At Independence Blue Cross, we are always striving for innovative ways to make specialty drugs more affordable without restricting member access to the medications they need.
As part of these efforts, we have been closely following the launch of biosimilars in the U.S. drug market — and looking at biosimilar trends in more established international markets.
What Are Biosimilars?
Biosimilars are less expensive versions of biologic drugs that have been on the market for years. So, what are biologics? Biologics are made from material that comes from living organisms, including humans, animals, and microorganisms such as bacteria or yeast. They’ve been used to treat a broad range of diseases and include vaccines and gene therapies.
Biosimilars have no clinically significant differences from their reference biologics (reference product) in terms of safety and effectiveness. The U.S. Food and Drug Administration (FDA) requires that all biosimilars meet the same rigorous standards as the reference product to be approved for use.
Currently, there are 26 FDA‑approved biosimilars for medical benefit drugs in the U.S. To take advantage of this growth, we are developing new strategies that address access and affordability for our members and employer groups who offer Independence Blue Cross health plans.
The U.S. Market vs. International Markets
The U.S. market has been slow to embrace biosimilars for many reasons — mainly due to patent litigation by rival pharmaceutical manufacturers. To illustrate this fact, only 17 of the 26 FDA‑approved biosimilars are available for use in the U.S. market. The other nine biosimilars are tied up in ongoing lawsuits.
Most biosimilars introduced in the U.S. are priced 5 – 10 percent below the reference product at launch. In contrast, the European market has welcomed biosimilar competition for more than a decade and, as a result, enjoys a more robust price decrease that can be as high as 40 percent.
Designating Preferred Biosimilars to Lower Costs
Independence Blue Cross recently designated the following six biosimilars as preferred products:
The reference products were chosen because they are high‑cost drugs that have significant utilization for most employer groups who offer Independence Blue Cross health plans. These drugs are mainly used for short‑term cancer regimens and have a high rate of new starts.
New requests for these drugs are only approved for the preferred biosimilars, unless the member has a contraindication or intolerance to them. To preserve continuity of care for members who currently have precertification approval for the reference products listed, we are not requiring those members to switch to a biosimilar. However, if a member and his or her doctor want to transition to one of the preferred biosimilars, they can do so easily. Our systems can automatically approve these requests.
Reducing Overall Drug Costs
By directing doctors and members to use biosimilars, we can help decrease overall treatment costs — particularly for self‑funded employer groups. These six preferred biosimilars are priced 12 – 15 percent lower than their respective reference products. As competition within the cancer class continues to exert financial pressure, we are projecting additional cost decreases over the next two years.
We continue to evaluate market trends on existing biologics and biosimilars to determine potential saving opportunities. We continue to proactively monitor the FDA pipeline for upcoming biosimilars that may impact our existing business strategies.
To learn more about our cost-saving strategies, please reach out to us.