IQVIA Report Assesses Long-Term Sustainability of the Biosimilars Marketplace

The European Union already has far more approved biosimilars—45 products referencing 15 medicines—than does the United States, but as a newly released report from IQVIA states, the number of European biosimilars available today represents just a fraction of what the market is expected to contain in the coming years, raising questions about the sustainability of the market.

The report examined the experience of 7 European nations (Germany, the Netherlands, France, Italy, Spain, Norway, and Denmark) across 5 key policy areas to assess how policy affects the sustainability of the marketplace:

Patient Access to Biologic Medicines

While the launch of biosimilars initially increases use of a molecule in the first years, growth declines—often to pre-biosimilar levels—within a few years, reflecting a decline in the competitiveness of a given drug in a widening therapeutic landscape. For example, infliximab enjoyed a 10% compound annual growth rate (CAGR) pre-biosimilar launch, which dropped to an 8% growth in molecule utilization after biosimilar availability.

Click to read more about patient access in Europe.

In nations where biosimilars are strongly promoted by health authorities—such as Norway—uptake is usually swift, but in nations such as Italy, which has shown greater hesitation about biosimilars, uptake has been slower.

Regulatory Environment and Clinical Guidelines

In the 7 countries evaluated, say the report’s authors, regulatory policies were generally neutral or positive toward biosimilars, giving them a favorable environment in which to compete.

Delays in product launches appeared to be driven by strategic decisions—for example, 1 rituximab molecule had a delayed launch because its manufacturer was working to ensure supply continuity—rather than by regulatory concerns.

Finally, treatment guidelines in 6 of the 7 countries were also neutral or positive toward biosimilars, leaving decisions to switch treatments in the hands of physicians. The 1 exception was Italy, where physicians were initially asked to justify any decisions to switch patients to biosimilars.

Safety, Quality, and Supply of Biosimilars

To date, no safety issues or quality issues of biosimilars have been identified by individual member states or the European Medicines Agency, and no supply shortages have been reported. Individual nations’ laws, such as those of Norway or Germany, penalize manufacturers for supply shortages.

Incentives

Incentives for physicians to switch patients to biosimilars include the assignment of prescribing targets linked with performance bonuses or the implementation of minimum prescription volume targets. For example, in Germany, minimum prescription volume targets exist for biosimilars, although they vary by region.

Patient incentives may include lower co-payments for biosimilars, but the report notes that patients who self-administer biologics may be reluctant to switch to a product with a different device for administration, slowing biosimilar uptake.

At the hospital level, purchasing and reimbursement mechanisms have a strong impact on biosimilar uptake; in France, where a hospital is paid a single sum per patient per case for a specific disease state, providers have an indirect incentive to use lower-cost biosimilars.

Competitive Pressure

Use of single-winner tenders for biologics used in a hospital setting can lead to rapid biosimilar uptake and rapid price erosion; in Norway, biosimilar rituximab reached an 80% market share in under 6 months after launching. (However, in the retail sector, which is not subject to strict tendering, biosimilar uptake for drugs like insulin is significantly lower.)

While single-winner tenders typically achieve the greatest price reductions, they keep the market concentrated on a single product; in markets where tenders have multiple winners, the report notes, multiple manufacturers stay engaged with the market, and all winning products typically drop in price.

The report also identifies 2 risks to sustainability in the market:

Payer-Driven Switching Incentives

Forcing physicians to switch to biosimilars through negative incentives may create short-term uptake and short-term budgetary rewards, but limits physician choice and reduces patient involvement in treatment decisions. Furthermore, forcing a switch disrupts market forces, says the report, and creates market uncertainty for drug makers.

Tendering Processes

Single-winner tenders may provide high savings for payers, but they do so at the risk of concentrated supply, again reducing physician choice and patient engagement and potentially disrupting the continuity of products. Contracts designed to keep multiple winners engaged in the market can help to provide a positive return on investment for biosimilar developers and also reduce the risk of supply shortages.

Finally, the report’s authors offer suggestions as to how to foster a sustainable market for the long term. First, they say, it is key to safeguard the needs of patients and provide physician product choice. Switching incentives that avoid limiting patient input or physician choice are preferable to negative incentives that promote prescribing a particular drug for financial reward.

Tendering and contracting should be properly balanced for long-term market sustainability rather than short-term gain, including the awarding of multiple winners for tenders. Pricing controls that facilitate short-term budget relief (such as reference pricing) can help grant access to the market for all parties.

Finally, say the authors, true sustainability will hinge on developers finding ways to innovate and differentiate their products on levels outside of price alone, along with creating new ways to support the needs of all other stakeholders.

“By simultaneously securing aspects of sustainability, including physician prescription choice, a means to manage healthcare budgets, and healthy levels of competition, supply, and product safety and quality, the biosimilars marketplace offers to bring with it lower costs and increased patient access to valuable biologic medicines, with benefits likely to increase over time,” the report concludes.