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Biosimilar success in the US market landscape requires a holistic approach

By Xcenda

By: Danielle Love, MA; Emily Liu, MBA, MA; Scott Shields, MBA; Shaila Yoshida, MS
This article appears in the Summer 2023 edition of HTA Quarterly. Subscribe to receive new issues.

In addition to a successful access and reimbursement strategy for biosimilars, understanding the regulatory environment and stakeholder incentives will be equally key to unlock biosimilars potential.

In the US, the biosimilar outlook is formidable with 40 biosimilars approved to date, out of which 27 have already launched. Biosimilars have steadily increased their market share in the therapeutic areas where they have been introduced, with adoption rates of some molecules reaching as high as 82%. There are 106 biosimilars in clinical development, and the next few years will see the competitive landscape change for several biologics. Estimates indicate that savings from biosimilars over the next 5 years could exceed US $180 billion. Their increasing adoption comes against the backdrop of an expanding US biologics market that has grown 12.5% annually on average over the last 5 years and comprises 46% of total medicine spending. As a result, biosimilars represent unprecedented opportunities to increase affordability and expand access to biologics and represent a watershed moment in the US healthcare landscape, akin to the introduction and successful implementation of generics for small molecule drugs.

Increasing biosimilar adoption requires a robust pricing and reimbursement strategy, considering the complex and changing market dynamics. Equally important will be navigating additional factors that also impact biosimilar adoption, such as the regulatory environment and differing stakeholder incentives.

Navigating pricing and reimbursement dynamics is key for biosimilar success

The Humira biosimilar launches in 2023 are expected to be one of the most significant market events in the biopharmaceutical industry due to the sheer size of the originator sales (~$20 billion) and potential for market disruption. As self-administered, pharmacy-benefit drugs, Humira biosimilars will face a different set of dynamics than the previous wave of physician-administered, medical-benefit biosimilar drugs.

Role of pharmacy benefit managers (PBMs)

For the Humira biosimilars, and other pharmacy-benefit drugs, which are typically dispensed directly to patients through retail, specialty, and online pharmacies, vertically integrated PBMs play critical roles: first, as payers who need to demonstrate successful negotiations and rebating to their member plans while maintaining the expectation that biosimilar cost savings are recognized almost immediately in list pricing; and, second, as owners of dispensing pharmacies (through vertical integration) with the ability to mandate the use of certain pharmacies and take advantage of 340B pricing. Vertical integration in the managed care space has led to 4 of the 5 top earning specialty pharmacies to be owned by a PBM.

Impact of 340B pricing

340B biosimilar reimbursement dynamics have extended into specialty pharmacies, some of whom are utilizing advantageous discounted 340B pricing and related markup on reimbursement for drugs flowing through specialty pharmacies. 

Formulary management 

We have already seen health plans managing biosimilars in the medical-benefit policies of some biologics through the use of prior authorizations and step edits. For pharmacy-benefit biosimilars, plans and PBMs are expected to leverage the benefit design and utilization management tools to manage them on their formularies. However, these drugs are typically more heavily rebated than medical-benefit drugs. Since biosimilars are not considered clinically differentiated from their reference product, contracted rebates (which ultimately determine the net price) are expected to play a determining factor in how pharmacy-benefit biosimilars will be covered by health plans and PBMs. 

Pricing strategy 

On January 31, 2023, Amgen announced the launch of Amjevita, the first of several biosimilars to Humira that will be introduced in the coming year. Amgen has indicated they will make Amjevita available at 2 different list prices: 1) wholesale acquisition cost (WAC) 55% below the current Humira list price and 2) WAC 5% below the current Humira list price. The dual-price strategy was essential to obtain and secure access on formularies of large PBMs and plan sponsors who are driven towards higher list prices to secure larger rebates. 

“With respect to the two list price approach that we’ve employed here at this launch, this is really to address the complexity of the US market. Pharmacy benefit managers have a business model that requires that they negotiate rebates with manufacturers, and so they would prefer a high list price and negotiate rebates to net the price down and then pass those rebates through to their upstream employer clients.” 
- Murdo Gordon Executive Vice President, Global Commercial Operations 

If the dual-price strategy sounds familiar, it’s because it was also employed by Viatris when they launched a branded, low WAC discount (5%) and an unbranded, high WAC discount (65%) version of their insulin biosimilar, Semglee. As expected, 2 large PBMs, Prime Therapeutics and Express Scripts, put the branded, low WAC Semglee on their preferred formulary lists.

Organizations must be cognizant of external factors besides reimbursement dynamics that impact biosimilar adoption

While having a sound pricing and reimbursement strategy is essential, there are still several exogenous factors at play that impact biosimilar adoption. Manufacturers of biosimilars must understand, monitor, and proactively strategize to address these other dynamics as they are all interconnected.

Interchangeability regulations

Interchangeability of biosimilars is a regulatory feature that is unique to the US market access system. Per current regulatory rules, an interchangeable biosimilar is only interchangeable with the reference product and not with other biosimilars. This can potentially cause confusion amongst key stakeholders such as providers, patients, and pharmacists, who have been used to a generic model where the small molecule drugs can be easily substituted amongst each other.

Ongoing legislation across the US healthcare spectrum

Another regulatory factor to monitor closely is the impact of the Inflation Reduction Act (IRA), whose provisions both help and hurt biosimilars. Due to the IRA, companies can take advantage of 5 years of increased Medicare reimbursement on biosimilars (ASP + 8% vs previous rate of ASP + 6%). However, the 2-year window around a biologic's selection for negotiation is a potential unintended negative consequence of the law. According to the IRA, a biologic will not be selected for pricing negotiation if the US Secretary of Health and Human Services determines that there is a “high likelihood” a biosimilar product will be licensed and marketed with the 2 years after which a drug is eligible for negotiation. If a biosimilar cannot come to market in that 2-year window, however, it will launch against the reference product that has already undergone pricing negotiation. The biosimilar will, therefore, need to launch at a price lower than the negotiated reference product. That far lower price might not be sufficient for the biosimilar to be profitable, potentially leading companies to question developing biosimilars.

Another compounding regulatory complication in biosimilar adoption is the 340B program where cost recovery for covered entities can be greater with reference drugs. As of the 2023 Outpatient Prospective Payment System (OPPS), the reimbursement to 340B hospitals has now increased to equal the reimbursement to non-340B hospitals, which is ASP + 6%. In the case of biosimilars, that reimbursement is now ASP + 8% for a 5-year period, thanks to the IRA.

340B hospitals have historically had lower utilization of biosimilars than non-340B hospitals, likely due to these dynamics. Milliman reports that in 2020, that difference was approximately 8%. In conjunction with the prices charged by these 340B hospitals, which can range from 3.2 times a drug’s acquisition cost up to 11.3 times, biosimilars face a daunting regulatory challenge in the 340B space.

Stakeholder incentives

As we have seen above, the dual-price strategy employed by manufacturers of pharmacy-benefit biosimilar drugs is one example of how different incentives of stakeholders in the drug pricing chain will impact access in the biosimilars landscape. Contracted rebates and the lack of transparency around them will make it difficult to accurately predict the magnitude of market share penetration by biosimilars and their reference products. This will have a greater impact on pharmacy-benefit drugs, which are more exposed to rebating than medical-benefit drugs.


Navigating the reimbursement landscape will be critical to increasing biosimilar adoption; but that is only one piece of the puzzle. Exogenous factors such as a regulatory landscape and stakeholder incentives are equally important in order to fully comprehend the implications of biosimilars in the biologics market landscape. There are other external factors as well that need to be proactively monitored, such as the technological challenges incorporating biosimilars into existing electronic medical record systems, educating each stakeholder in the healthcare continuum about biosimilars, understanding factors related to stocking and inventory management (e.g. decision by providers to stock all biosimilars to a reference product or only selected agents) and ensuring patients have access to support programs (such as copay assistance and free goods). Having a holistic view of all relevant factors will ensure greatest chance of success of biosimilars in the US market landscape.


  • AJMC. 340B, biosimilars, and more in the future of specialty pharmacy. Accessed February 17, 2023.
  • AJMC. Center for Biosimilars. Prime Therapeutics joins Express Scripts in moving Semglee to preferred formulary status. Accessed February 16, 2023.
  • AmerisourceBergen. U.S. biosimilar report. As of February 6, 2023. Accessed February 20, 2023.
  • Amgen. 2022 biosimilar trends report. Accessed February 16, 2023.
  • Amgen. Amjevita™ (adalimumab-atto), first biosimilar to Humira®, now available in the United States. Accessed February 16, 2023.
  • Amgen. Q4 2022 Amgen earnings conference call. Accessed February 17, 2023.
  • Centers for Medicare & Medicaid Services. CY 2023 Medicare Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System Final Rule with Comment Period (CMS 1772-FC). Accessed February 16, 2023.
  • Community Oncology Alliance. Examining hospital price transparency, drug profits, and the 340B Program. Accessed February 17, 2023.
  • Drug Channels. Why PBMs and payers are embracing insulin biosimilars with higher prices—and what that means for Humira. Accessed February 16, 2023.
  • FDA. Biosimilar and interchangeable biologics: more treatment choices. Accessed February 17, 2023.
  • IQVIA. Biosimilars in the United States 2023-2027. Accessed February 16, 2023.
  • Milliman. Biosimilar utilization at 340B and non-340B outpatient hospitals in the commercial market. Accessed February 16, 2023.
  • The Center for Biosimilars. Biosimilars approvals. Accessed February 17, 2023.