Amanda Forys, MSPH, senior director of reimbursement policy insights at Xcenda, discusses current reimbursement policy for biosimilars.
Transcript:How do drug makes feel about the current reimbursement code policy for biosimilars?
When the Centers for Medicare and Medicaid Services finalized their payment rule under the physician fee schedule and the outpatient prospective payment system for 2016, they kind of surprised manufacturers; they told them that instead of each customer coming out and being assigned its own billing code, or HCPCS code, that they would all be grouped together, which would be separate from the reference products. So, biosimilar A, B, and C would all share a code while the reference product sat on its own. When you think about the way the current market works with generic products—when a generic comes to market it shares a code with the branded product. So, you can have the brand and 10, 12, 15, however many generics are on the market, sharing that code, but in this case, this was a little bit unexpected and manufacturers did not expect the same policy to be followed as the generic policy because the BPCIA, which was put in place to establish the biosimilars approval pathway, doesn’t really allow for that.
The language wasn’t really intended for them all to be grouped, but they were not expecting them to all be grouped separately; what the manufacturers were expecting was that they were each going to get their own billing code, and therefore control their own destiny with their average sales price. So, this policy has been a little bit of a surprise to the manufacturers and those that have been bringing these products in, and have been really working hard to point out the differences to lawmakers and to regulatory bodies that we are not a generic, we are a unique product, we’re not biosimilar to one another—so grouping us together can create challenges from providers’ perspectives, and understanding our products. We should be treated separately as individual products and given our own code.
CMS tried to circumvent that by saying “let’s keep them all together in one code, but let’s assign a random 2-digit modifier that has to be placed on the claim,” and now that’s something that’s adding a burden onto the providers that isn’t really there for any other product. You don’t see any other product class where the manufacturer name has to be said with a modifier code. So, I think most manufacturers on the biosimilar side would like to see CMS re-evaluate this policy. It was open for comment this year for the 2018 Medicare physician fee schedule, so we’re hoping that we’ll get good data out there in the world about what’s happening with biosimilars and what’s going on with the market. CMS specifically said “we would like to see real evidence on how this could affect the market.” So it will be interesting to see if that data comes out and if CMS decides to keep the policy as is or if they decide to follow what the biosimilars manufacturers are asking for and separate the drugs.