Implications of UnitedHealthcare’s Preference of Remicade and Neulasta to Their Biosimilars

In a significant coverage move, UnitedHealthcare (UHC) has signaled that its commercial and Medicaid medical policies on infliximab and pegfilgrastim have changed direction in favor of the reference drugs.

UnitedHealthcare and biosimilars

Effective July 1, 2019, approximately 22.5 million commercial and 6 million Medicaid UHC members will not be able to access these biosimilars without trying the reference agents first (virtually eliminating biosimilar use). Both infliximab and pegfilgrastim are covered generally under the medical benefit as office-based infusions, and preferring Remicade® and Neulasta® (including OnPro®).

This move is important for a few reasons. First, it reverses UHC’s previous position, which preferred the biosimilars over the two originator products.

Second, it promotes a prior authorization practice that makes little sense—since the biosimilar and reference products are expected to work in the same way and produce similar outcomes, why would a patient who fails Remicade then be given Renflexis® instead of a different biologic medicine like adalimumab, ustekinumab, or others?

Third, it implies that both manufacturers have further reduced the net cost of these drugs to UHC and its customers, undercutting the current deals offered by the biosimilar manufacturers. If accurate, this is a positive development in that infliximab and pegfilgrastim prices are continuing to come down due to competition. It would also indicate that Amgen, maker of the pegfilgrastim originator Neulasta, is beginning to defend its prefilled syringe market more aggressively. This is significant, because Amgen had been more focused on defending the marketshare of its on-body injector (Onpro), which is dominant. Alternatively, Amgen may be bundling its filgrastim and pegfilgrastim products more effectively. Coherus and Mylan had previously announced pricing that would be one-third less than the list price of Neulasta. Coherus had specifically indicated that it would be seeking targeted deals with payers to ensure at least parity position for its prefilled syringe product Udenyca®. It did not, however, mention UHC as one of those payers.

Fourth, this move puts a further dent into the sustainability of the US biosimilar market. Obviously, preferring the originators will make access to their biosimilars considerably more expensive for patients. It can only promote greater price cuts by the competing brands and thus reduce profit margins for the biosimilar manufacturers. In the US, biosimilar makers need a little encouragement to stay in the market, as very few have had positive experiences to date (e.g., Pfizer, Boehringer Ingelheim, Momenta, Apobiologix to name a few).

No one denies the benefits of the increased competition meaning a halt to price increases and significantly lower net costs, but those benefits need to be extended across other biologic categories. Without a viable biosimilar industry, access to lower-cost biologics can only happen through price controls.

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