How CMS Should Reimburse for Biosimilars

The Centers for Medicare and Medicaid Services (CMS) have finalized a rule regarding the Medicare reimbursement methodology for biosimilar products. Biosimilars are prescription medications which have been approved by the Food and Drug Administration (FDA) as being “highly similar” to a specific biologic medication (known as the reference product). Thus, it is easiest for most people to think of biosimilars as the equivalent of generics for small molecule brand name medications, though this is not scientifically accurate. While small molecule generics are chemically identical (save for potentially any inactive ingredients) to their respective brand name drugs—and can be because they are chemically manufactured—exact copies of biological products, by their nature of being developed from living organisms, cannot be produced, and patients may respond differently to the reference product and the biosimilars.