The economic pressures for biosimilar drug use in cancer medicine

Abstract

The main rationale for using biosimilar drugs is for cost saving. The market development for biosimilar drugs will therefore depend on the degree to which cost saving measures are required by nations, medical insurers and individuals and the absolute savings that could be gained by switching from original drugs. This paper is designed to discover the degree to which financial constraints will drive future health spending and to discover if legal or safety issues could impact on any trend. A structured literature search was performed for papers and documents to 27 August 2011. Where multiple sources of data were available on a topic, data from papers and reports by multinational or national bodies were used in preference to data from regions or individual hospitals. Almost all health systems face current significant cost pressures. The twin driver of increasing cancer prevalence as populations age and cancer medicine costs rising faster than inflation places oncology as the most significant single cost problem. For some countries, this is predicted to make medicine unaffordable within a decade. Most developed countries have planned to embrace biosimilar use as a cost-control measure. Biosimilar introduction into the EU has already forced prices down, both the price of biosimilar drugs and competitive price reductions in originator drugs. Compound annual growth rates of use have been predicted at 65.8% per year. Most developed countries have planned to embrace biosimilar use as a major cost-control measure. Only legal blocks and safety concerns are likely to act against this trend. For centralised healthcare systems, and those with a strong tradition of generic medicine use, biosimilar use will clearly rise with predictions of more than 80% of prescriptions of some biologic drugs within 1 year of market entry in the USA. Delaying the implementation of such programmes however risks a real crisis in healthcare delivery for many countries and hospitals that few can now afford.

Fig. 1

The growth in insurance premiums and employee contributions to health insurance compared with employee earnings and general inflation in the USA over time from 1999 to 2010. Data from the Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 1999-2010. Bureau of Labor Statistics, Consumer Price Index, U.S. City Average of Annual Inflation (April to April), 1999-2010; Bureau of Labor Statistics, Seasonally Adjusted Data from the Current Employment Statistics Survey, 1999-2010 (April to April)

Fig. 2

The relative effect of demographics and increased unit treatment costs on the spending on Medicare, Medicaid as a% of USA over time from 2007 to 2082. The aging of the population accounts only for a modest fraction of the projected growth in federal spending on Medicare and Medicaid, while costs increasing at current rates push spending to almost 20% of USA GDP by 2082. Data from—The long-term outlook for health care spending, A Congressional Budget Office study, Nov 2007, Pub No. 3085; page 14

Fig. 3

A diagram to represent the QALY effect. Treatment A increases length and quality of life over control. Treatment B increases only quality of life over treatment A. Treatment B is clinically better than treatment A (it gains more QALYs than treatment B) but the ICERs of the two different interventions are required to decide which is the most cost-effective option?

Fig. 4

Expenditure on health in US Dollar purchasing power parity equivalents over time for 3 English-speaking countries. The UK and Canada have explicit rationing of health expenditure for novel treatments while the USA does not. Data from http://www.oecd.org/document/16/0,3746,en_2649_37407_2085200_1_1_1_37407,00.html. Accessed 6 March 2011