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Business ofOncology:Q1 2019Tesh KhullarSVP, Provider SolutionsFlatiron Health Flatiron Health 20191
Legal DisclaimerAll statements made during thispresentation are my own and do not reflectany opinions, views or statements ofFlatiron Health, Inc. Flatiron Health 2019
Regulatory update (340B, SiteNeutrality)Goals Market consolidation Biosimilars update Flatiron Health 20183
Tesh KhullarSVP, Provider SolutionsFlatiron Health 20 years in the business side ofcommunity oncology Oncology Therapeutics Network NOA GPO McKesson Specialty Health Onmark GPO McKesson / USON Flatiron Health Flatiron Health 20194
Regulatory Update Flatiron Health 20185
340BSite NeutralityPart B ExperimentsPBMs Flatiron Health 20186
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Market Consolidation Flatiron Health 20188
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CVS to Buy Aetna for 69BCVS / Aetna Deal(approved 11/2018)Updated thoughts: Trump administration has shown it's not receptive tovertical integration dealsThis created mega PBM with horizontal (patient) &vertical (drugs) leverageCVS’s largest customer is AetnaEstimating 750M in initial “synergies” (vast majority willcome from drug negotiation power)CVS wants to defend itself from vertically integratedpotential competitors (like Amazon) Flatiron Health 201712
Cigna to Buy ExpressScripts for 67BCigna /ExpressScripts Deal(approved 12/2018)Initial thoughts: Fell into similar review as CVS/AetnaCreated largest PBM with horizontal (patient) & vertical(drugs) leverageExpressScripts is one of ABC’s largest customersCigna procures orals from Cardinal’s via OptumHealthrelationship (formerly Catamaran)ExpressScripts has a specialty distribution arm(Curascript) - further mergers to be expected Flatiron Health 201713
Walmart in talks to acquire HumanaInitial thoughts: Walmart / HumanaSpeculation Will fall into similar review as CVS/Aetna & Cigna/Expressif agreed uponHumana already teamed up with Walmart for low priced,in network, generic oralsWalmart is McKesson’s largest customerHumana procures orals from ABCWith Humana, Walmart has a horizontal patient network& vertical drug distribution with the convenience of retailstores to undercut price to employers Flatiron Health 201714
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Biosimilars Flatiron Health 201817
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Biosimilars: Why is there so much buzz now? Biosimilars We are entering time where biologics will go biosimilar inUS (not just supportive care)In 2019, Avastin, Rituxan, Herceptin will have biosimcompetition Herceptin biosim approved Jan 2019 (Samsung) &Mylan and Amgen expected to followAnnounced that biosims will have their own j-codeBiosimilar use and regulation exists in Europe and isbeing defined in the U.S. Naming & interchangeability to be determinedCost & Payer formulary will determine use Flatiron Health 201719
LOE andBiosimilar Entryas of iles/5815/1638/4057/The State of US Biosimilars Market Access.pdf Flatiron Health 201820
Remicade:ExistingBiosimilars:A Tale of 2Markets Went biosimilar in the EU in 2015, US in 2016In Europe, market share dropped 50% in the last two years, when measuredby units sold (primarily to Celltrion) 1In US, Remicade has barely lost any market share due to J&J volume basedcontracting (main competitor is Pfizer - anticompetitive lawsuit pending) 1 2Enbrel: Went biosimilar in the EU in April 2017, US delayed (min later 2018)In Europe, markets hare dropped 25% in the last year, when measured byunits sold (primarily to Samsung) 1Rituxan: Went biosimilar in the EU in April 2017, US anticipated 2019In Europe, Rituxan market share dropped 13% in Q3 2017 (to Celltrion &Novartis / Sandoz) 1 1 hions-blow-europe-report2 emicade-contracting Flatiron Health 201721
1. 2.KeyTakeaways 3. Biosimilars are not new - just new in the U.S.Adoption has become standard of care in EuropeStill unclear how they will be priced (Brand vs. Generic)Biosim manufacturers will include historically branded companiesAmgen received FDA approval for biosimilar Avastin in Sept 2017 &Mylan for Herceptin in December 2017, Samsung for Herceptin in Jan2019US Market opportunity is huge - adoption is keyWorldwide annual Roche Sales of Avastin, Herceptin & Rituxanexceeded 21B, more than half coming from the US 1Fear that Insurers / PBMs may stick with branded biologics due torebates Flatiron Health 201722
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Walmart in talks to acquire Humana Initial thoughts: Will fall into similar review as CVS/Aetna & Cigna/Express if agreed upon Humana already teamed up with Walmart for low priced, in network, generic orals Walmart is McKesson’s largest customer Humana procures orals from ABC With Humana
