Policy Proposals Aim to Stimulate the Long-Term Sustainability of Infused Biosimilars

Panelists proposed policy solutions to ensure long-term sustainability of infusedbiosimilars amid current challenges, including average sales price (ASP) erosion and reimbursement issues. | Image Credit: Mohamad Zaki - stock.adobe.com

An IQVIA Institute Report detailed the current issues within the health care system that can lead to reduced uptake of infused biosimilars and threaten their long-term sustainability.¹

IQVIA organized an expert roundtable that reviewed and discussed potential policy proposals for overcoming certain challenges to the long-term sustainability of infused biosimilars. There were multiple stakeholders, including speakers from Moffitt Cancer Center, Pfizer, One Oncology, Biosimilar Forum, and Conquest Advisors and Global Healthy Living Foundation, that were part of the roundtable panel.

The report comes months after IQVIA released information on creating baselines of foundational data to better understand biosimilar dynamics with a particular focus on infused biosimilars that fall under the Medicare Part B buy-and-bill program.² That report touched on multiple issues that contribute to decreased biosimilar uptake and urged stakeholders to reform policies that resolve these issues.

As described in the new report, the panel met to discuss the obstacles that hinder the long-term success of infused biosimilars.¹ These challenges include rebate and access issues, net cost recovery dynamics for providers, average sales price (ASP) fluctuations and their impact on manufacturer profitability, and the lack of benefits for patient out-of-pocket expenses.

Addressing these issues is crucial for ensuring the financial sustainability of infused biosimilars by stimulating competition. These efforts could lead to lower prices, generate savings for additional services, and invest in future innovative medicines.

“The ASP erosion for infused biosimilars is the most concerning thing in the long run. The ASP system was not designed for biosimilars/generics, and ASP erosion also actually contributes to drug shortages,” Juliana Reed, MS, executive director of the Biosimilars Forum, said in the report.

Panelists suggested 5 policy proposals: an increase in ASP-based reimbursement percentages beyond 8%, utilization-based enhancements, shared savings models, implementation of a provider reimbursement floor, and adjustments made to incorporate rebates in ASP calculations.

The Inflation Reduction Act may increase Medicare's ASP payments for qualifying biosimilars. The specific ASP for a biosimilar can be calculated in 2 ways: either the biosimilar's ASP plus 6% of the reference biological's ASP, or temporarily, a higher rate of 8%. In contrast, Medicare reimburses originators at 106% of their ASP. This pricing structure difference aims to encourage health care providers to choose biosimilars over more expensive brand-name drugs.

Utilization-based enhancements and shared savings models are key to promoting the use of cost-saving biosimilars. Measuring the use of infused biosimilars through utilization-based enhancements can offer financial incentives for better performance. Providers that use infused biosimilars receive a portion of the savings realized by Medicare. Those who administer infused biosimilars would share in a portion of the difference between the ASP of the infused biosimilar and the reference product in the form of an add-on payment.

If ASP calculations factor in discounts to providers, payers, and distributors, Medicare reimbursement may be less than the provider's cost to acquire the product. This can result in financial losses for physicians who use biosimilars to treat their patients.

“We’ve demonstrated that there is a competitive market driving prices down, but if we don’t do something with regards to a floor reimbursement, then we will continue to see products drop off the market and crash,” said Robert Popovian, PharmD, MS, chief science policy officer at Conquest Advisors and Global Healthy Living Foundation.

A minimum reimbursement level needs to be established, including an effective date, initial amount, and whether it requires inflation adjustments. Shared savings models and incentive metrics are additional factors that may be necessary to secure healthcare savings and the long-term viability of biosimilars.

Adjusting the weight of rebates in ASP calculations or removal of rebates for biosimilars are considered alternative policies. Setting reimbursements based on average provider acquisition costs could address concerns around provider cost recovery and economic viability. Reimbursement currently lacks predictability for providers as the acquisition costs vary across each provider.

Overall, the panel believes a policy change by CMS for the ASP system pertains specifically to infused biosimilars is necessary to ensure the long-term sustainability of the infused biosimilar ecosystem. Research and evaluation are pertinent in understanding the implementation of these policies, potential benefits, and systemwide changes.

“Future policy discussions should carry this consideration forward and ensure that benefits for the patient are a part of policy discussions,” concluded the panelists.

References

1. Policy proposals to achieve long-term sustainability of infused biosimilars in the U.S. IQVIA Institute for Human Data Science. October 17, 2024. Accessed December 3, 2024. https://www.iqvia.com/library/insight-brief/policy-proposals-to-achieve-long-term-sustainability-of-infused-biosimilars-in-the-us
2. Jeremias S. Report: policy changes needed to ensure long-term market sustainability for biosimilars. The Center for Biosimilars^®. February 15, 2024. Accessed December 4, 2024. https://www.centerforbiosimilars.com/view/report-policy-changes-needed-to-ensure-long-term-market-stability-for-biosimilars