Dave Magnacca

The projections for the rising cost of healthcare have spurned robust dialogue from every sector of the healthcare economy. Among the many targets for cost control are the rising cost of specialty drugs - drugs distinguished by their route of administration, synthesis or bioengineering, mechanism of action, and cost.

Specialty drugs, and in particular a subset referred to as biologics, represent the fastest growing segment of pharmaceutical growth. Complex multi-step bio-engineering may extend the patent life of these drugs and their very nature precludes generic transitioning.

Although there are examples of market forces and competition emerging to curb specialty drug prices (e.g., pharmacy benefit manager negotiations for hepatitis C drugs), stakeholders seem impatient for these traditional market-based solutions.  Solutions that are not market-based have often been perceived as impractical or unfavorable for physicians and patients. Payer approaches to specialty drug cost control have included:  bundled reimbursement, episode-of-care reimbursement, restricted clinical pathways, product tiering, and step edits. Proposed policy approaches to specialty drug cost control have included, but are not limited to:  empowering Medicare to negotiate drug prices (as the Veteran’s Administration does), allowing the importation of drugs for personal use, and reforming the patent system to combat so-called pay-for-delay settlements between brand and generic drug makers.[[{"type":"media","view_mode":"media_crop","fid":"45809","attributes":{"alt":"Bruce Feinberg, D.O.","class":"media-image media-image-right","id":"media_crop_4720663030166","media_crop_h":"0","media_crop_image_style":"-1","media_crop_instance":"5267","media_crop_rotate":"0","media_crop_scale_h":"0","media_crop_scale_w":"0","media_crop_w":"0","media_crop_x":"0","media_crop_y":"0","style":"font-size: 13.008px; line-height: 1.538em; float: right;","title":"Bruce Feinberg, D.O.","typeof":"foaf:Image"}}]]

Biosimilars may be seen as representing a new hybrid of the traditional market-based solutions of brand competitors and patent expiration resulting in multi-sourced generics.  Since the 2010 passage of the Biologics Price Competition and Innovation Act, the FDA has worked to develop and implement an abbreviated licensure pathway for biological products proven to be highly similar to a previously-licensed biological reference products. The agency’s work culminated in March 2015 with the licensure of the first biosimilar product, Sandoz’s Zarxio.  Zarxio’s reference product is Amgen’s Neupogen, which was originally licensed in 1991. The biosimilar product now is licensed for the same indications as Neupogen.

This week, eleven months after the licensure of the first biosimilar, a medical advisory panel to the FDA recommended approval of a second product, a biosimilar form of Johnson & Johnson's (J&J) Remicade (infliximab), deciding it is highly similar to the blockbuster branded product. The independent panel determined that clinical trials of the biosimilar from Celltrion Inc. and Pfizer Inc., called Remsima, showed no clinically meaningful differences between it and Remicade in the treatment of rheumatoid arthritis and a related condition called ankylosing spondylitis. Moreover, the panel agreed that Remsima is likely similarly safe and effective for other conditions Remicade treats, including psoriasis and inflammatory bowel conditions like Crohn's disease and ulcerative colitis, even though Remsima was not tested against those conditions. [[{"type":"media","view_mode":"media_crop","fid":"45813","attributes":{"alt":"","class":"media-image media-image-right","id":"media_crop_8982640390750","media_crop_h":"348","media_crop_image_style":"-1","media_crop_instance":"5272","media_crop_rotate":"0","media_crop_scale_h":"0","media_crop_scale_w":"0","media_crop_w":"270","media_crop_x":"8","media_crop_y":"1","style":"font-size: 13.008px; line-height: 1.538em; float: right;","title":"Dave Magnacca","typeof":"foaf:Image"}}]]

As Remsima and other biosimilars gain broad approval, they will likely generate significant controversy among stakeholders, particularly the manufacturers of the reference products which are likely to have concerns about patent infringement.  Other stakeholders, such as patients, providers and payers, are also likely to voice concerns. 

Increasingly, the debate over cost is transitioning to a debate over value, but the value of specialty drugs - in what is often a complex multi-modality treatment of a chronic disease - is complicated, to say the least. At a minimum value assessment is a three-legged stool supported by efficacy, toxicity and cost. Solutions proposed by patient advocates and physicians often aim to control costs by providing standardized approaches to valuing new drug treatments compared with one or several prevailing standard of care. 

The evidence upon which the FDA sub-committee made its decision about Remsima, two clinical trials, will likely be intensely scrutinized to determine if the rigor applied meets this test. Even if stakeholders are satisfied with clinical non-inferiority, will the cost differences be significant enough to challenge the prevailing standard of care?

2015 was a remarkable year in the development of biosimilars as a foundational therapeutic in the treatment arsenal. With Tuesday’s decision, stakeholder adoption of biosimilars in the U.S. is no longer a question of “if,” but “when.” How biosimilars will further alter treatment paradigms and, as a result of those alterations, impact the global cost of care of the treated patient will be critical to the value assessment process. Traditional clinical research seems ill-designed to address the many questions surrounding biosimilar value assessment, necessitating a rapid expansion of health economics and outcomes research in this nascent field. 

1. Costs of specialty drugs continue to challenge the industry

2. Biosimilars represent new market-based solution

3. Broad recommendation language for Remsima may herald a rapid entry of more biosimilars

4. Long term, the degree to which providers and payers embrace biosimilars will depend on value assessments that will necessitate health economic and outcomes research.

Bruce Feinberg, D.O., is Vice President and Chief Medical Officer of Cardinal Health Specialty Solutions

Dave Magnacca, is Director of Biosimilars Planning and Execution for Cardinal Health Specialty Solutions.

Articles

In this op-ed, specialty medicine experts address the value of biosimilars in specialty care. Value, they write, is a "three-legged stool supported by efficacy, toxicity and cost."

Author | Dave Magnacca

Articles

The Place of Biosimilars in Value-Based Care