Federal Policy and Biosimilars: A Conversation With Molly Burich, MS, Boehringer Ingelheim: Part 2

In part two and the conclusion of this interview, Molly Burich, MS, Director, Public Policy: Biosimilars and Pipeline, speaks to Boehringer Ingelheim’s progress in Cytelzo interchangeability studies, its plans for the product in Europe in the face of several adalimumab biosimilars launches in the EU, and also the complexity inherent in CMS’s plans to move biologic agents from part B to part D coverage.

Molly Burich, Boehringer Ingelheim
Molly Burich, MS

BR&R: Boehringer Ingelheim indicated that it started the study on Cytelzo interchangeability last year. What’s the progress on this effort?

Burich: The trial is continuing to progress. It’s a high bar and a big commitment. We will certainly publicize relevant information in due course.

We feel that for Cyltezo, in particular, interchangeability is an important component. It may drive switching. The study will also show a complement of clinical data around that topic. We hope to have information to share in the future. [Editor’s Note: The VOLTAIRE-X study, which will evaluate the effect of switching between Cyltezo and Humira in patients with plaque psoriasis, has an estimated primary study completion date of March 2020 and full study completion of July 2020, according to ClinicalTrials.gov]

BR&R: Speaking about Cyltezo, I have a question about the marketing floodgates being opened in the EU for adalimumab biosimilars. At least 4 are being launched in the EU after the October 16th patent expiration. Does Boehringer Ingelheim plan to join the fray?

Burich: Boehringer Ingelheim had planned to bring Cyltezo to patients in the EU. Due to the patent litigation with AbbVie in the US, we will not commercialize Cyltezo in the EU. Boehringer Ingelheim will continue all activities for our biosimilar in the United States. We are committed to making Cyltezo® available to U.S. patients as soon as possible and certainly before 2023.

PART B TO PART D TRANSITION BY CMS 

BR&R: Medicare has indicated that it will move many Medicare part B drugs into part D. To what extent will this affect biosimilar access and utilization?

Burich: It is a very hot topic these days. We have some pretty significant concerns on conceptually around what it means for moving from part B to part D. The key reason revolves around the access question, including patient cost sharing.

A move from part B to plan D could mean that patient cost sharing may jump significantly. We know that part B beneficiaries have wraparound or Medigap coverage to protect them from cost sharing issues. In part D, there is not such protection. Aside from the biosimilar question, the move from part B to part D really has to be explored and discussed a lot more to understand how we can ensure that patient access is not reduced through high cost sharing. That needs to be ironed out as it applies to any part B drug before we can speculate whether this is an opportunity for a biosimilar. Time will tell what that really looks like.

Last month, CMS released the Medicare Advantage guidance allowing for step therapy for part B drugs. That could be a potential opportunity for biosimilars, if we know how some of the access concerns will be addressed. We just don’t have the full picture at this point.

BR&R: Is it possible that this move to part D might spur some payers to create biosimilar tiers? These would require lower cost sharing for patients compared with reference biologics, assuming contracts with the reference manufacturer permits it.

Burich: In my opinion, we’ll need access to more biosimilars before we see a lot of that activity. It’s hard to foresee what big benefit design changes will be coming, but it’s certainly possible. We’ll need a mature market in the US before that will happen.

BR&R: The devil is in the details with this switching issue but there’s also an access issue. Plans can make midyear formulary changes, this would then apply to biosimilars and reference drugs covered under part D.

Burich: This is an important issue. The latest guidance that we saw from CMS, which is now a couple of years old, allowed positive formulary changes. Adding the biosimilar to a formulary is always allowed mid-year. The question involves removing an originator product or changing its tier.

CMS has said that those situations would be reviewed on a case-by-case basis. These rules preventing negative formulary changes midyear are there to protect patient access. It will take CMS some time to iron out what the process looks like for this type of potential formulary change midyear. For now, we’ll have to rely on CMS’s case-by-case review

BR&R: In general, payers do not consistently fund and manage self-injectable specialty drugs in the same way. In some cases, they cover these agents under the pharmacy benefits, medical benefit, or even both. Further, they can be managed under either benefit as well. However, it seems we are moving toward pharmacy management of these agents. How does this affect biosimilar access, if at all?

Burich: There will be more benefit design changes once we have a more robust biosimilar market. More specifically, when we have pharmacy benefit biosimilars.

We’ve mentioned CMS’s intention to move more of these products from part B to part D. It is possible that commercial plans will have different benefit designs and treat injectables differently than Medicare does. We want to make sure that biosimilar or not, the access piece is really at the center of those changes; it will not be beneficial to the biosimilar market if this move causes significant patient access issues (e.g., actual access to this drug or big swings in cost sharing). All of those things will be equally problematic for a biosimilar as they are for an originator, so we want to make sure we have our eye on the access component.

BR&R: Health and Human Services Secretary Azar and FDA Commissioner Gottlieb have loudly stated their desire to improve biosimilar patient and market access. The Biosimilar Action Plan was released earlier in the summer to that end. What is the one aspect of the Biosimilar Action Plan that appeals most to manufacturers like Boehringer Ingelheim?

Burich: The aspect of education, tackling both proactive education and countering misinformation is very critical from our perspective. We’d like to see more materials moving forward that focus on switching and on interchangeability. We haven’t really scratched the surface on those topics from an education standpoint.

The reality is that the FDA has an important voice and bringing validity to educational materials is so critical for patients, physicians, and health plans as well. We hope that the FDA will stand by its public commitment to release more reading materials, more videos, more web info, etc. It is especially important at this juncture; we are seeing misinformation and a lack of clarity on certain things.

IS THE BIOSIMILAR ACTION PLAN ACTIONABLE?

BR&R: One of the biggest barriers to biosimilar access is the patent thickets. The rebate trap problem is another story. What power does HHS have to clear out the patent thickets? Or is this an area that can only be addressed by Congress?

Burich: This is the most difficult part of the Action Plan, because it is unclear who can truly implement change and what change might be realistic. We have to protect true innovation that’s important to all stakeholders.

At the same time, there’s no question that patent litigation is the leading barrier to biosimilar accesss. Some makers of branded pharmaceuticals have constructed patent thickets so that they could sustain prolonged, expensive litigation against competitors, while stifling competition. Humira is the prime example: More than 15 years after the molecule was approved , no biosimilar is being marketed – in the U.S. What the answer is and which government agency can effect change has yet to be determined.

BR&R: That change won’t come quickly, in any case. Whether enacted by Congress or the Office of the Inspector General, which may have to reinterpret the safe harbor statutes, this may only first apply to the second-generation of biosimilar agents, beyond 2021 perhaps. It seems likely that this will be a very deliberate process.

Burich: I do believe Commissioner Gottlieb is thinking about both how to get more products launched in the short term and also the long-term vision of a sustainable biosimilar market. That is such an important part of the problem.

We were very happy that the FDA had their public hearing. The FDA panel asked a lot of thoughtful and probing questions to the individual speakers. We are fully supportive of the Action Plan and its individual components. If we saw all of those things come together and start to see action, including finalizing the interchangeability guidance and providing more education, the biosimilar market would be in a far better place.

BR&R: We say that biosimilar manufacturers can make their products attractive to payers, but payers need to play a positive role here. Commissioner Gottlieb has said that payers have to help in this process by taking the long-term view, by not automatically sticking with the reference product because of the rebate revenue. They have to be open to using the biosimilars and nurturing the health of the industry. Is there anything else the biosimilar manufacturer can do to convince payers to make this market viable?

Burich: Certainly, biosimilar manufacturers have to approach these payer negotiations and conversations with competitive and innovative contracting approaches. That does not just include pricing but also how do you drive volume and true savings to both payers and patients. That kind of innovative approach is necessary, because we know it’s a challenging market.

Biosimilar manufacturers have to look at the whole picture as well. That means providing targeted patient/physician services to really help ensure that the switching experience is seamless for the patient and the physician so that biosimilar utilization is not viewed as something very disruptive.

Biosimilar Step Therapy for Medicare Part B: Does This Make Sense?

The Centers for Medicare and Medicaid Services (CMS) has decided drugs covered under Medicare part B may be subject to step therapy, if so desired by Medicare Advantage plans. UnitedHealthcare has become the first to publicly implement step therapy policies for these drugs. However, biosimilar step therapy is not the typical utilization management tool that industry executives are used to seeing.

biosimilar step therapyTraditional step therapy or step edits for prior authorization policies are typically used to require the use of an effective, low-cost drug class before trying a more-expensive treatment. For example, a plan might have a step in place before a patient can receive Humira®, such as requiring documented failure on other disease-modifying anti-rheumatic drugs, like azathioprine or methotrexate. This makes very good sense when supported by practice guidelines or treatment pathways, based on solid supportive evidence.

For biosimilar manufacturers, the perspective on the revised CMS policy, seems to imply trying the biosimilar before receiving the branded originator product. This biosimilar step therapy would make very little sense. A doctor would not be practicing evidence-based medicine if he or she prescribed Remicade® to a patient after failure of Renflexis®. There is no evidence to show that the biosimilar will work in a patient who did not receive adequate clinical benefit from the reference product (and vice versa). Similarly, there is no information to show that a patient who has an adverse effect while taking Remicade will not have that adverse effect after injecting with Renflexis (or vice versa). In other words, after failing one, a new mechanism of action should be tried, not a product with a very similar structure. This may be a different argument, if a subcutaneous form of infliximab was introduced, and this might be reason to step the infusible form through this drug.

In United’s announcement, they are clearly seeking to increase biosimilar utilization, as designated preferred part B agents, at the expense of Remicade use, the nonpreferred agent. Therefore, it may make more sense that new patients will have to use a biosimilar before being prescribed the reference product. Step therapy in this case is almost an aside.

Ironically, the Department of Health and Human Services has also expressed its desire to move part B agents like self-administered injectables to part D. This may not apply to infliximab, as it is given as an in-office infusion. Should this be the case, plans will have many pharmacy tools at their disposal beyond biosimilar step therapy.

In other biosimilar news…Fresenius Kabi has signed an agreement with Abbvie to delay its adalimumab biosimilar market entry in the US until 2023. The manufacturer is currently trying to secure European approval for the product. A 351(k) application has not yet been filed by Fresenius in the US.

Part B to Part D and Other Questions: How CMS’s Plans Could Affect Biosimilars

For 2019, the Trump administration has proposed transferring some products reimbursed by Medicare part B to part D coverage. Additionally, it will allow Medicare Advantage firms, which manage a small but significant percentage of Medicare beneficiaries’ care, to negotiate prices and utilize some pharmacy benefit tools to control costs.

Some of these tactics are a bit late to the party, as commercial insurers and health plans have been employing them for years. To the extent that an injectable treatment can be managed through the pharmacy benefit rather than the medical benefit, the drug can be easily subjected to prior authorization, step therapy, quantity limits, and other tools routinely used.

part b to part d coverageFor the few available biologics and their corresponding biosimilars, these infusions are covered in general on the medical benefit today. Infliximab, filgrastim, and pegfilgrastim are still subject widely to buy-and-bill scenarios. Yet, Neulasta® (pegfilgrastim) is already covered under a medical specialty benefit (fifth tier) for beneficiaries of two sample Medicare Advantage plans (HumanaChoice and Aetna Medicare Choice). In both of these plans, Neulasta is subject to prior authorization requirements. UnitedHealthcare covers it under the medical benefit, generally under its highest copayment or cost sharing tier. In contrast, Zarxio® is on the preferred or second tier for United’s Advantage 3-tier and Small Group plans, also under the medical benefit.

These agents, administered via office- or clinic-based infusions, may also be available through specific distribution channels, like specialty pharmacy. In contrast, self-administered agents like adalimumab may be distributed to patients through specialty pharmacies only, which are part of the managed care machinery.

Insulin is still considered a “transitional drug.” Like adalimumab, it is self-administered. However, it is already covered by Medicare under the part D benefit, at least when used outside of an insulin pump. Therefore, part D providers, like commercial plans, have preferred and nonpreferred insulin products, negotiate for pricing, and may use other pharmacy benefit tools.

The Administration has not yet announced which drugs it will from part B to part D. It is unlikely though that the Centers for Medicare and Medicaid Services will jump beyond the experience of commercial plans and insurers. Until other biosimilars are made available for prescription, the latest CMS attempt to control costs may not directly affect biosimilar manufacturers.

Patient Cost Sharing for Biosimilars in Part D Coverage Gap Likely to Cause Headaches

The Medicare part D coverage gap is seemingly an enigma for biosimilar manufacturers. Legislative language that seeks to close the coverage gap by 2020 incorporates a huge slip—pairing biosimilars with generics in how the Medicare eligible’s cost share is lowered over time.

An analysis by the health care consultant Avalere shows that Medicare patients will pay much more for the biosimilar drug in the coverage gap than for the innovator product. This may well result in a parallel prescribing situation: innovator products for the Medicare-eligible populations and biosimilars for everyone else.

The problem lies in the structure of the part D program, particularly, the coverage gap, authors of the Avalere paper point out.Image result for donut hole

The Affordable Care Act seeks to reduce and eventually eliminate the coverage gap (or “donut hole”). For this year, the coverage gap spans $3,310 to $4,860 in drug spending. After exiting the coverage gap, beneficiaries pay 5% of total costs. This seems straightforward, but complicating the matter is a provision to help close the coverage gap by 2020. That refers to the Coverage Gap Discount Program, in which drug makers must provide a 50% discount on brand-name products dispensed to Medicare beneficiaries who are presently in the coverage gap. In 2016, the health plan pays 5% of the costs in the gap (this increases through 2020 to 25%), and the beneficiary pays 45% (which decreases by 2020 to 25%). This manufacturer discount applies only to brands, not to generic and biosimilar drugs.

Avalere’s model assumes that the reference product at issue costs $30,000, and the biosimilar is discounted by 25%, which reflects the average discount seen in Europe. If patients A and B take the reference product and biosimilar, respectively, throughout the year, and this is the only agent he or she is prescribed, payments for either drug product will take the patient through the coverage gap and beyond. However, patient B will pay $1,536 (or 39%) more over the course of the year than his or her counterpart, because of the manufacturer’s required discounts on the branded product in the coverage gap.

There are 2 possible policy or regulatory options to correct the situation: (1) require the biosimilar manufacturer to provide coverage gap discounts as well by changing the legislative language or (2) add flexibility for part D providers to add biosimilar tiers, where biosimilars can be offered at substantially lower cost sharing compared with branded products.

Just after the meeting took place, the Medicare Payment Advisory Commission (MedPAC) met and discussed this issue, favoring the first option. MedPAC is the key resource Congress relies on for advice on Medicare financing and reimbursement issues, so there is hope that their recommendation will prompt a legislative fix.

At the Fall meeting of the Academy of Managed Care Pharmacy, this was a looming concern of several pharmacy and medical executives with whom I spoke. They think that, with rapid Congressional action, parallel prescribing is a possibility, to prevent unnecessary patient pain on reaching coverage gap.