The pharmacy team at Blue Cross and Blue Shield of Kansas is constantly looking for ways to improve affordability of prescription drugs for our members. Rising drug costs are a big part of today’s health care crisis, but the introduction of biosimilar drugs is expected to create millions in drug savings. Biosimilar drugs are relatively new to the prescription drug landscape and are becoming increasingly popular.
The introduction of biologics
For years, treating complex conditions like cancer, diabetes, Crohn’s disease and rheumatoid arthritis proved to be challenging and expensive. In 2003, the first blockbuster product, a biological drug, was approved in the U.S. This marked a significant turn in treating complex conditions.
Biological drugs, often called biologics, are complex drugs made from a living system, such as a microorganism, plant cell or animal cell. They’re different from your over-the-counter medications or typical pharmacy medications as they go through a separate, unique approval process with the Food and Drug Administration (FDA).
The cost of biologics
The price of a biologic is significant and can cost more than $500,000 per year in some cases.1 Hundreds of billions of dollars have been spent on biologic therapies. In 2021 alone, the U.S. spent $256 billion on biologics.2 The cost of these therapies now exceeds half of all dollars spent on ALL medications.
The debut of biosimilars
A biosimilar is a product that is highly similar to another biologic that is FDA-approved. Biosimilar drugs typically cost less and show no clinically meaningful difference from biologic drugs in terms of safety and effectiveness.
The first biosimilar was approved by the FDA in 2015. Some studies show that the U.S. health care system is projected to save nearly $40 billion with biosimilars, but with aggressive adoption of biosimilars, the system could save more than $100 billion.3
Blue Cross and Blue Shield of Kansas’ role
As a member-owned, not-for-profit insurance company, our commitment to serve Kansans involves making decisions to promote better health and well-being for our members, while also being good stewards of their dollars.
Our pharmacy team works diligently to research and review what preferred products we should cover – with our members’ best interests being the primary driver. In making these determinations, cost is a key consideration, but our primary focus is on the safety and effectiveness of any drug. Our members are our top priority and our decisions on preferred products reflect that. We focus on safe and effective medication therapies, and the biologic space is no different.
References:
1. Chen, Brian K et al. “Why Biologics and Biosimilars Remain So Expensive: Despite Two Wins for Biosimilars, the Supreme Court’s Recent Rulings do not Solve Fundamental Barriers to Competition.” Drugs vol. 78,17 (2018): 1777-1781. doi:10.1007/s40265-018-1009-0
2. Commissioner, Office of the. “FDA and FTC Collaborate to Advance Competition in Biologic Marketplace.” U.S. Food and Drug Administration, FDA, http://www.fda.gov/news-events/fda-voices/fda-and-ftc-collaborate-advance-competition- biologic-marketplace. Accessed 26 Sept. 2023.
3. “Projected US savings from Biosimilars, 2021-2025.” The American Journal of Managed Care, vol. 28, no. 7, 2022. Pp.329-335, https://doi.org/10.37765/ajmc.2022.88809.