Savings from biosimilars and Medicare formulary access

Area of Science:

• Health economics
• Pharmaceutical policy
• Biologics and biosimilars

Background:

• Medicare Part D formulary design impacts patient access to medications.
• Biosimilars offer potential cost-savings but face market access challenges.
• Adalimumab, a biologic for inflammatory conditions, has multiple approved biosimilars, including interchangeable ones.

Purpose of the Study:

• To evaluate how Medicare Part D formulary design influences biosimilar access and cost-savings.
• To assess the impact of formulary design on investment in biosimilar development.
• To use adalimumab biosimilars as a case study for Part D formulary practices.

Main Methods:

• Analysis of Medicare Part D formulary data for adalimumab biosimilars.
• Comparison of formulary access and patient cost-sharing for biosimilars versus innovator products.
• Review of market trends and investment factors in the US biosimilar market.

Main Results:

• Adalimumab biosimilars have lower formulary access in Medicare Part D compared to the innovator product.
• When available, adalimumab biosimilars often require coinsurance, resulting in higher patient costs than fixed copays common for generics.
• The US biosimilar market growth is slow, limiting potential cost-savings and investment returns.

Conclusions:

• Current Medicare Part D formulary designs create barriers to biosimilar access and cost-savings.
• Patient cost-sharing structures for biosimilars disincentivize uptake and investment.
• Policy changes encouraging broader biosimilar formulary inclusion in Medicare could stimulate development and market growth.