Regence found that implementing strategies to increase its biosimilar adoption rate reduced spending on specialty drugs by $37 million annually. The organization is the latest example of how biosimilar use has contributed to significant savings.
Regence health plans announced that achieving a 95% biosimilar adoption rate reduced spending on specialty drugs by $37 million annually. The organization is the latest example of how biosimilar use has contributed to significant savings.
“Biosimilar adoption involves collaboration between multiple segments of the health care system, including members, providers, payers and manufacturers….Accelerating biosimilar use will drive meaningful cost savings and health care sustainability, while maintaining quality of care for some of the most complex diseases members face,” commented David Robertson, vice president of pharmacy services at Regence.
The average annual cost of biologics, especially specialty drugs, can cost plans tens of thousands of dollars per member. However, specialty medicines account for less than 2% of insurance claims within Regence plans despite accounting for over 55% of the organization’s total annual drug spend. Biosimilars typically cost about 15% to 30% less than their reference biologics.
Regence’s plan to increase member adoption of biosimilars involved implementing a robust communication campaign and medical policies supporting member’s unique needs to minimize barriers to switching from reference products to biosimilars. Regence also developed educational material on biosimilars targeted at members and providers, highlighting the economic and clinical value that biosimilars can provide. Frequent and transparent communications with members and providers took place up to 6 months prior to patients switching to a biosimilar.
When choosing which biosimilars to prefer, Regence said that it evaluated manufacturer capacity to ensure treatments availability and minimal disruptions to supply chains. Prior authorization requirements were either removed or preapproved for preferred biosimilars to make it easier for patients to transition to a biosimilar.
Additionally, Regence gave notice about patient switches to infusion sites ahead of time to ensure that they would increase their supply of preferred biosimilars to meet higher demand.
Biosimilar Savings in Other Areas of Health Care
Recently, a report from the Association of Accessible Medicines found that utilization of biosimilars and generics have led to $373 billion in savings, of which $119 billion was from Medicare plans and $178 billion was from commercial plans. The report also estimated that the US health care system saved over $2.6 billion over the last 10 years because of the increased availability of biosimilars and generics.
Additionally, an article that examined a biosimilar adoption program found that Providence St Joseph Health, a large US nonprofit health system, created $26.9 million in cost savings and significantly increased biosimilar adoption rates.
According to a report published by the HHS Office of Inspector General, Medicare Part D planed missed out on between $84 million and $143 million in savings by failing to prioritize biosimilars over more expensive reference products.