As federal and state policymakers grapple with how to lower prescription drug prices, they should work to ensure that patients, particularly seniors, have greater access to and realize the full benefit of lower-priced generic drugs.
Increasingly, Medicare Part D plans are putting generic drugs into higher formulary tiers to compensate for escalating brand-name drug prices.
AAM Statement on Generic Drugs in Medicare Part D. Trends in Tier Structure and Placement, Avalere Health, May 22, 2018:
“In 2015, patients spent more than $6 billion in additional out-of-pocket costs on generic drugs compared to 2011. These increased out-of-pocket expenses on low-cost generics are being used by the plans to mask increases in branded drug prices.”
Avalere Health study funded by Association for Accessible Medicines.
Despite the importance of biosimilars to reducing the cost of medicine, policymakers recently included a provision in a proposed bill that would have prohibited biosimilars from receiving pass-through status in Medicare Part B.
Association for Accessible Medicines is calling on Congress to take meaningful action to lower prescription drug costs with the Prescription for Savings. Patients win when market-based competition from FDA-approved generics and biosimilars deliver savings at the pharmacy counter.
To this end, we recommend these seven policy solutions:
Congress should amend the Part D coverage gap discount program to classify biosimilars as “applicable drugs” in the Coverage Gap Discount Program. This change would allow biosimilar manufacturers to pay the 50 percent discounts paid by their brand competitors, and participate on a level playing field to compete for placement on the Part D plan’s formulary. It would reduce both patient out-of-pocket costs and Part D program spending.