Healthy decision on biosimilar drugs creates big savings for B.C. employer benefit plans

This week, the BC PharmaCare program will officially transition patients currently prescribed three brand name biologic drugs that are used to treat diabetes, arthritis, and certain types of skin conditions (Lantus®, Enbrel®, and Remicade®) to their biosimilar drug.

With this progressive move, the provincial government becomes the first jurisdiction in Canada to endorse the widespread use of biosimilars. As the top health benefits provider in BC, Pacific Blue Cross applauds their leadership and has aligned our policies in support.

“Biosimilars have similar effectiveness and safety with the same outcomes as the originator drugs at a fraction of the cost,” says Anar Dossa, Director of Pharmacy Services, Pacific Blue Cross. “In response to the Ministry’s decision and in keeping with our longstanding integration with BC PharmaCare, we immediately recommended to our plan sponsors that employees on originator drugs be transitioned to the biosimilar to maintain BC Pharmacare and Pacific Blue Cross coverage.”

 Biologics vs. biosimilars

 Over the last decade, biologics have become increasingly prescribed to treat a wide range of acute and chronic conditions like rheumatoid arthritis, inflammatory bowel disease, anemia, hormone deficiencies, skin conditions, and some forms of cancer.

As such, they represent the fastest growing segment of the pharmaceutical market; there are currently over 200 biologics and vaccines on the market worldwide and more than 900 in the development pipeline.

 Biologics are made by using living organisms (such as yeast or animal cells) to produce complex proteins. These proteins are purified and injected to affect certain processes in the human body. Due to their unique, complex production and handling requirements they are also one of the costliest drug classes.

Biosimilar drugs are lower cost versions of originator biologic drugs. To be approved for use in Canada, a biosimilar must be proven equally as safe and have the same therapeutic effect as the originator.

Research and development of biosimilars has grown significantly alongside biologics. Today, there are over 90 studies with over 14,000 patients involving switching from originator biologics to biosimilars. 

The impact of high cost drugs

Across Canada, prescription drugs— and biologics in particular—are a major contributor to health care costs increasing at an unsustainable rate.

The Canadian Institute of Health Information reported that, in 2017, drug spending rose at a higher annual rate (4.2%) than overall spending on hospitals (4.0%) and doctors (3.1%). Three of the top 10 classes of drugs sold in Canada are biologics, accounting for almost $3 billion of the $32.3 billion spent on prescribed drugs overall.

When announcing its Biosimilars Initiative in May, the BC Ministry of Health acknowledged that the high (and growing) cost of biologics impacts their ability to expand the number of drugs listed on the provincial formulary, saying that this change alone is expected to save  almost $100 million over the next three years.

 Mandating the use of biosimilars helps ensure the ongoing sustainability of BC PharmaCare while allowing the Ministry to improve access to additional drug therapies for more people who need them.  

 Sustainable employer benefit plans

 Pacific Blue Cross has seen a lot change in the BC health care system and private benefit plans over the past 75 years.

 In the 1970s a private health care plan was a perk that employers offered to attract and retain employees. The cost of providing those benefits was nominal and what was covered under the public system was generally quite sufficient to meet someone’s health care needs.

Today, the pendulum has swung in the opposite direction. Employer-provided benefit plans are now a “must have” to reduce absenteeism and improve staff engagement. But the costs of providing the care that people need have risen considerably, to the extent that employers are starting to worry about their overall plan sustainability. Drug costs are a key reason for that worry—and the continued growth of biologics is an important factor.

Up to now, BC PharmaCare has been covering the cost of the biologics at issue. As of today, PharmaCare will cover the cost of the biosimilar instead, which means plan sponsors will start seeing the cost impact if they continue to cover the originator biologic (the insert on Lisa’s story illustrates the differential).

The benefit of a BC health care expert

As BC’s Health Benefits Society with a mission to improve health and wellbeing for British Columbians— and the only health benefits provider located right here in BC—Pacific Blue Cross has developed a unique relationship with the Ministry of Health and other government agencies.

Aligning their drug policy to BC PharmaCare and supporting the Biosimilars Initiative allows plan sponsors to tailor their benefit options to fit the needs of all plan members while ensuring that the medications offered by the plan are the right drugs at the right price.

“We provide benefits coverage to one in three British Columbians and see very clearly the impact of high cost drugs on plan sustainability,” says John Crawford, President and CEO of Pacific Blue Cross. “In our view, BC Pharmacare is doing the right thing by using biosimilar savings to introduce new drug coverage, and our support of this helps Pacific Blue Cross, our advisors, and our plan sponsors balance plan coverage and cost to improve health and wellbeing for all our members.”