(Adds Amgen comment)
By Allison Martell and Allison Lampert
TORONTO/MONTREAL, May 27 (Reuters) - The Canadian province of British Columbia said on Monday that its public drug plan will switch as many as 20,400 patients from three branded biologic drugs to cheap near-copies called biosimilars, saving an estimated C$96.6 million ($71.9 million)over three years.
The new policy from the province's PharmaCare program targets Johnson & Johnson's JNJ.N Remicade and Amgen's AMGN.O Enbrel which treat rheumatoid arthritis and related autoimmune conditions, and Sanofi's SASY.PA long-acting insulin Lantus. It is the first of its kind in a Canadian public plan and could pave the way for similar programs across the country.
Biologic, or biotechnology, drugs are large molecules made from living cells, and tend to be expensive. Biosimilars work in the same way as the biologics they mimic, but unlike generics of less complex pills, they are not identical to the drug they are copying.
"Biosimilars are a necessary step to ensure PharmaCare provides existing coverage for more people and funds new drugs well into the future," said the British Columbia government in a statement.
In Canada, pharmacists cannot swap biosimilars for their branded predecessors once patents expire the way they can with generics. Doctors must specifically prescribe the biosimilar, and they have been slow to do that. European countries have been quicker to adopt the less expensive versions.
Sanofi Canada said it was disappointed and regretted that BC "did not take the opportunity to find an alternative solution to preserve this treatment option."
Amgen said it was "disappointed that British Columbia chose not to consider alternatives to address their financial concerns." The company, which is developing its own biosimilars of rivals' drugs, said it does support biosimilars for new patients.
J&J's Janssen unit did not respond to a request for comment.
Canadian law says provincial governments must cover medically necessary care by doctors, but prescription drugs are paid for through a patchwork of public and employer-based insurance plans.
While every province offers some drug coverage, it is often limited to the elderly or people with low income or exceedingly high drug costs. BC's system is unusual because it covers most residents, with deductibles based on income.
BC said patients with some types of arthritis, diabetes and plaque psoriasis would have until Nov. 25, 2019, to switch to a biosimilar. After that, the original biologic drugs would only be covered for those indications under exceptional circumstances.
At the same time, BC announced that it would begin covering two newer biologics: Boehringer Ingelheim and Eli Lilly's LLY.N diabetes drug Jardiance, and Eli Lilly's Taltz, which treats psoriatic arthritis.
The new policy should benefit drugmakers with covered biosimilars such as Merck & Co MRK.N , Novartis' NOVN.S Sandoz unit, Pfizer (NYSE:PFE) PFE.N and Eli Lilly (NYSE:LLY).
Merck Canada lauded the step in a statement on Monday.
"The initiative could help save millions of dollars over the first three years, and could improve access to prescription drugs for patients in the province," the company said https://reut.rs/2KgnWy7.
Pfizer said it supported a well-controlled switch from a reference biologic drug to a biosimilar in an approved indication.
"BC has taken an informed, inclusive and responsible approach to enhancing access to biosimilars," Pfizer said.
Most Canadian provinces have started limiting coverage of branded biotech drugs for new patients, without forcing patients to switch. Even that has prompted backlash. Early this year, J&J (NYSE:JNJ) won a lawsuit against Quebec, forcing its public drug plan to resume coverage of Remicade for new patients.
Because the ruling was based on the procedure Quebec took dropping the drug, most expect it to have little impact outside Quebec. It is not clear how it will affect future policy in the province, which has a public plan for all residents who lack private insurance.
A spokeswoman for Quebec's Health Department said work was under way to "identify the best practices and measures that could be used to help biosimilars make up a greater part of the market," but that it would be premature to say more.
($1 = 1.3440 Canadian dollars)