Study examines cost to Medicare of delayed Humira biosimilars
Medicare would have saved $2.19 billion on adalimumab spending between 2016 and 2019 had biosimilars become available in the years they were approved, according to a study titled “Medicare's Lost Savings Due to Delayed Adalimumab Biosimilar Entry.”
“Delayed adalimumab biosimilar availability resulted in important forgone savings to Medicare that could have been allocated to other health services, highlighting the need for patent reform and legal changes to facilitate biosimilar availability in the United States,” the study says.
The study notes that the Food and Drug Administration approved five Humira biosimilars in the years it examined, but none will be launched before 2023 due to various patent settlements with Humira maker AbbVie.
In calculating the savings to Medicare, the study assumes that the first biosimilar, Amjevita, would launch with a 25% price discount relative to Humira, with an additional 3.4% price discount per year. They assumed that the subsequent biosimilar launches would result in a further 1.7% price discount upon market entry, based on biosimilar launch prices in the European Union.
By 2019, the study says the biosimilars would have achieved a 42.9% discount on the price Humira. Additionally, the study suggests the availability of various biosimilars would drive the price of Humira down by 3.5% annually, potentially bringing its price down by 21.3% by December 2019.
Actual Medicare payments for Humira products from 2016 to 2019 grew from $1.75 billion in 2016 to $2.47 billion in 2019, a combination of increased prices for Humira and more units being sold. During the 4-year period, net prices per unit, which included syringe and pen formulations of adalimumab, increased from $1571 to $1752.
“Had adalimumab biosimilar products launched immediately upon approval, estimated Medicare nonrebate spending on them would have been $18.3 million in 2016, $225.7 million in 2017, $436.2 million in 2018, and $727.7 million in 2019,” the study says, noting that during that same time, Medicare nonrebate Humira spending would have declined from $2.33 billion to $1.42 billion annually.
Under their scenario of earlier biosimilar introduction, cumulative Medicare spending on adalimumab from 2016 to 2019 would have been $8.98 billion instead of $12.11 billion. “Our estimates were likely conservative,” the study says.
Among the changes suggested in the study is a proposal for allowing originator products exclusivity protection for just 1 key patent filed before FDA approval. “Alternatively, manufacturers could be free to secure any number of patents on their product but to claim infringement on only a few,” it said.