Cost-savings for biosimilars in the United States: a theoretical framework and budget impact case study application using filgrastim

ABSTRACT

Background: Biosimilars can directly reduce the cost of treating patients for whom a reference biologic is indicated by offering a highly similar, lower priced alternative. We examine factors related to biosimilar regulatory approval, uptake, pricing, and financing and the potential impact on drug expenditures in the U.S.

Methods: We developed a framework to illustrate how key factors including regulatory policies, provider and patient perception, pricing, and payer policies impact biosimilar cost-savings. Further, we developed a budget impact cost model to estimate savings from filgrastim biosimilars under various scenarios. The model uses publicly available data on disease incidence, treatment patterns, market share, and drug prices to estimate the cost-savings over a 5-year time horizon.

Results: We estimate five-year cost savings of $256 million, of which 18% ($47 million) are from reduced patient out-of-pocket costs, 34% ($86 million) are savings to commercial payers, and 48% ($123 million) are savings for Medicare. Additional scenarios demonstrate the impact of uncertain factors, including price, uptake, and financing policies.

Conclusions: A variety or interrelated factors influence the development, uptake, and cost-savings for Biosimilars use in the U.S. The filgrastim case is a useful example that illustrates these factors and the potential magnitude of costs savings.

KEYWORDS:

• Biosimilar
• cost
• filgrastim
• framework
• cost-savings
• regulatory policies

Declaration of interest

S Grewal, J Carlson and S Ramsey have consulted for Sandoz. S Balu is employed by Sandoz. The authors have no other relevant affiliations or financial involvement with any organization or entity with a financial interest in or financial conflict with the subject matter or materials discussed in the manuscript apart from those disclosed. Peer reviewers on this manuscript have no relevant financial or other relationships to disclose.

Author contribution statement

Simrun Grewal was involved with the conception and design, analysis and interpretation of the data, drafting and revising the paper, and final approval.

Scott Ramsey was involved with the conception and design, analysis and interpretation of the data, drafting and revising the paper, and final approval.

Sanjeev Balu was involved with the conception and design, revising the paper, and final approval.

Josh Carlson was involved with the conception and design, analysis and interpretation of the data, drafting and revising the paper, and final approval.

All authors agree to be accountable for all aspects of the work.

Additional information

Funding

This paper was funded by Sandoz Inc.