Experts: EU Will Continue to Beat US on Biosimilar Adoption

by Peter Johnson

As biologics research and development becomes more granular, biosimilars may wind up both less useful and profitable than boosters of the drug category once thought. According to experts, the first wave of biologic patent expiry is almost over — and a new set of expirations starting in 2024 will determine whether biosimilars will have as big an impact in the U.S. as they have in the European Union.

The EU "experienced this biosimilar wave ahead of regions such as the US and Asia-Pacific because the EU created the first biosimilar-specific approval pathway," according to Quentin Horgan, GlobalData's senior drugs database analyst. And insiders say that the U.S. health care system, as with the first wave of biosimilars, is unlikely to jump on the second.

What limits US uptake?

• "There are additional variables unique to the US market impacting biosimilar uptake. These include a multi-payer public and private health system, pricing dynamics with rebates and prescriber administration of reference vs. biosimilar, and manufacturer-led patent thickets which challenge marketization," says Chantell Sell Reagan, Pharm.D., national pharmacy practice clinical lead at Willis Towers Watson.
• In the U.S., "what we've seen is biosimilars require similar kinds of promotional and market access strategies that branded products have," explains Jeff Stoll, Ph.D., a principal and national strategy lead for life sciences at KPMG.
• Stoll points out that drug researchers now tend to focus their biologics research on rare diseases, with the intention of developing a curative product. That means the market for a biosimilar might be too small to justify development, or that the patients who could use a biologic might already be healthy by the time the biosimilar comes to market.

Rebate system stymies drugs:

• "Currently, the rebate system means that, oftentimes, biologics are on a higher [formulary] tier than biosimilars," which limits uptake, Horgan says. Biosimilars may have a lower list price than their biologic counterpart but be in a more expensive formulary tier to a patient "just due to the way that the deals they've already enacted [are structured]."
• Horgan also observes that interchangeable designations are not as common in the U.S. as they are in the EU. To date, only one biosimilar has been granted an interchangeable designation, the regulatory tag the FDA gives to generics.

From RADAR on Drug Benefits