AAM Releases New Report: New Generics Are Less Available in Medicare Than Commercial Plans | Association for Accessible Medicines
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AAM Releases New Report: New Generics Are Less Available in Medicare Than Commercial Plans

WASHINGTON, DC (July 19, 2021) — The Association for Accessible Medicines (AAM) today released a white paper, “New Generics Are Less Available in Medicare Than Commercial Plans.”

New generic entrants benefit patients and the health care system by introducing competition for high-priced drugs. However, new evidence confirms that the Medicare Part D Program continues to underperform compared to commercial plans in providing patient access to generic medicines.

Today’s report reveals persistent design flaws within Medicare Part D that act as barriers to coverage of and access to recently approved, low-cost generic drugs. There’s simply no justification for providing America’s seniors worse access to lower-cost generics than beneficiaries in commercial health plans receive, said Christine Simmon, Senior Vice President, Policy & Strategic Alliances, AAM, and Executive Director, Biosimilars Council. This analysis provides critical data illustrating how crucial first generics are in driving drug prices down and how coverage within Part D plays a key role in ensuring patients reap their full benefits.

As Congress considers reforms to modernize Medicare Part D, policymakers should correct perverse incentives and expand access to new, lower-cost generics. Specifically, policymakers should prioritize the following to ensure patient access to lower-cost generics:

  • Require Part D plans to review first generics and biosimilars within a specified time frame and provide written justifications to CMS if they are not placed on formulary after that review.
  • Prohibit or restrict plan’s ability to place generic drugs on non-generic tiers.
  • Incentivize the use of lower-cost medicines by decreasing plan liability for biosimilars and generics, relative to the reference brand.
  • Align plan incentives for using low-cost products in the catastrophic phase.

These changes will meaningfully reduce out-of-pocket costs for Part D beneficiaries and increase savings for taxpayers and the Medicare program overall.

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About AAM

AAM is driven by the belief that access to safe, quality, effective medicine has a tremendous impact on a person’s life and the world around them. Generic and biosimilar medicines improve people’s lives, improving society and the economy in turn. AAM represents the manufacturers and distributors of finished generic pharmaceuticals and biosimilars, manufacturers and distributors of bulk pharmaceutical chemicals, and suppliers of other goods and services to the generic industry. Generic pharmaceuticals are 90 percent of prescriptions dispensed in the U.S. but only 20 percent of total drug spending. 

About the Biosimilars Council

The Biosimilars Council, a division of the Association for Accessible Medicines (AAM), works to ensure a positive environment for patient access to biosimilar medicines. The Biosimilars Council is a leading source for information about the safety and efficacy of more affordable alternatives to costly brand biologic medicines. Areas of focus include public and health expert education, strategic partnerships, government affairs, legal affairs and regulatory policy. More information is available at www.biosimilarscouncil.org.

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