Hospital Settings Drive Up Spending on Biologics, Biosimilars

A new study from the Employee Benefit Research Institute highlights the high — and growing — markups that hospital outpatient departments assign to biologic drugs, while also examining the variation in how HOPDs and physician offices (POs) treat innovator biologics compared to their biosimilars.

The study analyzed medical and pharmacy claims data from Merative MarketScan Commercial Database — which covers nearly 25 million people with private health insurance — from 2013 to 2020, and it focused on seven innovator biologics and their biosimilars that had been launched as of 2020.

The percentage of the seven innovator biologics administered in HOPDs varied from 6% to 58% in 2020, according to the report. HOPDs were more likely than POs to use bone marrow stimulant Neupogen (filgrastim), and cancer treatments Herceptin (trastuzumab) and Rituxan (rituximab) over their biosimilars. For all seven innovator biologics examined, allowed charges were higher in HOPDs than in POs.

The study also found that, with the exception of biosimilars for Neulasta, HOPD and PO markups for biosimilars were lower than the markups for innovator biologics, as of 2020.

Meanwhile, an analysis of coverage policy from MMIT Analytics showed that the majority of people with commercial plans have coverage for biosimilars and their reference biologics with utilization management restrictions under the medical benefit. MMIT is the parent company of AIS Health.

This infographic was reprinted from AIS Health’s biweekly publication RADAR on Drug Benefits.

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