Health Subcommittee Hearing on Lowering Costs for Patients: The Health of the Biosimilar Market

House Ways and Means Subcommittee on Health

2025-04-08

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Summary

This hearing convened to discuss the crucial role of biosimilars in reducing healthcare costs and expanding patient access to essential medications, while also highlighting the significant barriers impeding their wider adoption and development[ 00:18:00-00:21:57 ] [ 00:28:59 ]

Themes

Benefits and Cost Savings of Biosimilars

Biosimilars are presented as a vital tool for promoting affordability and access to essential biologic drugs, having already saved the U.S. healthcare system billions of dollars since their introduction in 2015[ 00:20:02 ]

. They offer more affordable treatment options for chronic diseases such as cancer, diabetes, and arthritis, and are launched at prices up to 35% lower than branded drugs[ 00:20:21 ] [ 00:31:03 ] . Biosimilars have also increased drug supply availability, contributing to nearly 700 million days of patient therapy[ 00:20:47 ] . Experts estimate that overcoming barriers to biosimilar adoption could save an additional $181 billion over the next five years[ 00:21:15 ] .

Barriers to Biosimilar Adoption and Development

Several factors hinder the widespread adoption and development of biosimilars. Pharmacy Benefit Managers (PBMs) and insurers often favor more expensive originator biologics due to lucrative rebate structures, which can lead to situations where the reimbursement for biosimilars is less than their acquisition cost, making them inaccessible to patients and economically unviable for providers. The 340B drug pricing program also distorts the market by incentivizing participating hospitals to use more expensive drugs, as they make substantial profits from the price difference. Current Medicare reimbursement policies, particularly in Part B, can unfairly penalize healthcare providers for choosing lower-cost biosimilars, further reducing patient access. The Inflation Reduction Act (IRA), despite its intentions to lower costs, has been criticized for creating unpredictability in the market through its price-setting process, deterring investment in biosimilar development. Additionally, extensive patent thickets by brand-name manufacturers and cumbersome regulatory processes at the FDA delay biosimilar entry and market competition.

Impact of Trump Administration Policies on Research and Healthcare Infrastructure

Several speakers raised concerns about the impact of the Trump administration's policies on scientific research and healthcare infrastructure[ 00:23:45-00:24:01 ]

. Significant cuts in federal funds for the National Institutes of Health (NIH) and mass layoffs at the Food and Drug Administration (FDA) and other HHS agencies are seen as devastating to future drug innovation, clinical trials, and the approval process for new therapies, including biosimilars[ 01:14:49 ] . These actions are feared to undermine the FDA's ability to ensure drug safety and efficacy, and to reduce confidence in regulatory oversight. Concerns were also raised about potential tariffs on pharmaceuticals making medications even more expensive, and proposed cuts to Medicaid and changes to the Affordable Care Act (ACA) marketplace that would reduce patient access to insurance and affordable medications.

Recommendations for Improving Biosimilar Access and Development

Witnesses provided several recommendations to enhance the biosimilar market. These include simplifying the FDA approval process while maintaining safety standards, reforming rebate practices to eliminate their use for biosimilars, and modifying the 340B program to remove disincentives for biosimilar use. Other suggestions involve increasing physician reimbursement for biosimilars and establishing a floor price for market stability. Transparency in drug pricing, amending the IRA to address unpredictability, and ensuring Medicare beneficiaries have guaranteed access to lower-cost biosimilars are also critical. Empowering the FDA to designate interchangeability more flexibly, providing resources to the Patent and Trademark Office to prevent patent thickets, and facilitating pharmacist substitution of interchangeable products were also proposed.

Tone of the Meeting

The tone of the meeting was largely concerned and urgent, reflecting a shared understanding of the potential benefits of biosimilars alongside significant apprehension about current market distortions and governmental policies. There was a clear, bipartisan consensus on the importance of biosimilars for cost savings and patient access[ 00:19:13 ]

[ 01:18:01 ] . However, there was a stark partisan divide regarding the impact of specific federal policies, particularly the Inflation Reduction Act (IRA) and the actions of the Trump administration concerning federal research and regulatory agencies[ 00:23:45-00:24:01 ] . Democratic members and some witnesses expressed alarm and frustration over perceived threats to scientific innovation and healthcare access due to these policies[ 00:23:45-00:24:01 ] [ 01:14:33 ] [ 02:00:28 ] . Republican members, while also acknowledging challenges, often attributed them to the IRA and other regulatory burdens[ 01:18:39 ] . Overall, the discussions conveyed a sense of urgency for legislative action to address the identified barriers and unlock the full potential of the biosimilar market[ 00:21:03-00:21:15 ] .