Increased Competition Drives Biosimilar Market Shifts
For the past decade, biosimilar adoption in the U.S. has proceeded at a relatively slow pace, due in large part to limited financial rebates for payers and provider preferences for biologics. Recent research suggests that utilization is finally picking up steam as more health plans place both biosimilars and their reference biologics on preferred formulary tiers.
A Health Affairs study found that preferred coverage of a single biologic declined by 47% between 2017 and 2022, while preferred coverage of multiple drugs rose 46% in the same period. In September 2024, an analysis of coverage data from MMIT Analytics confirmed the progression of this trend, finding that most patients covered by the same health plans tracked in the Health Affairs study are covered for both biosimilars and their reference biologics.
To learn more about payer and provider perspectives on biosimilars, the MMIT Index team surveyed payers representing more than 75% of commercial and managed Medicare lives, along with a representative sampling of providers and oncologists.
Payers Realizing Biosimilar Cost Savings Across TAs
According to the Q2 2024 MMIT Index Biosimilar Trends survey, nearly all payers have recognized cost savings from the shift to biosimilars. In oncology, the most notable cost savings were generated in neutropenia, an indication in which biosimilars comprise 39% of the overall prescription volume. The majority of payers also realized cost savings in breast cancer (24% of prescription volume); one-third of payers recognized cost savings in non-small cell lung cancer and colorectal cancer.
In non-oncology indications, payers representing 77% of commercial lives recognized cost savings from biosimilar usage in rheumatoid arthritis, followed by diabetes (63% of commercial lives) and ophthalmic treatments (33%). Biosimilars account for approximately 27% of current prescription volume for rheumatoid arthritis and 15% of prescription volume for diabetes.
Payers largely expect biosimilar utilization to remain static over the next year, although one-third expect increases in all oncology areas besides neutropenia and breast cancer. Several payers noted that “more biosimilar releases and price erosion” will likely have an effect on utilization, while others commented that “the more [biosimilars] are prescribed, the more comfortable the provider becomes, and payers save money.”
Exclusion of Reference Products Driven by Biosimilar Competition
While some payers report that they would never manage biosimilars separately from the reference product, payers representing 54% of commercial lives indicated that they would likely do so once there were multiple biosimilars to hit the market.
Most payers (62%) also said they would likely exclude a reference product from their formularies once there was a certain number of biosimilars available in an indication, although there was no consensus on that number (see Figure 1). Payers indicated they would transition members to biosimilars by either mandating switches (65%) or requiring a trial and failure of the biosimilar before access to the biologic was allowed (53%).
Figure 1
Payers also confirmed that they are most likely to cover a biosimilar for its approved indication only, even if the reference product is approved for multiple indications. Nearly all payers (covering 92% of commercial lives) indicated that a biosimilar’s interchangeability designation carries weight in terms of formulary placement and preferred positioning.
Of all the types of payer-manufacturer contracts, rebate-based contracts are by far the most common. Payers representing the majority of commercial lives (between 56% and 91%) have rebate-based contracts with each manufacturer of branded products that currently (or will soon) face biosimilar competition. The one exception was AbbVie, as payers representing 31% of commercial lives hold portfolio-based contracts with this manufacturer.
Providers Expect Increased Biosimilar Utilization In 2025
As more biosimilars are approved and added to formularies, more physicians and oncologists are prescribing them. For the most part, that transition has been uneventful. For example, among the physicians who have prescribed Humira biosimilars in the past 6-12 months, the majority report minimal impact to their treatment approaches.
Biosimilar adoption varies significantly by indication, of course. Surveyed physicians estimate that biosimilars account for roughly 40% of their practice’s total prescription volume in rheumatoid arthritis and diabetes. Among the oncologists who have prescribed a biosimilar in the past year, about two-thirds have done so for breast cancer and neutropenia. Oncologists estimate that biosimilars account for 67% of their overall prescription volume for neutropenia and 57% for both chronic lymphocytic leukemia and renal cell carcinoma.
Across all indications aside from colorectal cancer, a significant majority of physicians and oncologists expect biosimilar utilization to increase in the next year as compared to reference products. For rheumatoid arthritis, ophthalmic, and oncology, providers predict that better pricing and insurance coverage/mandates will be the top two drivers of increased utilization; in diabetes, providers say that greater availability will be the primary driver.
Lessons From The Humira Biosimilar Market
Manufacturers of upcoming biosimilars should continue to track what’s happening in the Humira (adalimumab)biosimilar market for tips on their own launch strategies. Now that all the adalimumab biosimilars are available, many payers have updated their formularies to exclude Humira.
Of the survey respondents, payers representing 75% of commercial lives said they were somewhat or highly likely to remove Humira from their formularies by Q2 2025. The majority of payers say that more favorable contracting from biosimilar manufacturers and a lower list/net price would influence their decision to remove Humira. Among payers unlikely to remove Humira, the product is most likely to be placed on the preferred specialty tier.
Despite payers’ willingness to exclude Humira from formulary, manufacturers who seek to secure coverage for their adalimumab biosimilar face stiff competition—especially given the new trend of payers leveraging distributor/manufacturer partnerships to private-label their own adalimumab biosimilars. As these entities expand, manufacturers of other biosimilars may need to explore their own payer/PBM partnerships to ensure coverage.
Biosimilar manufacturers can also benefit from examining how, when and why physicians have chosen to prescribe a Humira biosimilar. Among surveyed physicians, the majority (70%) who prescribed an adalimumab biosimilar did so to achieve cost savings for their patients. For 59% of physicians, Humira was not covered under their patient’s insurance; for 44% of physicians, they needed to prescribe a biosimilar as a step therapy before they could access Humira.
While the majority of payers perceive the price of Humira biosimilars as in line with their expectations, only 11-26% of surveyed physicians said that the average patient out-of-pocket cost of biosimilars met their expectations. The research suggests that further physician education on the cost of these drugs could potentially move the needle for utilization volume. Physicians are motivated to save their patients money, yet many cannot quantify the potential savings of prescribing one biosimilar versus the reference product, or one biosimilar versus another. In fact, for all nine adalimumab biosimilars, more than one-third of physicians did not know what the average out-of-pocket cost is for a patient.
Overall, surveyed physicians ranked ‘similar formulation to reference drug,’ auto-injector ease of use, and FDA interchangeability as the three most important factors in their decision-making about which adalimumab biosimilar to choose. Physicians note that less than 40% of their patients who are eligible to use an adalimumab biosimilar are currently using one, but 70% expect that percentage to increase over the next year as coverage continues to shift.
For insights on biosimilar utilization, contracting, and management, learn more about MMIT’s Biologics & Injectables Index and Oncology Index.