IQVIA, 2018 Advancing Biosimilar Sustainability in Europe

SEPTEMBER 2018
Advancing Biosimilar
Sustainability in Europe
A Multi-Stakeholder Assessment
Introduction
A growing number of biologic medicines have been developed and approved
over the past decade, improving the lives of patients worldwide. Although
these have been effective at treating numerous diseases, patient access has
been limited, partly due to their relatively high cost. As biologics lose their
patent-protection, many biosimilars are becoming available across Europe,
and manufacturers are seeking to bring additional biosimilar products to
market. These are expected to bring with them the opportunity to generate
competition for biologic therapies and thereby lower costs and increase patient
access. However, some biosimilar policies and purchasing mechanisms limit
participation of competitor products in specific markets, apply increasing
price pressure or push physicians to switch patient product use. These current
dynamics have raised questions about the sustainability of the biosimilars
market in the long-term.
This report puts forth a framework for the evaluation The contributions to this report by Deanna Nass,
of sustainability in the biosimilars market, seeking to Henrike Resemann, Per Troein and Judith den
identify the key elements that influence sustainability Uil, and dozens of others at IQVIA are gratefully
for all stakeholders. Based on these criteria, current acknowledged.
policies and market dynamics are assessed to
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identify risks and challenges to the current and future
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This report was produced independently by the

IQVIA Institute for Human Data Science based on
MURRAY AITKEN
research and analysis undertaken by the IQVIA
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Consulting Services group and commissioned and
IQVIA Institute for Human Data Science
funded by Pfizer.
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Table of contents
Executive summary 2
Sustainability in the biosimilars marketplace 4
Availability of biosimilar products 4
European policies and frameworks for biosimilars 5
Defining sustainability for the biosimilars marketplace 7
Current dynamics of biosimilars in Europe 12
Patient access to biologics 12
Regulatory environment and clinical guidelines 14
Biosimilar safety, quality and supply 15
Incentives 15
Competitive pressure 17
Risks to sustainability 23
Areas of greater risk to long-term sustainability 25
Impact of changes in payer-driven switch 25
Impact of changes in procurement policies 26
The path to strengthen sustainability 29
Notes on sources 32
Methodology 32
References 35
About the authors 38
About the IQVIA Institute 39
1
Executive summary
Biosimilars are now an integral part of the market for and quality. Metrics that can gauge trends in these
biologics, which overall accounted for $277 (€238) individual elements of sustainability are useful tools to
billion in sales globally in 2017 and is projected to monitor progress and the impact of policy decisions.
reach $452 (€388) billion by 2022 . In ten developed
1
To analyse the sustainability of current policies, a

markets alonei, $45 (€38) billion of biotech spending
set of seven countries with differing approaches to
is now estimated to be exposed to biosimilar
biosimilar utilisation and a set of seven molecules
competition, and another $52 (€44) billion is expected
with different purchasing and use characteristics that
to go off patent from 2019 to 2022.2 By 2027, 77% of
had biosimilars approved between 2013 and 2017,
current biotech spending is expected to be subject
serve as a useful basis for study. Specific elements
to some form of competition2. A large and diverse
of sustainability can then be measured across these
group of manufacturers—numbering 184 globally3 —are
varying types, helping to identify where it may be at
investing in the development and commercialisation
risk in the future and how hypothetical changes may
of biosimilars, bringing with this investment the
impact these areas.
promise of high-quality biologic therapies at a lower
cost.
In the European market, biosimilars have increased
patient access to biologic medicines, raising
In Europe, more than 45 biosimilar products (for
utilisation of the molecule (i.e., all variants of the same
15 biologic medicines) are now approved and
biologic medication, including the originator and
registered—treating a variety of diseases within
biosimilar products) across countries. The current
oncology, autoimmune disorders, diabetes and
regulatory environment and clinical guidelines are
fertility4. Frameworks to facilitate, and mechanisms
positive toward sustainability by creating a neutral or
to encourage, the use of biosimilars have been
positive climate for biosimilars relative to originator
established at the European and country level, and
biologics (i.e., the first, branded variant of any
have consistently emphasised the role biosimilars can
biologic medication). Additionally, product-related
play in expanding biologics access for patients while
sustainability elements have been maintained across
lowering treatment costs.
countries: biosimilars have proven to be safe, quality
With the potential for biosimilar use to offer savings of products, and manufacturers have provided a reliable
more than €10 billion between 2016 and 2020 in the supply to markets.
EU5 countries alone , payers are likely to experience
5
Different levels of biosimilar uptake, price erosion

some relief of budgetary constraints or the ability to
and competitor concentration among manufacturers
reallocate funds, depending on the policy priorities
occur based on the setting of care in which biosimilars
of each country. However, to sustain the market for
are prescribed and used, and the payer purchasing
biosimilars in the long-term, ongoing benefits for all
mechanisms in place. In the retail setting—where
stakeholders must be ensured. A multi-faceted view of
physician incentives to switch patients to biosimilars
sustainability therefore comprises elements including
may formally exist but with lenient implementation,
providing patient access, physician prescription
and patients are familiar with the products and may
choice, a means to manage existing healthcare
even be attached to them—biosimilar uptake is slower
budgets for payers, the safeguarding of a healthy
than in the hospital channel, where different payer
level of competition and supply, and product safety
purchasing mechanisms—which include tendering
i Developed markets include: U.S., Japan, Germany, France, Italy, U.K., Spain, Canada, South Korea, Australia
2
and contracting—and different types of incentives, eliminate the incentive for biosimilar manufacturers
provided by or enforced by payers, drive higher levels to innovate in areas to support patients and providers
of uptake. Price competition among manufacturers in when they select on price only.
response to different payer purchasing mechanisms
An increased focus on a number of areas is necessary
results in different levels of price erosion, with single-
in order for payers and policy makers to help
winner tenders exerting maximum pressure on price
strengthen sustainability in the long-term and ensure
but negatively affecting sustainability.
biosimilars continue to improve access to safe and
Some of the key elements of a sustainable system high-quality biologic treatments in Europe. Firstly,
were found to potentially be at future risk due to safeguarding the interest of patients and serving
payer-driven switch (where a patient’s treatment is their needs in the best way possible remains a
switched by the treating physician but influenced by critical consideration for health authorities and will
payer decisions, incentives and prescribing barriers) become even more so as a greater number of new
and purchasing systems. For physicians, sustainability biosimilars coming to market will be able to be self-
means being able to consistently deliver the best administered. Secondly, while creating incentives that
healthcare for patients and to maintain their freedom promote biosimilar uptake, it is necessary to ensure
to prescribe relevant treatments of choice . However,
5
that physicians retain prescription freedom to offer
payer-driven switch reduces physician prescription the best product selection for a specific patient.
choice and patient involvement in the treatment Thirdly, careful design of purchasing mechanisms is
decision, limiting or changing product selection for important, with tenders and contracts designed to
the patient by removing some as possible options have multiple winners and include criteria other than
for physicians to select without adding significant price, as they allow greater prescription and product
work-burden. Overall, the impact of these policies is choice for physicians and patients respectively, as well
expected to be greater for patients whose disease as sustain healthier levels of competition as compared
requires chronic treatment (e.g., diabetes). In addition, with single-winner tenders.
payer-driven switch, especially if enforced though
Overall, in an environment that fosters sustainability,
negative physician incentives, provides a means to
both originator biologic and biosimilar manufacturers
manage healthcare budgets in the short term but
will be incentivised and encouraged to continue
jeopardises sustainability by disrupting market forces
innovating in differentiation areas for their products
and bringing uncertainty to manufacturers of whether
outside price and to continue the development of
they will be locked out from selling product in a
new biologic products, including biosimilars, thus
market for a duration of time.
further supporting the sustainability of the biologics
Although single-winner tenders were found to achieve market and finding new ways to assist in the needs of
greatest price reduction on biologic molecules when all stakeholders.
biosimilar competition exists, they were also found
not to support long-term sustainability as they disrupt
market forces and competition by excluding non-
winner manufacturers from the market for the duration
of the tender contract. Additional evidence suggests
single-winner tenders do not always optimise savings,
since physicians can still use non-preferred product
at a higher price; whereas multi-winner tenders offer
price reductions on all contracted products. They also
3
Sustainability in the biosimilars marketplace
• Biosimilars are now an integral part of the market for biologics (both original and biosimilars), which
accounted for $277 billion in sales globally in 2017 and is projected to reach $452 billion by 2022.
• Forty-five biosimilars (for 15 biologic medicines) are now approved and registered across Europe.
They treat a broad variety of diseases within oncology, autoimmune disorders, diabetes and fertility.
• A large and diverse group of manufacturers – 184 in total globally – are investing in the development
and commercialisation of biosimilars.
• Mechanisms to facilitate biosimilar use have been established at the EU and country level. These have
consistently emphasised the role biosimilars can play in expanding biologics access for patients while
lowering patient treatment costs.
• A multi-faceted view of sustainability includes elements affecting all stakeholders including patient
access, physician prescription choice, a means to manage existing healthcare budgets, and the
safeguarding of healthy levels of competition, supply and product safety and quality.
• Metrics that can gauge trends in individual elements of sustainability are useful tools to monitor
progress and the impact of policy decisions.
• A set of seven countries with differing payer approaches to biosimilars management, and different
utilisation of seven molecules that recently faced biosimilar competition, provide a useful basis for
studying the elements of sustainability.
• A route to sustain the market for biosimilars will ensure ongoing benefits for all stakeholders in the
long-term.
AVAILABILITY OF BIOSIMILAR PRODUCTS is expected to go off patent from 2019 to 20222. By

Over the past 12 years, biosimilars have transformed 2027, 77% of current biotech spending is expected to
the marketplace for biologic medicines. To date, be subject to some form of competition2.
45 biosimilars for 15 biologic molecules have been
As more original biologic patents expire, a large
approved and registered by the European Medicines
and diverse group of manufacturers – 184 in total
Agency (EMA)4, treating a variety of diseases within
globally3 – are investing in the development and
oncology, autoimmune disorders, diabetes and
commercialization of biosimilars. A growing number
fertility (see Exhibit 1). Biosimilars are now an integral
of biosimilars are therefore expected to undergo
part of the total market for biologics, which accounted
the approval process and reach the market in
for $277 (€238) billion in sales globally in 2017 and is
the upcoming years, particularly in oncology and
projected to reach $452 (€388) billion by 20221.
autoimmune disease. As an example, in addition to
In ten developed markets alone , $45 billion of
7
the two rituximab biosimilars already approved for
biotech spending is now estimated to be exposed use in Europe by the EMA, there were 25 more in
to biosimilar competition, and another $52 billion development at the end of 2017. Similarly, over 40
4
Exhibit 1: Availability of Biosimilars in Europe
Enoxaparin
Sodium Trastuzumab
Somatotropin Epoetin alfa Infliximab Etanercept Rituximab Bevacizumab
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Epeotin zeta Filgrastim Follitropin alfa Insulin glargine Insulin lispro Adalimumab
Molecules selected
as case studies Teriparatide
for analysis
Source: EMA List of Biosimilars, May 20184; IQVIA Global Consulting Services, Jul 2018
Notes: Molecules were selected as research case studies based on availability of data. Only the first biosimilar approved per molecule is presented.
Total number of biosimilars approved by the EMA is 45 as of August 2018.
adalimumab biosimilars are in varying stages of the respective reference originator biologic, once
development by manufacturers in Europe, North biosimilar comparability has been demonstrated.
America and Asia Pacific – a number that raises the
6
question of whether markets can support all of these The EMA regulatory process excludes from their
competitors, although this topic is not addressed in remit the topic of interchangeability (a fundamental
this report. element of biosimilar policies) and instead leaves

interchangeability decisions to individual countries
EUROPEAN POLICIES AND FRAMEWORKS as part of national policy. Within this report,
FOR BIOSIMILARS interchangeability, switch and substitution are defined
The establishment of policies and regulatory according to the EMA7, which highlights the difference
frameworks for biosimilars at the European and between switch, based on physician and patient
country levels reflect considerable efforts to facilitate joint decision-making, and substitution, done at the
biosimilar use and to emphasise the role they can play pharmacy-level automatically without consulting the
in expanding patient access to biologic medicines prescribing physician (see Exhibit 2).
while lowering treatment costs. At the European level,
the establishment of a centralised procedure for the To date, switch decisions remain with the physician;
evaluation and regulatory approval of biosimilars with automatic substitution by the pharmacy without
clear guidelines for manufacturers provided the first physician consent is generally not allowed, although
step in improving patient access to biosimilars. As in some cases hospitals and hospital pharmacists
part of this procedure, biosimilar manufacturers are will informally push physicians to switch8. Moreover,
required to submit an abbreviated dossier, which is clinical guidelines at the European and individual
assessed according to standard approval timelines, country level do not discriminate between originator
such as those for original molecules. Biosimilar or biosimilar, placing all products on an equal
medicines can be awarded the same indications as playing field.
5
SUSTAINABILITY IN THE BIOSIMILARS MARKETPLACE
other healthcare professionals, payers, the Member

Exhibit 2: The EMA’s Definitions of
States’ competent authorities and the pharmaceutical
Interchangeability, Switch and Substitution
industry)” in an effort to establish further non-
INTERCHANGEABILITY regulatory approaches to enhance access to and
The possibility of exchanging one medicine for another medicine that uptake of biosimilars in Europe11.
is expected to have the same clinical effect. This could mean replacing
a reference product with a biosimilar (or vice versa)
or replacing one biosimilar with another In addition to the biosimilar framework set by the
European Medicines Agency and other European
Replacement can be done by: actions, countries have adopted different policies
to manage biosimilars, particularly around pricing,
SWITCHING SUBSTITUTION (Automatic) purchasing and utilisation, although some of these
When the prescriber decides to The practice of dispensing one policies may also apply to originator biologics:
exchange one medicine for medicine instead of another
another medicine with the same equivalent and interchangeable
therapeutic intent medicine at pharmacy level 1. Biosimilar reference pricing: Reference pricing
without consulting the rules, which set reimbursement based on the
prescriber
prices of the originator and other biosimilars for
Source: European Medicines Agency. Biosimilars in the EU – Information guide
for healthcare professionals. 20177.
that molecule, function similarly to the reference
pricing for generics, and exist in Spain, as well
as Norway and Denmark. In addition, national
European efforts to increase the reliability of, and payers in Italy and Spain expect biosimilars
public trust in, biosimilars in terms of quality and to have a 20–30% lower launch price versus
safety, are reflected in the EMA’s attempts to increase originators. Originator price cuts are also expected
the transparency of biosimilar approvals, as well as in by payers upon biosimilar entry in Germany,
the release of a document in collaboration with the France and Italy in the hospital sector, as well as
European Commission aimed at providing reliable Denmark. Additional discounts on both biosimilar
information for Health Care Practitioners (HCPs)9. and originator list prices are also expected
This document provides a definition of biosimilars, a and are realised via tenders or negotiated
comparison of biosimilars to generics, reassurance through contracting arrangements, resulting in
of biosimilar safety and an in-depth overview considerably lower net price levels.
of the biosimilar regulatory pathway. It further
provides information and guidance for HCPs around 2. Biosimilar purchasing: Hospital biosimilar
communicating with patients on biosimilars. purchasing is done via subnational or multiple
tenders in France, Italy and Spain, while Norway
Furthermore, the European Parliament adopted a and Denmark have national tenders in place.
resolution in March 2017 proposing measures to Hospital purchasing in Germany and the
increase access to medicines within the European Netherlands is handled through contracts, while
Union. In part, it calls for a more predictable and no specific purchasing mechanisms are used for
stable framework of drug patent protection and biosimilars in the retail purchasing sector.
fewer delays hindering entry of biosimilars. It also
calls for streamlining the assessment process, to 3. Biosimilar utilisation: Across the markets in scope,
accelerate patient access and lower administrative physician switching is allowed, while automatic
burdens for biosimilar companies10. The European pharmacy-level substitution is forbidden.
Commission (EC) has also established a regular multi- Nevertheless, physicians may be encouraged
stakeholder workshop aimed at bringing together all to switch to a biosimilar product by hospital
“concerned stakeholders (patients, physicians and pharmacists informally across markets8. Incentives
6
Exhibit 3: U.K. Example of a National Framework for Biosimilar Commissioners
Assessment of Monitoring and

Engagement Implementation
the Opportunity Data Collection
• Current treatment pathways • Identify key stakeholders • Getting the best price • Pharmacovigilance
• Availability of products • Materials for engagement • Decision to prescribe • Monitoring uptake
• Materials for implementation • Switching
• Incentivising prescribing
Source: National Health Service England. Commissioning framework for biological medicines (including biosimilar medicines), 2017 Sep12.
for biosimilar use differ between the hospital the need for collaboration and engagement with
and retail sectors. In the retail sector, incentives patients, prescribers and providers in these efforts.
are implemented via prescription indicators or Commissioners are encouraged to promote switching
quotas that are usually softly enforced at the where appropriate, incentivise prescribing and moni-
physician level, leading to slower biosimilar uptake. tor biosimilar uptake via a dedicated database.
Meanwhile, in the hospital setting, incentives are
usually applied at the practice or regional level by DEFINING SUSTAINABILITY FOR THE
measuring them against performance indicators BIOSIMILARS MARKETPLACE
or internal benchmarks, as well as indirect financial Biosimilars are seen as a key means to alleviate
incentives such as where funding is determined financial challenges faced by many stakeholders
though diagnosis related groups (DRGs) and paid a in the currently constrained European budgetary
fixed amount per-patient per-case. environment. With the potential to offer savings of
more than €10 billion between 2016 and 2020 in the
Biosimilar frameworks have further been created at EU5 countries alone5, payers could see increased
the country level. For instance, the National Health biosimilar use resulting in a relief of budgetary
Service (NHS) England developed a commissioning constraints, or a reallocation of funds (for instance
framework for biologics medicines12 with an emphasis towards emerging innovative therapies), depending
on the current and future use of biologics, highlight- on the policy priorities of each country. Additionally,
ing potential savings of at least £200 million to £300 the availability of biosimilars promises to provide
million per year by 2020 or 2021 through the use of physicians with additional choices of biologics for
biosimilars. The framework is aimed to support local prescribing, while improving patient access to such
commissioners, who are responsible for assessing, medicines and encouraging healthy competition
planning, prioritising, purchasing and monitoring the between manufacturers. Simultaneously, maintenance
NHS health services in their respective regions. As of safety, quality and supply of all biologic medicines,
such, it provides guidance on how best to utilise the including biosimilars, remains a key consideration for
opportunity presented by increased competition in all stakeholders7.
the biologics market and to commission biosimilars,
by guiding them to specific actions across four areas Sustaining the market for biosimilars is key in securing
(see Exhibit 3). The NHS in England further highlights the long-term benefits of increased biosimilar use for
7
Exhibit 4: A Multi-Stakeholder Definition of Sustainability for the Biosimilars Marketplace
PATIENT ACCESS
SAFE AND HIGH PHYSICIAN

QUALITY BIOLOGIC PRESCRIPTION
MEDICINES CHOICE
Biosimilar sustainability
improves patient access and physician
prescription choice of safe and high quality
biologic medicines, in a framework that considers the
ongoing needs of all stakeholders (patients, healthcare
professionals/providers, payers and manufacturers), HEALTHCARE
NEEDS OF ALL
STAKEHOLDERS provides a means to manage existing healthcare BUDGETS
budgets while safeguarding a healthy level of

competition and supply.
HEALTHY HEALTHY
LEVEL OF LEVEL OF
COMPETITION SUPPLY
Source: IQVIA Global Consulting Services, Jul 2018
all stakeholders and supporting the development of Policies can influence the achievement of these
further biosimilar molecules. A multi-faceted view of elements variably, and it is therefore valuable to
sustainability – one including elements affecting all explore which policies best secure a sustainable
key market stakeholders and influencing the uptake environment that supports these. Five key areas
and utilisation of biosimilars – is therefore necessary were identified that have significant influence on
to evaluate the current biosimilar policy landscape sustainability in the biosimilars marketplace, including
in Europe (see Exhibit 4). The elements included in the current regulatory environment and clinical
this view therefore represent the needs of patients, guidelines for biosimilars, product and supply features,
physicians, payers and manufacturers and aligns incentives for biosimilar use and competitive market
with the healthy functioning of the marketplace for pressures such as pricing, all of which influence overall
biologic medicines. patient access to biologic medicines (see Exhibit 5).
Exhibit 5: Biosimilar Sustainability Assessment Framework: Key Areas
Regulatory Environment and

Clinical Guidelines
• Time to access the market

• Treatment guidelines
• Interchangeability policies
Competitive Pressure Product

ACCESS TO
• Level of competition BIOLOGIC MEDICINES • Safety and quality
• Pricing rules and dynamics • Supply continuity
• Purchasing mechanisms
Incentives
• Patient factors
• Provider and prescriber
incentivisation
8
These five key policy areas are: for manufacturers, as well as provide greater
opportunity for manufacturers to obtain a return
1. Access to biologic medicines: Policies that support
on their investment. Sustainable policies therefore
sustainability enable greater use of biosimilars,
ensure that more than one competitor continues
leading to increased patient access to biologic
to supply the market and periodicity is short
therapies.
for tenders (twelve months maximum). Finally,
these policies aim to achieve a steady price
2. Regulatory environment and clinical guidelines:
erosion across competitors, and at the same time,
Existing regulatory policies offer a bespoke
guarantee that originators do not offer aggressive
pathway for biosimilars, granting them faster
price discounts to sustain their market share.
access to market, and hence support sustainability.
Additionally, sustainable policies place biosimilars
and originator biologics at the same level in
clinical guidelines, allowing physicians to choose “If the physician decides to
a treatment based on the patient’s best interest switch a patient, that’s fine.
and ensuring treatment continuity for previously
The economic value should not
treated patients, and have clear interchangeability
policies not allowing for pharmacy-level
guide the medical decision...
substitution without physician consent. Now, even though there is
more data present around
3. Product: Policies that support sustainability
guarantee safety, quality and supply standards for biosimilarity, I would not
biosimilars. Procurement policies also minimise the subsume any clinical reasoning
risk of biosimilar and originator supply shortages,
for economic reasoning.”
ensuring patient’s product continuity.
Expert, Italy
4. Incentives: Policies that support sustainability
ensure alignment between the direct incentives
offered to different stakeholders by payers to
influence product choice and indirect incentives
tied to the financing and reimbursement Within these five policy areas, a set of qualitative and
mechanisms in place. Additionally, these policies quantitative metrics were selected as the best means
should not encourage patient preference for a to assess impact on sustainability. These metrics
specific product. were used within this study to examine the impact
of current policies on long-term sustainability in the
5. Competitive pressure: Policies that support biosimilars marketplace, identify where sustainability
sustainability apply price pressure on biosimilar may be at risk in the future based on the current
and originator biologics to enable reductions in landscape and determine how hypothetical changes
the budget impact of biologic medicines, while in these (i.e., future scenarios) may impact these areas
safeguarding a healthy level of competition in of risk (see Exhibit 6).
the market. Sustainable policies avoid over-
concentration, with no single product (either
originator or one biosimilar) dominating the market
or securing long-term contracts greater than
24 months. This helps to prevent supply challenges
and keep the market attractive and competitive
9
Exhibit 6: Biosimilar Sustainability Assessment Framework: Qualitative and Quantitative Metrics Examined
POLICY AREAS AREA SUBTYPE # Metric Measure
ACCESS TO BIOLOGIC Increased molecule use by Increase in DDD over the

ACCESS 0.
MEDICINES biosimilar entry study time
Time from EMA approval to first sales

TIME TO ACCESS THE MARKET 1. Time to first sales of first biosimilar (months)
REGULATORY Positive / neutral (molecule) /

TREATMENT GUIDELINES 2. Treatment guidelines negative
ENVIRONMENT
AND CLINICAL
GUIDELINES SWITCHING POLICIES 3. Physician switching policies (Not) enforced / allowed / other
SUBSTITUTION POLICIES Pharmacist automatic substitution

4. (Not) enforced / allowed / other
policies
SAFETY AND QUALITY 5. Safety and / or quality control alerts Number of alerts
PRODUCT
Presence / absence of supply
SUPPLY CONTINUITY 6. Number of shortages
shortages
PATIENT FACTORS 7. Patient incentives Yes / No
8. Existence of prescription quotas Yes / No

INCENTIVES
PROVIDER & PRESCRIBER
9. Provider financial incentives Yes / No; Specify incentives
INCENTIVISATION
Physicians quotas linked with

10. Yes / No
financial incentives
11. Biosimilar penetration % of biosimilars over total molecule

LEVEL OF COMPETITION
12. Biosimilar competitor concentration # competitors taking 90% market
Mandatory price cut policy for

13. Yes / No
originator
Price reference policy at molecule

14. Yes / No
level
PRICING RULES AND

15. Price erosion vs. originator % vs. originator
COMPETITIVE DYNAMICS
PRESSURE Price evolution of biosimilars over
16. % vs. originator
time
Price evolution of biosimilars over

17. % price reduction
time
18. Length of contracts Months
PURCHASING MECHANISMS 19. Number of winners Single vs. multiple
Winner decision criteria beyond Positive / neutral / negative for

20. price biosimilars

Notes: DDD = Defined daily dose.
10
The various policy areas were assessed across contracting-only markets and mixed markets that
multiple metrics, except for access to biologic include either or both tendering and contracting – and
molecules, which was measured by the impact across a set of seven biologic medicines that have
of biosimilar introduction on overall molecule faced recent biosimilar competition (see Exhibit 7).
utilisation. The ecosystem created by the current The biosimilars now available for the seven biologic
regulatory environment and clinical guidelines was medicines chosen were launched in the European
evaluated by estimating ‘time to first sales’, assessing market between 2013–2017, thus allowing for an
the impact of guidelines discriminating biosimilar analysis of relatively recent biosimilar competition,
or originator products, as well as by identifying as well as investigation into historical trends. Further,
physician medicine switching policies and pharmacist these molecules have varied purchasing and use
substitution policies and their respective impact on characteristics, and along with the countries selected,
biosimilar use and uptake. Product elements were serve as a useful basis to study biosimilars in Europe.
assessed by examining the impact on biosimilar
and originator supply shortages and their possible Exhibit 7: Countries and Molecules Assessed
implications, looking at biosimilar safety alerts, supply
COUNTRY MOLECULE ACRONYM
shortages and contingency mechanisms. Further,
patient, physician or care-institution incentives for Germany Insulin lispro INS-LP
increased biosimilar use were identified to determine
Netherlands Rituximab RIT
their impact on sustainability. Finally, competitive
pressure was assessed by determining biosimilars
France Enoxaparin sodium ENO
market penetration and competitor concentration,
examining pricing policies for biosimilars and Italy Etanercept ETA
originator biologics, estimating their impact on price

Spain Insulin glargine INS-G
erosion and supply and finally the impact of existing
purchasing practices (e.g., tendering). Norway Follitropin alfa FOLα
The impact of each metric on sustainability in the Denmark Infliximab INF

biosimilars marketplace was assessed across a set
of seven European markets with differing payer
Note: Erythropoietin (EPO) and granulocyte-colony stimulating factor (GCSF),
purchasing mechanisms – tendering-only markets, the first biosimilars launched, were not included due to limited data availability.
11
Current dynamics of biosimilars in Europe
• Biosimilars have significantly contributed to increased patient access to biologic medicines.
• The European regulatory environment and clinical guidelines are generally positive toward sustainability
by creating a neutral or positive environment for biosimilars relative to originator biologics.
• Biosimilars have proven to be safe, quality products and manufacturers have provided reliable supply
to markets.
• Different payer purchasing mechanisms result in differential uptake, price erosion and concentration of
biologics.
• In the retail setting, where physician switching incentives may formally exist but with lenient
implementation, and patients may be familiar with or attached to specific products, biosimilar uptake is
slower than in the hospital purchasing channel.
• In the hospital channel, different payer purchasing mechanisms, such as contracting and tendering,
and different types of positive and negative incentives, provided by or enforced by payers result in
different levels of uptake, price erosion and concentration.
• Price competition dynamics by manufacturers in response to different payer purchasing mechanisms

result in different levels of price erosion, with single-winner tender markets resulting in the most
significant short-term price reductions but jeopardising long-term sustainability.
• Recent dynamics in the biosimilars market pose threats to two key elements: payer-driven switch and
tender systems, which award total molecule market volume to a single competitor.
PATIENT ACCESS TO BIOLOGICS the recommendations of the European Society for

Among the countries and molecules reviewed, Medical Oncology (ESMO)13, prescribers prefer having
biosimilar launch brings with it an increase in patient some time to familiarise themselves with new agents,
access to biologic medicines by increasing overall inform patients about possible treatment switch and
biologic molecule utilisation (i.e., all variants of the monitor patients whose treatment has been switched
same biologic medication, including the originator more closely, before routinely prescribing a new
and biosimilar products). This can be seen for biosimilar 8. Faster biosimilar penetration rates are
usually seen in specialties where physicians have
all molecules that have achieved a minimal level
previously been exposed to biosimilars and have
of adoption within a country (see Exhibit 8). The
more experience in using them8.
launch of biosimilar competitors increases molecule
growth and utilisation in the years following launch. Biosimilar use is also linked to fewer restrictions in the
However, growth begins to slow to pre-launch levels use of biologics with respect to treatment duration
within a few years, often reflecting the declining and dosing (e.g., using full loading doses in anti-TNF
competitiveness of the molecule itself within a treatment) allowing, in most cases, for correct dosing
market that includes innovative therapies. In line with and hence favouring better patient outcomes.
12
Exhibit 8: Growth in Molecule Utilisation Across Countries with Successfully Adopted Biosimilars, as a
Percentage of 2012 Values
180% 10% 8% 14%

Mar 2012 MAT Sales Measured in DDD
Sales Volume Evolution as a Percent of
160% 5% 7% 6% N/A 12%
140% 1% 7% 1% 3% 10%
8%
Molecule Growth
120%
6%
100%
4%
80%
2%
60%
0%
40% -2%
20% -4%
0% -6%
2012
2013
2014
2015
2016
2017
2018
2012
2013
2014
2015
2016
2017
2018
2012
2013
2014
2015
2016
2017
2018
2012
2013
2014
2015
2016
2017
2018
2012
2013
2014
2015
2016
2017
2018
Etanercept Follitropin alfa Infliximab Insulin glargine Rituximab
CAGR CAGR Originator Biosimilar Year of launch Growth Over Prior Year
pre-launch post-launch
Source: IQVIA MIDAS, MAT Mar 2012 – Mar 2018.

Notes: DDD = Defined Daily Dose. Includes all countries and molecules where >6.6% country penetration of molecule was achieved by MAT 2018; Star indicates
appearance of first sales within IQVIA data for countries included. All data shown is a full year moving annual total ending in March of that year. Drops in 2018 may
reflect entry of alternative branded drugs or biosimilars with more convenient method of administration.
In line with public statements made by drug agencies, by health authorities, the uptake is usually fast, while
different uptake patterns have also been observed in countries like Italy, where health authorities had a
across countries. For example, in countries like conservative perspective, the uptake has been slower
Norway, where biosimilars are strongly promoted (see Exhibit 9).
Exhibit 9: Growth in Utilisation by Country of All Molecules Exposed to Biosimilar Competition Where
Biosimilars Were Successfully Adopted, as a Percentage of 2012 Values
300% 45%
Mar 2012 MAT Sales Measured in DDD
Sales Volume Evolution as a Percent of
40%
6% 22%
250% 35%
30%
14% 8% 6% 17%
Molecule Growth
200%
25%
7% 7% 2% 6% 6% 2% –1% 7% 20%
150%
15%
10%
100%
5%
50% 0%
-5%
0% -10%
2012
2013
2014
2015
2016
2017
2018
2012
2013
2014
2015
2016
2017
2018
2012
2013
2014
2015
2016
2017
2018
2012
2013
2014
2015
2016
2017
2018
2012
2013
2014
2015
2016
2017
2018
2012
2013
2014
2015
2016
2017
2018
2012
2013
2014
2015
2016
2017
2018
Germany Netherlands France Italy Spain Norway Denmark
CAGR CAGR Originator Biosimilar Year of launch Growth Over Prior Year
pre-launch post-launch
Source: IQVIA MIDAS, MAT Mar 2012 – Mar 2018.

Notes: DDD = Defined Daily Dose. Includes all countries and molecules where >6.6% country penetration of molecule was achieved by MAT 2018; Star indicates
appearance of first sales within IQVIA data for countries included. All data shown is a full year moving annual total ending in March of that year. Drops in 2018 may
reflect entry of alternative branded drugs or biosimilars with more convenient method of administration.
13
CURRENT DYNAMICS OF BIOSIMILARS IN EUROPE
Exhibit 10: Time to First Sales for Biosimilars versus Branded Products by Country
Difference between biosimilar average

Country Time to first sales (months) as compared with branded average (months)
-2 Despite fast time to access, biosimilars take slightly

Germany shorter to register sales than branded products
-5 Biosimilars take on average 5 months less than

Netherlands branded products to register first sales
-0,4 Biosimilars take similar time to first sales than

France branded products
-2,9 Biosimilars take almost 3 months shorter than

Italy branded products
-7 Biosimilars take 7 months less than branded

Spain products

Norway products

Denmark products
0 3 6 9 12 15 33
INF FOLα INS-G ETA ENO INS-LP RIT Shorter Similar Longer
Biosimilar Average Branded Average Outliers
Source: IQVIA MIDAS, Mar 2018; IQVIA Global Consulting Services, Jul 2018
Notes: The average score does not take into account outliers. Time to first sales for infliximab in the Netherlands and Denmark is based on the extended
patent expiry date. Clear outliers were excluded from country level analysis.
REGULATORY ENVIRONMENT AND CLINICAL

GUIDELINES “[Italy] didn’t experience as much
Regulatory policies and clinical guidelines in the seven
uptake of biosimilars as expected.
markets examined are generally neutral or positive
towards sustainability in the biosimilars market,
The OSMED database indicated
creating a favourable environment for biosimilars. some issues… that biosimilar
As the European Commission reports, there is no uptake was good when more
single approach to ensure successful utilisation of
than four biosimilars of the same
biosimilars11, as reflected in the variable uptake across
markets and products.
compound were available, but
somehow the uptake was not as
Overall, the ‘time to first sales’ (defined as the
expected [since] it was only two
time from market approval to first product sales)
for biosimilars is lower than the time to first sales products.”
for branded products across all markets in scope
(see Exhibit 10), reflecting a positive regulatory Expert, Italy
environment for biosimilars. Delays in product
launches in some markets might be driven by the
Overall, retail molecules tend to take longer to
company’s strategic decision and commercial
register first sales than hospital drugs, with significant
opportunity or intellectual property issues, rather
time lag observed.
than by country health authorities. For instance, the
manufacturer of the first rituximab biosimilar delayed Finally, treatment guidelines are neutral or positive
launch in some countries to ensure supply continuity. towards biosimilar products in most countries, placing
14
them all at the same level as the originator in terms instance, France is currently drafting a new law to
of clinical efficacy. Decisions to switch treatments create contingency mechanisms for possible supply
from originator biologic to biosimilar (or the other chain shortages, and other countries like Norway or
way around) remain at the physician’s discretion Germany include penalties for manufacturers if supply
across markets. An exception was in Italy, where shortages occur.
Agenzia Italiana del Farmaco (AIFA) guidelines did
INCENTIVES
not originally consider biosimilars as interchangeable
Incentives are used by payers across countries to
with originator biologics, and physicians were
influence physician and patient product choice.
required to justify the switch decision. However,
Patient, physician or care-institution incentives can
updated guidelines were published recently and
influence biosimilar uptake as well as patient quality
this requirement was removed14. Overall, guidelines
of care, by influencing treatment decisions based on
discriminating between or against biosimilar or
price rather than on clinical criteria or patient needs.
originator products, as well as physician switching and
Incentives can be financial or non-financial (e.g.,
automatic pharmacy-level substitution policies, can
physician prescription quotas), positive or negative
have impact on biosimilar use and uptake.
(e.g., financial bonuses or penalties, respectively), be
BIOSIMILAR SAFETY, QUALITY AND SUPPLY applied as guidelines or targets, or be a combination
Authorised biosimilars have proven to be safe, high- of these16. Incentives within the hospital and retail
quality products with manufacturers providing a sectors differ.
reliable supply to markets. For this reason, the EMA
In the retail purchasing sector, physician switching
states: “[…] biosimilars approved through the EMA can
incentives may formally exist, but often have lenient
be used as safely and effectively in all their approved
implementation. This is partly because prescribers are
indications as other biological medicines”7. There
rarely the budget holders and are thus less focused
have also been no supply shortages for biosimilar
on creating savings, combined with incentives that are
products reported to date by the EMA15. No safety
not stringent and not always linked to consequences.
or quality alerts have been identified, although this
Formal mechanisms in the retail sector set out by
remains critical to the EMA and individual country
payers to incentivise biosimilar use include:
health authorities as an issue to guard against. For
• Prescribing targets for biosimilars linked to

“There are no shortages [of financial or non-financial incentives, such as the
prescribing-related performance bonuses for
biosimilars], although it is difficult
biosimilar insulin use enforced in France
to manufacture them. We
expected more of them…. It is • Federal prescribing targets, including minimum
prescription volume targets for several biosimilars,
not excluded that it won’t happen
currently in place in Germany
though — prices are sharp and
there are risks in the market. Existing provider incentives are not specifically
designed to encourage biosimilars (at times
I would expect there to be more
stretching across a range of recommendations
problems in the future as the about care delivery) and not always linked directly to
prices will be lower and lower.” financial incentives. In the case of Germany, federal
prescribing budget targets are employed as direct
Expert, Netherlands incentives to encourage overall biosimilar use, but
since they are set on a regional level, it is up to the
15
Exhibit 11: Infliximab Biosimilar Prescribing Targets Set by KVs and KBV in Germany
INFLIXIMAB BIOSIMILAR (AS A PERCENT OF TOTAL INFLIXIMAB VOLUME)
SELECTED KVs KV TARGETS KBV TARGETS
2016 2017 2018* 2016 2017 2018*
Berlin 7.0% n/a n/a 2.2% 20.2% 35.0%
Saarland 9.6% 33% n/a 9.6% 25.7% 47.6%
Sachsen 20% 20% n/a 1.0% 11.6% 19.1%
Westfalen-Lippe > 45% > 75% n/a 11.4% 44.8% 68.0%
Average (across KVs) — — — 5.6% 24.6% 40.6%
Range (across KVs) — — — 0.4-16% 11.5-45% 19-70%
Source: KVB national target recommendations 201717; Saarland KV 2017 targets18; Westfalen-Lippe KV 2017 targets19; Sachsen 2017 targets20; Berlin KV 2016
targets21; Saarland KV 2016 targets22; Sachsen KV 2016 targets23; Westfalen-Lippe KV 2016 targets24; KVB national target recommendations 201625; KVB national
target recommendations 201826.
*Notes: Four selected Kassenärztliche Vereinigung (KVs) are presented in this table. Average and range estimated across all 17 KVs.
regions to implement them. At national level, federal (e.g., Benepali) rather than the branded originator
prescribing targets for therapy areas are set between (Enbrel) for cost savings, describing them as
the GKV (Gesetzliche Krankenversicherung; German therapeutically equivalent, while Bayern KV
statutory health insurance) and KBV (Kassenärztliche recommends only that naïve patients be started on
Bundesvereinigung, or German national association of biosimilar products.
statutory health insurance physicians, that influences
Indirect patient incentives impacting retail biologics
decisions on medical service provision by supervising
may also exist in the retail setting, such as when
and representing the interest of physicians at the
biosimilars are linked to lower co-payments or
federal level), including minimum prescription
exemptions from co-payments. However, in cases
volume targets for several biosimilars which vary by
when patients self-administer the product, they
region (see Exhibit 11). KBV targets17 for the 2018
are familiar with and often more attached to the
year have increased significantly versus 2017, with
product or associated device used for their therapy,
infliximab targets rising from 24.6% to 40.6%, and
and therefore more resistant to being switched to
varying by region, ranging from 19.1% in Hamburg to
a biosimilar. These factors, combined with lenient
69.6% in Lower Saxony (average: 41%)17-26. Etanercept
implementation of physician and care-institution
targets too range from 7.7% in Thüringen to 57% in
incentives, results in slower biosimilar uptake
Westfalen-Lippe (average: 25%). KVs (Kassenärztliche
compared to the hospital purchasing channel.
Vereinigung, or the 17 German associations of
Biosimilar uptake needs to be actively incentivised
statutory health insurance physicians that are the
to ensure physician prescription and sustainability in
members of the KBV) are not obliged to abide to the
the retail channel; learnings from the generics market
minimum prescribing targets set by KBV, such as in
also support the need for active incentives to promote
the case of Westfalen-Lippe and Sachsen, which
switch from originators.
have higher targets compared to the national quotas
set by KBV for their respective regions, and can
In the hospital purchasing sector, incentives for
decide to make their own additional conditions or
biosimilar use are less formal and indirect, but
guidelines17-26. For instance, Westfalen-Lippe
nonetheless have a stronger effect on uptake, as
encourages physicians to prescribe biosimilar
practice economics are directly impacted by the
16
patient involvement in therapy decisions combined
“[For doctors] one of the biggest with stronger financial incentives for providers has
contributed overall to stronger biosimilar uptake in
issues [discussed] in the past was
the hospital sector as compared to the retail setting.
losing their prescribing freedom.
But they are also part of the health COMPETITIVE PRESSURE
The speed and level of biosimilar product penetration
system and there are medical
in each market varies substantially depending on
specialist groups that contract market dynamics influenced by the payer purchasing
with the hospital, whose income mechanisms in place, as well as between the hospital
depends on how well the hospital and retail sectors.
does…. If they prescribe less and

the hospital does better, their “When we are talking about
income also becomes higher. The biosimilars, we have to
Ministry of Health accepts the differentiate between biosimilars
freedom to prescribe, but they in the hospital versus the
say, ’what you do for us, you do for outpatient setting…. For retail
yourself’. The doctors understand treatments, the physician is totally
that the world is changing…. They free to make a decision between
understand that it is important to products on the market in France.
lower to the costs of healthcare. The retail pharmacy is not allowed
Prescribing freedom is big but to switch the treatment. [For the
hospital setting] at the beginning
they do think about costs.”
we decided to give the choice to
Expert, Netherlands the physician and all biologics
were available on the formulary,
physician’s choice of biologic product. Depending but it won’t go on like this
on the purchasing and reimbursement mechanisms anymore and it will only be one
in place, care-institutions and physicians face
biosimilar… we will always have
different levels of pressure to promote switch to a
biosimilar product. For instance, in hospitals funded tenders with one winner.”
based on diagnosis related groups (DRG) –where
a hospital is paid a lump sum per patient per case Expert, France
based on diagnosis – such as in France, providers
have an indirect incentive to increase use of biologic
products with lower prices and retain the excess Setting of care
of the DRG tariff as profit. In addition, patients Biosimilar uptake varies substantially between
treated with products purchased in hospitals face hospital-purchased and retail-purchased products,
no additional costs for their treatment and are as the latter are not managed through stringent
usually less attached to the specific product used, mechanisms, such as tenders. Use of single-winner
and therefore do not express a preference between tenders in the hospital setting can lead to rapid
biosimilar and originator biologic products. Lower biosimilar uptake, with biosimilar volume shares
17
Exhibit 12: Biosimilar Penetration in Norway Over Time
Hospital (Tendering System in Place) Retail (Not Payer Managed)
100% 98 100%
86
Biosimilar Share of Molecule

79
80% 80%
73
60% 60%
40% 40%
26
19 31
20% 20%
1 3
0% 0%
0 12 24 36 48 60 0 12 24 36 48 60
Months from first biosimilar first sales Months from first biosimilar first sales
RIT ETA INF INS-G FOLα
Notes: Displays the additive share of all biosimilar products from the time of first biosimilar launch.
reaching 80% for biologic molecules in less than six commonly reduce the prices of all winning products,
months, such as in the case of rituximab in Norway while providing multiple alternatives for prescribers
(see Exhibit 12). In comparison, in the retail sector, to choose and may enable patient continuation on
where biosimilars are not actively managed and current biologic medicines as needed.
promoted, the uptake is significantly lower as in the
case of drugs like insulin glargine.
Additionally, markets vary in their payer purchasing “We consider everything of course:
mechanisms, from contracts – directly negotiated
safety, reliability, stability of
between insurers and manufacturers (as in Germany)
or between hospitals and manufacturers – granting
the product, data, factors that
access to multiple biosimilars, to bidding processes might improve the chance for the
where one or more manufacturers may be awarded product to be on the formulary,
entry to the market or region based on low price or
but we consider that if a product is
other criteria. Such bidding processes include single
(national) tenders or multiple tenders, with single or
on the French market, the product
multiple winners, and many variations in between. already got through several
In single-winner tenders, the winning product is assessments so it means that we
primarily used to supply the market, but physicians
are able to use it safely. Which is
may still request a different product for a patient
as an exception, by providing justification for their
why 85% of the decision is related
choice. Conversely, contracts (e.g., German statutory to the price.”
health insurance) and tenders that are designed to
have multiple winners with criteria beyond price Expert, France
alone keep multiple manufacturers actively engaged,
18
IMPACT OF TENDER TYPES
Although analysis in our report shows that single-winner tenders achieve greatest price reduction on
biologic molecules when biosimilar competition exists, there is additional evidence from other data
sources to show that multiple-winner tenders may result in lower average net molecule costs per defined
daily dose (DDD) for a region overall (see Exhibit 13). This cost savings occurs since price reductions are
obtained on all contracted products (often including the originator) in multiple-winner tenders rather
than only on one product. In sustainable environments where physicians can choose between options
to optimise patient care, and where they may gravitate towards higher list-price products, regions
that achieve price-reductions on all available products see lower average costs. For instance, use of
multiple-winner tenders in Sweden by individual, or groups of, county councils, led in some cases to
lower average net cost for infliximab per DDD at the molecule level (reflecting all products and the
product mix of originator and biosimilars) than single-winner tenders during the first quarter of 2018. The
superior reductions seen here for multiple-winner tenders reflect the interplay of a number of factors
including the price reductions achieved in tenders on any infliximab product (e.g., whether some products
remain available at list- or high-price such as in single-tenders, or the influence of volume discounts in
negotiations) and the increased use of less expensive forms in one area versus another. Examination of
the data shows that regions with the highest net cost often have a high use of a non-preferred product
at a high price. Since payers, similarly to healthcare providers, benefit from multiple-winner tenders, the
fact that they at times realise greater overall molecule savings than single-winner scenarios is important to
note. Finally, tenders with multiple winner offer the option of supply alternatives in case of distribution or
stocking issues.
Exhibit 13: Infliximab Per DDD Product Costs by Swedish County in Relation to Use of
Single - Versus Multiple-Winner Tenders, Q1 2018
Multiple winners, lower cost

4
Multiple Winners
2
Single Winner
Single winner, higher cost

0
50 55 60 65 70 75 80 85 90 95 100 105
Average Net Cost (SEK) per DDD of Infliximab, Q1 2018
Each bubble represents a county council; bubble size reflects the use of the molecule;
Bubble colour represent counties within the same purchasing consortia association
Source: E-hälsomyndigheten (EHM) Hospital Data, Q1 2018

Notes: The difference in average net cost correlates with the negotiated price, and to a higher degree, the extent to which the lowest price product is used -
i.e. the rate at which patients are switched to the lowest cost product.
19
Exhibit 14: Biosimilar Penetration in Denmark and France
Denmark France
Single-Winner, National Tender Multiple-Winner, Sub-national Tenders
100% 100 100%
88

80% 80%
60% 60%
48.6
40% 40%
20% 20%
10.7
0% 0%
0 12 24 36 48 0 12 24 36 48
Months from product’s first sales Months from product’s first sales
Months 12 24 36 Months 12 24 36
Average Share 90% 93.8% – Average Share 9.9% – –
ETA INF
Moderate biosimilar uptake is recorded in markets

where national tenders are not in place – including “The opportunity with biosimilars
Germany, Netherlands, France, Italy and Spain – as is to change between them
physicians take more time to become familiar with
and create more competition
the biosimilar products and start prescribing them
routinely. In contrast, use of national tenders leads to between companies. They give
faster and higher biosimilar penetration, particularly the opportunity to create release
when run as single tenders with single winners, as in in budgets…. At the end of the
the case of Norway and Denmark (see Exhibit 14).
day, the centralized council
Competitor market concentration medicine took the decision to
Following the launch of the first biosimilar, the market
change patients to the cheapest
for a biologic medicine is usually concentrated in option, and that why they have
a single product – either the originator biologic or a fast and high uptake on
the biosimilar. Due to the low number of existing
biosimilars.”
competitors, the leading product may capture up to
90% of the market for the specific molecule (the level
Expert, Denmark
defined in this analysis as denoting a concentrated
market). However, as new biosimilars become
available over time, markets tend to become more
fragmented, with new competitors starting to capture insulin glargine, enoxaparin sodium and insulin lispro.
shares of a specific molecule (see Exhibit 15). In the It should be noted that in countries with single-winner
retail purchasing sector, fewer biosimilar launches tenders for a biologic molecule, market concentration
have led to originators retaining a higher market remains high over time as the tender-winning product
share over time, as demonstrated by the examples of always captures the majority market share.
20
Exhibit 15: Competition Concentration in Germany
EMA approval order

100%
9% 9% 6% 3% 2%
90% 11%
Volume Share (as DDDs)
80% 23% 23% 10%

36%
60% 13%
94% 98% 100%

40%
69% 78%
56% 61%
20%
0%
INF FOLα* INS-G* ETA ENO RIT INS-LP*
Originator Competitor 1 Competitor 2 Competitor 3
Notes: DDD = Defined Daily Dose. Depicts contracting markets in Germany as of 2018. Concentrated markets are defined as those with a single
competitor capturing 90% or more of the market. * Denotes retail purchased products. INS-G presumed to have low penetration due to an aggressive originator
product strategy and patient familiarity with the product device, etc. Totals may not add to 100% due to rounding
Pricing rules, at launch, for biosimilars and rules that

impact the price of the originator when biosimilars
enter the market (e.g., reference pricing) help payers “There is a policy [in Italy]
manage budgets while limiting the impact on
about mandatory discounts for
competition in the market. Payer control over pricing
is enforced via price-regulation policies in the retail generics. [They are] at least
sector, and tenders or contracting arrangements in 20% but normally much higher:
the hospital sector. Our analysis shows that across 70%. This could not be applied
the retail and hospital segments, biosimilars launch
for biosimilars… biosimilars
at a 20% average discount, at list level, versus the
originator (see Exhibit 16). In response to different would not be viable with such
payer purchasing mechanisms, originator and large discounts.”
biosimilar manufacturer pricing behaviour differs,
and results in varying levels of price erosion across Expert, Italy
markets and products; usually, single-winner tenders
result in the fastest and most significant short-term
price erosion, as in the case of Norway and Denmark.
21
Exhibit 16: Percent Difference Between Biosimilar and Originator Price at Biosimilar Launch by Country
10%
0%
-10%
-20%
-30%
-40%
-50%
-60%
-70%
Germany Netherlands France Italy Spain Norway Denmark
Average Total
Difference -8% -6% -10% -23% -19% -19% -15%
Lower Similar Higher
INF FOL INS-G ETA ENO INS-LP RIT Biosimilar Average
Notes: Displays biosimilar product average price vs. originator price at the date of the first biosimilar sales; Uses estimated simple average.
NOTE ON PRICING
This analysis of medicine spending is based on prices reported in IQVIA audits of pharmaceutical
spending, which are in general reported as the invoice prices wholesalers charge to their customers
including pharmacies and hospitals. In some countries, these prices are exclusive of discounts and rebates
paid to governments, private insurers or specific purchasers. In other countries, off-invoice discounts are
illegal and do not occur. The mix of true prices and opaque pre-discounted prices means the analyses in
this report do not reflect the net revenues of pharmaceutical manufacturers or net cost to payers. The use
of off-invoice discounts and rebates along with statutory price concessions required of manufacturers by
governments or government programmes result in net prices and spending lower than invoice.
Originators are also subject to these discounts prior to the launch of biosimilars, and significant levels of
off-invoice discounts and rebates are common for traditional branded medicines. However, discounts on
originator specialty medicines (including biologics) are understood to be low, as payers’ ability to negotiate
lower net costs is often limited by the absence of direct competition with other branded originators or
biosimilars.
The following example from Germany, selected based on net price data availability, demonstrates the
greater and faster extent of price erosion at the net level: for infliximab, while the list price of the first biosimilar
entering the market was 20% lower than the originator’s list price, the net price was 44% lower than the
originator list price (reflecting an additional 24% list-to-net discount) (see Exhibit 17).
22
Exhibit 17: List and Net Prices in Germany, as a Percent of Originator List Price
Infliximab Rituximab
100% 100%
80% 90%
60% 80%
40% 70%
20% 60%
0% 50%
Jan14 Jul14 Jan15 Jul15 Jan16 Jul16 Jan17 Jul17 Jan18 Jul16 Jan17 Jul17 Jan18
Biosimilar 1 List Biosimilar 2 List Biosimilar 3 List Originator List

Biosimilar 1 Net Biosimilar 2 Net Biosimilar 3 Net Originator Net
Product Biosimilar 1 Biosimilar 2 Biosimilar 3 Originator Product Biosimilar 1 Biosimilar 2 Originator

Product's Net vs. List Product's Net vs. List
24% 30% 24% 62% 9% 7% 16%
Price Discount (Jan 2018) Price Discount (Jan 2018)
Source: IQVIA Pricing Insights, Apr 2018; MIDAS Mar 2018

Notes: Analysis is only feasible in Germany and Italy (not depicted) for hospital products, due to data availability. IQVIA Pricing Insights used for list prices.
MIDAS prices used for hospital net prices.
RISKS TO SUSTAINABILITY
Reviewing the current biosimilar landscape across • Payer-driven switching incentives (metrics 8–10):
the individual metrics of the Biosimilar Sustainability Incentives to support biosimilar use are few and
Assessment Framework enables identification of areas leniently implemented across markets, resulting
that pose a potential risk to sustainability in weak enforcement of a switch to a biosimilar
(see Exhibit 18). product. However, potential enforcement of
medicine switching policies by payers in the future,
Overall, the majority of metrics in our analysis were
either via binding guidelines or negative incentives
found to score positive for sustainability across the
to physicians (e.g., financial penalties), remains
countries and biologic medicines in scope. Analysis
an element of critical importance for the long-
shows that biosimilars have contributed to increased
term outlook of sustainability in the biosimilars
patient access to biologics by increasing the overall
marketplace.
use of biologic medicines, in a regulatory environment
that is positive towards biosimilar sustainability. No • Tendering process (metrics 18–20): Additionally,
critical issues on biosimilar safety, quality and supply the results of this analysis reveal that biosimilars
have been identified, while patient incentives (e.g. market concentration (metric 12) is currently high,
lower co-payments or exemptions from co-payments) and therefore suggests a high level of risk to supply,
are affected only indirectly by existing retail rules and particularly due to the use of tendering in the hospital
are not applicable to hospital products. purchasing sector. Concentration has the potential
to decrease over time as physicians gain experience
However, two key elements in the current biosimilar
and familiarity with biosimilar products. Biosimilar
policy framework can potentially pose threats to long-
price evolution varies depending on the mechanism
term sustainability in the biosimilars marketplace: in place: single-winner tenders lead to accelerated
23
Exhibit 18: Biosimilar Sustainability Metrics Across Countries Based on Existing Policies
POLICY AREAS AREA SUBTYPE # Metric DE NL FR IT ES NO DK
ACCESS ACCESS TO BIOLOGICS 0. Increased molecule use

by biosimilar entry ~ ~ ~ – ~ ~ +
TIME TO ACCESS THE
MARKET 1. Time to first sales + + ~ + + + +
REGULATORY
ENVIRONMENT
TREATMENT GUIDELINES 2. Treatment guidelines ~ + ~ – ~ ~ +
AND CLINICAL
GUIDELINES
SWITCHING POLICIES 3. Physician switching
policies + + + + + + +
SUBSTITUTION POLICIES 4. Pharmacist automatic
substitution policies + ~ ~ + + + ~
SAFETY AND QUALITY 5. Safety and / or quality
control alerts + + + + + + +
PRODUCT
SUPPLY CONTINUITY 6. Presence / absence of
supply shortages + + + + + + +
PATIENT FACTORS 7. Patient incentives – – + ~ ~ – –
8. Existence of
prescription quotas – ~ ~ ~ ~ – ~
INCENTIVES
PROVIDER & PRESCRIBER
INCENTIVISATION 9. Provider financial
incentives ~ – – – – – –
10.
Physicians quotas linked
with financial incentives ~ – ~ – – ~ –
11. Biosimilar penetration ~ ~ ~ ~ ~ + +
LEVEL OF COMPETITION
12. Biosimilar competitor
concentration – – – – – – –
13. Mandatory price cut
policy for originator –+
O B + + –+
O B + + +
14. Price reference policy at
molecule level + + + + – – –
COMPETITIVE
PRICING RULES AND
DYNAMICS 15. Price erosion vs.
originator ~ ~ + – + + +
PRESSURE
16. Price evolution of
biosimilars over time ~ + + – – ~ ~
17.
Price evolution of
originators over time – + + + + + +
18. Length of contracts + + + + + + +
PURCHASING
MECHANISMS 19. Number of winners + + ~ + + – ~
Winner decision criteria
20. beyond price – – ~ ~ – – –
O: Originator B: Biosimilar +Positive for Sustainability ~ Neutral for Sustainability – Negative for Sustainability
Areas of Potential Sustainability Risk
price erosion and high savings for payers in the short Changes in these policy elements were assessed
term by creating highly concentrated situations, as being able to restrict physician prescription
but raise concerns of sustainability risks. Multiple- choice, forcing patients to switch treatment as well
winner tenders and contracting arrangements as threatening supply and introducing instability for
lead to less aggressive price erosion but offer the
both originator biologic and biosimilar manufacturers.
opportunity for physicians to gain experience with
Pharmacy substitution was also reviewed as part
newly launched biosimilar products and maintain
of the current policy analysis (metric 4) and was
more choices when making prescribing decisions
for patients. As a result, tendering was identified as a found to pose threats to sustainability, but was not
key element of current policies with the potential to included in the hypothetical future scenario analysis
substantially influence long-term sustainability in the as most countries are unlikely to introduce pharmacy
biosimilars marketplace. substitution in the immediate future.
24
Areas of greater risk to long-term sustainability
• Payer-driven switch, especially if enforced though negative physician incentives, provides a means
to manage healthcare budgets in the short term but jeopardises sustainability by reducing physician
prescription choice, limiting or changing therapy for the patient, reducing patient involvement in
treatment decisions, disrupting market forces and bringing uncertainty to manufacturers.
• Payer-driven switch potentially leads to loss of a therapy option currently working for patients, and the
impact is estimated to be greater for patients whose disease requires chronic treatment.
• Single-winner tenders with price as the only selection criterion exert maximum pressure on price but
jeopardise sustainability.
• By reducing physician prescription choice, limiting or changing therapy for the patient and minimising
patient involvement in treatment decisions, single-winner tendering mechanisms with price as the only
selection criterion fail to meet the needs of all stakeholders.
• Single-winner tendering mechanisms with price as the only selection criterion also disrupt market
forces, thereby bringing uncertainty to manufacturers about continued market participation and
investment profitability; jeopardising long-term competition and eliminating the incentive for
manufacturers to innovate in areas to support patients and providers, hence putting long-term
budget sustainability at risk.
IMPACT OF CHANGES IN PAYER-DRIVEN SWITCH The results of this analysis indicate that payer-
Payer-driven switch is defined as a payer’s effort driven switch, despite providing a means to manage
to increase the rate of physician use of biosimilars, healthcare budgets in the short term with no adverse
possibly supported by incentives to elicit the desired effect on patient access to biologic products, product
prescribing behaviour. The impact on long-term quality and supply, jeopardises sustainability in
sustainability in the biosimilars marketplace of payer- a number of ways, especially if enforced though
driven medicine switching policies, and associated negative physician incentives. Firstly, payer-driven
implementation incentives put in place to drive switch leads to reduced prescription choice for
switching, was evaluated as one of the key elements physicians, who are pressured to consider the payer’s
of the current biosimilar policy framework with the guidance on product options in addition to their
potential to influence sustainability in the future (see clinical judgement. The impact of medicine switching
Methodology – Future Scenarios Design and Analysis). policies is greater when linked to negative incentives,
Three hypothetical future scenarios of payer-driven such as financial penalties, as physicians face greater
switch linked to different incentive structures were pressure to achieve the specified quota, and may be
defined and subsequently analysed with respect to influenced to act outside the patient’s best interest.
their impact on each of the elements encompassed Negative incentives may further impact healthcare
under the sustainability definition (see Exhibit providers by adversely affecting the economics of
19). The analysis also considered the influence of their practice.
therapy duration on the outcome of each scenario, as
switching was expected to have greater impact in the Similarly, payer-driven switch jeopardises patient
case of chronic patient treatment. continuity on the same product – as treatment
25
AREAS OF GREATER RISK TO LONG-TERM SUSTAINABILITY
Exhibit 19: Payer-driven Switch Scenarios – Impact on Sustainability in the Biosimilars Marketplace
SCENARIO I II III
Payer driven switch with Payer driven switch with Payer driven switch with
no financial incentives positive incentives* negative incentives
Patient Access
Physician Prescription Choice ✗ ✗
Safe and High Quality Biologic Medicines
Patients ✗ ✗ ✗
All Stakeholders Providers ✗
Payers ✓ ✓ ✓
Originator Manufacturers
Biosimilar Manufacturers
Healthcare Budgets ✓ ✓
Healthy Level of Competition ✗ ✗
Healthy Level of Supply
✓ ✓ ✗ ✗
Scenarios that Best Very Positive Neutral Negative Very No
Support Sustainability Positive Negative Impact
Notes: *Includes physician quota and margin gains from diagnosis related group (DRG) funding.
decisions become determined by price rather than IMPACT OF CHANGES IN PROCUREMENT POLICIES
clinical judgement – as well as a smooth transition from The second part of the scenario analysis evaluated the
one product to another. The impact of payer-driven impact of different procurement policies, with a focus
switch on patients is greater in the case of chronic on tender dynamics, since this area has an apparent
conditions, such as diabetes, where patients receive effect on long-term sustainability in the biosimilars
lifelong treatment and are more attached to their marketplace. Eight possible future scenarios of
therapy. Medicine switching policies thereby further tendering arrangements were defined and analysed
reduce patient participation in treatment decisions. with respect to their impact on each of the elements
encompassed under the sustainability definition (see
Moreover, payer-driven switch has an overall negative
Exhibit 20). Although not directly tested, contracting
impact on competition, as it disrupts the market, and
mechanisms are expected to have similar behaviour
forces physicians to use a specific biologic product,
to multiple-winner tenders. Tendering arrangements
particularly when linked to positive or negative
were defined based on the number of tenders carried
incentives. Enforcement of medicine switching policies
out per market (one vs. multiple), the number of
by payers also brings uncertainty to both originator
tender winners (single vs. multiple) and the criteria
and biosimilar manufacturers who face the risk of being
used to award the tender (only price vs. price plus
excluded from the preferred list of treatments.
other criteria).
26
Exhibit 20: Tendering Scenarios – Impact on Sustainability in the Biosimilars Marketplace
SCENARIO I II III IV V VI VII VIII

Number of Winners One One One One Multiple Multiple Multiple Multiple
Criteria Price Price+ Price+ Price+ Price Price Price+ Price+
Number of Tenders Multiple One One Multiple Multiple One One Multiple
Patient Access ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Physician Prescription Choice ✗ ✗ ✗ ✗ ✗ ✗ ✗ ✗
Safe and High Quality Biologic Medicines
Patients ✗ ✗ ✗ ✗ ✗ ✗ ✗ ✗
All Stakeholders Providers ✗ ✗ ✗ ✗ ✗ ✗ ✗ ✗
Payers ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Originator Manufacturers ✗ ✗ ✗ ✗ ✓ ✓
Biosimilar Manufacturers ✓
✗ ✗ ✗ ✗ ✓
Healthcare Budgets ✓ ✓ ✓ ✓ ✓ ✓ ✓ ✓
Healthy Level of Competition ✗ ✗ ✗ ✗ ✗ ✗
Healthy Level of Supply ✓ ✓ ✓ ✓

✓ ✓ ✗ ✗
Scenarios that Best Very Positive Neutral Negative Very No
Support Sustainability Positive Negative Impact
The analysis of current dynamics indicate that tenders each tender contracting period based on non-clinical
overall improve access to biologic treatments as criteria (i.e., tender price). Furthermore, single-winner
products become available at lower prices and do not tendering disrupts market forces as manufacturers can
adversely affect safety, quality and supply stability. get excluded from the market for variable periods of
time, depending on tender-contract duration. Single-
While single-winner, national-level tendering with
winner tenders are therefore negative for both originator
price as the only selection criterion was identified
and biosimilar manufacturers, particularly when a single
as the tendering arrangement with the potential to
tender is conducted at national level rather than multiple
exert the maximum pressure on price, this jeopardises
individual tenders at subnational levels. Exclusion of
long-term sustainability. This tendering arrangement
results in substantially reduced prescription freedom manufacturers from a market or region is expected to
for physicians, who are required to provide justification jeopardise healthy competition in the long-term; while
for choosing to treat a patient with a different product. price as the only assessment criteria is expected to
In addition, single-winner tenders negatively impact eliminate manufacturers’ incentives to innovate in areas
patients and the healthcare systems that serve them of added value (e.g., administration route, device design,
by disrupting their continuity on specific products patient support programs) providing further support to
and forcing them to switch treatment at the end of patients and providers.
27
AREAS OF GREATER RISK TO LONG-TERM SUSTAINABILITY
Conversely, contracts (such as with the German

Krankenkassen, or health insurers) and tenders that
“We see where the lower price
are designed to have multiple winners with criteria limits are of a manufacturer,
beyond price are expected overall to have a more and we try to find a price that
positive impact on sustainability in the marketplace
is in that lower range but that
and better serve the needs of all key stakeholders.
In this scenario, physicians and patients are still
is still acceptable for more
presented with multiple prescription and treatment manufacturers to ensure multiple
choices respectively, while the risk of supply products on the market”
shortages is reduced. Finally, manufacturers have
better chances of securing part of the market volume, Expert, Germany
thus increasing the likelihood that their investment
in biosimilars yield positive returns and further
increases the likelihood that they will invest in the
development of biosimilars in the future. Moreover,
having tender criteria broader than price allows
manufacturers to better address patient needs and
compete more meaningfully. For instance, additional
criteria may include value-added services, device
design, considerations around inactive ingredients or
excipients, traceability and supply stability, that help
to adequately cover the needs of patient, physician
and care-institution and thus lead to better biosimilar
sustainability. This is because more manufacturers
secure a place in the market and receive fair gains,
encouraging them to continue development of both
biosimilar and new biologic medicines.
28
The path to strengthen sustainability
Policies for the biosimilars marketplace that are designed to ensure they meet the needs of all key stakeholders
have a positive influence on sustainability overall. Such approaches enable countries not only to improve patient
access and manage healthcare budgets, but to also encourage competition, provide healthcare that meets the
needs of individual patients and support manufacturers in developing biosimilars that offer additional value.
Many of the best-practice approaches that support sustainability (see Exhibit 21) are already present in Europe,
though not in every market, and the value of various policies continue to be debated.
Exhibit 21: Best Practices to Achieve Sustainability for All Stakeholders in the Biosimilars Market
SUSTAINABILITY ELEMENTS
Patient Access Continue to maintain a regulatory environment and clinical guidelines favourable to
biosimilar approval and uptake, to increase patient access to biologic treatment
Ensure guidelines and policies support a smooth transition for patients from one
therapy to another when patient is guided to switch by the treating physician
Physician Prescription Choice Maintain prescription freedom for physicians, enabling them to select therapy
for patients
Ensure multiple products are available on the market, enabling physicians to have
choice of approved therapies
Create well-designed incentives that foster biosimilar uptake, while safeguarding
physician choice and patient input into treatment decisions, such as treatment switch
Safe and High Quality Incentivise both originator biologic and biosimilar manufacturers to continue
Biologic Medicines innovating in differentiation areas for their products to better support the needs of
patients, physicians and care-institutions
Implement payer purchasing mechanisms that include criteria other than price, thus
encouraging the provision of additional value – e.g., patient services, design elements,
formulations, etc.
All Stakeholders Maintain involvement of all relevant stakeholders in discussions and decision-making
regarding biologic and biosimilar medicines in Europe
Balance the price pressures exerted by tenders or other payer purchasing mechanisms with
the requirements for long-term market sustainability e.g., by implementing procurement
policies in the biologics market that simultaneously addresses the needs of all key
market stakeholders
Healthcare Budgets Continue to incentivise the uptake of biosimilars to facilitate budget release in the
short term, while considering the long-term sustainability of the market
Design incentives considering the needs of target physicians and care-institutions
Healthy Level of Competition Sustain healthier levels of competition with multiple-winner tenders as compared with
single-winner tenders
Make purchasing decisions based on additional criteria beyond price, thus incentivising
biosimilar manufacturers to innovate in areas to support patients and providers
Healthy Level of Supply Sustain a healthy supply of biologics to the market, by enabling access of both originator
and biosimilar products
Encourage multiple manufacturers to function within a market through multiple-winner
tenders/contracts reducing the potential risk of shortages
29
THE PATH TO STRENGTHEN SUSTAINABILITY
In order for payers and policy makers to help Use of purchasing mechanisms: Careful design of
strengthen sustainability in the long-term and set the purchasing system is needed to balance the
a path to ensure biosimilars continue to improve effectiveness of tenders and contracts with the
access to safe and high-quality biologic treatments, requirements for long-term market sustainability.
increased focus on a number of areas is necessary. Tendering and contracting in the biologics market
can, if properly balanced, facilitate the generation
Patient interest and prescriber choice: Safeguarding
of healthy market competition while allowing payers
the interest of patients and serving their needs in the
to adequately manage healthcare budgets over
best way possible remains a critical consideration for
time, as well as addressing the needs of other key
health authorities and will become even more so as a
market stakeholders (e.g., patients, physicians, care-
greater number of new biosimilars coming to market
institutions, biosimilar and originator manufacturers).
are able to be self-administered and patient familiarity
with product and device is likely to exert greater Awarding multiple winners: Tenders and contracts
influence on physician product choice and patient better support sustainability when they are designed
compliance . Ensuring physicians retain prescription
27
to have multiple winners and include criteria other
freedom, along with the ability to choose and access than price. These purchasing mechanisms allow
approved therapies to offer product selection for greater prescription and product choice for physicians
patients, is therefore necessary, along with the and patients respectively, as well as sustain healthier
creation of incentives that promote biosimilar uptake levels of competition as compared with single-
and take into account patient clinical considerations. winner tenders. This is because more manufacturers
secure a place in the market and receive fair gains,
Use of incentives: In addition to the policy frameworks
encouraging them to continue development of
currently in place, European countries can create
both biosimilar and new biologic medicines. All of
further incentives to promote biosimilar uptake
these are increasingly important in both the hospital
– to boost savings to the healthcare system and
purchasing and retail sector. Moreover, having tender
support the sustainability of the market – without
criteria broader than price allows manufacturers to
adversely affecting the quality of care offered to
better address patient needs and compete more
patients. Medicine switching policies that avoid
meaningfully. For instance, additional criteria may
incentives limiting patient input and physician choice
include value-added services, device design, inactive
– predominantly negative incentives – are best able to
ingredients, traceability and supply stability, that help
balance system savings with patient needs. Incentives
to adequately cover the needs of patients, physicians
linked to treatment switch also need to be carefully
and care-institutions and thus lead to better biosimilar
designed to avoid eliciting unfavourable prescribing
sustainability.
behaviours by physicians – such as prescribing a
particular biologic without due regard for individual Pricing control policies: Price control policies in the
patient factors due to an offered financial reward. form of molecule reference pricing, direct price cuts,
Further, effective demand-side incentives are or other forms, facilitate budget release in the short
designed considering the behaviour and needs term while granting access to the biologics markets
of physicians and care-institutions that will be the for all biosimilar and originator players. In parallel,
ultimate target of those incentives. Incentives that physician prescription freedom is maintained and
encourage switching according to the physician’s patient product continuity is guaranteed to a higher
discretion, and allow for some time from launch of a extent. Price control should however be implemented
biosimilar to when it is subject to the existing incentive to the extent that market forces are not significantly
structure, are the most sustainable. disrupted and manufacturers remain able to freely
30
compete based on multiple product criteria and Overall, a number of policies currently in place in
services beyond price. Europe can be leveraged to ensure and support
long-term sustainability of the biosimilars market,
Promote innovation: In an environment that fosters
while additionally fulfilling the needs of all
sustainability, both originator biologic and biosimilar
stakeholders. By simultaneously securing aspects of
manufacturers are incentivised and encouraged
sustainability, including physician prescription choice,
to continue innovating in differentiation areas for
a means to manage healthcare budgets, and healthy
their products outside price, and to continue the
levels of competition, supply, and product safety and
development of new products, further supporting the
quality, the biosimilars marketplace offers to bring
sustainability of the market and finding new ways to
with it lower costs and increased patient access to
support the needs of all other key stakeholders.
valuable biologic medicines, with benefits likely to
increase over time.
31
Notes on sources Methodology
This report is based on the IQVIA services detailed BIOSIMILAR SUSTAINABILITY ASSESSMENT
below. FRAMEWORK
Research into this topic included both qualitative and
IQVIA MIDAS™ is a unique platform for assessing quantitative analyses of relevant IQVIA data sources,
worldwide healthcare markets. It integrates IQVIA’s secondary research, as well as consolidation of insights
national audits into a globally consistent view of from discussions with IQVIA biosimilar experts, relevant
the pharmaceutical market, tracking virtually every Pfizer affiliates and external policy experts.
product in hundreds of therapeutic classes and
provides estimated product volumes, trends and Secondary research using external and IQVIA
market share through retail and non-retail channels. publications was performed to obtain a preliminary
view on the current biosimilar landscape in each
IQVIA Pricing Insights offers a series of solutions market, and to inform the relevant qualitative metrics
combining core pricing and reimbursement data. included in the framework. IQVIA MIDAS sales data
IQVIA Pricing Insights provides regulated pricing and data from other public sources (e.g., EMA) were
information and price points for in-line brands and used to estimate the remaining quantitative metrics
future products to help mitigate against price changes included in the framework (see Exhibit 22). All price-
across multiple markets. In addition, the service related metrics are based on list prices, which can be
provides access to integrated customised databases, robustly gathered and referenced across the markets
dashboards and reports as well as pricing and in scope.
reimbursement applications to address each client’s
specific needs – by country, competitive climate and IQVIA BIOSIMILAR SUSTAINABILITY PRIMARY
therapy area. MARKET RESEARCH PROGRAM
A primary market research study was performed
Biosimilars Landscape Tracker offers summaries from June to July 2018 and included discussions with
of biosimilar regulatory, policy, pricing and market 26 stakeholders from countries in Europe (including
access landscape and biosimilar sales across multiple payers, policymakers, thought-leaders from IQVIA and
developed and emerging markets. Pfizer employees) in order to validate analytic findings
on the current biosimilar landscape in each market and
Biosimilar Knowledge Connect centralises news,
to obtain insights on future policy developments likely
information and resources pertaining to biosimilars.
to have an impact on sustainability in the biosimilars
e-hälsomyndigheten — the Swedish eHealth Agency marketplace. Eight of these interviews were conducted
(e-hälsomyndigheten or eHm) provides aggregated with external policy experts across the countries
sales data for drugs in Sweden and includes profiled in this report to specifically validate the
medicines sold in pharmacies and hospitals. results of the current policy landscape analysis and to
pressure test the future scenario analysis. Perspectives
of the external policy experts provided insight into
both current and future policy trends and potential
threats to sustainability across Europe and within
individual markets.
32
Exhibit 22: Metrics to Evaluate
# CATEGORY METRIC MEASURE SOURCE
Access
Access to biologic Increased molecule use (measured in Quantitative
0. Increased molecule utilization MIDAS
medicines DDD) with biosimilar entry
Regulatory Environment and Clinical Guidelines

Regulatory and Time from EMA approval to first sales Quantitative
1. Time to biosimilar access* EMA, MIDAS
P&MA pathway of first biosimilar (months)
Treatment Differentiation between policies Positive / neutral (molecule) / National
2. Qualitative
guidelines for biosimilars and originator negative guidelines
3. Physician switching policies (Not) enforced / allowed / other Qualitative
Substitution Public sources
policy Automatic substitution policies
4. (Not) enforced / allowed / other Qualitative
at pharmacy level
Product
Safety and / or quality control
5. Safety and quality Yes / No; number of alerts Qualitative
alerts National Drug
Presence / absence of supply Agency websites
6. Supply continuity Yes / No Quantitative
shortages
Incentives
7. Patient factors Patient incentives Yes / No; Specify incentives Qualitative Public sources
8. Existence of prescription quotas Yes / No; Specify quotas Qualitative Public sources
Provider and Physician Rx and financial
9. prescriber Mandatory quotas vs. recommended Qualitative Public sources
incentives
incentivization
Physicians quotas linked with
10. Yes / No; Specify incentives Qualitative Public sources
financial incentives
Competitive Pressure
11. Biosimilar penetration % of biosimilar over total molecule Quantitative
Level of MIDAS
competition Biosimilar competitor Number of competitors equaling
12. Quantitative
concentration 90% of the market
Mandatory price cut policy for
13. Yes /no Quantitative
originator
Public sources
Price reference policy at
14. Yes/no Quantitative
molecule level
15. Pricing rules and Price erosion vs. originator Percent biosimilar vs. originator Quantitative
dynamics
Price evolution of biosimilars
16. Percent biosimilar vs. originator Quantitative MIDAS
over time
Price evolution of originators
17. Percent price reduction Quantitative
over time
18. Length of contracts Months Quantitative
19. Tendering process Number of winners Single vs. multiple Qualitative Public sources
Winer decision criteria beyond Positive / neutral / negative for
20. Qualitative
price biosimilars

Notes: DDD = Defined daily dose
33
Exhibit 23: Multi-Stakeholder Assessment
SUSTAINABILITY ELEMENTS SIX POINT SCALE

A six point scale was used to differentiate the impact
Patient Access Very Very

Positive Positive Neutral Negative Negative
Physician Prescription Choice

✓ ✓ ✗ ✗
Safe and High Quality
Biologic Medicines
The scenario The scenario Opportunities The scenario The scenario
All Stakeholders creates a creates a and risks creates a risk creates a
significant favourable created are in the significant
favourable opportunity balanced in element risk in the
opportunity in the the scenario element
Healthcare Budgets in the element for that
element element
Healthy Level of Competition
No Additionally, we have considered the possibility that the proposed
Impact scenario does not have an impact for a specific element in the
Healthy Level of Supply definition
FUTURE SCENARIOS DESIGN AND ANALYSIS The impact of each scenario was evaluated across
A three-step process was followed to analyse the each of the sustainability definition elements, and
Source:
impact of the two key policies – payer-driven switch mapped to a six-point scale based on IQVIA expertise,
and tendering – that were assessed to potentially pose leveraging on existing understanding on the market
threats to long-term sustainability in the biosimilars and supported by analysis of current landscape (see
marketplace. All possible scenario options were first Exhibit 23).
outlined for each, based on the key variables with
Further review of this assessment was then conducted
potential impact on sustainability. The impact of each
to pressure test assumptions and conclusions of the
scenario was then assessed separately for its impact on
analysis.
sustainability across all the key elements encompassed
under the Multi-Stakeholder Definition of Sustainability.
34
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2018]. Available at: http://www.ema.europa.eu/ema/index.jsp?curl=pages/regulation/document_listing/
document_listing_000376.jsp&mid=WC0b01ac05807477a6
16. Rémuzat C, Kapuśniak A, Caban A, Ionescu D, Radière G, Mendoza C, et al. Supply-side and demand-side
policies for biosimilars: an overview in 10 European member states. Journal of Market Access & Health
Policy. 2017;5(1):1307315.
17. Kassenärztliche Bundesvereinigung. Rahmenvorgaben nach § 84 Abs. 7 SGB V - Arzneimittel - für das
Jahr 2017 vom 30. September 2016 (KVB national target recommendations 2017). Available at: https://
www.gkv-spitzenverband.de/media/dokumente/krankenversicherung_1/arzneimittel/rahmenvertraege/
vertragsaerzte/Rahmenvorgaben_Arzneimittel_2017_84-Abs-7-SGB-V.pdf
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Available at: https://www.kvsaarland.de/documents/10184/481162/Arzneimittelvereinbarung+2017
19. Arzneimittelvereinbarung nach § 84 Abs. 1 SGB V für das Jahr 2017 für Westfalen-Lippe Zwischen der
Kassenärztlichen Vereinigung Westfalen-Lippe (KVWL). 2017. Available at: https://www.kvwl.de/arzt/recht/
kvwl/amv_hmv/avm_wl_2017.pdf
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sachsen.de/fileadmin/data/kvs/img/Mitglieder/Verordnungen/170327 _170109-AMV_2017_Endf.pdf
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das Jahr 2016. 2016 Jan. Available at: https://www.kvsaarland.de/documents/10184/480739/
Arzneimittelvereinbarung+2016
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sachsen.de/fileadmin/data/kvs/downloads/vertrag/AMV_Endf_2016_Internet.pdf
36
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https://www.kvwl.de/arzt/recht/kvwl/amv_hmv/amv_wl_2016.pdf
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Arzneimittel.pdf
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2017 Dec;4(2):209-218.
37
About the authors
MURRAY AITKEN
Executive Director, IQVIA Institute for Human Data Science
Murray Aitken is Executive Director, IQVIA Institute for Human Data Science, which provides
policy setters and decisionmakers in the global health sector with objective insights into
healthcare dynamics. He led the IMS Institute for Healthcare Informatics, now the IQVIA Institute,
since its inception in January 2011. Murray previously was Senior Vice President, Healthcare Insight, leading IMS
Health’s thought leadership initiatives worldwide. Before that, he served as Senior Vice President, Corporate
Strategy, from 2004 to 2007. Murray joined IMS Health in 2001 with responsibility for developing the company’s
consulting and services businesses. Prior to IMS Health, Murray had a 14-year career with McKinsey & Company,
where he was a leader in the Pharmaceutical and Medical Products practice from 1997 to 2001. Murray writes and
speaks regularly on the challenges facing the healthcare industry. He is editor of Health IQ, a publication focused on
the value of information in advancing evidence-based healthcare, and also serves on the editorial advisory board
of Pharmaceutical Executive. Murray holds a Master of Commerce degree from the University of Auckland in New
Zealand, and received an M.B.A. degree with distinction from Harvard University.
ISABEL RODRÍGUEZ
Principal, Consulting Services, Pricing & Market Access
Isabel Rodriguez is Principal, IQVIA Global Consulting Services. She has over twelve years of
experience in pharmaceutical consulting and has led highly diverse projects on pricing and
market access, forecasting, acquisitions and geographic expansion, launch planning and product
positioning, among others. Isabel holds a BSc. Biology from Universidad Autónoma de Madrid, in Spain.
JOANNA DIAMANTARA
Associate Consultant, Consulting Services
Joanna Diamantara is an associate consultant within the IQVIA Global Consulting Services. She
has over two years consulting experience across projects. Joanna holds a BSc in Biochemistry
from Imperial College in the U.K. and an MSc in International Health Policy from London School of
Economics & Political Sciences in the U.K.
MANUEL VÁZQUEZ
Manager, Consulting Services, Pricing & Market Access
Manuel Vázquez is manager within the IQVIA Global Consulting Services. He has over eight years
of consulting experience with a focus on global pricing and market access (PMA) projects and
health economics and outcomes research (HEOR) strategy to support the PMA decision making
process. Prior to IQVIA, he worked for six years as a retail pharmacist manager in the United Kingdom. Manuel holds
a PharmD from Universidad de Salamanca in Spain and an MBA from Manchester Business School in the U.K.
38
About the IQVIA Institute
The IQVIA Institute for Human Data Science • Understanding the future role for
contributes to the advancement of human health biopharmaceuticals in human health, market
globally through timely research, insightful analysis dynamics, and implications for manufacturers,
and scientific expertise applied to granular non- public and private payers, providers, patients,
identified patient-level data. pharmacists and distributors.
Fulfilling an essential need within healthcare, • Researching the role of technology in health system
the Institute delivers objective, relevant insights products, processes and delivery systems and the
and research that accelerate understanding and business and policy systems that drive innovation.
innovation critical to sound decision making and
Guiding Principles
improved human outcomes. With access to IQVIA’s
The Institute operates from a set of Guiding Principles:
institutional knowledge, advanced analytics,
technology and unparalleled data the Institute works • Healthcare solutions of the future require fact based
in tandem with a broad set of healthcare stakeholders scientific evidence, expert analysis of information,
to drive a research agenda focused on Human Data technology, ingenuity and a focus on individuals.
Science including, including government agencies,
academic institutions, the life sciences industry and • Rigorous analysis must be applied to vast amounts
payers. of timely, high quality and relevant data to provide

value and move healthcare forward.
Research Agenda
• Collaboration across all stakeholders in the
The research agenda for the Institute centers on
public and private sectors is critical to advancing
5 areas considered vital to contributing to the
healthcare solutions.
advancement of human health globally:
• Insights gained from information and analysis
• Improving decision-making across health systems
should be made widely available to healthcare
through the effective use of advanced analytics and
stakeholders.
methodologies applied to timely, relevant data.
• Protecting individual privacy is essential, so research
• Addressing opportunities to improve clinical
will be based on the use of non-identified patient
development productivity focused on innovative
information and provider information will be
treatments that advance healthcare globally.
aggregated.
• Optimizing the performance of health systems by
• Information will be used responsibly to advance
focusing on patient centricity, precision medicine
research, inform discourse, achieve better
and better understanding disease causes, treatment
healthcare and improve the health of all people.
consequences and measures to improve quality and
cost of healthcare delivered to patients.
39
CONTACT US
info@iqviainstitute.org
iqviainstitute.org
LOCATION
100 IMS Drive
Parsippany, NJ 07054
USA
Copyright © 2018 IQVIA. All rights reserved. WP.0056-1-09.2018

IQVIA, 2018 Advancing Biosimilar Sustainability in Europe

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IQVIA, 2018 Advancing Biosimilar Sustainability in Europe

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SEPTEMBER 2018

This report was produced independently by the

Sustainability in the biosimilars marketplace 4

Availability of biosimilar products 4

European policies and frameworks for biosimilars 5

Defining sustainability for the biosimilars marketplace 7

Current dynamics of biosimilars in Europe 12

Patient access to biologics 12

Regulatory environment and clinical guidelines 14

Biosimilar safety, quality and supply 15

Areas of greater risk to long-term sustainability 25

Impact of changes in payer-driven switch 25

Impact of changes in procurement policies 26

The path to strengthen sustainability 29

About the authors 38

About the IQVIA Institute 39

To analyse the sustainability of current policies, a

Different levels of biosimilar uptake, price erosion

AVAILABILITY OF BIOSIMILAR PRODUCTS is expected to go off patent from 2019 to 20222. By

Somatotropin Epoetin alfa Inﬂiximab Etanercept Rituximab Bevacizumab

this report. element of biosimilar policies) and instead leaves

other healthcare professionals, payers, the Member

Assessment of Monitoring and

measuring them against performance indicators BIOSIMILARS MARKETPLACE

Exhibit 4: A Multi-Stakeholder Definition of Sustainability for the Biosimilars Marketplace

SAFE AND HIGH PHYSICIAN

budgets while safeguarding a healthy level of

Source: IQVIA Global Consulting Services, Jul 2018

Exhibit 5: Biosimilar Sustainability Assessment Framework: Key Areas

Regulatory Environment and

• Time to access the market

Competitive Pressure Product

Source: IQVIA Global Consulting Services, Jul 2018

POLICY AREAS AREA SUBTYPE # Metric Measure

ACCESS TO BIOLOGIC Increased molecule use by Increase in DDD over the

Time from EMA approval to first sales

REGULATORY Positive / neutral (molecule) /

SUBSTITUTION POLICIES Pharmacist automatic substitution

PATIENT FACTORS 7. Patient incentives Yes / No

8. Existence of prescription quotas Yes / No

Physicians quotas linked with

11. Biosimilar penetration % of biosimilars over total molecule

Mandatory price cut policy for

Price reference policy at molecule

PRICING RULES AND

Price evolution of biosimilars over

18. Length of contracts Months

PURCHASING MECHANISMS 19. Number of winners Single vs. multiple

Winner decision criteria beyond Positive / neutral / negative for

Source: IQVIA Global Consulting Services, Jul 2018

originator biologics, estimating their impact on price

The impact of each metric on sustainability in the Denmark Infliximab INF

• Biosimilars have significantly contributed to increased patient access to biologic medicines.

• Price competition dynamics by manufacturers in response to different payer purchasing mechanisms

PATIENT ACCESS TO BIOLOGICS the recommendations of the European Society for

180% 10% 8% 14%

160% 5% 7% 6% N/A 12%

Source: IQVIA MIDAS, MAT Mar 2012 – Mar 2018.

Germany Netherlands France Italy Spain Norway Denmark

Source: IQVIA MIDAS, MAT Mar 2012 – Mar 2018.

• Price competition dynamics by manufacturers in response to different payer purchasing mechanisms

• Prescribing targets for biosimilars linked to