Obstacles to the Adoption of Biosimilars for Chronic Diseases

There is optimism that biosimilars will offer lower-cost therapeutic alternatives to branded biologic drugs, in the same manner as generic drugs have done for small-molecule drugs. On average, the cost of a small-molecule drug declines by 70% in the 24 months following initial generic approval. Furthermore, generic drugs currently account for 88% of all US prescriptions, yielding 10-year cost savings in excess of $1.5 trillion. Here, Hakim and Ross explore why biosimilars for chronic diseases, the largest category of biological therapies, are unlikely to yield widely expected cost savings.