Following their Senate Finance Committee hearing in February, all seven biopharmaceutical CEOs have now offered hundreds of pages of written responses to more specific questions.
The lackluster biosimilar market in the US is addressed in nearly all their comments, with some executives explaining in detail as to why their biosimilars have yet to gain market share, while undertones of biosimilar fear-mongering linger in others’ comments.
Merck CEO Kenneth Frazier explained to Sen. Mike Enzi (R-WY) how in general, biosimilar competition in the US “thus far has resulted in moderation of prices, but actual utilization of the biosimilars remains modest at best. We fear that an environment where market entry of biosimilars brings value to the market, but little or none of that value accrues to the biosimilar patient or the health care system, will not be sustainable.”
Frazier said Congress should pursue policies to encourage and support biosimilar uptake and utilization in order to realize these potential savings for the system and patients. These policies could include reduced cost sharing in Medicare Part B.
Merck introduced Renflexis (infliximab-abda), a biosimilar to Janssen’s Remicade, at a 35% discount to the originator product, “yet we have captured only a tiny fraction of the market,” Frazier said.
“Uptake of the product was limited, we believe due to physician confusion regarding interchangeability and extrapolation, and a lack of physician, patient, and payer incentives. While we believe that the prescribing physician must always have the authority to designate exactly which biological product is dispensed to the patient, we believe there are market barriers that hamper appropriate adoption of biosimilars.
Medicare Advantage plans seem to be imposing controls that require providers to first use the reference biologic before providing coverage for the biosimilar, he added.
“Further, prescribers may be comfortable with a single switch (i.e., moving a stable patient from a reference product treatment protocol to a biosimilar), but may have concerns about switching a patient multiple times, absent the interchangeability designation. We believe that regulatory clarification of these terms and concepts could help mitigate concerns for providers and support biosimilar product adoption,” Frazier added.
Pfizer CEO Albert Bourla similarly explained how his company’s Remicade biosimilar Inflectra (infliximab-dyyb) has captured only 6% of the market despite the fact that its average selling price is 25% lower than the reference product.
“In many cases, payers decline to include lower-cost biosimilars or generics in their formularies because they would risk losing the rebates they could receive by covering higher-cost medicines,” Bourla explained. “The centerpiece of the scheme is the ‘rebate trap’ that uses pricing penalties (i.e., the loss of significant rebates) to coerce insurers to enter into exclusive deals that cover Remicade while effectively blocking Inflectra from coverage. Multi-product bundling is just one aspect of the conduct.”
But for companies with lots of revenue to lose should biosimilar competition gain traction in the US, the executives often sang a different tune.
AbbVie CEO Richard Gonzalez, who has sought to stave off competition for his mega-blockbuster Humira (adalimumab) in the EU this year and by 2023 in the US, further explained the differences between biosimilar and generic drug markets.
“There is no requirement that two biosimilars found to be interchangeable with a single reference product must show that it is safe and effective to switch between the two interchangeable biosimilars, even though in practice this is likely to happen in the marketplace if biosimilars are treated like generic drugs,” Gonzalez said.
He also discussed how there might be “more structural differences—or different types of structural differences—between the two biosimilar products than between either biosimilar and the reference product. As such, without clinical data assessing the effects of switching between two biosimilars of the same reference, there is no evidence to scientifically justify interchangeability or automatic substitution between them.”
Similarly, J&J EVP Jennifer Taubert said: “The approval of an interchangeable biosimilar may address some of the physician and patient reservations about switching a stable patient to a non-interchangeable biosimilar.”