US Biosimilar Market Current Trends & Challenges

The Biologics Price Competition and Innovation Act (BPCIA), enacted on March 23, 2010, was created to set up a regulatory pathway for the approval of biosimilars, with the intention of  fostering market competition, lowering drug prices, and improving access to biologics. Of the 73 approvals, 53 biosimilars are now commercially available in the market, reflecting the growing complexity and diversity of therapeutic options and commercial implications.

Below is a snapshot of a five-year post-launch analysis across nine molecules for which biosimilars are available:

• Biosimilars have significantly reduced the average sales prices (ASPs) of both reference and biosimilar products after their entry into the market. On average, ASPs decreased by 53% within five years following the first biosimilar launch.
• Biosimilars have gained 52% market share five years after initial launch. On average, oncology, ophthalmology, and select supportive care biosimilars have grown to 81% market share after five years. In contrast, immunology, filgrastim, epoetin alfa, and insulin glargine biosimilars have reached 25% market share after five years.

There are interesting trends to watch in pricing and contracting practices:

• Many manufacturers have adopted a dual pricing approach to biosimilars, usually providing an unbranded, low wholesale acquisition cost (WAC) option in addition to a branded, high WAC option. The high WAC option often provides an opportunity for payers to earn higher rebates, which can help lower premiums or offset other costs. Lower WAC options can provide upfront cost savings that can potentially cascade down to both the health plan and the patient, directly benefiting each with lower costs. This two-tier approach caters to different stakeholders with varying priorities and needs, and increases the chance for patients to gain access to these medicines.
• For insulin glargine and infliximab, originators have launched unbranded versions with lower WAC in addition to the higher, branded WAC. For adalimumab, the reference product is available both as the original brand and as a co-branded private label product, reflecting the complexity of pricing categories and formulary placements.
• In cases where biosimilar prices drop rapidly, some biosimilar companies have decided to withdraw from the market completely because the low price point adversely impacts healthcare professional (HCP) reimbursement and payer access. In other cases, companies adjust their WAC prices to compete at higher price points. This imperative is centered on the need to provide sufficient reimbursement incentive for providers and an overall value proposition that ensures market access with key stakeholders.
 The private label market is growing; several pharmacy benefit managers (PBMs) have contracted with select private label to offer private label versions of biosimilars or reference products. As of July 2025, six private label products are available for adalimumab and four for ustekinumab.

For payers and PBMs, the most obvious incentive to adopt biosimilars is the cost advantage that they offer to health plans, providers and patients, while having the same therapeutic efficacy and safety profile as reference products. However, non-pricing factors also influence their decision-making on biosimilars.

• Given the limited option of biosimilars placed on formularies, ensuring a reliable supply is crucial for their successful integration into health systems. When making formulary decisions to prefer specific products, payers rely on the supply reliability of manufacturers to provide products without disruptions and to respond flexibly to market demands. Supply disruptions not only pose administrative and clinical challenges, but also risk continuity of care and can increase overall healthcare expenditure.
• Payers consider quality control an important factor when making formulary decisions. Biologics, including biosimilars, are complex molecules produced in living cells, which can exhibit inherent variation due to post-translational modifications occurring within the cellular environment. Demonstrating strict control measures to ensure consistent quality is critical for establishing trust with payers, providers, and patients. As the market continues to evolve toward regulatory streamlining, i.e., waiving requirements for manufacturers to conduct comparative efficacy studies or interchangeability switching studies, it will become increasingly important for biosimilar companies to demonstrate consistent quality throughout the development, manufacturing, and commercialization processes.
• However, recent cases like the adalimumab and ustekinumab biosimilars have shown that the first-to-market’s success is not always guaranteed, and payers and PBMs may wait until several price points are established in the market before making coverage decisions. 

While the number of biosimilar approvals and launches have increased over the past decade, biosimilars have yet to fully realize their potential in the US, as many are still struggling to capture meaningful market share. Although adoption rates are higher among medical benefit molecules such as oncology, ophthalmology, and supportive care, biosimilar penetration remains low in pharmacy benefit markets including adalimumab and insulin. With the launch of private label products for adalimumab, biosimilar uptake is improving but the reference product still maintains a dominant position, holding 73% market share as of May 2025. In the infliximab category, the reference product still holds 42% of the market eight years after the first biosimilar launch.

• Earlier this year, ustekinumab biosimilars launched with steep discounts ranging between 80-90% off the reference product's WAC. Stelara was one of the first drugs selected for price negotiation under the Inflation Reduction Act (IRA) and many manufacturers offered aggressive discounts, in an attempt to secure formulary access for their biosimilars alongside the reference product before the IRA-negotiated price takes effect in January 2026. This represents how arbitrary price controls like the IRA force biosimilars to launch at “near-bottom” pricing from launch. As more biologics become subject to IRA negotiations in future rounds, there will be less incentive for biosimilar developers to invest in future pipelines, with increased uncertainty in business feasibility. 
• When the new discounted price for Stelara takes effect in January 2026, the potential savings that biosimilars can offer to plans may be reduced, making step therapy through biosimilars a less attractive strategy for plan sponsors. Additionally, the Most Favored Nation (MFN) policy, introduced under the Trump administration, would have a similar effect if implemented, as widespread reduction of brand list prices will lead to smaller cost savings with biosimilars, which means less motivation for payers to adopt biosimilars and less incentive for biosimilar developers to enter the market, as there is less commercial opportunity. Novel biologics and biosimilars do not function separately; the biologics market is an ecosystem that operates through a ‘virtuous cycle,’ where innovation—backed by strong research and development— continues to create novel biologics, as biosimilars replace older biologics with competitive versions that improve access and affordability. 
• Private labels are emerging as a new trend in the pharmacy benefit category. The adalimumab class slowly grew to six private label options over time, but with ustekinumab, private label biosimilars were launched early alongside traditional biosimilar options. According to data from IQVIA, the introduction of private labels has led to a mass transition of patients from originators to biosimilars with adalimumab, but this only happened when the originator was removed from formularies. To date, the market has not seen that occur in the ustekinumab class. What is the incentive for an HCP to prescribe a biosimilar if the originator is still being covered on the patient’s formulary? Should biosimilars be placed on a lower-price tier, similar to generics, on a patient’s prescription benefit design? The breakthrough with private labels, while beneficial for biosimilars, leads to a fundamental question: how will the market embrace this new trend, and what is the best way to foster competition and create enough market opportunity so that the market remains attractive and viable in the long-term? Originators presumably are unlikely to lower their prices without biosimilar competitors or enforcement measures such as the IRA.

To date, there has been clear success with some biosimilar classes contributing to driving down overall costs, but the legislative challenges and limited uptake in some categories probably necessitates careful consideration and reflection across stakeholders. For developers to continue investing in biosimilars in high-cost drug categories in the future, there has to be a level of confidence that the market will support lower-cost biosimilars when they are approved years down the line.

Looking at biosimilar usage in clinical practice, adoption among prescribers is increasing, although it varies by specialty and product. While familiarity with biosimilars is generally high, actual prescribing patterns are influenced by perceptions regarding safety and efficacy—often accompanied by lingering questions and concerns—and previous experience (or no experience) with biosimilars. Patients frequently do not understand that there are no clinically meaningful differences between a reference biologic and its biosimilar equivalent. Therefore, there is a need for HCPs, pharmacy associations, employers, trade groups, and patient advocacy organizations to engage their communities in educating about the quality, reliability, and cost benefits of biosimilars. Many of these groups have in fact worked to educate their prescribers and patients about biosimilars, and a few health systems have given priority access to biosimilars because of their cost-saving potential. However, the US needs a more systematic approach, where biosimilars can be preferred over reference products. Plan sponsors should be asking if there is a biosimilar-first strategy available to save on healthcare costs.

The more our society learns about and accepts the value of biosimilars as more affordable alternatives to high-priced reference biologics, the sooner we will see meaningful progress in cost savings for our healthcare system. There is an enormous need for a thriving biosimilar market in the US as the best solution to address high drug costs—both individually and collectively. The time to impact this impression of market acceptance is now.

--Issue 06--