From The Editor | April 9, 2020

Biosimilars In An Election Year: What To Expect

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By Anna Rose Welch, Chief Editor, Biosimilar Development

White House

It’s hard to believe it has only been a month or so since I was in San Diego for the Festival of Biologics World Biosimilar Congress (WBC). (Anyone else feel like we’re on day 500,000 of the Great Quarantine?) As I wrote in a previous article on the conference, attendees discussed a wide-array of ongoing biosimilar evolutions — or, more realistically, incremental but important improvements.

For one, in the U.S., we’ve been inundated with proposed legislation to speed up the availability of biosimilars and build the appropriate frameworks within Medicare programs to promote biosimilar usage. It may be tricky to focus on the intricate workings of biologics and biosimilar policies in the midst of this intensely collaborative time for the Covid-19-fighting industry. But as a recent article examining the current impact of the virus on biosimilars highlighted, there has been some positive movement so far. In particular, we saw some legislation released from the House of Representatives and the Senate, both of which proposed bills that could get us closer to where we want to be with biosimilar uptake.

Of course, as we approach election season and drug prices remain a central part of the candidates’ platforms, I had a number of questions about the overall impact this could have on currently proposed biosimilar policies. While at the World Biosimilar Congress (pre-social-distancing), I sat down with Christine Simmon, the executive director and SVP of policy and strategic alliances for the Biosimilars Council. We discussed several leading policy efforts that are front-of-mind for the Council, paying a closer look, as well, to some of the potential limitations of the proposals as they stand now.

Biosimilars In An Election Year: Where Do They Fit In?

During a presentation at the WBC, Simmon expressed her optimism over the current state of the biosimilar market. FDA approval numbers and biosimilar market launches have increased. There are also a growing number of conversations on the Hill about improving pharmaceutical competition overall. Given that drug pricing has been a central tenet of political platforms since the 2016 election, it will, no doubt, remain the administration’s priority leading up to and following the election in November.

However, while drug pricing and competition are commonly spoken words from political podiums, these conversations are still less nuanced than those of us in the biosimilar space may like. “You do hear references to generic drugs and increasing competition,” Simmon explained. “However, we rarely hear a reference to specialty medicines. Biologics and biosimilars don’t often enter the conversation specifically.” Given the ongoing efforts to educate (which rightfully pale in response to the covid-19 efforts at the moment), it’s unlikely we’ll see a presidential candidate come out swinging with improving biosimilar competition, in particular, as a central part of their platforms.

That said, however, there are some high-profile cases related to the Affordable Care Act (ACA), which could have dangerous ramifications for the Biologics Pricing Competition and Innovation Act (BPCIA) and provide more visibility into biosimilars on the administration level. Should Texas vs. Azar, which is currently scheduled to be heard in the fall, rule that the ACA is unconstitutional, the ACA would disappear, taking the BPCIA with it.

“We’ve always known the BPCIA isn’t separable from the ACA,” Simmon explained. “You can’t just snip it out; it would have to be reintroduced, which would take a long time, as evidenced by other policy efforts. There would also be the risk that it would be changed in some ways that could be less helpful for biosimilars should it be reenacted.” (For more on this, be sure to check out this latest editorial from Sandoz’s Carol Lynch on how the loss of the ACA would impact the burgeoning biosimilar market. In fact, she argues Congress should be taking steps now to “prepare for the unexpected” and ensure that the “BPCIA can stand on its own.”)

Current Considerations Surrounding 2 Ongoing Policy Proposals

Though the word “biosimilars” may not be on the candidates’ lips during presidential debate season, there has been a notable push towards creating biosimilar-friendly policies. There have been quite a few efforts proposed within the House of Representatives or the Senate to incentivize the use of biosimilars throughout the U.S. One of these bills Simmon touched upon in her presentation is The Acting to Cancel Copays and Ensure Substantial Savings for Biosimilars (a.k.a the ACCESS act), which would remove the cost-sharing requirement for Medicare Part B patients receiving the biosimilar. Given the lack of transparency around drug pricing and rebates today, many patients are not realizing the financial benefits of biosimilars. (For an interesting analysis of this, check out Stan Mehr’s article here.) As such, the ACCESS Act, would be one step toward addressing the lack of patient incentive to choose biosimilars.

Despite the benefits this legislation could provide for biosimilar uptake, Simmon is seeing resistance amongst some members of Congress around the overall impact of this bill. In the past, there have been similar efforts to implement $0-dollar copays for generics, however they’ve often been met with hesitance. Though on the surface it looks like a winning proposition, there are some concerns that patients still need to have some financial skin in the game. “They want the consumer, the patient, to have some degree of financial liability to ensure they have the motivation to make active treatment decisions,” she said. “Otherwise, it may be seen or feel too much like we’re forcing patients’ hands.”

There is also a bit of skepticism around whether there will be a great draw for patients given the prominence of wraparound coverage in Part B. This supplemental coverage typically alleviates any additional medicine costs patients may encounter, in turn cushioning the impact of financial liability. It goes without saying that for Medicare Part B patients without this coverage, a zero-dollar copay could be immensely valuable. But for those who may already be paying little out of pocket, bills such as the above may not be meaningful in the long run or incite long-term change.

You’ve also likely heard about the Bolstering Innovative Options To Save Immediately On Medicines Act (BIOSIM Act). This bill specifically targets the physician by altering the reimbursement amount for prescribing biosimilars. Under the buy-and-bill program, physicians currently receive reimbursement for the average sales price (ASP) of the biosimilar, plus 6 percent of the reference product’s ASP. This looks decent on paper, but the percentage does go down a few points due to sequestration. (Instead of 6 percent, the total goes down to roughly 4 percent.) Similarly, we’ve often found in practice that this equation simply evens out the reimbursement level between biosimilars and their reference products, rather than providing a slight financial advantage in choosing the biosimilar. The BIOSIM Act aims to change that, altering the ASP+6 percent equation so that physicians prescribing biosimilars under Part B would earn ASP+ 8 percent of the originator’s ASP.

While the goal is to put biosimilars in a more favorable light to physicians, it was fascinating to hear this discussed in a conference setting with physicians present. As one physician explained to the crowd, there is resistance to bills such as this in the physician community because it implies that treatment decisions are driven entirely by the reimbursement rates of treatments as opposed to a patient’s clinical needs.  

However, Simmon argues that there is an opportunity to better position the goals of this policy before physicians. Rather than being an incentive, she sees such policies like the BIOSIM Act as a means of helping physicians with any unforeseen management costs that may come following a biosimilar transition. “If you’re a physician recommending a different treatment option for your patient, I would think you’re taking extra time to explain what that treatment is and addressing any patient concerns,” she offered.

Over the past few years, we’ve seen a few pieces of real-world evidence surrounding the behind-the-scenes costs for health systems following larger scale transition programs. One of the concerns expressed, especially in the earlier days of transitioning, was that any additional cost savings the biosimilar offered would be swept into the cost of managing and monitoring the patients’ condition post-switch. These costs could come from the physician needing to spend additional time with each patient to introduce, educate, and guide them through the switch, or with the patient in regular follow-up visits post-switch.

“Rather than looking at the increased reimbursement as an incentive to use the biosimilar, perhaps it can be framed as compensation for the time required to introduce and implement these products in your patient population,” said Simmon.

While she doesn’t anticipate the industry will be able to celebrate the approval of all the biosimilar-related bills out there, she does consider this incremental push within the Senate Finance Package toward a more biosimilar-friendly landscape a victory. “These policies won’t necessarily be a silver bullet, but that these two examples are even included in the Senate finance package is a victory,” she added.

Biosimilar Council Looks For Non-Congressional Solutions To Spur Biosimilar Uptake

Though the response to Covid-19 has captured the government’s and public’s attention over the past few weeks, it’s still clear that saving costs in the healthcare system remains a leading goal. In fact, as companies keep announcing vaccine and novel antibody development for the virus, it’s safe to say we’ll need pricing relief on the biologics side of things even more so. That’s why, amongst all the talk of how things might be slowing down in the industry, we learned that a couple of pieces of legislation sneaked their way into the House of Representatives. One of these is particularly promising. At the beginning of March, the Increasing Access To Biosimilars Act of 2020 was introduced, which would require CMS to introduce a shared savings program for biosimilars.

A few weeks ago, I published an article about the different types of value-added care models that could positively impact biosimilar uptake — one option being shared savings models. CMS currently has a shared savings program in place (the Medicare Shared Savings Program or MSSP) that isn’t directly focused on biosimilars. Overall, however, this practice is particularly worth watching in the biosimilars realm. For the past few years, we’ve heard about overseas gainsharing successes in nations like the U.K., and it has inspired questions around how we can implement a similar tool here in the U.S.

During her presentation, Simmon pointed out that this a model she and the Biosimilars Council have been promoting for a while now, especially because CMS currently has the agency to create such a program on its own without congressional legislation (though we are now starting to see some). “Participating providers in the biosimilars shared savings program would receive a portion of the savings for prescribing biosimilars,” Simmon explained. “This would benefit not only the provider but also the Medicare program, and in turn patients and taxpayers.”

As she explained further, biosimilars are not part of patients’ current “healthcare vernacular” at this point in time. Therefore, transitions are more likely to be introduced and implemented at the physician’s (or payers) discretion, as opposed to the patient’s request. A shared-savings opportunity could help improve the expansion of biosimilar use across different healthcare systems, especially if the use of a cost-effective agent and their accrued savings, enables providers to improve their hospitals and healthcare services. As Simmon points out, programs such as this also improve the nation’s experience with biosimilars as a whole and create the framework for large scale implementation efforts.

It’s unclear yet when such a program would roll out and what it would look like. So far, the Biosimilars Council and The Biosimilars Forum have been expressing their interest in this model in various meetings across the administration to spark dialogue and overall interest. Following the submission of a proposal document, the CMS’ Innovation Center would then go about creating the program parameters. In the past, CMS’ value-based programs have been launched on a regional scale, as opposed to being a wide-spread national effort. Simmon anticipates this program would be rolled out in a similar manner.

Though the industry would like to see biosimilar use increase, she emphasized that it’s important that the shared savings program should remain a voluntary effort for each healthcare system. “There are a number of ways to make a demo project palatable to different stakeholders,” she explained. “No one wants this demo program to be forced or imposed. Sometimes projects have taken that path and have failed. We want such a program to be palatable for all participating physicians and healthcare systems so we can keep establishing a positive framework for biosimilar use across the U.S.”