GPhA concerned about proposed drug payment model’s impact on biosimilars

May 12, 2016 12:50 PM

The Generic Pharmaceutical Association (GPhA) and its Biosimilars Council are concerned that the Centers for Medicare and Medicaid Services (CMS) proposed demonstration to revamp how Part B pays for prescription drugs will “erode the economic incentives that drive the U.S. healthcare system to lower-cost therapeutic alternatives,” particularly in the biosimilars space, according to comments submitted to CMS.

GPhA and its Biosimilars Council also urge the agency to rethink its proposal to avoid adoption of value-based tools that undermine the balance between competition and innovation.

In the comments, Christine Simmon, Senior Vice President, Policy and Strategic Alliances, GPhA, states:

“Both GPhA and the Biosimilars Council share CMS’ stated goal of reducing overall Medicare expenditures, while maintaining or improving the quality of care provided to beneficiaries. Generic prescription drugs and biosimilars are uniquely positioned to help CMS achieve this goal.

However, we have serious concerns that the demonstration, as proposed, risks limiting the savings created through open market competition, particularly in the nascent biosimilars market. We strongly encourage the agency to carefully consider thoughtful changes to both phases of the demonstration in order to maintain robust competition, and a strong incentive to invest in affordable medicine, where possible.

Most importantly, CMS should ensure that Phase II of the proposal does not create an environment where generic or biosimilar products are compared with anything other than their intended reference product.”

GPhA and the Biosimilars Council also continue to oppose CMS’ coding and payment policy for non-interchangeable biosimilars, as outlined in 2015 public comments. The current coding and Average Sales Price (ASP) calculation methods are a significant departure from previous CMS policy and unfairly disadvantage non-interchangeable biosimilars.

Additionally, GPhA and the Biosimilars Council also voiced some concern over the expansive scope of the proposal, and urged CMS to consider a more targeted demonstration that could more effectively measure the effects of any new Value-Based proposals.

“Generic drugs and biosimilars can play a significant role in CMS efforts to lower health costs,” said Simmon. “We look forward to working with CMS to expand beneficiary access to more affordable alternatives to high-cost products.”

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