- The patent has finally expired for Humira, the biologic drug used to treat arthritis, ulcerative colitis, Crohn’s disease, and other conditions.
- The first biosimilar competitor, Amjevita, is already on the market with seven more expected by the end of 2023.
- However, experts don’t expect the biosimilar drugs to be much cheaper than Humira due to legal settlements and government regulation.
“Humira is the first blockbuster self-injectable biologic to have competition in the marketplace,” said Ralph Pisano, rPH, president of Nuwae, a healthcare technology firm dedicated to driving down prescription drug prices.
“Humira is the highest-selling drug of all time,” he told Healthline. “It treats half a dozen autoimmune conditions and it has more indications than any other biologic in its therapeutic category. In 2021, Humira generated [nearly] $21 billion in revenue for manufacturer AbbVie, consuming a significant portion of any payers’ drug spend at an average annual cost per patient of $80,000.”
Humira’s original patent expired in 2016, but AbbVie was able to delay the emergence of biosimilar drug competitors until this year.
“AbbVie has made changes to the drug and filed additional patents to delay the competition,” Pisano said. “AbbVie finally settled with manufacturers of Humira biosimilars to allow their drugs to reach the market in 2023.”
Humira belongs to a class of drugs known as
The most well-known drug to be made with a biological process like this is insulin, which is created by injecting bacteria with insulin genes to grow the hormone.
Because of this process, near-copies of biologic drugs are called “biosimilars” and are subject to additional regulatory scrutiny.
“In the strictest sense, a traditional generic drug is an exact copy of the originator. There can be different fillers, colors, or non-active ingredients, and there are tolerance thresholds, but in the most basic way, a traditional generic drug is a replica of the original,” said Alex Rivosecchi, PharmD, a senior product manager at Bluesight, a medication intelligence company.
“This is possible with traditional generic medications because they are relatively small molecules that can be chemically synthesized,” he told Healthline.
“On the other hand, biologic medications are larger and more complex; thus, the processes used to develop traditional generic drugs cannot be used to develop biosimilars,” Rivosecchi added. “Biosimilars are approved by the FDA by demonstrating that they are ‘highly similar’ to the reference product. That means that they are close enough in duplication to accomplish the same therapeutic and clinical results, but not an exact copy.”
In short, biosimilars are harder to produce and have more regulatory hurdles, which means the existence of brand-name alternatives — like in the case of Humira — may not drive prices down nearly as much as when a comparable generic drug enters the market.
“When compared to generic drugs, which can cost as little as 80 percent to 90 percent of the price of branded pills, the impact of biosimilars seems modest,” said Jayne Hornung, rPH, the chief clinical officer at MMIT, a global pharma intelligence provider.
“We’ve seen the impact of generic small molecule drugs cut the profits of a brand by more than half in the first full year after the generic’s market entry. We have not yet seen that with biosimilars,” she told Healthline.
Then there’s another issue: interchangeability.
“Generics are generally automatically substituted at the point of sale without a provider doing anything. This is referred to as ‘interchangeability,'” Howard Deutsch, a principal partner at global healthcare consulting firm ZS Associates, told Healthline. “By contrast, biosimilars may not be interchangeable in the U.S. without additional clinical development, which means that a biosimilar must be explicitly prescribed.”
That lack of interchangeability could be a real problem for seeing huge price falls from Humira alternatives. One needs to look no further than runaway insulin prices, of which only a single biosimilar insulin, Semglee, has been approved as interchangeable with its counterpart, Lantus.
There’s another reason Humira alternatives may not move the cost needle much: AbbVie’s legal settlements in antitrust cases brought by its prospective competitors.
“AbbVie’s agreements with biosimilar manufacturers flat out state that they cannot offer a lower out-of-pocket cost to the patient,” Pisano explained. “The biosimilar manufacturers also have to pay royalties to AbbVie, which elevates their cost. AbbVie paid more than $5 billion in rebates to pharmacy benefit managers in 2021, and by increasing their rebates only slightly, they can continue to compete with biosimilars on price.”
The market is already seeing this dynamic in action.
For instance, Amjevita has set two tiers of pricing, the first of which is only 5% below Humira’s monthly price of $6,922 for the drug, Reuters reported.
The other is a half-price tier, but experts say that’s not likely to appeal much to Pharmacy Benefit Managers (PBMs) who rely on rebates to steer drug prices in the for-profit U.S. healthcare system.
“Large PBMs that manage most claims and formularies are in a unique and powerful position and profit billions in rebates by promoting and preferring more costly drugs that are less affordable to the patents that need them,” Pisano explained. “When all of these factors are combined, our team of experts believes we will see a much slower adoption of Humira biosimilars in the market. We are predicting about 5 percent market share for biosimilars in 2023, rising to as much as 25 percent by 2026, but with little movement in the net price.”