Australian Study Reveals Significant Cost Savings and Market Impact From Biosimilars

The economic impact of biosimilars on the Australian health care system is now clearer, with data revealing their role in reducing market expenditure and driving price competition, a finding detailed in a new study published in Value in Health Regional Issues.¹

Biosimilars significantly reduce healthcare costs in Australia, enhancing access to biologics while driving price competition in the pharmaceutical market. | Image credit: Zerophoto - stock.adobe.com

Researchers conducted the analysis to address a critical challenge facing health care payers: balancing the rapid growth in indications and costs of biologic medicines with finite health budgets. The researchers recognized that once patents for reference products expire, the introduction of biosimilar medicines is a key strategy to provide continued patient access to necessary treatments while ensuring the long-term affordability of funding schemes.

Monoclonal antibodies (mAbs) and Fc-fusion proteins, often referred to as biologics, have revolutionized the treatment of previously difficult-to-treat chronic inflammatory diseases and cancers.² Since the late 1990s, when the first mAb, rituximab, was launched, these medicines have come to dominate the global pharmaceutical market. The global market for biologics was valued at an estimated $320 billion in 2020, representing 40% of the total pharmaceutical market in Europe.³ In Australia, this trend is mirrored, with mAbs accounting for a quarter of the total expenditure on the national Pharmaceutical Benefits Scheme (PBS) in 2022.¹ Given the significant and growing expenditure on these medicines, there is a clear need to understand how the introduction of less expensive biosimilar alternatives impacts the market.

The primary objective of the present study was to describe the specific impact of biosimilars on the volume and cost of biologics within the Australian market. To achieve this, the research team extracted Australian sales data for selected biologic medicines with at least one biosimilar available for a minimum of 12 months. The data, spanning a decade from 2010 to 2020, was sourced from IQVIA-MIDAS. The researchers measured expenditure in US dollars and volume in standardized units (SUs). They calculated the differences in expenditure, volume, and average SU price for both the reference product and the total market for the 12-month periods before and after biosimilar market entry.

A key finding was the substantial reduction in total expenditure for biologic reference products. Just 12 months after a biosimilar entered the market, the expenditure for the reference product was reduced by 38.3%. This occurred in a market that experienced only a minimal increase in overall use, demonstrating that the savings were primarily driven by price reduction rather than a change in market size.

The price competition was also evident in the per-unit cost. The average price of a standardized unit for reference products decreased by 30% to 40%. Furthermore, the study confirmed that the price of biosimilar standardized units was as much as 40% lower than the price of their reference products. By 2020, the cumulative effect of these introductions was clear: biosimilars had grown to account for 30% of the total biologics market in Australia.

The study also identified differences in market share uptake depending on the timing of the biosimilar’s introduction. Earlier introductions, such as etanercept and infliximab, had a lower short-term market share (2.0% and 1.8%, respectively) compared with more recent introductions like rituximab (21.8%) and trastuzumab (9.3%). This suggests that policy changes and increased clinician confidence over time may have accelerated the adoption of newer biosimilars.

While the study in question did not focus on patient-level data, other research has shown that the acceptance and use of biosimilars are influenced by a variety of factors related to the people receiving the care. A separate study on patients with inflammatory arthritis and inflammatory bowel disease revealed that most people (95%) obtained their medication information from specialists.

However, only a small percentage (4.6%) of respondents in that study reported using a biosimilar, and a significant majority (66.9%) were unsure if biosimilars were even available in Australia. This highlights the ongoing need for patient education and communication from health care providers. The most frequent factor that would influence a person to switch from a reference product to a biosimilar was a specialist’s recommendation.

The study's focus on sales data meant it did not capture patient-level experiences or prescribing habits, which are influenced by factors like policies, incentives, and knowledge among healthcare providers and people receiving care. These limitations may help explain why, despite documented cost savings, Australia's biosimilar uptake has lagged behind that of European markets.

The authors noted the significance of the results for policymakers. "Our data confirms that biosimilar introduction is a powerful tool for reducing market expenditure and driving down the price of reference products. This suggests that targeted policy initiatives can create the potential for greater medicines access for people across Australia by improving the financial sustainability of the healthcare system."

The demonstrated cost savings and increased market penetration indicate that biosimilars are not only viable alternatives but are also essential for maintaining accessible and affordable health care.

References

1. Hillen JB, Stanford T, Ward M, et al. Medicines policy in action: the impact on volume and cost of biologic medicines after biosimilar introduction. Value Health Reg Issues. 2025;50:101173. doi:10.1016/j.vhri.2025.101173

2. Ingrasciotta Y, Cutroneo PM, Marcianò I, et al. Safety of biologics, including biosimilars: perspectives on current status and future direction. Drug Saf. 2018; 41:1013-1022. doi:10.1007/s40264-018-0684-9

3. Spotlight on biosimilars. IQVIA. 2021. Accessed September 8, 2025. https://www.iqvia.com/insights/the-iqvia-institute/reports-and-publications/reports/spotlight-on-biosimilars