• With the exceptioN n o EW f b Si F oR siO mM ila T rs H fE o r E N Me PL up O o Yg E en E B , t Eh N e Em FIT ar R ket ES s Eh AR arC e H f I oN r t Sh Te ITiUT nno Ev ator biologics w ere between 65% - 87% in 2020. • HOPDs were sometimes more likely and sometimes less likely than POs to use innovator New Research Finds That Hospital Markups on Biologic Medicines Roughly Double biologics over biosimilars. HOPDs were more likely than POs to use Neupogen, Herceptin and Costs and Limit Potential Savings From Biosimilar Competition Rituxan over their biosimilars. However, POs were more likely than HOPDs to use Remicade and Avastin. HOPDs and POs were about equally likely to use Neulasta and Epogen/Procrit. - Workers and Employers Seeing Higher Costs as a Result - • For all 7 innovator biologics examined, allowed charges were higher in HOPDs than in POs. HOPD markups on innovator biologics is roughly doubling costs for employers and minimizing For immediate release: 7/5/23 savings that could be achieved through biosimilar competition. Allowed charges were about For more information: Ron Dresner double in 2019, averaging 98% higher. In 2020, allowed charges were more than twice as high in dresner@ebri.org HOPDs, averaging 121%. • In 2020, the HOPD markup ranged from 75% - 183%. The HOPD markup increased between 2019 (Washington, D.C.) – A new research report published today by the Employee Benefit Research and 2020 for all innovator biologics examined. Institute (EBRI) found that higher hospital markups on biologic medicines are roughly doubling the costs for employers and minimizing savings that could be achieved through biosimilar competition. “Our ongoing research findings continue to show that HOPD markups on physician-administered outpatient drugs result in costs that are, on average, twice as high as those in POs. This can The research report, “Location, Location, Location: Spending Differences for Biologic and Biosimilar significantly undermine the potential savings that could be achieved through biosimilar Medications by Site of Treatment,” examined whether the potential cost savings from biosimilars is competition," said M. Christopher Roebuck, Ph.D., study co-author and Founder & CEO of impacted by whether patients seek care from physician offices (PO) or hospital outpatient RxEconomics LLC. "Given the robust pipeline of biosimilars, employers and other plan sponsors departments (HOPD), as the trend towards HOPDs might be impacting potential savings. should closely monitor HOPD markups, biosimilar uptake and overall market trends." The original biologic, known as the innovator biologic, sometimes has substitutes which are known To view a summary of the 17-page Issue Brief, “Location, Location, Location: Spending Differences as biosimilars. Biosimilars are similar versions of the medicine with no clinically meaningful for Biologic and Biosimilar Medications by Site of Treatment,” visit www.ebri.org/biologics- difference in effectiveness or safety from the innovator biologic. In recent years, a robust biosimilar biosimilars. marketplace has emerged driving substantial savings for patients, employers and insurers. As of February 2023, there are 29 biosimilars on the market competing against 11 innovator biologics. The Employee Benefit Research Institute is a non-profit, independent and unbiased research organization that provides the most authoritative and objective information about critical issues “Competition in the evolving market suggests innovator biologics and biosimilars both are relating to employee benefit programs in the United States. For more information, visit competing on price to retain or gain market share. However, as HOPDs continue to markup the www.ebri.org. price of biologics at faster and higher rates than biosimilars and consolidation drives care away from POs into HOPDs, employers will continue to see costs go up. As a result, the savings potential # # from biosimilars may not be fully realized,” explained Paul Fronstin, Ph.D., study co-author and director, Health Benefits Research, EBRI. Key findings in the research report include: • Use of biosimilars among individuals with employment-based health benefits in the United States is growing as more biosimilars enter the market. Among the 9 innovator biologics with available biosimilars as of October 2022, most of the biosimilars were launched in the U.S. in 2019 and 2020. • Allowed charges for biosimilars were higher in HOPDs than in POs. However, the markups for biosimilars were lower than the markups for innovator biologics. Biosimilar markups in HOPDs averaged 87% in 2019 and 101% in 2020. In 2022, HOPD markups ranged from 59% - 141%. The HOPD markup increased for 7 of the 9 biosimilars examined.