Objective

The biosimilar pathway was established by the Affordable Care Act as a way to provide more treatment options and lower health care costs through increased competition. To date, little published research has examined whether biosimilars have lowered health care costs. We used publicly available information to determine if the introduction of biosimilars has led to a decrease in the average sales prices (ASP) of both innovator and biosimilar products potentially generating savings for the Medicare program.

Methods

We used ASP files from the Centers for Medicare & Medicaid website to track changes in the ASP for all innovator and biosimilar products on the market for at least one year and calculated the percentage decrease from the date of biosimilar introduction until January 2020.

Results

ASPs declined for almost all innovator products and their biosimilars from their date of introduction through January 2020. For example, the ASP for innovator infliximab decreased by 30.3% following the introduction of a biosimilar. The biosimilar infliximab-dyyb experienced a 52.4% decrease in ASP during the study period, while ASP for the biosimilar infliximab-abda decreased by 25.5%.

Conclusions

Entry of biosimilar competition correlated with declining Medicare Part B payments for both innovator products and their biosimilars. As a result, the federal government and patients have benefited not only from lower-cost biosimilars, but also from declining prices of reference products.