Biosimilar Competition Has Led to "Marked Reductions" in Biologics' Net Prices, Study Finds

The promise of biosimilars is that these subsequent-entry products can reduce the cost of biologic therapy by offering lower-priced alternatives that do not compromise efficacy or safety. An additional benefit is that the presence of competition in the marketplace can also drive down costs for originator products, or at least curb price growth, though to what degree biosimilars have had such an impact on originator biologics in the US market has not been fully elucidated.

In a new research letter appearing this month in JAMA Network Open, a team of researchers from the University of Pittsburgh and the UPMC Health Plan reported on their assessment of how biosimilar availability has impacted prices for reference products.

Using pricing data from January 2007 to June 2018 from SSR Health, the researchers examined prices for filgrastim, pegfilgrastim, and infliximab (which face biosimilar competition), as well as insulin glargine (which has a follow-on insulin available). For each year, they calculated the mean list and net prices and mean discounts for Medicaid and other payers for the drugs in question.

They found the following:

• List and net prices for brand-name filgrastim (Neupogen) rose in parallel annually by 5.1% and 6.1% before biosimilar entry. After the availability of the first biosimilar in 2015, list prices stagnated, and net prices decreased by a mean of 7.7% each year.
• List and net prices for brand-name pegfilgrastim (Neulasta), prior to biosimilar availability, rose by a mean of 7.5% and 4.9%, respectively, until the first biosimilar came to market in 2018. After the biosimilar’s launch, list prices stagnated, and net prices dropped by 7.4%.
• List and net prices for brand-name infliximab, Remicade, increased by a mean of 6.0% and 6.0%, respectively, from 2007 to 2013. Then, in 2013, net prices started to drop by a mean of 1.3% annually, then by 13.6% annually after the introduction of the first biosimilar in 2017.
• List and net prices for the brand-name insulin glargine (Lantus) increased annually from 2007 to 2014 by a mean of 14.7% and 8.8%, respectively. From 2015 to 2019, list price growth was a mean of 5.8%. Net prices dropped by a mean of 14.4% in 2015, then dropped further to a mean of 23.5% after a follow-on product became available.
• Medicaid discounts rose by means of 20.1% for filgrastim, 31.2% for pegfilgrastim, 33.8% for infliximab, and 35.2% for insulin glargine across the study period.

While the study was subject to limitations—including the fact that estimates of Medicaid discounts reflect only statutory rebates and the fact that it is not possible to determine whether large discounts are a result of increases in rebates or other manufacturer concessions—the authors write that, for all 4 products, availability of biosimilars or follow-ons accelerated decreases in net prices for biologics.

“Our findings show that biologics that faced biosimilar competition—even without interchangeability—showed marked reductions in net prices and leveling off of list price increases,” write the authors.

Reference

San-Juan-Rodriguez A, Gellad F, Good CB, Hernandez I. Trends in list prices, net prices, and discounts for originator biologics facing biosimilar competition. JAMA Netw Open. 2019;2(12): e1917379. doi:10.1001/jamanetworkopen.2019.17379.