Expanding the use of biosimilars to treat serious illnesses like cancer or autoimmune diseases could reduce a patient's out-of-pocket costs by 17%, according to a new issue brief released by the Center for Medical Economics and Innovation at the Pacific Research Institute.
"Biologics effectively treat very serious illnesses but can often be very expensive and lead to patients incurring significant out-of-pocket costs," said Wayne Winegarden, director of PRI's Center for Medical Economics and Innovation and the brief's author. "Our new study shows that if more patients were able to utilize lower cost biosimilars, they could meaningfully reduce their out-of-pocket costs. Policymakers should make it a priority to eliminate the inefficiencies standing in the way of more patients saving by using biosimilars."
In "Promoting Biosimilar Competition to Reduce Patients' Out-of-Pocket Costs," Winegarden cites IQVIA data showing that 2.2% of patients had out-of-pocket costs exceeding $1,500. Data from the Kaiser Family Foundation found that 20% of patients account for 80% of out-of-pocket health care spending.
Originator biologics are innovative medical treatments that treat cancer, arthritis, auto-immune diseases, and other serious illnesses. They create tremendous value for patients but are also very expensive. Biosimilars are medicines that have the same quality and effectiveness as the originator biologics. They are the equivalent to generic medicines for the biologics market – and have the potential to provide significant savings for patients.
Winegarden said that biosimilars typically sell at discounts of up to 20% to 40% and have the potential to significantly reduce the amount of money the healthcare system spends on drugs. More important, they have the ability to reduce the out-of-pocket costs paid by patients.
According to Winegarden's research, biosimilars can:
- Reduce a patient's average out-of-pocket costs by 17%, when weighted by the total spending for each drug.
- Reduce total out-of-pocket spending by $238 million for patients in just the 9 biologic drug classes where biosimilars have been approved.
- In one scenario - for the biosimilar treating rheumatoid arthritis, ulcerative colitis, psoriasis, and Crohn's disease, among other illnesses – Winegarden's research found that biosimilars could reduce patient out-of-pocket costs by up to 47%.
Winegarden argues that these large potential savings for patient out-of-pocket costs justifies why policymakers should prioritize enacting reforms to reduce the market and regulatory inefficiencies that stand in the way of the greater use of biosimilars.