June 7 (Reuters) - AbbVie's ( ABBV ) top-selling

arthritis drug Humira has held onto more than 80% of patients

after facing nine lower-priced rivals in the U.S. in the last

year, raising questions about whether the market for

prescription biosimilars can survive in its current form, drug

pricing experts and analysts say.

Humira, which lists for almost $7,000 a month, is the first

top-selling drug to compete with a slew of biosimilars, which

are close but not exact copies of branded biologic medicines.

But after their launch last year, industry middlemen known

as pharmacy benefit managers determined patient access with

little incentive for doctors to switch to alternatives, they

said.

Biosimilars were available at lower prices than Humira

through the three largest benefit managers, CVS Health's ( CVS )

Caremark, Cigna's ( CI ) Express Scripts and UnitedHealth

Group's Optum Rx.

At least seven drugmakers offered sharply discounted prices,

but few patients used them until CVS removed AbbVie's ( ABBV ) Humira

from its list of covered drugs.

Regulatory reform is needed so patients can more easily

access biosimilars and draw rival drugmakers to develop them,

said Stacie Dusetzina, a health policy professor at Vanderbilt

University.

"It's not clear to me there's any incentive at all for

companies to spend their time and money creating biosimilars.

And if no one will, then the price of the brand would never come

down," she said.

The biosimilar industry is advocating for regulatory

changes, saying $6 billion in potential savings have been lost

since the launches.

AbbVie ( ABBV ) declined to comment, but has previously said it

conceded on price to get equal access for Humira alongside

biosimilars on lists of covered drugs, and expects 36% U.S.

sales erosion for its drug this year. At its peak, annual sales

topped $22 billion.

Unlike generic drugs, the FDA only allows some biosimilars

to be swapped for the branded medicine by a pharmacist. Most

must be specifically prescribed.

Last year, a bipartisan group of lawmakers backed

legislation to make it easier to interchange biosimilars. The

government and lawmakers have also called for reforms and are

looking closely at benefit manager deals with drugmakers.

When an anticipated six biosimilars of Johnson & Johnson's ( JNJ )

$11 billion Crohn's disease drug Stelara hit the U.S.

market starting next year, private healthcare insurers will

likely repeat the Humira playbook, drug pricing experts said.

J&J Chief Financial Officer Joe Wolk told Reuters in April

that the Stelara biosimilar market is likely to unfurl similarly

to Humira's given benefit manager contracting practices and

doctor and patient resistance.

"Over 75% of our business comes in either Crohn's disease or

ulcerative colitis, which are serious illnesses where the

patients or the physicians treating them tend not to want to

disrupt the therapy," he said.

Spokespeople for Express and Optum, asked about Humira

biosimilar launches, said they offered several options to give

patients a choice of medicines, helping lower costs for their

employer and insurer clients.

CVS Chief Medical Officer Sree Chaguturu said in an

interview that the company kept covering Humira while

determining which manufacturers had high-quality biosimilars

with reliable supply. It now covers a Sandoz biosimilar

and a co-branded Humira, both from its new Cordavis

pharmaceutical unit.

WORTH THE WAIT

Benjamin Rome, a drug pricing researcher at Harvard Medical

School, said that because biosimilars are not exact copies like

generics, pharmacists need more information about the safety of

switching medicines.

Zachary Wallace, a rheumatologist at Massachusetts General

Hospital, is one of four doctors who told Reuters they had begun

regularly prescribing Sandoz's Hyrimoz biosimilar when CVS

stopped covering Humira.

They said they did not want to prescribe unfamiliar

biosimilars unless they were sure patients were benefiting from

lower list prices.

"I would have to see that those discounts actually got

passed on to patients in some way," Wallace said.

In the U.S., drugmakers have a list price for their drugs

that can be discounted for employers and insurers who receive

after-market volume based discounts, called rebates.

ZS pharmaceuticals consultant Komal Gurnani predicted that

as many as five Humira biosimilars will exit the market within a

few years before they get to her forecast of $400 million in

peak sales.

She expects companies with other planned biosimilar

launches, like Amgen ( AMGN ), Sandoz and South Korea's

Celltrion, to leverage their other products to

negotiate favorable terms with insurers and stay in the market.

Sandoz and Celltrion, which have long sold Humira

biosimilars outside the U.S., said they were committed to the

U.S. market.

Celltrion Chief Commercial Officer Tom Nusbickel said the

company is willing to wait years to gain a significant U.S.

foothold. "We have a last-man standing approach to this market,"

he said.

Indian drugmaker Biocon, which sells a Humira

biosimilar in Europe, said it too was committed to the U.S.

market, as did Pfizer ( PFE ), which launched its biosimilar in

October.

Boehringer, which reduced its U.S. sales staff earlier this

spring, Teva and Organon said they are committed to

the U.S. Fresenius and Amgen ( AMGN ) declined to comment and

Coherus could not be reached for comment.

Organon biosimilar head Jon Martin said it would be worth

the wait even if biosimilars took six years to gain 50% market

share as they did when J&J's arthritis drug Remicade faced

rivals starting in 2016.

"That's what gives us some optimism," he said.