Biosimilars and Pharmacy Interchangeability - Episode 5

Challenges for Payers With Costs of Biosimilars

Experts remark on the challenges faced by payers with the costs of therapy with biosimilar products.

Transcript

Kyle Skiermont, PharmD: Al, what are some of the biggest challenges that you see from the health plan or the payer perspective when it comes to biosimilars?

Al Heaton, BS, PharmD, RPh: Well, it kind of epitomizes a challenge that we have on an ongoing basis. But because of the cost of these things it brings it front and center. We’re on a collision course between population health, which is what payers do best, and then personalized medicine.

Right now, specialty drugs account for maybe 1.5% of all claims in a plan, but they may drive 45%, 50% of the plan’s cost, and the plan’s sponsor’s cost, the employer group. And as biosimilars come into the market, we look at them as that potential for cost savings. So we can treat our population but we can treat it more cost-effectively.

The employer groups like this, but it gets down then to that individual member, and an employer group of maybe 500 members may have only 1 or 2 people, 1 or 2 of their employees, that are on a biologic product, and that drives half their cost. And so it’s a very difficult challenge, from a payer perspective, to talk about that because you start really identifying those onesies and twosies. There’s HIPAA [Health Insurance Portability and Accountability Act] issues there. It’s difficult to structure benefits that make it equitable across the board when you have 499 people subsidizing 1, and that 1 gets singled out. So the employer groups haven’t been militant in saying, “Don’t do therapy.” They do, deep down, want to treat their members. That’s first and foremost. But the biosimilars will give them an opportunity to at least treat their members, albeit a small number, more efficiently.

Kyle Skiermont, PharmD: Do the biosimilars have the potential to allow you and/or the ultimate plan sponsor to expand the coverage that they have, or does it make it easier, or, I’ll call it more lenient?

Al Heaton, BS, PharmD, RPh: Yes. It makes it more explainable in some respects. And with the biosimilars and the biologic products right now, we have this kind of perverse problem going on. The employer groups, for years, have always looked at people like me, the older male, as being their risk pool. But now if you consider rheumatoid arthritis, multiple sclerosis, cystic fibrosis, it’s the young female of childbearing age that’s actually their risk pool for high-cost drugs.