Centers for Medicare & Medicaid Services (03/30/15)

With the Food and Drug Administration's approval of the first biosimilar in the United States, the Centers for Medicare & Medicaid Services (CMS) has clarified some points about coverage under Medicare Parts B and D. CMS notes that when a wholesale acquisition cost (WAC) is available, Medicare will pay 106 percent of the WAC until Average Sales Price (ASP) information is available. Then, Medicare payment will equal the ASP for the biosimilar plus 6 percent of the ASP for the reference product. CMS expects to create a separate code to distinguish biosimilars from their reference biologicals. In addition, CMS plans to release guidance to plans confirming that approved biosimilars will be subject to existing rules for prescription drugs under Part D. CMS' existing formulary review and change policies provide Part D sponsors with flexibility to promote the appropriate use of biosimilars when designing their Part D benefits. CMS will evaluate formulary change requests involving biosimilars on an individual basis. Reference and biosimilar products will not be considered different drugs to satisfy the two distinct drugs requirement for each of the submitted categories and classes. Biosimilars may be added to plan formularies at any time as a formulary enhancement. Biosimilars are not considered a generic drug or a multiple source drug, so they are subject to the higher maximum copayments for low-income subsidy-eligible individuals applicable to all other Part D drugs.

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