Often in politics, the players are quick to assign “crisis” to an issue, but when it comes to the rising costs of health care and prescription drugs, the status quo is quite literally a matter of life and death. A recent Gallup poll showed that an astonishing 34 million Americans know a friend or family member who died after being unable to afford the medical care and treatment they needed.
To further underscore the severity of this problem, 58 million adults reported that they have been unable to pay for their prescription drugs at some point in the past year.
While these figures are difficult to confront, this crisis over rising drug costs is not unsolvable. Stakeholders across the health care industry — from the Food and Drug Administration and Congress to physicians and patients — recognize the urgent need to lower drug costs. Policymakers have appropriately recognized that increasing access to lower-cost biosimilars is a key part of the solution to help save patients, taxpayers and the health care system at-large billions of dollars.
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Similar to how generic medicines have saved almost $2 trillion over the last decade, biosimilars are lower-cost alternatives to reference biologic medicines.They are used to treat complex illnesses such as cancer and Crohn’s disease, and are safe, effective and FDA-approved.
Biosimilars cost on average 26 percent less than their biologic counterparts, meaning they hold promise to unlock billions in savings. In fact, biosimilars could save the U.S. health care system as much as $150 billion over the next decade.
Yet the biosimilars market remains sluggish: Only 12 of the 26 approved biosimilars are available to patients, and only one biosimilar has surpassed the reference medicine to gain meaningful market share. Regulatory barriers, misaligned financial incentives and anti-competitive practices have stifled the biosimilars market in the United States, and patients are suffering for it. Biosimilars can help lower costs for millions of Americans, but they must first be able to access them.
Members of Congress, some of who likely know a friend or family member who was unable to pay for medication and treatments, are finally beginning to recognize this, evidenced by the recent spate of bipartisan biosimilars legislation introduced over the last few months.
The bipartisan drug pricing packages winding their way through the House and Senate both contain a critical biosimilars policy that would dramatically reduce health care costs: enhancing reimbursements to providers by increasing the average sales price add-on payment rate in Medicare Part B. This simple action would help stimulate their use, since the current reimbursement system does not financially encourage prescribing the often lower-cost biosimilar. A slight increase in the add-on payment rate could reduce health care costs by as much as $8.2 billion over the next decade.
Other bipartisan policy reforms that have been introduced in Congress, including reducing out-of-pocket costs for biosimilars in Medicare Part B — provide direct savings for seniors.
While these bills will be instrumental in helping shore up the biosimilars market, this crisis also requires structural, market-based and regulatory fixes, and it needs to be supported by bold, visionary leadership.
That same Gallup poll found that two-thirds of Americans don’t believe that President Donald Trump has made enough progress on curtailing the rising costs of prescription drugs. This is not a condemnation but rather an opportunity for Trump to act swiftly to alleviate the financial burden on our nation’s seniors, patients and taxpayers by making simple changes that increase biosimilars and result in near-immediate health care savings.
Biosimilars are a bipartisan and recognized solution to help ease the financial burden on our nation’s seniors and taxpayers, but Congress and the Trump administration must act to unlock their full savings potential. No one should lose a loved one when solutions, such as biosimilars, can help many more people get access to the medicine they need.
Juliana Reed is the president of the Biosimilars Forum.
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