By: Dr. Steve Miller, chief clinical officer, Cigna
Biologic medicines have transformed treatment for many complex and debilitating conditions, including cancer, multiple sclerosis, and rheumatoid arthritis. They comprise a large portion of specialty spend and are the fastest segment of prescription drug spending. In 2018, biologics accounted for over one-third (36%; $123.6 billion) of all drug spend in the United States. That’s a 50% increase since 2014.
The health care system cannot continue to sustain the current rate of specialty drug spend increases. The good news is that biosimilar products offer savings opportunities to help mitigate the growing and costly biologic specialty drug market through competition. As leaders in health care affordability, Cigna has taken steps to prefer biosimilars when clinically appropriate and believes there is opportunity to help biosimilars gain greater traction in the U.S.
Why are biologics so expensive?
Biologics contain large, highly complex molecules that are derived from or contain components of living organisms. They must be created from living systems, which makes them difficult to replicate. Without a pathway to support generic competition, biologics have historically been the only pharmacologic option available and are priced at a premium – some up to $10,000 per treatment regimen. Without alternative options, many patients are faced with unsustainable out-of-pocket costs and difficult choices about how to afford their care.
Are there generic versions of biologics that could help drive greater competition and lower costs?
The U.S. Food and Drug Administration (FDA) introduced a new pathway to develop “biosimilar” drugs in 2009. While not identical, this review process is similar to the agency’s approval pathway to accelerate availability of generic medicines. These alternatives to the original biologics are reviewed and tested to ensure their safety and efficacy. By definition, a biosimilar can have no clinically meaningful differences to its biologic reference product. As patents for several biologics have expired and more are expected, the introduction of biosimilars has the potential to save U.S. consumers billions in health care spending dollars over the next decade.
If the cost-saving opportunity with biosimilars exists, why hasn’t there been greater adoption?
Currently, 29 biosimilars have been approved by the FDA, but only 20 are available in for use in the United States. For comparison, the European Union currently has 66 biosimilar drugs approved for use. The complexities in the U.S. health care system and strategies deployed by pharmaceutical manufacturers have delayed biosimilar launches and prevented Americans from recognizing their potential cost savings.
This slow adoption is reminiscent of the introduction of generics in the 1990s and resulting challenges faced by the industry to promote widespread use. It took time and support from providers and other industry players to gain consumer trust in generic medicines and grow their market share. Today, generics represent 90% of all prescriptions in the U.S. and have generated $2.2 trillion in savings in the past decade.
What is the best way to accelerate biosimilar adoption?
Cigna has actively supported the introduction of the FDA’s biosimilar pathway for the past decade and has continued to advocate for additional changes that will further advance the promise of these medicines. However, there is always more work to be done. We believe now is the time to ensure that patients can easily access these clinically-proven therapies and that we all have a role in helping to establish trust and support greater uptake.
One way that Cigna reduces prescription drug costs, particularly for high-cost specialty medicines like biologics, is with aggressive formulary management strategies that help ensure clients and customers pay the lowest net cost for the most clinically effective drugs. An independent Pharmacy and Therapeutics Committee (P&T Committee) conducts regular reviews of our formularies and makes recommendations based on the latest clinical data. As new and innovative treatments, including biosimilars, become available, we will continue to review and incorporate the most clinically effective medicines at the lowest net cost.
The path forward will require new solutions to effectively challenge the status quo. We believe that if we embrace technological breakthroughs and innovations – like biosimilars – we can address the devastating financial impact of ultra-high cost medicines and transform the health care system for all future patients living with complex, chronic conditions.