In a world of rapidly rising health and social care costs, expensive biologics treatments that keep people out of hospital are often better than cheaper medicines that don’t – but only if budgets allow.
Improving access to biosimilars, which are generic equivalents of biologics, potentially solves this dilemma by delivering the same efficacy at a lower price. The technology has already been developed for a new generation of biosimilars, but European procurement rules have some unintended consequences which are preventing full advantage being taken of the benefits that technological innovations will create in the coming years.
Care costs more than medicine
According to a recent survey of 20 OECD countries, health spending grew strongly in 2021 at 6%, amounting to around 10% of GDP. Many blame this unsustainable rate of growth on overpriced medicines. But most of the data contradicts this assumption. European healthcare procurement bodies have become increasingly effective at leveraging their purchasing power to drive down the cost of treatments on the basis of negotiated competitive tenders and robust cost/benefit analysis by independent bodies.
The real drivers of rising healthcare and social care costs lie elsewhere. They relate to the building, operating and staffing of hospitals, and the expanding network of skilled support staff who provide long term social care to an ageing population that is increasingly beset by chronic degenerative and metabolic disease.
Biosimilars are about more than price
Nevertheless, lowering the price of biologic medicines while maintaining efficacy can help to slow the rising costs of healthcare. Biologics are increasingly important in the formulary of medicines. They are often the leading treatments in any indication, and the high levels of innovation in biologics continue to advance new therapies.
Biologics do have a drawback, which is high cost, but a wave of generic biosimilar competition is gradually overcoming this. Every biosimilar is required by regulators to deliver bioequivalence, meaning that it is sufficiently similar to the original molecule. This trend is already gaining momentum as more biologic products approach patent expiry.
Second order impacts of biosimilars
The potential benefits to healthcare budgets are not just measured by lower prices or the ability to manufacture biological treatments at scale reliably. The indirect effects are significant too. Reductions in frontline salary bills and operational costs are enabled by fewer hospital visits and lower demand for sustained care. These savings can then be directed towards resourcing other healthcare priorities, such as tackling waiting times and increasing service quality – which all improve patient experience.
Spreading the benefits of biologic innovation
Ongoing biologic innovations in the fields of cell and gene therapy are set to have profound knock-on benefits in the coming years as their patents begin to expire. Biosimilar competition will be free to drive down prices and spread the benefits of large scale manufacture to lower-income nations that could not afford the original treatments. In these cases, halting and even reversing the upward spiral of this aspect of healthcare costs becomes a real possibility.
Overcoming manufacturing obstacles with QTL
Technical obstacles remain, of course. Biologics are complex to manufacture, and developers of the original molecule often retain secret know-how to protect their effective monopoly long after patents expire. Technical constraints such as product titre, downstream processing and access to manufacturing plant capacity undermine the ability of biosimilar producers to compete on a commercial scale with reliably bioequivalent products. Without competition, prices don’t drop and access to a wider range of affordable medicine does not improve. In these circumstances, the overall sustainability of healthcare is put at risk.
A new era for recombinant proteins
Fortunately, a new era of multi-parameter optimisation is entering the field of recombinant protein manufacture. Quantitative Trait Loci (QTL) technology enables manufacturing strains to be developed that create and customise recombinant proteins with characteristics that are tailor-made for their chosen market.
By unleashing the full power of biology, QTL technology can deliver consistent quality and exact bioequivalence at a lower cost of manufacture – with significantly less plant required. Even in cases where know-how has been retained by the developer of the original reference compound, QTL technology can engineer around this, making the commercial manufacture of recombinant protein therapeutics viable.
Challenging vested interests
These exciting technical advances suggest that a recalibration of the European procurement system might be needed to ensure that QTL technology’s enormous commercial potential translates into lower biosimilar prices for the wider public. The commercial advantages that incumbent drug companies currently enjoy, which are unintentionally protected by the current procurement system, also need to be challenged and overcome.
Curtailing spiralling healthcare costs requires two big changes. The first is to introduce a more innovative and competition-friendly approach to procurement. The second is to persuade our ageing populations to adopt healthier lifestyles. Neither will be easy.