By Jake Velie, CPT, Founder, Chairman & CEO, National Integrative Health

Biosimilars are getting a lot of attention right now. They should. They are changing the economics of the drug channel. Provider-administered biosimilars now account for an estimated 6% of the Big Three wholesalers’ drug distribution revenue, but 23% of their gross profit.¹

But employers should not confuse more biosimilars with automatic savings.

That is not how this market works.

A lower-priced drug only helps if the plan is positioned to capture the savings. Too often, it is not. The problem is not just the drug. The problem is the path the drug takes through the system.

PBMs control formularies. TPAs see claims on the medical side. Stop-loss carriers absorb catastrophic exposure. Clinical and sourcing partners see savings opportunities the rest of the chain misses. If those groups are not aligned, savings leak out fast.

That is why the biosimilar conversation needs to get bigger.

Channel strategy already shapes what employers actually pay. The three largest PBMs manage roughly 80% of prescription drug volume, and each one operates its own private-label drug business.² Their 2026 formularies exclude most marketed biosimilars and favor versions sold by their own affiliates. In some cases, cheaper biosimilars share formulary space with higher-priced affiliated versions.³

On paper, that can look like a win. The economics are not that simple. Market control, formulary placement, specialty pharmacy steering, and vertical integration all influence whether lower-cost therapies actually lower employer spend.⁴

Then there is the other issue employers keep running into: some of the highest-cost drugs do not show up where people expect them.

Everyone watches the pharmacy benefit. Far fewer people watch the medical benefit, where infusion and provider-administered drugs are billed. That is where visibility drops. It is also where price swings with site of care.

The data is clear. A 2026 study of more than 52,000 matched infusions found that hospital outpatient infusions cost about 42% more than the same therapies delivered in an office, home, or ambulatory infusion center, with similar patient outcomes.⁵ Earlier employer claims research found hospital outpatient prices for some infused specialty drugs running as much as 84% higher than in physician offices.⁶

Those costs do not stay small. Sun Life’s latest analysis of more than 70,000 high-dollar stop-loss claims found that million-dollar-plus claims rose 46% from 2022 to 2026, with injectable and specialty drugs among the key drivers.⁷

So yes, biosimilars matter. But the real question is bigger: can the employer see the whole claim, compare the real alternatives, and make the right decision across every channel?

That is where good partners matter.

A strong PBM matters. A strong TPA matters. A thoughtful stop-loss partner matters. A clinical cost-management partner matters. The plans that get the best results do not rely on one point solution. They build alignment across everyone touching pharmacy, medical claims, reimbursement, and catastrophic risk.

That is how employers move from theoretical savings to real savings.

The right question is simple: what is the lowest net cost way to deliver the right therapy to the right patient? If the PBM has the best answer, use it. If the better answer sits outside that channel, go get it. If the site of care is driving the excess cost, fix the site of care. If the claim is hiding in the medical benefit, bring it into the light before it becomes a stop-loss problem.

Biosimilars are part of the answer. They are not the whole answer.

The employers who win here will not be the ones chasing headlines. They will be the ones building a model that connects biosimilar strategy, medical benefit visibility, site-of-care discipline, and aligned incentives across PBMs, TPAs, stop-loss carriers, and clinical partners.

That is how lower prices turn into lower spend.

Sources

1. Bryce Platt, “The Spinoff: How Biosimilars Are Becoming Wholesalers’ Next Hit Show,” Drug Channels, September 22, 2026, https://www.drugchannels.net/2026/09/the-spinoff-how-biosimilars-are.html

2. Tyler Novotny and Bryce Platt, “The Private Label Biosimilar Paradox in Medicare Part D,” Drug Channels, September 1, 2026, https://www.drugchannels.net/2026/09/the-private-label-biosimilar-paradox-in.html

3. Adam J. Fein, “The Big Three PBMs’ 2026 Formulary Exclusions: MFP, Private Label Biosimilars, and Direct-to-Patient Threats for PBMs,” Drug Channels, January 22, 2026, https://www.drugchannels.net/2026/01/the-big-three-pbms-2026-formulary.html

4. See notes 2 and 3; and Adam J. Fein, “Drug Channels News Roundup, April 2026: PBM Specialty Pharmacy Steering, MLR Profit Shifting, Hospitals’ Fake Prices, and a Peek Behind the Scenes at DCI,” Drug Channels, April 28, 2026, https://www.drugchannels.net/2026/04/drug-channels-news-roundup-april-2026.html

5. Daniel Cullen et al., “Infusion Therapy Patient Outcomes Are Similar at Reduced Costs in Alternative Sites of Care Compared with Hospital Outpatient Departments: A Matched Cohort Analysis of Infusion Therapy Across Multiple Chronic Conditions,” Journal of Managed Care & Specialty Pharmacy 32, no. 3 (March 2026): 312–322, doi:10.18553/jmcp.2025.25264, https://pmc.ncbi.nlm.nih.gov/articles/PMC12948754/

6. Paul Fronstin and M. Christopher Roebuck, “Location, Location, Location: Cost Differences in Health Care Services by Site of Treatment — A Closer Look at Lab, Imaging, and Specialty Medications,” EBRI Issue Brief no. 525, Employee Benefit Research Institute, February 18, 2021, https://www.ebri.org/docs/default-source/pbriefs/ebri_ib_525_siteoftreatment-18feb21.pdf

7. Sun Life U.S., “What Drives Multimillion-Dollar Medical Claims? Sun Life Report Shows Secondary Health Conditions, Hospital Stays and Specialty Drugs Among Key Factors,” news release, May 21, 2026, https://www.sunlife.com/en/newsroom/news-releases/announcement/what-drives-multimillion-dollar-medical-claims-sun-life-report-shows-secondary-health-conditions-hospital-stays-and-specialty-drugs-among-key-factors/124097/