Latest Humira Price Increase Could Add $1 Billion to US Healthcare System in 2018

Even though many of the drug price increases announced in recent days have generally remained below 10%—the self-imposed cap that some companies appear to have adopted—these increases will still cost payers and patients a great deal, particularly in the case of Humira (adalimumab), the blockbuster rheumatoid arthritis (RA)/inflammatory disease treatment, the price of which manufacturer AbbVie is increasing by 9.7%. That single price increase could add $1.2 billion to the US healthcare system’s drug costs in 2018, according to Wells Fargo analyst David Maris.

“AbbVie's 9.7% increase is likely to be the costliest price hike to the U.S. healthcare system,” Maris said. “With the drug bringing in $12.6 billion in the [United States] each year, that price increase means an added $1.2 billion to the healthcare system." Over the past 5 years, Humira’s price has more than doubled, thanks to incremental hikes, Maris noted. Humira is now the best-selling drug in the world, expected to earn $20 billion or more worldwide—the first drug to ever pass that threshold.

And there’s no immediate biosimilar competition for Humira in the United States after AbbVie successfully delayed biosimilar competition from Amgen, which received FDA approval in September 2016 for its adalimumab biosimilar (Amjevita). (The European Commission also approved Amgen’s adalimumab biosimilar in March 2017.) Patent disputes delayed the launch of the biosimilar, with AbbVie suing Amgen for infringing on 10 its patents. Amgen reached a settlement with AbbVie in September 2017 under which AbbVie will grant patent licenses to Amgen for the sale of Amjevita on a country-by-country basis, and the companies have dismissed all pending litigation over the drug. In addition, Amgen will launch its biosimilar in the European Union (under the name Amgevita) on October 16, 2018, but in the United States, Amjevita will not launch until January 31, 2023. Boehringer Ingelheim’s adalimumab biosimilar (Cyltezo) was also approved by the FDA in August 2017, but is the subject of additional patent litigation.

Humira continues to dominate the RA and inflammatory disease markets despite an assessment by the Institute for Clinical and Economic Review (ICER), an independent cost-effectiveness watchdog, which concluded that Humira isn’t worth its current price and doesn’t work as well as 2 of its competitors. ICER stated that, to be cost-effective, Humira’s net price would need to be at a 50% to 69% discount to its list price at the time of the assessment.

The organization concluded that targeted immune-modulating RA drugs (TIMs), like Humira, work better than older treatments such as methotrexate, but the prices of TIMs detracted from their cost-effectiveness rating, which ICER bases on a quality-adjusted life-year (QALY) analysis. Most immune modulators exceed traditional cost-QALY analysis thresholds, according to ICER. In fact, Humira has the highest per-QALY cost of the all anti—tumor necrosis factor drugs at $232,664. Infliximab (Remicade) had the lowest at $202,824. While biosimilar competition for adalimumab is delayed potential competition for Humira may eventually come in the form of novel drugs that are expected to erode its dominance in the RA market, such as Janus kinase inhibitors.