New Zealand's Pharmac Proposes Funding Only Biosimilar Epoetin Alfa

New Zealand’s Pharmaceutical Management Agency (Pharmac) has proposed to stop funding Janssen’s reference epoetin alfa product in favor of a biosimilar.

Janssen’s drug, sold in New Zealand as Eprex (and in the United States as Epogen) would lose funding after a transition period beginning in February 2019. After the close of the transition, only Novartis’ approved biosimilar, sold as Binocrit, would be eligible for funding in community and hospital settings.

The change, which would be applicable until June 30, 2022, follows a May 2018 request for proposals from drug makers to supply epoetin alfa.

Click to read more about Binocrit.

Pharmac, which was established in 1993 to help rein in high drug costs for the nation’s public health system, manages New Zealand’s schedule of government-subsidized pharmaceuticals, a list that comprises approximately 2600 medicines used in public hospitals.

Whenever possible, Pharmac awards a sole tender for a single brand of a product to be reimbursed, and patients who wish to use a different product, such as a reference product for a biosimilar, must pay the full price of their preferred drug. The tendering process, says Pharmac, generates approximately $30 million in savings each year, and these savings are used to widen access to already subsidized medicines.

The agency has thus far shown strong support for the use of cost-saving biosimilars in the tendering process; in August 2012, Pharmac announced a decision in which it named Sandoz’ biosimilar filgrastim, sold as Zarzio (and sold in the United States as Zarxio), the sole supplier of filgrastim for the nation. Then, in 2014, when biosimilar infliximab (Inflectra) became available in New Zealand, Pharmac used availability of the lower-cost biosimilar to negotiate a 30% cut to the list price of the reference infliximab, Remicade. The deal with Remicade’s maker, Janssen, will save the country an estimated $25 million (approximately USD $16 million) over a 5-year term.

Pharmac is open to public comments on the proposed change to its epoetin alfa supply until September 10, 2018.