Given that Express Scripts has been advocating for payers to accept and support the usage of biosimilars, I was surprised that no biosimilars were included in its recently announced list of 2017 formulary exclusions.
Company spokesman David Whitrap tells me Express Scripts is waiting for biosimilars to be administered through the pharmacy benefit and then it will begin reviewing each product on a case-by-case basis.
“Because Neupogen and Zarxio are almost exclusively administered through the medical benefit,” he said. “A pharmacy formulary decision in this class – either Express Scripts’, CVS’, or another PBM’s – has very little impact on payers or patients.”
Whitrap mentions CVS because it did include two brand-name substitutes in its 2017 standard formulary. Sandoz’s Zarxio is one of them. It’s a biosimilar replacement for Amgen’s chemotherapy drug Neupogen.
“With regard to Zarxio,” said CVS Health Vice President of Investor Relations Michael McGuire, “while the products are not directly interchangeable and cannot be automatically dispensed as alternatives, we believe that the clinical profile of the products is appropriate to make this change. We do have members using these products, and they are already required to go through a clinical review prior to using them. We believe that the additional level of scrutiny to ensure proper utilization will add to the value of this change.”
The CVS Health 2017 formulary also includes a follow-on product (Eli Lilly and Company’s Basaglar) as a replacement for Sanofi’s diabetes basal insulin Lantus.
Lantus may still be ejected from Express Scripts’ 2017 formulary when Basaglar launches in the U.S. in December, Whitrap said.
The number of formulary exclusions can be a competitive point of contention between the big PBMs, who may simultaneously downplay the significance while noting that a competitor excludes more than they do. And there is merit to the notion that the significance of exclusions is overplayed. A better measure of the impact of exclusions isn’t the total number, says McGuire, but the level of member disruption, or the effect on patient adherence to therapy.
“Measuring member disruption provides a better assessment of the impact caused by drug removal rather than the count of products,” he said. “And in that regard, we expect member transition across our book of business to be in line with previous years and less than 1.5 percent.”
Express Scripts says its level of patient disruption is 0.12 percent.
Some analysts opine that existing formulary exclusions are just the tip of the iceberg, and come 2020 —when patents begin to expire and the regulatory landscape is finally smoothed out— we can expect PBMs to reject even more branded products in favor of low-cost substitutes. Of course, negotiations will be a big factor in how that plays out. From a big picture perspective, I expect PBMs to tread reservedly as the opportunities to save aren’t without risk. When it comes to excluding drugs, employers don’t like the idea of limiting their workers’ options, thus it’s not an entirely attractive proposition for payers.