Biosimilar pricing and the challenge of market sustainability
Healthcare systems worldwide face mounting pressure from aging populations and rising chronic disease prevalence. This is placing increasing strain on public healthcare budgets. As biosimilar pricing and competition become central to managing these pressures, governments are pursuing a range of cost-containment strategies. However, the nature and maturity of these efforts differ significantly between markets.
In the United States, drug pricing has historically operated as a free-pricing market. Manufacturers often set list prices without direct government intervention. However, recent policy developments signal a shift towards more direct government involvement to manage pharmaceutical expenditure. The Inflation Reduction Act introduced Medicare price negotiations for a select number of high-expenditure medicines. It also capped annual price increases for Medicare Part B and D drugs to the rate of inflation. This marked a departure from the historically hands-off approach to pricing. Meanwhile, the proposed Most Favoured Nation pricing mechanism would benchmark US prices against those in comparable OECD countries. This reflects the ongoing political appetite to align US prices more closely with international levels.
In Europe, governments have been using cost-containment as a tool to manage pressure on healthcare budgets. In France, the 2026 Social Security Financing Bill targets €1.6 billion in pharmaceutical savings. It does so through stricter price cuts, increased clawback payments, and accelerated adoption of generics and biosimilars. Similarly, Germany is responding to growing financial pressures within its statutory health insurance system. Rising deficits reported by sickness funds have intensified debates over sustainable pharmaceutical spending, as expenditure growth outpaces fund contributions. These fiscal pressures have made drug pricing reform a central issue within the Federal Ministry of Health’s new Pharma and Medical Technology Strategy Dialogue. The dialogue aims to balance industrial competitiveness with long-term financing stability of the health system.
Biologics have a large impact on pharmaceutical spending due to their higher list prices compared to small-molecule therapies. The introduction of biosimilars following loss of exclusivity was expected to alleviate some of this cost pressure. They offer health systems lower-cost alternatives with comparable efficacy and safety profiles. Yet the extent to which biosimilar competition translates into originator price erosion varies considerably. This is shaped by the regulatory and pricing frameworks governing each market.
This article examines how pricing policies across the US, France, and Germany shape biosimilar-driven price erosion of originator biologics, and the implications for manufacturers in an increasingly cost-constrained environment.
Method
This analysis compared the total number of EMA and FDA-approved biosimilars from a sample of originator biologics as of October 2025. Where the same biosimilar was approved by both agencies, their originators were compared to identify which agency granted the first approval. This gave a top-line view on market attractiveness. It highlighted which agency had the most biosimilar approvals and the markets where manufacturers were able to launch first.
We analysed originator biologics with three or more FDA and EMA-approved biosimilars and at least one common to both agencies. Insulin-based molecules were excluded. We grouped the sample by the level of biosimilar competitors. We tracked the average change in list prices over five-year windows pre- and post-LoE (loss of exclusivity). This approach enabled the comparison of how differing policy environments influence the extent to which biosimilar competition translates into originator price erosion.
Biosimilar competition: EMA vs FDA approvals
Based on a sample of 16 originator biologics, Figure 1 shows the EMA approved 106 biosimilars and the FDA approved 73 (a difference of 33 more approvals in Europe). Of these, the EMA exclusively approved 59 biosimilars, the FDA exclusively approved 26, and both agencies approved 47.
Beyond the greater number of biosimilar approvals, there was also evidence of a preference to launch first in the EU. Of the 47 biosimilars approved by both agencies, 88% of their corresponding originators (n=16) received their first biosimilar approval from the EMA.
Figure 1: The total amount of biosimilars (n=132) approved by the EMA and FDA from a sample of 16 originator biologics.
The higher level of approvals can partly be attributed to the EMA’s early establishment of a biosimilar approval framework in 2005. Through its Committee for Medicinal Products for Human Use (CHMP), the EMA saw its first biosimilar, Omnitrope, approved in 2006. The FDA’s Biologics Price Competition and Innovation Act (BPCIA) created America’s first biosimilar pathway in 2009. Its first approval, filgrastim-sndz (Zarxio), came in 2015 (Iskit, 2025). With almost a decade’s head start, the EMA pathway is more established. Manufacturers have had significantly more time to build familiarity with European submission requirements.
Table 1: Summary of biosimilar pricing and adoption policies across the EU4+UK.
For more information see our earlier article “The Impact of Access Policies on Biosimilar Pricing in Five Major EU Markets – Inbeeo Strategic Market Access & Pricing”.
Commercial complexity beyond approval
However, while the regulatory pathway into Europe may be more established, the commercial environment that follows approval is more complex. In the US, a single federal approval grants nationwide market access under a free-pricing system. In Europe, manufacturers must navigate pricing and reimbursement policies that vary significantly between countries (Table 1). For example, France fixes biosimilar prices 40% below its originator, while in Germany negotiations with manufacturers determine prices. This variation in national policies adds an additional layer of complexity that directly impacts the speed of biosimilar adoption between individual European countries.
How biosimilar pricing and competition shapes originator price erosion
With the regulatory landscape established, the following sections examine how originator prices respond to biosimilar competition across these three markets.
Key findings on biosimilar pricing and competition
Across the European markets, a higher number of biosimilar competitors led to more price erosion on originators post-LoE. This was consistent with the statutory pricing frameworks in both markets that directly link pricing outcomes to biosimilar competition. However, this relationship did not follow a clear linear pattern. In France, larger price cuts consistently correlated with the presence of more biosimilars. This was also the case in Germany, although less consistently. In both markets, the timing of price revisions may have meant cuts were not captured within the five-year window for each originator.
The US presents a very different picture as a decentralised, market-driven system with no national pricing or procurement policies. Unlike in Europe, biosimilar competition did not result in absolute price cuts. Instead, it significantly reduced the rate at which originators could raise prices. This is consistent with a market-driven system where competition erodes pricing leverage rather than triggering statutory cuts. However, this effect did not deepen progressively with more biosimilar competitors. Originators with fewer biosimilar competitors (1–3 biosimilars) saw no price increase post-LoE, while those facing more competition (4–10 biosimilars) still experienced small increases. A higher biosimilar presence signals a larger commercial opportunity. These increases were therefore likely driven by the need to maintain a high list price to secure competitive formulary placement and rebate contracts that support greater uptake and total sales.
France: Statutory pricing driving the deepest post-LoE erosion
Figure 2: The average percentage change of list prices for originator biologics (n=13) 5 years before and after LoE (Loss of Exclusivity) in France, grouped by level of biosimilar competition.
Pre-LoE, originator prices declined by an average of 4.7% (Figure 2). This reflected periodic CEPS-led price revisions, price-volume clawback agreements, and external reference pricing benchmarked against Italy, Spain, Germany, and the UK. Post-LoE, erosion deepened to 9%. Originator prices face a mandatory 20% cut upon first biosimilar entry, with biosimilars set 40% below the originator. Further reductions are linked to market share over the following 18–24 months (Yujeong Kim, 2020).
Germany: Reference pricing creating gradual, competition-led erosion
Figure 3: The average percentage change of list prices for originator biologics (n=13) 5 years before and after LoE (Loss of Exclusivity) in Germany, grouped by level of biosimilar competition.
Pre-LoE, prices were largely stable at an average increase of 1.0% (Figure 3). The G-BA assessment sets prices, allowing only small inflation adjustments. Post-LoE, prices declined by an average of 2.8%. This is due to originators being placed into therapeutic reference groups alongside biosimilars. Reimbursement is capped at a reference price calculated from products at the bottom third of the group. As more biosimilars enter at lower prices, originators face growing pressure to cut list prices to minimise the patient co-pay gap.
The United States of America: High list prices resistant to erosion
Figure 4: The average percentage change of list prices for originator biologics (n=13) 5 years before and after LoE (Loss of Exclusivity) in the United States, grouped by level of biosimilar competition.
Pre-LoE, originator prices increased by an average of 5.6% (Figure 4), reflecting the absence of statutory pricing mechanisms. Post-LoE, the average increase dropped to 0.6%, with no instances of absolute price cuts. The persistence of modest increases stems from the PBM rebate structure. Incentives tied to rebate contracts encourage maintaining high list prices to secure competitive formulary placement. This creates a dynamic where both originators and biosimilars can still experience price increases post-LoE.
Conclusion
Across all three markets, biosimilar competition placed downward pressure on originator pricing after LoE, but the nature of that pressure differed significantly. In Europe, statutory pricing frameworks translated biosimilar entry into direct price erosion, with France’s approach driving the deepest cuts and Germany’s reference pricing producing more gradual, competition-led reductions. In the US, biosimilar competition degraded originator pricing power but did not result in absolute price cuts, with the PBM rebate structure continuing to incentivise list price maintenance even in competitive markets.
Ongoing policy reforms may reshape these dynamics. MFN pricing and PBM reform in the US could weaken the inflationary pricing dynamic observed in this analysis, with potential spill over effects for Europe as manufacturers adjust global pricing strategies in response. If US originator prices fall, the commercial headroom that incentivises biosimilar entry may shrink, raising questions about whether the market can support the same level of competition that this analysis shows is needed to drive meaningful price erosion.
With 118 biologics expected to lose exclusivity over the next decade, a clear understanding of how pricing policies shape the relationship between biosimilar competition and originator price erosion will be essential for manufacturers navigating an increasingly cost-constrained global landscape.
Contact Inbeeo to discuss how biosimilar pricing strategies may impact your market access planning.
References
Iskit, A. B. (2025). Biosimilars and interchangeability: Regulatory, scientific, and Global Perspectives. European Journal of Pharmaceutical Sciences, 107224.
Yujeong Kim, H.-Y. K. (2020). Uptake of biosimilar infliximab in the UK, France, Japan, and Korea: Budget savings or market expansion across countries? Frontiers in Pharmacology.