FormalPara Key Points for Decision Makers

Plan Type Matters for Biosimilar Adoption: Health insurance plan type influences biosimilar adoption among US patients.

Less Flexible Plans Drive Biosimilar Switching: HMOs and EPOs with lower flexibility led to higher biosimilar switching, possibly due to aggressive negotiations or larger rebates.

Optimizing Plan Design for Biosimilars: Decision makers should focus on plan design to boost biosimilar use, potentially saving costs and improving patient access drugs.

1 Introduction

Biosimilar adoption may help lower drug spending for biological therapies [1]. Most biosimilars available in the USA are not interchangeable, meaning that pharmacies may not dispense the biosimilar in place of the reference biologic without a new medical prescription [2]. Increased biosimilar uptake, therefore, depends on physicians prescribing the biosimilar, which is influenced by provider discretion and dependent on health insurance plans incorporating the biosimilar in their drug formularies [3]. Economic incentives created by differences in cost considerations, formulary design, and provider networks could explain why insurers would cover biosimilars differently in low/high flexible plans. This study investigates the impact of health insurance plan type on biosimilar adoption among commercial patients in the USA. Specifically, the study will explore two key factors: (1) the likelihood of switching to a biosimilar once it becomes available, and (2) the likelihood of initiating treatment with a biosimilar. By analyzing claims data from 2015 to 2019, the study provides empirical evidence on the role of health insurance plans in driving biosimilar adoption, which is crucial for lowering drug spending for biological therapies. As most consumers start using biologics/biosimilars prior to Medicare eligibility, we focused on commercially insured patients. The findings of this study will inform policy decisions aimed at promoting biosimilar uptake and improving the affordability of biological therapies for patients.

2 Methods

We used the IBM MarketScan Commercial Claims and Encounters (CCAE) pharmacy claims to identify switchers and biosimilar initiators for six biologic–biosimilar pairs from January 2015 to December 2019 (Table 1). Biologic–biosimilar pairs were chosen based on data availability and market availability for the study period (there are still relatively few biosimilars launched on the US market). Biosimilar list and approval dates were derived from the Food and Drug Administration (FDA) purple book database. The CCAE contains longitudinal pharmacy, outpatient, and inpatient claims for over 40 million individuals with employer-sponsored health insurance [4].

Table 1 Chemical name, brand name, reference product, approval date, launch date, and therapeutic category of biosimilars studied
Full size table

A switcher was defined as an individual who (1) initiated treatment with a reference biologic, (2) had at least 2 courses of treatment with the reference biologic recorded in 6 months, (3) switched to the biosimilar for all remaining courses of treatment recorded in the data, and (4) was continuously enrolled in the same health plan. We also examined the likelihood of initiating treatment with a biosimilar. Individuals who had more than one switch were excluded as these situations may reflect clinical or patient driven decisions rather than payer decisions. Our main characteristic of interest was health plan type, divided in three groups: high-deductible plans [high-deductible health plans (HDHP) and consumer directed health plans (CDHP)]; low-flexibility plans [health maintenance organizations (HMO) and exclusive provider organizations (EPO)], and high-flexibility plans [preferred provider organizations (PPO) and point-of-service (POS) plans].

We controlled for patient demographics, such as age, gender, geographic region, and employment status, as well as drug group using linear probability models implemented at the patient level.

We conducted several regressions to the model specification, measurement, and observation. We show the main results of the analysis.

3 Results

Our analysis found that health plan type plays a significant role in determining the likelihood of biosimilar uptake. Specifically, we found that enrollment in a low-flexibility plan was associated with a higher probability of both switching to and initiating treatment with a biosimilar, while enrollment in a high-flexibility plan was associated with a lower probability of both switching to and initiating treatment with a biosimilar, compared with high-deductible plans.

As shown in Table 2, the probability of being a switcher was 1% higher (p < 0.01) for enrollees in a low-flexibility plan as compared with enrollees in high-deductible plans. Moreover, the probability of being an initiator was 2% higher (p < 0.01) for enrollees in a low-flexibility plan as compared with enrollees in high-deductible plans. This effect size may seem small, but when considering that switchers comprise only 3% of the population, the magnitude of this effect is substantial, representing a 33% increase in the likelihood of switching to a biosimilar.

Table 2 Relationship between health plan type and likelihood of being a switcher or biosimilar initiator (2015–2019)
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In contrast, enrollment in a high-flexibility plan was associated with a lower probability of being a switcher (0.9% lower; p < 0.01) and a lower probability of being an initiator (1% lower; p < 0.01) when compared with high-deductible plans.

These findings highlight the importance of health insurance plan design in promoting biosimilar uptake and suggest that low-flexibility plans may be more effective in encouraging biosimilar adoption.

4 Discussion

Within our sample, 3% of all claims correspond to individuals who switched to biosimilars, while 8% were initiators. These relatively low percentages suggest that there is a considerable market potential available for companies involved in the production of biosimilars.

This study reveals that health plan type may have an important impact on switching behavior and biosimilar initiation as we found that low-flexibility plans, such as HMOs and EPOs, were more likely to have patients who are switchers and/or biosimilar initiators across all drug categories. We recommend that future research explore why these plan type differences exist. For example, are certain types of plan more likely to receive larger rebates for biosimilars than others?

One potential explanatory mechanism to explore is whether HMO/EPO plans, which are often capitated forms of insurance, have greater financial incentives than other, non-capitated forms of insurance for encouraging the use of lower-cost drugs like biosimilars [5]. Another potential contributing factor could be that, because HMOs/EPOs typically have more limited formularies [6], they may be able to negotiate more rebates for the drugs that they do cover. However, given the financial resources needed to develop and market a new biosimilar and the fact that biosimilars generally have lower list prices than their reference counterparts, it seems unlikely that biosimilar manufacturers would be able to afford to offer larger rebates than reference product manufacturers. Given these complex mechanisms at play and the data limitations of this present study (in which we were unable to observe rebates or net prices), we encourage future research to study the role of rebates in the uptake of biosimilars across different types of plan.

It is important to note that this study was limited to analyzing pharmacy claims data, which only capture the use of biologics and biosimilars obtained through pharmacy benefit. However, many biologics are primarily administered in an outpatient setting, where the decision-making process for product selection may differ. Therefore, further research is needed to understand if the trends identified in this study hold true for biologics and biosimilars administered in the outpatient setting, where health plan type may not be as influential in product selection. Such research could involve analyzing medical claims data and/or conducting qualitative interviews with healthcare providers to better understand the factors influencing their product selection decisions. Understanding the full scope of how health plan type influences the use of biologics and biosimilars is crucial for policymakers and healthcare stakeholders as they work toward increasing biosimilar uptake and lowering drug spending for biological therapies. Regrettably, we were somewhat limited in exploring the drivers of why different plan types experience different rates of switching/biosimilar initiation as the Marketscan dataset does not include information on rebates.

As biosimilars gain interchangeability approval, it remains a policy challenge for policymakers and researchers to promote biosimilar adoption [7]. In this context, it may be worthwhile to investigate the practices of HMOs and EPOs, which seem to be associated with increased biosimilar switching and initiation. Such research can provide insights into the factors that influence the uptake of biosimilars and help identify strategies to further promote their use.