Panel on Prior Authorization Reveals Role PBMs Play in Biosimilar Uptake in Oncology

At a session at the recent Association of Community Cancer Centers’ 2022 Annual Meeting & Cancer Center Business Summit, panelists discussed the complex role that pharmacy benefit managers (PBMs) and practices play in the uptake of biosimilars, including their concerns that savings derived from biosimilars may be lost without reform.

The session, “Prior Authorization: How the Sausage Is Made,” contained many conversations surrounding how prior authorization policies have created undue administrative burdens on oncology practices. The panelists said that PBMs’ focus on rebate incentives may prevent some biosimilars from being prescribed, potentially opening the door for biosimilars to not be included or preferred on formulary placements.

Collectively, the panel agreed that the current system needs reforms, with one of the panelists, Andrew Hertler, MD, chief medical officer for New Century Health, explaining that the system was intended to make sure that both necessary treatments are accessible and practices get paid.

Prior authorization is a contentious topic in the biosimilar space. Despite most prior authorization transactions being seamless—like handing a credit card to a hotel clerk so that they can ensure a bill can be paid prior to checking in a guest—panelist John Hennessy, MBA, CMPE, senior vice president and strategist at Valuate Heath Consultancy, said that the system is so broken to the point that having the a biosimilar be covered by insurance isn’t enough to ensure patients have access to it.

“Prior authorization at some point was meant to protect people from low-value experiences…. When those transactions happen poorly, and they happen with great uncertainty, that value is lost,” said Hennessy.

Another panelist, Lalan Wilfong, MD, executive vice president of value based care & quality programs for Texas Oncology and vice president of payer relations and practice transformation at McKesson Specialty Health, expressed that practices with assumed risk shouldn’t have to bear the burden of misaligned incentives that have spread throughout the health care sector and kept costs high.

Wifong said he believes that the use of prior authorization for formulary management is inappropriate and will ultimately force practices to have to manage multiple brands of the same biologic and create a greater burden on practices and nurses, who often administer the products.

Hertler agreed with Wifong and added that he hopes to see the approval for care bundling, where a patient with a certain type of cancer could be approved for diagnostic testing, scans at designated intervals, and course of treatment all at once. He also said that rebates threaten to undermine the ability for practices to manage costs through the use of biosimilars.

“It’s not about which is the best product, but which has the best rebate for the payer….If someone takes offense, I’m sorry, but that’s what’s going on. One of the challenges is, as we try as providers of care to take care of patients, to simplify this process, sometimes things outside of our control make it a lot more complex. And prior authorization, in some cases, becomes almost a contract negotiation on a patient-by-patient basis,” Hennessy added.

Wifong suggested that savings achieved through biosimilar use should be invested in targeted therapies, where extra spending may be warranted, instead of being applied to mandates that drive up costs of care without improving upon it.

“Biosimilars are supposed to lower the cost of cancer care, and they did. But it's my fear is that we may actually flip into a world where that doesn't occur…. And I don't think any of us want to live in a world where cancer care costs continue to escalate rapidly,” he said.