Hospitals, Physician Offices Significantly Mark Up Prices for 3 Drugs With Biosimilars

Hospitals and physicians’ offices mark up the cost of certain drugs to the point that they may cost twice the amount as the same drugs being dispensed in specialty pharmacies, according to a new report from AHIP. Among the 10 drugs evaluated, 3 have multiple biosimilars available.

The researchers found that the 10 drugs, on average, cost $1400 more when administered in physicians’ offices; the cost per single treatment in hospitals was an average of $7000 more. Notably, the estimates were for a single treatment, but all 10 drugs require multiple treatments.

To identify the 10 drugs on the list, AHIP researchers used the list of top 25 drugs by spending in Medicare Part B for 2019 and consulted with AHIP’s member plans on the drugs commonly delivered through specialty pharmacies. They calculated the 3-year average cost for a single treatment in hospitals, physicians’ offices, and specialty pharmacies using medical and pharmacy claims data from the IBM MarketScan Commercial Database from January 1, 2018, to December 31, 2020.

The 3 drugs with biosimilars that made the list were Herceptin, which has 5 trastuzumab biosimilars approved and on the market; Remicade, which has 4 infliximab biosimilars approved but only 3 on the market; and Rituxan, which has 3 rituximab biosimilars approved and on the market.

“The data are clear, specialty pharmacies lower patient costs by preventing hospitals and physicians from charging patients, families, and employers excessively high prices to buy and store specialty medicines themselves,” Matt Eyles, president and CEO of AHIP, said in a statement. “Secure, direct delivery is a safe and smart competitive alternative that improves affordability and access for everyone.”

Herceptin

Physician offices marked Herceptin up $1875 and hospitals marked up the price $6091. The average markup was 131% in hospitals and 40% in physician offices over specialty pharmacies.

Biosimilars for Herceptin have been on the market in the United States as early as July 2019 when Kanjinti from Amgen/Allergan launched. Kanjinti had been approved in June 2019. The first trastuzumab biosimilar approved was Ogivri from Viatris/Biocon, which was approved December 2017 but did not launch until December 2019.

The other trastuzumab biosimilars are Ontruzant from Organon/Samsung Bioepis, which was approved January 2019 and launched April 2020; Herzuma from Celltrion/Teva, which was approved December 2018 and launched March 2020; and Trazimera from Pfizer, which was approved March 2019 and launched February 2020.

These trastuzumab biosimilars are approved to treat HER2 overexpressed breast cancer.

Remicade

In physician offices, Remicade, which treats Crohn disease and psoriasis, has been marked up $695 (15%) over pharmacies. Hospitals marked the therapy up $5601 (124%).

There are 4 approved infliximab biosimilars but only 3 launched on the US market. Ixifi was approved in December 2017; however, Pfizer has chosen not to market this product in the United States to avoid competition with another infliximab biosimilar that it manufactures. Inflectra, from Pfizer/Celltrion, was approved in April 2016 and launched in the United States November 2016.

The second infliximab biosimilar approved was Renflexis from Organon/Samsung Bioepis, which was approved May 2017 and launched July 2017. The most recent approval and launch is Avsola from Amgen, which was approved December 2019 and launched July 2020.

Rituxan

On average, the rheumatoid arthritis treatment Rituxan was marked up $625 (7%) in physician offices and $7926 (85%) in hospitals over specialty pharmacies.

Truxima, from Celltrion/Teva, was the first rituximab biosimilar approved in November 2018. It launched November 2019. Ruxience, from Pfizer, was approved July 2019 and launched January 2020. Finally, Riabni, from Amgen, was approved December 2020 and launched January 2021.