Promoting biosimilars could save large employers billions
Biosimilars are on track to save the U.S. health care system up to $183 billion by 2025.
In 2018, all U.S. self-insured employers could have saved $1.4 billion and realized significant savings for their employees by promoting the use of biosimilars in employer-sponsored health plans.
The potential for biosimilars is tremendous, yet many employers continue to lose out on millions in savings. With nearly half of Americans relying on their or their family’s employers for health coverage, and as the costs of care rise in the US, employers should consider biosimilars as a viable solution to lower health expenditures and realize significant savings for their employees. In doing so, employers can also promote greater health system sustainability and access.
Related: Regain control of drug spend in 2022: 3 pharmacy benefits trends to watch
Employers around the U.S. are already seeing success in utilizing biosimilar substitution plans. For example, Ford Motor Company recently shared a case study detailing their strategy to implement biosimilars in their health plan, which required new and current utilizers of a reference product to switch to the biosimilar. Since 2019, this transition has saved Ford nearly $5 million. As a result, we’re beginning to see other employers in Michigan implement similar programs with no member disruption—meaning patients are continuing to get the treatment they need at a more affordable cost. This example provides an important blueprint for other employers across the US who are looking for impactful ways to reduce overall health care spending and out-of-pocket costs for their employees.
As the promise of biosimilars continues to be realized in the U.S., more patients—an estimated 1.2 million by 2025—will have access to these high-quality, more-affordable biologic medicines as a result of the availability of biosimilars. Biosimilars are also on track to save the U.S. health care system up to $183 billion by 2025.
There are currently 33 approved biosimilars and 21 launched biosimilars in the U.S. across oncology, ophthalmology, immunology and diabetes—and this will only continue to grow. With a number of new medicines expected to launch that will have a significant impact for patients across new disease areas, 2023 will be a milestone year for biosimilars. This provides a crucial opportunity for employers to collaborate with payers and PBMs to ensure biosimilars are included on formularies. Additional education will also be critical to assure that employers and employees alike understand the value these more affordable, high-quality, safe and effective biologic medicines can provide.
Actions for employers
There are a few actionable steps companies can take now as they collaborate with PBMs and consultants to design benefit plans for next year.
Ask questions. Be prepared to ask tough questions of medical carriers, PBMs and consultants. For example, ask medical carriers for member data, information regarding available programs and where medical carriers are innovating on behalf of plan sponsors. Employers should consider hiring an expert pharmacy consultant and a rebate aggregator.
Develop a thoughtful plan design. This is key when looking to adopt biosimilars. Consider limited grandfathering to allow the use of existing medicines so as not to disrupt patients during their treatment cycle and ensure clear communication with members. Employers should also avoid a one-size-fits-all approach. Consider developing a strategy for each drug, its market dynamics, level of physician acceptance, and treatment situation.
Educate employees. Educating new and existing employees on their benefit packages is an important step for employers to help build confidence and trust in biosimilar medicines. Biosimilar information and education should be included in the company’s online and email communications, inclusive of potential cost savings, real-time benefit lookup tools and cost calculators that include biosimilars as available options.
Consider rebates. Rebates significantly impact the employer-sponsored health care arena, and they must be carefully considered. Employers should not be afraid to implement a lowest net cost without rebates strategy. If, however, a rebate model is used, the rebates should be reexamined regularly as the rebate landscape is constantly changing and employers will need to adapt the strategy to ensure the lowest net cost.
Realizing the full potential of biosimilars
The role of biosimilars in delivering savings and expanding patient access is more important than ever. Biosimilar acceptance and uptake is accelerating, and the U.S. marketplace is well-positioned to welcome new biosimilars in the coming years. However, there is more to be done to ensure the success of these medicines and their potential savings are fully realized. Through adequate education and collaboration with payers, employers can generate millions in savings and be real change agents in making more biosimilars accessible to patients across the U.S.
Brian Lehman, MBA, MHA, RPh is director, patient advocacy and strategic alliances, for Sandoz.
Read more: