Biosimilars Forum Statement Regarding the CMS’ Treatment of Biosimilars Under the Medicaid Drug Rebate Program
Washington, DC, January 11, 2017– In a recent release for the Medicaid Drug Rebate Program, CMS reiterated and expanded its position that biosimilar drugs should be classified as single source drugs, which means that manufacturers must pay states the innovator rebate for Medicaid utilization of biosimilar products. Biosimilars will therefore be subject to pay rebates on state Medicaid utilization based on the rebate formula for single source (branded) drug products, not based on the rebate formula for multiple source drugs.
The Biosimilars Forum expresses disappointment with the CMS release as it directly conflicts with CMS treatment of biosimilars under the Medicare Part B Fee Schedule. The CMS Part B reimbursement policy, which treats biosimilars as multiple source drugs, places each biosimilar to the same reference product under the same Healthcare Common Procedure Coding System (HCPCS) code and into a single payment rate. This policy limits patient and provider access based upon economic considerations, and without consideration of the potential heterogeneity of treatment across biosimilars. Patient-centric considerations should be of primary importance to CMS rather than a focus on a one price fits all solution.
CMS’ decision not to consider biosimilar products as multiple source drugs in the context of the Medicaid Drug Rebate program exacerbates incongruity across the Agency. The inconsistency inherent in CMS’ decision to classify biosimilars as multiple source drugs in the context of Part B reimbursement is highly questionable and troubling for patients, providers and manufacturers that would benefit most from a payment policy that offers enhanced access, achieves long-term savings, and supports a competitive marketplace.
Simply put, by CMS’s own acknowledgement in the context of other federal health programs, biosimilars are not multiple source drugs, and should not be reimbursed under a payment methodology designed for multiple source drugs that is inclined to stifle innovation in a bourgeoning field.
About the Biosimilars Forum
The Biosimilars Forum is a nonprofit organization whose mission is to advance biosimilars in the United States with the intent of expanding access and availability of biological medicines, and improving health care. The founding members of the Biosimilars Forum represent the majority of companies with the most significant U.S. biosimilars development portfolios.