CMS established a lower maximum copay for biosimilar and interchangeable biological products that is equivalent to the lower co-pay required for generic and preferred multiple source drugs.
In November 2017, the Centers for Medicare and Medicaid Services (CMS) released a proposed rule that included the proposal to lower cost sharing for and improve enrollee incentives to choose biosimilars over reference biologics, and to reduce costs to both Medicare Part D enrollees and the Part D program. This objective would have been accomplished by revising the definition of generic drug (§ 423.4) to include follow-on biologic products approved under the section 351(k) biosimilar pathway. This change would impact Low-Income Subsidy (LIS) cost sharing and non-LIS catastrophic coverage phase cost sharing, and would not be universally applied across other CMS policy.
In April 2018, CMS finalized the proposal to allow biosimilars to be covered at the generic copayment level for LIS-eligible beneficiaries and therefore achieve the intent of the original proposal. CMS did not revise the definition of generic drugs because their proposed approach "could be misinterpreted and create further confusion about the broader treatment of biosimilar and interchangeable biological products under the Part D program." But, instead, CMS established a lower maximum copay for biosimilar and interchangeable biological products that is equivalent to the lower co-pay required for generic and preferred multiple source drugs (revising § 423.782(a)(2)(iii)(A) and § 423.782(b)(3)) and will have the following impacts in 2019:
Institutionalized dual-eligible or receiving home- and community-based services:
Dual eligible, below or at 100% of the Federal Poverty Limit (FPL):
Dual eligible, above 100% FPL or Medicare-only below 135% FPL:
Medicare-only, between 135% and 150% FPL
The final rule did not change the cost sharing for biosimilar drugs to the same level as generic drugs for non-LIS beneficiaries in the catastrophic coverage phase. Under the new approach, the one that does not revise the definition of generic drug, CMS did not have the flexibility within statue to establish a lower copay.
The good news is that this change will not have a negative impact on non-LIS cost sharing in the catastrophic phase because such enrollees are required to pay cost sharing that is equal to the greater of the applicable copay amount ($3.40 for generic drugs or $8.50 for other products including biosimilars in 2019) or 5%. Given the high cost of biological products in general, the non-LIS catastrophic cost sharing will almost certainly be 5%.
Budget Impact Analysis of Biosimilar Natalizumab in the US
Projected savings from biosimilar natalizumab were $452,611 over 3 years, driven by decreased drug acquisition costs and a utilization shift from reference to biosimilar natalizumab.
Biosimilars in America: Overcoming Barriers and Maximizing Impact
July 21st 2024Join us as we explore the complexities of the US biosimilars market, discussing legislative influences, payer and provider adoption factors, and strategies to overcome industry challenges with expert insights from Kyle Noonan, PharmD, MS, value & access strategy manager at Cencora.
Eye on Pharma: BI Cyltezo Partnership; Europe Ustekinumab Launch; Mexico Biosimilar Approval
July 24th 2024Boehringer Ingelheim (BI) partners with GoodRx to offer its unbranded adalimumab biosimilar to patients at an exclusive low price; a new ustekinumab biosimilar launches in Europe; and Mexican officials approve a bevacizumab biosimilar.
Biosimilars Oncology Roundup for June 2024—Podcast Edition
July 7th 2024On this episode of Not So Different, we review biosimilar news coming out of June, with clinical trial results from conferences and a study showcasing how to overcome economic and noneconomic barriers to oncology biosimilars.
Real-World Study: No Increase in Health Resource Costs After Infliximab Biosimilar Introduction
July 20th 2024Although biosimilars reduce drug purchasing costs for hospitals, it’s unclear whether those savings might be offset by increased health resource utilization following a non-medical switching initiative.