Biopharmaceuticals tend to be efficacious as they target body systems specifically involved in well-diagnosed conditions. They therefore tend to be welcomed by patient groups and clinicians; on the other hand, they may be viewed by regulatory authorities, third-party payers and patients as being expensive and having limited outcome data at launch. The biopharmaceutical market is expected to grow by 12–15% per year [3], as a result of a burgeoning pipeline, approval for more common conditions, increasing use and expanding indications [4].

In the current atmosphere of financial restrictions, will biosimilar pharmaceuticals, which are cheaper than the reference biopharmaceuticals due to lower costs of R & D, come to dominate this part of the medicines market? Or will the inherent differences between biopharmaceuticals and biosimilars produce differences in safety, effectiveness and costs? If the biosimilar and the reference biopharmaceutical are interchangeable, generic substitution will maintain effectiveness at reduced costs, and can be recommended. However, if the biosimilar and the reference biopharmaceutical are not interchangeable, the savings arising from less expensive biosimilars need to be weighed against the impact on effectiveness and costs of therapy. A less effective biosimilar may result in the need for additional therapy or hospitalisation and may entail the patient taking more time off work. In this case, an economic evaluation needs to be performed to assess the value of the biosimilar.

EMA guidelines recognise that there may be differences between the biosimilar and the reference biopharmaceutical or indeed also between biosimilars from different manufacturers [5]. However, biosimilar monoclonal antibodies and erythropoietins have dispelled many of the fears that surrounded so-called ‘follow-on biopharmaceuticals’. The case has therefore been made for compounds not being identical, but having similar efficacy. This of course has to be proved afresh for each new biosimilar.

Complex comparisons

An economic evaluation calculates the incremental cost-effectiveness ratio of an intervention relative to a relevant comparator. If the comparator encompasses a biopharmaceutical and a biosimilar, the price of which medicine should be used to value costs? The cost-effectiveness of the intervention (the answer) will be different if a different question is asked.

Many countries have developed guidelines that serve as a standard for designing and conducting economic evaluations to be included in medicine reimbursement applications [6]. No guidelines specify whether the valuation of comparator costs should be based on the price of the reference biopharmaceutical or the biosimilar. However, Belgian guidelines do state that, if the comparator covers two kinds of medicines with a different price, but equal outcomes, the least expensive medicine should be used in the economic evaluation because such a medicine is more cost effective than the more expensive medicine [7].

This would imply that, if there are no differences in effectiveness between the biopharmaceutical and the biosimilar, the price of the biosimilar needs to be used in the economic evaluation, even if biosimilars are not frequently used in the country. On the other hand, the Baltic countries, Finland, France, Italy, Spain and Sweden recommend that the most common treatment should be used as comparator.

The exercise is not merely of abstract interest to university departments. If pharmacoeconomic calculations are able to tease out a correct answer from the mass of information that could be used, and policies are implemented, it will have a real effect on treatments and costs. A 20% price reduction of five off-patent biopharmaceuticals as a result of biosimilar competition could save the EU over Euros 1.6 billion per year [7,8].

Related articles

Market access for biopharmaceuticals and biosimilars: a case study

The case for health economic studies on biopharmaceuticals

Biopharmaceuticals: the start of personalised medicine

References

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2. Simon F. Market access for biopharmaceuticals: new challenges. Health Aff. (Millwood) 2006;25(5):1363–70.

3. Cohen M, Morrow T, Penna P. Managing the expanded use of biologics across therapeutic areas: an example from b-cell targeted therapies. Am J Manag Care. 2006;12(2 suppl):S24–37.

4. Mellstedt H, et al. The challenge of biosimilars. Ann Oncol. 2008;19(3):411–9.

5. European Medicines Agency (EMA), Committee for medicinal products for human use (CHMP), Guideline on similar biological medicinal products, CHMP/437/04, London, 30 October 2005.

6. International Society for Pharmacoeconomics and Outcomes Research (ISPOR). Pharmacoeconomic Guidelines around the World. [monograph on Internet] Lawrenceville, NJ: ISPOR; c2010 [cited 21 September 2010].

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8. Oldham T. Strategies for entering the biosimilar market. In: Biosimilars – Evolution or Revolution? London: Biopharm Knowledge Publishing. 2006.