CONTENTS

8 OVERVIEW

9 EXECUTIVE SUMMARY

10 REGULATORY LABELS
10 Marketed Crohn’s disease products in the US, Japan, and five major EU markets
14 Marketed ulcerative colitis products in the US, Japan, and five major EU markets
17 Bibliography

19 GLOBAL ACCESS LEVERS
19 Biologics comprise the majority of spend in IBD; new agents will continue to increase spend
21 Payers restrict access to IBD medications
23 IBD drugs are managed as part of the wider inflammatory class of drugs
28 The largest unmet need in UC and CD is severe patients at later lines of therapy, where options are limited

30 EVIDENCE AND VALUE
30 Remission-based endpoints are key for most payers
34 Key opinion leaders and payers want longer clinical trials with extension studies
34 US and EU payers and physicians want head-to-head trials to directly assess efficacy and determine pricing

36 ACCESS TO RECENTLY APPROVED AND PIPELINE PRODUCTS
37 Payers are unimpressed by Stelara’s placebo-controlled trials
41 Superiority data against infliximab are unlikely to push etrolizumab to be a first-line biologic
47 Oral compounds may struggle to achieve differentiation against one another due to the lack of head-to-head trials
49 Otezla’s experience in dermatology could provide the best example for how oral IBD drugs will fare
50 Payers are skeptical that oral therapies can bridge the gap before biologics
54 Access for JAK inhibitors hinges on pricing strategy
56 A better safety profile matters to physicians, but is unlikely to move the needle from an HTA or payer perspective
59 Ozanimod’s approval in UC could prove problematic for approval in MS
60 Some payers may elect to contract for selected oral inhibitors

62 PRICING

66 US
66 Insights and strategic recommendations
67 Medicare pays $2.9bn for Humira and Remicade at an average of over $25,000 per beneficiary
67 The inflammatory conditions segment has been the most expensive specialty drug category for eight consecutive years
68 Humira is the drug with the highest spend in the specialty category for all Express Scripts’ payers
68 Rising per member per year spend for Humira is mostly due to unit cost increases
70 Commercial formularies vary in their tier positioning for IBD drugs
75 Exclusions are more common within Medicare Part D formularies than in commercial plans
80 Medicare Part D covers first-generation biologics, but with high out-of-pocket costs for members
80 State Medicaid programs are largely in consensus on their IBD preferred drug formulary lists
82 Prior authorization is the key utilization management tool used in IBD for all payers in the US
90 Drugs with approvals in multiple inflammatory indications are favored in payer contracting
91 Five TNF-alpha inhibitor biosimilars have been approved by the FDA, but only two have launched
92 Payers continue to prefer Remicade over biosimilar infliximab
93 Larger discounts are required to promote biosimilar infliximab use
94 Bibliography

98 JAPAN
98 Bibliography

100 BIOSIMILAR TNF-ALPHA INHIBITORS IN THE FIVE MAJOR EU MARKETS
100 Insights and strategic recommendations
100 The uptake of biosimilar TNF-alpha inhibitors varies across EU markets, as the EMA does not determine interchangeability
101 Payers resort to biosimilar quotas to promote uptake
102 High quotas requiring biosimilar use prompt many physicians to switch patients
103 Switching costs have led to reservations among some payers, meaning switching among multiple biosimilars is unlikely
105 Discounts are not the only strategy to facilitate switching among biosimilars
106 Payers use tenders, physician incentives, and formulary exclusions to drive biosimilar uptake
111 Payers are willing to implement more aggressive measures to promote biosimilar uptake
111 Bibliography

113 FRANCE
113 Insights and strategic recommendations
113 ASMR rating has an impact on pricing
151 In the absence of head-to-head trials versus TNF inhibitors, later entrants largely receive no added benefit
151 Access to Stelara and Entyvio is restricted to TNF-failure patients in CD and UC respectively
152 Entyvio gets added benefit in TNF-alpha-refractory UC patients
153 Etrolizumab’s ASMR hinges on efficacy data demonstrating absolute improvement over infliximab
154 Bibliography

156 GERMANY
156 Insights and strategic recommendations
156 A positive assessment from the G-BA will impact pricing negotiations
163 Lack of head-to-head comparisons results in no added benefit for Entyvio
163 Certain sickness funds subject TNF-alpha inhibitors to indicative budget limits, but the relevance of this may change under ongoing reforms
164 New G-BA software will make added benefit assessments and prices for competing drugs more visible to prescribers
165 Etrolizumab may have mixed pricing due to an anticipated added benefit in some patient populations
166 Stelara is expected to bypass benefit assessment in CD despite approval post-AMNOG
166 Bibliography

168 ITALY
168 Insights and strategic recommendations
168 Delays in AIFA decisions for newly launched drugs hamper regional and local access
168 Limited budgets present the greatest barrier to biologics use
175 AIFA reimburses all biologics approved for CD and UC, but with access restrictions
175 UC and CD drugs reimbursed by AIFA are found in the regional formulary of Emilia-Romagna
177 Bibliography

179 SPAIN
179 Insights and strategic recommendations
179 National reimbursement decisions are usually not a barrier to access
183 IPT restricts Entyvio in UC and CD to patients who have failed TNF-alpha inhibitors
183 IPT restricts Stelara for CD to patients who have failed on or who are contraindicated to TNF-alpha inhibitors
183 Regional access to UC and CD treatments varies in Spain
187 The Catalonian therapeutics committee has outlined a pathway for CD
187 Moving towards a flat fee per patient will incentivize use of the least expensive IBD therapy
187 Bibliography

189 UK
189 Insights and strategic recommendations
189 NICE approval is a key market access barrier
206 Entyvio is restricted to the third line in CD after failure with a TNF-alpha inhibitor, and requires a patient access scheme
206 Entyvio is reimbursed in the full patient population for UC with a patient access scheme and a one-year stopping rule
207 Remicade is reimbursed for pediatric UC patients, as per its marketing authorization, despite failing the cost-effectiveness test
207 Xeljanz’s pricing will largely be dictated by its cost in RA, which will need to be comparable to Olumiant
208 Managing spend for IBD drugs will revolve around start-and-stop criteria
208 Regional formulary decisions
208 Bibliography

210 METHODOLOGY
210 Primary research
210 Price assumptions
211 Exchange rates
212 Bibliography

LIST OF FIGURES
211 Figure 1: Price sources and calculations for the US and EU, by country

LIST OF TABLES
11 Table 1: Marketed products and approved indications for Crohn’s disease drugs in the US, Japan, and five major EU markets
15 Table 2: Marketed products and approved indications for ulcerative colitis drugs in the US, Japan, and five major EU markets
25 Table 3: Levers impacting access to IBD drugs in the US and five major EU markets, by country
63 Table 4: Pricing of key Crohn’s disease drugs in the US, Japan, and five major EU markets, by country
66 Table 5: Pricing of key ulcerative colitis drugs in the US, Japan, and five major EU markets, by country
67 Table 6: Top anti-inflammatory drug prescriptions filled by Medicare beneficiaries participating in Part B and D programs, 2015
69 Table 7: Specialty drug spend by Express Scripts commercial members (inflammatory diseases market), 2016
70 Table 8: CVS Caremark and Express Scripts’ formulary exclusions for IBD drugs, 2016–18
71 Table 9: Formulary placement of IBD medications in selected commercial formularies
76 Table 10: Formulary placement of IBD medications in selected Medicare formularies
80 Table 11: Selected formulary practices of top 10 Medicare Part D and Medicare Advantage IBD drugs
81 Table 12: Formulary placement of IBD medications in selected state Medicaid formularies
83 Table 13: Prior authorization criteria for Crohn’s disease drugs with major health insurers and pharmacy benefit managers
86 Table 14: Prior authorization criteria for ulcerative colitis drugs with major health insurers and pharmacy benefit managers
98 Table 15: Japan – pricing premiums given to medicines that can demonstrate benefit over comparators
109 Table 16: Market access tools used to promote biosimilar TNF-alpha inhibitor uptake in the five major EU markets, by country
114 Table 17: Transparency Committee’s ASMR ratings and pricing implications
115 Table 18: Transparency Committee’s SMR ratings and pricing implications
116 Table 19: Transparency Commission’s assessment of Crohn’s disease treatments
133 Table 20: Transparency Commission’s assessment of ulcerative colitis treatments
158 Table 21: G-BA assessment of key Crohn’s disease therapies
160 Table 22: G-BA assessment of key ulcerative colitis therapies
164 Table 23: Spending regulations for TNF-alpha inhibitors in the five largest physicians’ associations in Germany
170 Table 24: Reimbursement conditions for Crohn’s disease treatments in Italy
173 Table 25: Reimbursement conditions for ulcerative colitis treatments in Italy
176 Table 26: Italian regional formulary decisions for Crohn’s disease drugs
176 Table 27: Italian regional formulary decisions for ulcerative colitis drugs
180 Table 28: Therapeutic positioning reports for IBD drugs in Spain
184 Table 29: Spanish Society of Hospital Pharmacy ratings
185 Table 30: Regional MADRE assessments for Crohn’s disease drugs
187 Table 31: Regional MADRE assessments for ulcerative colitis drugs
191 Table 32: NICE assessments of key Crohn’s disease therapies
199 Table 33: NICE assessments of key ulcerative colitis therapies
212 Table 34: Exchange rates used for calculating drug prices