by hundreds of billions more.
Biosimilars will do for the biotech market, primarily made up of very expensive injectable drugs, what generic drugs did for traditional oral solid pills a decade ago: lower the cost for safe, effective treatments that improve and save lives. They will revolutionize the category of spending that is among the fastest-growing and most worrisome for payers who want to continue providing sustainable, high-quality benefits for their members.
That’s why it comes as such welcome news that the Food and Drug Administration recently accepted the first two applications from drug companies that want to produce biosimilars for patients in the U.S. While biosimilars have been safely used in the European Union, Japan and other countries for years – with prices 30% lower than their brand-name counterparts – applications here have been bogged down in the regulatory process.
Biosimilar Process Moves Ahead
In July, the FDA accepted a filing by Sandoz, a Novartis Group company, seeking approval to begin selling biosimilar filgrastim. The drug, which Sandoz calls Zarzio®, would compete with Amgen’s Neupogen® – a blockbuster treatment used to decrease rates of infection in certain cancer patients during chemotherapy. The drug made $1.4 billion in sales last year.
Nearly 84% of those sales were in the U.S., where unlike in more than 40 other countries, Neupogen does not face biosimilar competition. If the FDA approves Sandoz’ application within the allotted 10-month review period, biosimilar Zarzio would hit the market by May 2015.
The second biosimilar application accepted by the FDA in August, would challenge Johnson & Johnson’s Remicade® (infliximab). Widely used to treat rheumatoid arthritis, Crohn’s disease and other inflammatory conditions, Remicade sales totaled $8.4 billion last year.
Pharmaceutical manufacturer Celltrion is seeking FDA approval to sell Remsima®, a biosimilar to Remicade that currently is available to patients in 50 other countries. Though Remicade isn’t scheduled to lose patent protection until 2018, Celltrion is suing to invalidate Johnson & Johnson’s patents.
Express Scripts’ analysis, using conservative assumptions, predicts $22.7 billion in savings from these two biosimilars over their first decade of use. That’s assuming a 30% discount for biosimilars – as has been seen in other countries – and 30% of patients being treated for the first time using a biosimilar rather than the brand-names Remicade and Neupogen through 2020.
While these are important steps, questions remain about how biosimilars eventually will reach patients.
Traditional solid generics can be automatically substituted for brand-name prescriptions in most cases without explicit approval from providers. But the FDA has not yet said whether that will be the case for biosimilars – and some states already have passed legislation saying pharmacists cannot make the switch unless the FDA deems the biosimilar and branded drug to be interchangeable.
Another issue lies in what biosimilars are called. Originator companies want biosimilars of their products to each have a distinct generic name (versus traditional medications in which, for example, multiple manufacturers can call their anti-inflammatory product “ibuprofen”). But biosimilar manufacturers say that would cause unnecessary confusion and could lead patients to believe their products aren’t as safe or effective as the original.
Express Scripts advocates for the most clear and simple processes to ensure that safe, affordable biosimilar medications reach patients who need them – and we urge our clients and other stakeholders to do the same.
Regardless of how these questions are resolved, our teams of specialist pharmacists have deep knowledge of these complex health conditions, the range of appropriate treatments and clinical best practices. This knowledge helps ensure the highest level of care at the lowest cost. Our expertise in pharmaceutical therapies for oncology, Crohn’s disease and rheumatoid arthritis will help ensure that these first two biosimilars are used appropriately to maximize their value.
With spending on prescription drugs continuing to rise, topped by double-digit trends in specialty medications, biosimilars will play an important part in keeping healthcare benefits affordable and accessible for Americans.
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