HDMA's research arm studies biosimilar market dynamics
Biosimilars market dynamics are already taking shape in Europe, but the contrast between pharmacy benefits and medical benefits, and the effects of commercial insurers, will create a different set of dynamics when more biosimilars enter the US market. That’s a preliminary view from the Center for Healthcare Supply Chain Research, the research arm of HDMA, in a newly issued report, “Biosimilars: Lessons from Europe and Strategies for the US.”
Some background: biosimilars are the biologic compounds meant to replicate the therapeutic action of commercialized biologics, which are now roughly a quarter of the entire US drug market (by sales) and are growing at double the overall rate. The US passed the Biologics Price and Competition Act in 2010 to establish a regulatory-approval pathway for them, but although FDA has made some forward steps, the pathway is still undefined. Outside of the approval process, there are still unsettled issues on “interchangeability” (being able to substitute any biosimilar for the targeted, original biologic) and “indication extrapolation” for instances where the original biologic is approved for multiple therapeutic conditions. About $55 billion worth of current biologics sales will be off-patent by 2020 and accessible to biosimilars, provided that the regulatory issues are resolved.
After analyzing trends in Europe (where biosimilars have been marketed for seven years now, with ten currently on the market), the Center draws several conclusions, including:
The Center also takes special note of drugs provided, under a medical benefit, by “vertically integrated entities of distributors, GPOs and providers,” such as the specialty distribution arms of the major wholesalers, some of whom are aligned with specialty pharmacies and providers. As in oncology or rheumatology, where this is occurring today, such alignments “may exercise significant influence through contract strategies” including bundled services to the specialty clinics.
The overall conclusions are that the biosimilars market is likely not to function identically to the generics market and that, as the Center says, “There is a wide range of potential outcomes for the biosimilars market and a number of promising opportunities for stakeholders to create value.”
The report is available for purchase at the HDMA Center’s website. Also, HDMA is conducting a seminar on Nov. 12-13 on the specialty pharmaceuticals supply chain where the report will be a session topic.