--- name: biosimilar-erosion description: > This skill should be used when the user asks about "biosimilar erosion", "Purple Book", "biologic exclusivity", "interchangeability", "how fast will [biologic] erode", "erosion curve", or needs the post-LOE revenue slope for a biologic. Anchors prompt-library ID SUB-PHA-05. metadata: version: "0.1.0" layer: "Competitive" --- # Biosimilar erosion curve Turn a biologic's exclusivity position and competitive set into a dated erosion curve that a revenue model can consume. ## Workflow 1. **Establish the reference product's position** from the Purple Book (`scripts/purple_book.py`): BLA number, first licensure date, reference-product exclusivity expiry, and any listed biosimilars with their licensure dates and interchangeability status. 2. **Count and qualify the entrants.** Not all approvals launch. Check for: launch announcements, settlement-driven launch dates, manufacturing capacity, and whether the entrant is a large player with contracting muscle or a small one that will discount without winning share. 3. **Determine the substitution mechanism**, which drives everything: - *Interchangeable, pharmacy-dispensed* → fastest erosion. - *Not interchangeable, physician-administered, buy-and-bill* → slowest; erosion depends on ASP dynamics and the physician's reimbursement spread, not on the pharmacy. - *Payer-forced switching* → step-shaped erosion at formulary dates (1 January is the usual step), not a smooth curve. 4. **Model price and volume separately.** Biosimilar competition is initially price-led: the reference product often holds volume while conceding net price through rebates. A model that assumes volume loss will misread the first two years and then be surprised by the cliff when contracts finally flip. 5. **Build the curve.** Quarterly, from the entry date, with the shape justified by the substitution mechanism and by two named analogue molecules with similar mechanics. Analogues do more work here than theory. 6. **Watch the defence.** Reference-product sponsors deploy: authorised biosimilars, next-generation formulations (higher-concentration, subcutaneous, longer-acting), device improvements, and aggressive contracting that trades price for volume retention. Each changes the curve; name which ones are in play. 7. **Instrument the curve.** Once entry happens, replace assumption with observation via `rx-utilization` → sdud-trx-proxy and Medicare Part B/D spending dashboards. A curve that is not being checked against data quarterly is a guess with a chart. 8. Emit the brief. ## Not-automatic A biosimilar approval does not license an erosion assumption. Approval without launch, without interchangeability, or without contracting capacity produces very little erosion, and several approved biosimilars have never meaningfully launched. Reference: `references/erosion-analogues.md`. Contract: `../../references/evidence-brief.md`.