Alvarez & Marsal: Barriers Slowing Biosimilar Market Growth
Alvarez & Marsal's analysis highlights challenges hindering biosimilar market entry and competition within the pharmaceutical sector. Contrary to expectations, price competition and patient access to more affordable alternatives have been slower than anticipated.
The management consulting firm Alvarez & Marsal identified significant barriers slowing the growth of the biosimilar market in a March 2021 analysis. While biosimilars were anticipated to disrupt the pharmaceutical landscape by lowering prices and increasing access to biologic drugs, their market penetration has been slower than many predicted.
The report points to several factors contributing to this trend, including concerns over anti-competitive practices. The European Commission's Directorate-General for Competition's 2021 management plan indicates ongoing investigations into such practices that delay the entry and expansion of biosimilars and generics.
Biosimilars are highly similar to biologic medicines but are not exact replicas due to inherent variability in their complex manufacturing processes. This necessitates a more lengthy and costly development and regulatory approval pathway compared to generic drugs. Despite initial list price discounts typically ranging from 10% to 30%, actual price differences can widen post-negotiation. The full economic benefits expected from biosimilar competition are not yet being realized by national health systems and insurers.
Alvarez & Marsal emphasizes that the adoption of biosimilars is influenced by both demand-side and supply-side factors. Key decision-makers include payers (national authorities, insurers) who influence pricing and reimbursement, prescribers (clinicians, pharmacists) who determine which drugs are used, and patients. For significant savings to be achieved, effective collaboration among these stakeholders and robust market mechanisms are essential to facilitate wider uptake.