Summary
Sets the Medicare payment rate for newly authorized biosimilar products at average sales price (ASP) of the biosimilar product + 6% of the corresponding branded product’s ASP.
Implementation Status
CMS outlined implementation of this provision in the CY11 Physician Fee Schedule Final Rule.
On July 1, CMS released its CY 16 Medicare hospital OPPS and ambulatory surgical center proposed rule (fact sheet), which estimated that net CY 16 OPPS payments will decrease by -0.2%, or $43 million, compared with CY 15 payments. Comments are due by Aug. 31
On July 8, CMS posted the CY 16 Medicare Physician Fee Schedule (MPFS) proposed rule, which delineates payment policies impacting over one million physicians and other practitioners paid under the MPFS each year (see fact sheet here). Citing the latest doc fix (P.L. 114-10), the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), CMS effectuates the statutory 0.5% increase. Comments are due Sept. 8.
On Sep. 3, the first-ever biosimilar approved in the US went to market.
On Sep. 17, the Senate HELP Subcommittee on Health convened a hearing to hear an update from the FDA on biosimilar implementation.
2016
On June 1, FDA announced an information collection seeking that sponsors of past and present biologic applications submit a proposed suffix composed of four lowercase letters for use as the distinguishing identifier included in the name designated by FDA. On June 22, the FDA withdrew the proposed information collection regarding four-letter suffixes.
On July 6, CMS released the calendar year (CY) 2017 hospital outpatient prospective system (OPPS) and ambulatory surgical center (ASC) payment system proposed rule. CMS estimates that overall, hospital outpatient departments (OPDs) will experience a 1.6 percent – or $5.1 billion – increase relative to CY 2016.
2017
On July 14, CMS released the CY 2018 Medicare Physician Fee Schedule (MPFS) proposed rule. The proposal updates rates and policies applicable to Medicare physicians and other professionals under Medicare Part B as of Jan. 1, 2018. This provision of the ACA is addressed in the rule.
Statutory Text
SEC. 3139. PAYMENT FOR BIOSIMILAR BIOLOGICAL PRODUCTS. (a) IN GENERAL.—Section 1847A of the Social Security Act (42 U.S.C. 1395w–3a) is amended— (1) in subsection (b)— (A) in paragraph (1)— (i) in subparagraph (A), by striking ‘‘or’’ at the end; (ii) in subparagraph (B), by striking the period at the end and inserting ‘‘; or’’; and (iii) by adding at the end the following new subparagraph: ‘‘(C) in the case of a biosimilar biological product (as defined in subsection (c)(6)(H)), the amount determined under paragraph (8).’’; and (B) by adding at the end the following new paragraph: ‘‘(8) BIOSIMILAR BIOLOGICAL PRODUCT.—The amount specified in this paragraph for a biosimilar biological product described in paragraph (1)(C) is the sum of— ‘‘(A) the average sales price as determined using the methodology described under paragraph (6) applied to a biosimilar biological product for all National Drug Codes assigned to such product in the same manner as such paragraph is applied to drugs described in such paragraph; and ‘‘(B) 6 percent of the amount determined under paragraph (4) for the reference biological product (as defined in subsection (c)(6)(I)).’’; and (2) in subsection (c)(6), by adding at the end the following new subparagraph: ‘‘(H) BIOSIMILAR BIOLOGICAL PRODUCT.—The term ‘biosimilar biological product’ means a biological product approved under an abbreviated application for a license of a biological product that relies in part on data or information in an application for another biological product licensed under section 351 of the Public Health Service Act. ‘‘(I) REFERENCE BIOLOGICAL PRODUCT.—The term ‘reference biological product’ means the biological product licensed under such section 351 that is referred to in the application described in subparagraph (H) of the biosimilar biological product.’’. (b) EFFECTIVE DATE.—The amendments made by subsection (a) shall apply to payments for biosimilar biological products beginning with the first day of the second calendar quarter after enactment of legislation providing for a biosimilar pathway (as determined by the Secretary).