Delayed biosimilars market entry costs US billions

Biosimilares/Investigación | Posted 22/10/2021 post-comment0 Post your comment

Delayed adalimumab biosimilar entry to the US market is estimated to have cost Medicare over US$2.19 billion between 2016 and 2019, a study published in Clinical Pharmacology and Therapeutics has revealed.

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The originator of adalimumab is Humira, made by AbbVie, who generated US$15 billion in US sales with this product in 2019. The availability of lower cost biosimilars of this product would increase its availability and reduce spending on medications in the US. Adalimumab is one of the top 10 best-selling drugs for Medicare Part D, which together accounted for 16% of net total Part D spending in 2019 [1]. Between 2016 and 2019, the US Food and Drug Administration (FDA) approved five adalimumab biosimilars. However, in January 2021, none of these, nor the sixth subsequently approved, had reached the market due to patent dispute settlements.

Lee and co-workers at Harvard Medical School, set out to determine the cost of this delayed market entry. They estimated the difference between reported spending on originator adalimumab and estimated spending on originator and biosimilar adalimumab products assuming timely biosimilar market entry.

The team’s calculations estimated potential biosimilar spending based on certain projections based on market capture (estimated at 15% for the first biosimilar and 5.5% for successive in their first year and 5% annually thereafter), price reductions (3.5% per year for the first biosimilar and 2.4% for additional biosimilars), and price discounts, e.g. 25% at launch.

The estimated non-rebate spending on biosimilars year-on-year is given in Table 1. Cumulatively, between 2016–2019, spending on adalimumab could have been US$8.98 billion instead of the observed US$12.11 billion. When the team also accounted for estimated rebates, the total predicted savings are in the region of US$2.19 billion.

Table 1: The estimated non-rebate spending on approved adalimumab biosimilars, had they entered the market, between 2016–2019
Year Estimated non-rebate spending on biosimilar Estimated non-rebate spending on originator
2016 US$18.3 million US$2.33 billion
2017 US$225.7 million US$2.04 billion
2018 US$436.2 million US$1.78 billion
2019 US$727.7 million US$1.42 billion

  

The Harvard team states that this is a conservative estimate; and saving could have been far greater as has been seen in some European Union countries, such as Denmark, where adalimumab biosimilars entered the market in 2018, shortly after approval and within months, spending on adalimumab reduced by over 80% of its pre-biosimilar price [2].

In conclusion, to bring savings to Medicare and healthcare systems, the Harvard team suggests that patent reform is needed to help bring more biosimilars to market. In addition, antitrust laws need to be strengthened, as was seen in the 2019 California Preserving Access to Affordable Drugs Act.

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References
1. GaBI Online - Generics and Biosimilars Initiative. A few drugs account for most of Medicare Part D spending [www.gabionline.net]. Mol, Belgium: Pro Pharma Communications International; [cited 2021 Oct 22]. Available from: www.gabionline.net/reports/a-few-drugs-account-for-most-of-medicare-part-d-spending
2. GaBI Online - Generics and Biosimilars Initiative. Denmark achieves 83% reduction in adalimumab costs through switching [www.gabionline.net]. Mol, Belgium: Pro Pharma Communications International; [cited 2021 Oct 22]. Available from: www.gabionline.net/biosimilars/research/Denmark-achieves-83-reduction-in-adalimumab-costs-through-switching

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