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Cost Savings of Supportive Care Biosimilar in the Medicare OCM Population

June 12, 2020

A new study sought to better understand how The Centers for Medicare and Medicaid Services (CMS) reimbursement for pegfilgrastim has been impacted by the introduction of two pegfilgrastim biosimilars into the market.

Results of the study were presented at the American Society of Clinical Oncology (ASCO) Annual Meeting (May 29-31, 2020).

Pegfilgrastim is an often used supportive care agent for febrile neutropenia prophylaxis after chemotherapy for patients with cancer. However, pegfilgrastim has been shown to account for 5.3% of the total cost of cancer care for all patients in the Oncology Care Model (OCM). Fluctuations in the cost or quantity of pegfilgrastim—including the introduction of biosimilars to the market—may have a significant impact on an OCM practice’s performance.

Jennifer Webster, MS, director of data science, Integra Connect (West Palm Beach, FL), and colleagues tracked the average CMS reimbursement for pegfilgrastim from July 2016 through June 2019 and compared the average reimbursement as well as the average change in reimbursement before and after the introduction of pegfilgrastim biosimilars.

Researchers noted that prior to the introduction of biosimilars, the Medicare Part B reimbursement of pegfilgrastim increased at a rate of $292 per year through the first 30 months of the OCM, resulting in an average reimbursement of $3636 per administration in Q3 2018. Since the introduction of biosimilars, Dr Webster and colleagues found that the average pegfilgrastim reimbursement has held steady – with an average reimbursement of $3543 from July 2018 through June 2019. The change in reimbursement has decreased from $292 per year to -$93 per year.

Authors of the study wrote that after applying the patterns they detected in their OCM data sample to the general Medicare population, the introduction of biosimilars resulted in approximately $4.8 million in savings compared with what the total reimbursement would have been without biosimilars in the market in Q4 2018. Thus, the projected savings in 2019 and 2020 are $79.1 million and $157.9 million, respectively.

While most of the cost containment is not due to the use of biosimilars (90.6% of patients in Q2 2019 are still receiving branded pegfilgrastim), the introduction of biosimilars has caused the branded agent to stabilize and potentially drop net acquisition cost prices, Dr Webster and colleagues noted. Thus, the introduction of biosimilars has created pressure on the market that has resulted in significant cost savings to CMS and has made it easier for practices participating in the OCM to have better performance.—Zachary Bessette

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