However, health system P&T committees have the authority to create interchange or substitution policies for biosimilars. These policies should answer the following questions in accordance with state law (which can vary widely):
- Does the substitution require prescriber consultation?
- Is the policy restricted to the biosimilar’s approved indications, or should use be extrapolated to all the innovator product’s indications?
- What is the potential impact on dosing?
- What guidance is there for opting out of biosimilar substitution?
4. Awareness of changing reimbursement policies
Biosimilars are consistently priced 15% to 30% below that of the innovator biologic, but in the past, convoluted reimbursement policies meant that these lower prices did not always translate to lower post-reimbursement costs. To combat this and incentivize biosimilar use, recent policy changes are steadily addressing and resolving disparities in Medicare reimbursement between biosimilars and innovator biologics. One example is the removal of biosimilar exclusion from the Medicare Part D coverage gap discount program in the Bipartisan Budget Act of 2018. Now, both innovator biologic and biosimilar manufacturers must provide a 70% discount.
While policy changes are beginning to take effect, one remaining reimbursement hurdle remains: some major insurance providers may only cover biosimilars if the patient has a contraindication, intolerance, or an ineffective response to the innovator biologic.
Innovator biologics continue to be cited as preferred agents and, unfortunately, payer reimbursement is often a major driver in the use of biosimilars in health systems.
Ultimately, health systems need to stay up-to-date and aware of changing reimbursement policies for biosimilars to provide the lowest cost care without compromising quality of care.
Advancing the biosimilars era
Several competing biosimilar versions of bank-busting biologics are expected to reach the market in the coming months, including Rituxan (rituximab), Avastin (bevacizumab) and additional Herceptin (trastuzumab) biosimilars.
These new entrants present a massive opportunity for hospital systems to manage cost and reinvest savings in other value-added areas, but these savings can only be realized if the above hurdles are cleared.
To do this, pharmacy and health system leaders must seize the opportunity to guide discussions in their organizations about these challenges and present solutions to improve the adoption of biosimilars.
Thomas E. Henry III, MBA, RPh, CPh is a clinical pharmacy advisor at Lumere and actively practices as a pharmacist. He has held 17 interim executive and director level positions where he was responsible for leading pharmacy operations at some of the top institutions in the country. Adrianne Spencer, PhD is a pharmacy researcher at Lumere. She has worked in cancer research for six years.