Determining Biosimilars' Role in the Formulary

Bruce Feinberg, DO: Kathy, I want to bring you back in because as an administrator for a cancer center, you’re probably actively involved in contracting and likely working directly with the group purchasing organization. You’re having to deal with the issue of your contract and the potential for rebates because you’re running a business. You’ve got the social responsibility, the practice responsibility, and the business responsibility, and it can weigh heavy as you make those decisions. You may, in your heart of hearts, believe we should bring down the total cost of care, but as a practice, we have to also run a business and be viable as a business, and that contract for that reference brand is really attractive. We may have to do that.

Tell me more about that and to what extent—you don’t have to be specific or name names—that is a reality in the same way it’s reality on the payer side, which Karina can address. It’s a reality of the practice side because we’re mixing this business with the science and the medicine.

Kathy W. Oubre, MS: I’d like to back up for a second and add to what Dr Michael Diaz was saying earlier. For biosimilars to be successful in community oncology, which is my world, you do have to have that physician champion within the organization, but you also have to have that administrative champion. Then you have to have the marriage of the 2. The physician has to tell me it is efficacious to be able to give this. Then it’s my job to figure out how we’re going to handle that. I take those products, and what I generally do is look at my patient data from the last year. I figure out who is on what, and then I take all those biosimilars, put them together in a spreadsheet, and look at my rebates. Then I come up with my delta on the end.

Then I also have to look at my payer issues. We’re not going to name names, but to go back to what Bhavesh Shah brought up earlier, rebates and those rebate walls that we have can be a problem and can tie our hands in making those successful within a practice. If I’m required by a payer to use an originator, and I have a large percentage of my patients on that particular health plan, then we have a problem on our hands. That changes the way my formula works.

Bruce Feinberg, DO: Right, so now you have to think about your contract, and what threshold can you hit? You have to go all in for the originator, even though you might have wanted to really pursue the biosimilar. At least for this current year, until you can get face time with the payer and talk this out to make the case for both, or until the biosimilar is willing to match that rebate with the payer, you’re still going to have to make the decision.

Kathy W. Oubre, MS: It’s a couple of things. It’s contract design, whether I’m having to hit a market share and what that market share looks like. Most of the market shares for the biosimilars sit kind of low because they do want adoption of the product. We’re also having issues of GPO [group purchasing organization] parity. Biosimilars have brought out some very interesting market forces that a lot of us haven’t seen before, so perhaps an originator manufacturer making a parity deal with the GPO. That happened last year when the biosimilars started coming out. If you were aligned with a particular GPO, you had access to 1 biosimilar, and that was the way it looked.

That was fascinating because we’ve never really seen that kind of parity hit, and it was not the 1 we chose to use. Then that becomes an issue. It has really presented some interesting problems and challenges. If you have multiple payers that all require something different, you do have to evaluate your processes and maybe accept that you have to split your basket several different ways.

I find it better to have those contract conversations with the biosimilar manufacturers, because at the end of the day, they need their products to be successful. They understand the economics and the market forces that we’re facing, and you’ve seen a lot of movement and flexibility in contract design from those biosimilar manufacturers.