3 Ways Insurers Can Help Promote Biosimilar Adoption

May 1, 2019

The FDA Commissioner says that insurers can help biosimilar adoption by taking short-term financial losses over long-term drug savings. What else should they be doing?

At a recent Brookings Institute event, outgoing FDA Commissioner Scott Gottlieb, MD, was circumspect about lagging biosimilar adoption. Even though 17 biosimilar drugs are currently approved, very few of those are on the market-and even fewer are found as preferred drugs on payer formularies. Gottlieb said that too many health plans are too focused on short-term financial losses when it comes to biosimilars, ignoring the long-term costs savings that these agents can bring.

Julie Rubin, PharmD, BCPS, director of clinical services for CompleteRx, a pharmacy management consultancy firm, agrees with Gottlieb’s comments.

“Insurance companies are getting rebates from the different drug companies. If they switch to biosimilars, they would lose those rebates. If they use a competitor product like a biosimilar, they are not going to have the same financial incentives upfront,” she says. “Biosimilars usually offer anywhere from 20-30% reduction in price, which helps the patient. But the insurance companies will not get the rebates they would have gotten previously.”

But, Rubin argues, using that reasoning to ignore the potential of biosimilars is short-sighted. And there are other things that insurance companies could do to encourage the biosimilar market beyond looking at this month’s balance sheet.

Here are three ways insurers could help promote biosimilar adoption:

1. Let go of their fear

Rubin says that many insurers have not fully embraced biosimilar drugs, despite the promise of cost savings because of “fear of the unknown.”

“Biosimilars haven’t been out there that long,” she explains. “Are they truly the same? Are they truly generic? The evidence says they are but it’s taking some time for that data to reach everyone.”

Rubin added the many legal issues surrounding biosimilars also have insurers dragging their feet.

Related: FDA Issues Biosimilar Naming Guidance

 “These patent infringement suits make it difficult for some of these drugs to come to market because the biosimilar companies are afraid they will immediately be sued by the originator manufacturers,” she says. “That’s holding back some insurers. But they need get over these fears and look at the opportunities instead.”

2. List biosimilar products as preferred drugs

Rubin said another way insurance companies could hasten biosimilar adoption is by giving biosimilar agents preferred status. She said that some insurers are starting to make those switches.

“In some cases, we’re seeing the biosimilar competitors are become more preferred-and certainly providers, particularly oncologists, are putting more pressure on payers to cover these drugs,” she says. “But, on the whole, I think insurers need to be more aggressive about giving these agents preferred status. If they don’t, when providers want to use the biosimilar, patients can’t get coverage and they end up using the old drug.”

3. Take a more active role in biosimilar education

As payer organizations make their designations regarding preferred, second tier, and third tier drugs, they have a big opportunity to help educate patients and providers about the promise of biosimilar agents. While Rubin concedes that many look to the biosimilar manufacturers or providers to do that education, there is a significant role for insurance companies, too. Creating some simple pamphlets explaining what a particular biosimilar drug is, why it’s hitting the market, and its efficacy could help put the public more at ease.

“Insurance companies, right at the beginning of the year when they make those decisions about what drugs are preferred, can start educating providers that this drug is the new preferred in this class-and this is why,” she says. “It can help get more information out about these agents.”

Rubin stated that providers, payers, and patients will all have to pick up the mantle to help accelerate the biosimilar market. But insurance companies can play a key role-if they are willing to look at long-term savings to the healthcare industry as a whole, instead of short-term rebates and financial incentives.

“So many of these drugs cost our public so much money,” Rubin says. “If we can provide more savings to the public, if we can be more flexible about what options are out there, insurance companies will see those savings, too. Both in terms of improved compliance and patient outcomes, and the amount of money in their own pockets.”

Kayt Sukel is a science and health writer based outside Houston.