shutterstock_276650021.jpgTamal Taru co-wrote this blog post with Sandeep Sangwan. This post was originally published on ZS's pharmaceuticals blog, The Active Ingredient.

Biosimilars are at a nascent stage in the U.S. The market has seen just one biosimilar in oncology in supportive care (Zarxio), two in immunology (Inflectra and Renflexis) and one in diabetes (Basaglar). The immunology and diabetes spaces have been exposed to biosimilars for less than a year, and the oncology space has yet to see a biosimilar in therapeutic care. However, more biosimilars are nearing approval in these therapy areas, and some big products are expected to face biosimilar competition by 2018.

The extent of biosimilars’ adoption in these therapy areas would depend upon the perception and influence of various stakeholders (physicians, payers, manufacturers and patients). Stakeholders’ behaviors and decision-making regarding biosimilars vary across these therapy areas, caused by differences in the competitive landscape, innovation and brand preference, among other things. Hence, observations from each therapy area should be viewed with these differences in mind. Even within these therapy areas, there’s a variation in perception around biosimilars among physicians of different specialties.

Here are a few key points to consider that could drive stakeholders’ perceptions—and therefore acceptance—of biosimilars in each therapy area:

  • Market share: Originator manufacturers will use their market position to defend their market share. To compete, biosimilar companies could produce additional clinical trial data to achieve interchangeable status, which could empower pharmacists to substitute, could boost physician confidence and could empower payers to be more assertive.
  • Switching: Physicians’ willingness to shift existing patients from the originator product to a biosimilar can significantly affect a drug’s market share. Indication-specific data demonstrating safety and efficacy in switching patients can help biosimilar companies convince more physicians to switch, but more data means more cost.
  • Formulary exclusions: Physicians are concerned about the impact of formulary exclusions. For example, diabetes drug Lantus was excluded from the CVS formulary. In diabetes, insurance coverage is the deciding factor for physicians. However, in oncology, this might not have much impact.

Issue

Key points for the stakeholders to consider

Safety/efficacy

  • Physicians’ skepticism in life-threatening diseases, namely oncology
  • Robustness of clinical evidence (pivotal and real-world)
  • Manufacturer’s reputation
  • Interchangeable status
  • Use in treatment-naïve versus previously treated patients

Switching at physician level

  • Duration of therapy (chronic versus acute)
  • Interchangeable status
  • Price advantage and formulary position

Extrapolation acceptance by physicians

  • Level of education
  • Clinical evidence

Pharmacy-level substitution

  • Interchangeable status
  • Level of education

 

If we take a closer look at each therapy area, there are additional aspects to consider:

• Oncology: Physicians’ are the most influential stakeholder in the oncology space considering that most of the products are buy-and-bill, and depending on the life-threatening nature of the disease. After an initial lag, physicians have now started adopting the first biosimilar in supportive care, Sandoz’s Zarxio, biosimilar to Neupogen (filgrastim). It has captured 23% share in the short-acting G-CSF market and is available at a 15% discount, as observed via Bloomberg. According to a recent ZS-sponsored market research study, the majority of oncologists using Zarxio reported having a positive experience. Another study presented at ASCO 2017 shows switching patients from Neupogen to Zarxio is safe and efficacious.

Payers and pharmacy benefit managers have largely accepted the supportive care treatment Zarxio. In fact, UnitedHealthcare and CVS Health have replaced Amgen’s Neupogen with Zarxio on its formularies. As filgrastim is primarily a medical benefit drug, oncologists’ treatment decisions have largely remained independent of payers unless they enforce restrictions like prior authorization or step therapy. More than 80% of Zarxio’s prescription volume has flowed through the institutional channel while the remaining volume can be attributed to the retail channel, according to Symphony Health Solutions data accessed through Bloomberg. Although prescription volume through the retail channel is comparatively small, Zarxio is covered more often than Neupogen. Amgen has secured most of the market share by converting healthcare providers to long-acting Neulasta, a version of Neupogen with a more convenient delivery device. In 2016, Neulasta was used by more than three times as many patients as Neupogen.

It’s worth noting that Zarxio is used as supportive care and not as therapeutic care. Hence, it’s relatively easier to convince physicians to use a biosimilar than it would be for an oncology therapeutic. The dynamics of therapeutic oncology are different: On one hand, there’s the issue of financial toxicity that can encourage physicians to adopt biosimilars. On the other hand, physicians might be more hesitant to prescribe a biosimilar for therapeutic oncology versus supportive care because of the perceived risks involved in the therapeutic setting.

• Immunology: Market leaders, such as AbbVie’s Humira, may create barriers to switching through contracting and rebates. If payers can’t convert patients to a biosimilar fast enough, then they may suffer financially once the rebates disappear, a situation some call the “rebate trap.” For example, if a payer breaks a contract with an originator and gives a biosimilar a better position on the formulary, then the originator may withdraw rebates for its product. Because immunology market leaders have a sizeable share of the market, the payer’s potential losses due to originator rebate withdrawal would far outweigh the potential savings due to biosimilar adoption. Hence, some payers may succumb to originator pressure and proceed cautiously in adopting biosimilars.

Pfizer and Celltrion launched Inflectra, biosimilar to Remicade (infliximab), in late 2016 at a 15% discount to Remicade, which has now increased to a 19% discount, according to First Databank. Pfizer hasn’t changed Inflectra’s price since its launch, but Janssen raised Remicade’s price in February 2017 by about 5%, which it generally does every six months. Inflectra has had a slow start in the U.S. and was able to capture about 1% volume share of the infliximab market five months after launch, according to Symphony Health Solutions.

Adoption of Inflectra is expected to increase, according to a recent analysis of Inflectra’s clinical data, showing that the biosimilar is safe and effective in treating ulcerative colitis and Crohn’s disease (IBD). This likely will increase its use by gastroenterologists who have been hesitant because Inflectra’s first approval in IBD indications was by extrapolation rather than through clinical trials. That means that generating some clinical evidence for extrapolated indications can help biosimilar companies gain physician confidence.

Celltrion also is pursuing interchangeable status for Inflectra in the U.S. If achieved, it wouldn’t have much effect on uptake through the retail channel because Inflectra is primarily a buy-and-bill product. However, the interchangeable status would provide physicians with additional confidence in Inflectra’s safety and efficacy profile, and potentially would provide a boost to its adoption.

• Diabetes: Insulins are covered under pharmacy benefit, a channel where payers have traditionally been in greater control. Lilly’s Basaglar, biosimilar to Lantus (insulin glargine), has acquired 4% of the total U.S. insulin glargine market since its launch in December 2016, according to Symphony Health Solutions data accessed through Bloomberg. Physicians in the U.S. base their insulin prescription decisions on payer coverage amounts and the availability of co-pay cards. Lilly’s strategy to provide a savings card for patients, with other support services, will likely help Basaglar’s adoption.

Basaglar is available at a 15% discount from the originator, according to First Databank. With an increase in insulin costs in the U.S., Basaglar’s discount likely will encourage adoption by payers and patients. Basaglar will be covered by the major commercial insurance plans, as it already has replaced Lantus on the formularies of pharmacy benefit managers including CVS Health and United Healthcare.

However, newer-generation, long-acting insulin, such as Novo Nordisk’s Tresiba, are expected to gain share from the insulin glargine market. Because physicians have a favorable impression of Tresiba and its formulary coverage has expanded, the insulin glargine market itself may shrink.

For manufacturers interested in bringing biosimilars to market in any of these categories, it’s helpful to understand the various factors that both encourage and discourage adoption. With the right knowledge of how switching and formulary exclusions impact a biosimilar’s market share, companies can learn to operate in concert with—and not against—stakeholders’ perceived notions of biosimilars’ effectiveness and worth. The originators also would need to deploy their defense strategies against biosimilars, taking into consideration the level of influence of different stakeholders in specific spaces.

Biosimilars are a growing reality in the U.S. market now, and their pace of adoption in different spaces will become critical. Companies can help stakeholders to develop an informed perception of biosimilars to help shift the market in their product’s favor.


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Advisory input provided by Tucker Herbert, Christina Corridon, David Weil and Art Cook.