“Gainsharing” methods of payment can boost use of biosimilars, a less expensive cancer treatment

The US faces high drug prices, especially for biologics, which are among the most expensive therapies available, accounting for 51% of drug expenditures in 2024.

There is a less-pricey alternative, biosimilar agents that are similar to generic drug versions of these biologic therapies. Yet the US has lagged behind other countries in the adoption of these alternatives, partially because of financial incentives for insurers and providers to prefer high-priced biologics that offer high rebates that boost the company’s bottom lines.

However, well-designed reimbursement methods can lead to rapid adoption of biosimilars and significant savings for purchasers and patients.

A new study led by UC Berkeley School of Public Health’s James C. Robinson, PhD, MPH, looks at mechanisms that could induce hospitals to make the switch to less expensive biosimilar treatment alternatives.

“Major biologics are losing patent protection in the coming five years,” says Robinson. “ This study shows how insurers and hospitals can accelerate the transition to less expensive biosimilars for these products, thereby moderating health care cost inflation while maintaining quality of care.”

The study’s findings suggest that “gainsharing” methods of payment, in which insurers and hospitals share the savings of using less expensive therapies like biosimilars, could boost their use, making the US health care system more efficient.

The paper is part of a series of studies on pricing and adoption for the most expensive specialty drugs and biologics in the US health care system.