A Vibrant Biosimilars Market to Drive Savings: 5 Things You Should Know
We know a competitive and dynamic biosimilar marketplace is essential to meaningfully reduce drug costs and achieve both short- and long-term savings. Our top priority is to help payors control drug spend without compromising care – biosimilars have the potential to do just that. In fact, a recent U.S. Food and Drug Administration analysis finds “zero difference” in risks when switching from a reference product to a biosimilar.1
Here are five things to know about how biosimilar competition can help drive low net cost for payors:
1. Why biosimilars matter to specialty costs
The spending for reference products with biosimilar options was $38 billion by the end of 2022, and reference products representing another $96 billion in spending are set to face biosimilar competition in the next five years.2
Autoimmune conditions such as rheumatoid arthritis and plaque psoriasis are a costly category, accounting for almost 40 percent of all specialty utilization trend.3 There are nine Humira biosimilars in the market for treating autoimmune diseases and another eight biosimilars for Stelara expected to launch in early 2025.
Finding effective, durable strategies to lower specialty costs is important for all of us. Biosimilars can fulfill that promise across all therapeutic areas, if the right product and the right attributes are there.
2. Maximizing the potential of biosimilars
Biosimilars represent one of the best opportunities to create competition and reduce costs, especially in specialty pharmaceuticals where drug prices are rising the fastest.
To strengthen the market now and in the future, CVS Health launched Cordavis, a wholly owned subsidiary, to ensure increased competition and to improve cost and access to biosimilars in the United States.
3. Bringing high-quality biosimilar products to market
Cordavis will manufacture and commercialize pharmaceutical products that will adhere to high quality, ease of use, and supply standards, starting with biosimilars. Ensuring reliability and commercialization support within the supply chain is critical to meeting the entire patient population’s needs.
4. A better model built on disrupting the status quo
In 2014, we created Red Oak, a large generic purchasing consortium, to help curb costs and ensure reliable access to new generic drug introductions. Now about 90 percent of all prescriptions dispensed are generics.5
Fast forward to today, as CVS Caremark looks to work with Cordavis and other manufacturers to achieve low net cost for biosimilars and encourage investment in future products.
At launch, Cordavis is setting the list price of its first product, Hyrimoz, at 81 percent lower than the current list price of Humira. Lower list prices may also result in reduced out-of-pocket expenditures for some plan members.
5. The importance of seamless, personalized member experiences
Member and provider acceptance is a key step to help support a vibrant biosimilar market. We have an established history managing member adoption and prescriber confidence. Historically, more than 94 percent of members have adopted preferred biosimilar products in specialty categories.6
Using digital tools and electronic health record connectivity, we can meaningfully engage prescribers well in advance of a formulary change to guide them through appropriate next steps and deliver an exceptional experience for plan members. Proactive outreach with providers across multiple touchpoints helps facilitate a seamless adoption of biosimilars.
Biosimilars have the power to transform the pharmacy landscape, as generics did. Supporting the adoption of, and easier access to biosimilars is crucial to increase competition, lower specialty drug costs, and improve affordability for members.
With a clinically sound formulary strategy that prefers biosimilars coupled with a seamless transition plan, we help deliver significant savings to our clients and their plan members.
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3 CVS Health Analytics, 2023. CVS Health uses and shares data as allowed by applicable law, our agreements and our information firewall. Adherence results and savings may vary based upon a variety of factors such as plan design, demographics and programs adopted by the plan.
4 CVS Health Book of Business, 2023, Commercial Clients with ACSF, Q3 2023 YTD; net cost per member per month (PMPM), inclusive of rebates. These are estimates and subject to change. Actual results may vary depending on benefit plan design, member demographics, programs implemented by the plan and other factors.
5 FDA U.S. Food and Drug Administration – Office of Generic Drugs 2021 Annual Report, February 2022
6 CVS Health Analytics, 2022. Claims data from January 2022 based on Advanced Control Standard Formulary [biosimilar classes include: Oncology, Kidney, Diabetes and Rheumatoid Arthritis]. Actual results may vary depending on benefit plan design, member demographics, programs implemented by the plan and other factors.
This document contains references to brand-name prescription drugs that are trademarks or registered trademarks of pharmaceutical manufacturers not affiliated with CVS Caremark.
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