Assessing the Value of Biosimilars: A Cost-Effectiveness Approach for Managed Care Organizations.
Biosimilars like Cyltezo and Avsola offer better clinical outcomes at much lower costs than their reference biologics, yet their formulary placement often does not reflect this value.
Where it sits
this study against the rest of the dulaglutide corpusSummary and findings
This study evaluates the cost-effectiveness of biosimilars compared to their reference biologics in managed care organizations for rheumatoid arthritis, Crohn's disease, and type 1 diabetes mellitus. Key findings indicate that biosimilars demonstrate strong cost-effectiveness, with Cyltezo showing a better clinical response than Humira at a much lower cost. The study aims to inform formulary management and resource allocation in healthcare settings.
Abstract
Biologic medications are essential for treating chronic diseases but come with high costs, prompting interest in biosimilars as more affordable alternatives. Biosimilars are highly similar to FDA-approved biologics in terms of safety and efficacy, though not identical. Managed Care Organizations (MCOs), especially those contracted by Medicaid in New York, play a key role in formulary management and cost containment. Despite over 600 approved biologics, only approximately 69 biosimilars are available, and their adoption varies widely. This study evaluates cost and clinical outcomes across three disease states-Rheumatoid Arthritis (RA), Crohn's Disease (CD), and Type 1 Diabetes Mellitus (DM)-using biologic-biosimilar pairs: Adalimumab (Cyltezo), Infliximab (Avsola), and Insulin Glargine (Semglee). We aim to understand pricing discrepancies and the lag in biosimilar uptake within MCO formularies through cost-effectiveness analysis. Findings will inform whether clinical equivalence translates into formulary preference and support efficient resource allocation while maintaining patient access and treatment outcomes. A formulary review identified high-cost biologics with FDA-approved biosimilars used in managed care. RA, CD, and T1DM were selected based on prevalence and cost impact. Biologics included Humira, Remicade, and Lantus, with biosimilars Cyltezo, Avsola, and Semglee. Selection was based on FDA approval, formulary access, and clinical relevance. Efficacy and safety were confirmed through trial review and real-world data. Cost-effectiveness was assessed using ICER, calculated from annual treatment costs and clinical outcomes, with a $50,000 willingness-to-pay threshold. Biosimilars demonstrated strong cost-effectiveness compared to their reference biologics. Cyltezo showed better clinical response than Humira (69% vs 64.5%) at a much lower annual cost ($6600 vs $107,992.82), yielding an ICER of -$2.25 million. Avsola was also more effective than Remicade (68.1% vs 59.1%) and significantly cheaper ($24,000 vs $50,500), with an ICER of -$297,752.81. Semglee and Lantus had equivalent outcomes, but Semglee cost less ($1775.76 vs $4896), supporting a cost-minimization approach. Despite favorable outcomes, biosimilars were often placed on equal or higher formulary tiers than reference biologics due to rebate contracts, limited interchangeability, and provider hesitancy. Biosimilars offer equal or better clinical outcomes at much lower costs in RA, CD, and T1DM. Cyltezo and Avsola were dominant in both efficacy and cost, yet their formulary placement remains inconsistent due to rebate-driven incentives, provider hesitancy, and administrative barriers. To improve adoption, MCOs and PBMs should prioritize value-based formulary decisions, enhance transparency, and support provider and patient education. Pharmacists can help lead biosimilar use through counseling and substitution protocols. Greater alignment between clinical evidence and formulary practices can lower costs, improve access, and promote sustainable care.
Background
This paper addresses the economic implications of biosimilars in treating chronic diseases, particularly in managed care settings. Prior research has established the safety and efficacy of biosimilars, yet their adoption remains inconsistent. Understanding the cost-effectiveness of biosimilars is crucial for improving access to treatments while managing healthcare costs.
Methods
The study utilized a cost-effectiveness analysis comparing biologic-biosimilar pairs across three disease states: rheumatoid arthritis, Crohn's disease, and type 1 diabetes mellitus. The analysis included a formulary review to identify high-cost biologics and assessed cost-effectiveness using incremental cost-effectiveness ratios (ICER) based on annual treatment costs and clinical outcomes. The willingness-to-pay threshold was set at $50,000.
Results
Cyltezo demonstrated a clinical response of 69% compared to 64.5% for Humira, with an annual cost of $6600 versus $107,992.82, resulting in an ICER of -$2.25 million. Avsola had a clinical response of 68.1% compared to 59.1% for Remicade, with costs of $24,000 versus $50,500, yielding an ICER of -$297,752.81. Semglee and Lantus showed equivalent clinical outcomes but differed in cost ($1775.76 vs $4896).
Interpretation
The findings suggest that biosimilars can provide equal or better clinical outcomes at significantly lower costs compared to their reference biologics. However, the clinically meaningful impact of these findings is tempered by the challenges in formulary placement due to rebate contracts and provider hesitancy. This study underscores the need for managed care organizations to align formulary practices with clinical evidence to enhance biosimilar adoption.
Key findings
- Cyltezo showed better clinical response than Humira (69% vs 64.5%) at a much lower annual cost ($6600 vs $107,992.82), yielding an ICER of -$2.25 million.
- Avsola was more effective than Remicade (68.1% vs 59.1%) and significantly cheaper ($24,000 vs $50,500), with an ICER of -$297,752.81.
- Semglee and Lantus had equivalent outcomes, but Semglee cost less ($1775.76 vs $4896).
Limitations
- Formulary placement influenced by rebate contracts.
- Provider hesitancy limits biosimilar adoption.
- Not reported in abstract.