Radar on Drug Benefits

Congressional interest in PBM reform may turn into comprehensive legislation as soon as this summer, D.C. insiders tell AIS Health, a division of MMIT, and possibly has enough bipartisan support to pass both chambers. Lobbyists representing employer plan sponsors say that measures including a requirement that PBMs be fiduciaries to plan sponsors and members, a federal ban on spread pricing, and mandatory price transparency disclosures are all under serious discussion.

Several Senate committees have made moves to advance PBM legislation. The Finance Committee held a hearing on PBMs at the end of March; the Commerce Committee has advanced legislation; and the Health, Education, Labor and Pensions (HELP) Committee seems poised to mark up legislation this month, according to press reports. In the Senate, which is controlled by Democrats, several bills have sponsors from both parties, and the HELP Committee markup will feature members of both parties, led by committee chair Sen. Bernie Sanders (I-Vt., who caucuses with Democrats) and ranking member Sen. Bill Cassidy (R-La.).

Mark Cuban Cost Plus Drug Co., the wholesale, direct-to-consumer drug manufacturer and pharmacy launched by the eponymous entrepreneur, will sell brand-name diabetes drugs from Janssen, a division of Johnson & Johnson. Cuban also says that the company will soon sell hypothyroidism treatment Tirosint (levothyroxine). The drugs are the first brand-name products to be sold by the company, which has previously focused exclusively on generics; Cuban says that the company plans to sell whatever brand-name drugs that it can, depending on drugmakers’ interest.

Invokana (canagliflozin), Invokamet (canagliflozin-metformin HCl) and Invokamet XR (canagliflozin-metformin HCl) are now available from the startup, according to an April 3 tweet. Invokana will cost $243.90 for a 30-day supply, while Invokamet and Invokamet XR will each cost $244.20 for a 60-day supply. During a March 23 panel on prescription drug pricing and policy convened by Vanderbilt University, Cuban said that he doesn’t expect to stop at offering just a few brand-name drugs.

Uber Technologies, Inc. announced late last month that it would embed same-day prescription delivery on its Uber Health app, expanding the offerings available to its health care provider and payer customers. Although the feature could help patients adhere to their medications and save costs for employers, PBMs and health plans, Uber faces numerous competitors in a crowded field and could have challenges getting the delivery feature covered, according to health care experts who spoke with AIS Health.

Uber Health, which launched in 2018, is primarily used for coordinating non-emergency medical transportation of patients to and from hospitals and other health care facilities. The company entered the prescription delivery business in August 2020 through a partnership with NimbleRx in Seattle and Dallas. And two years ago, the company formed a partnership with ScriptDrop to make Uber the default delivery app for a network of grocery stores and independent pharmacies in 37 states. Those stores and pharmacies already had deals with ScriptDrop, a health care information technology company founded in 2016, so they gained access to Uber’s network of drivers.

Access to the abortion pill mifepristone is in limbo following two contradictory court rulings. On April 7, U.S. District Judge Matthew Kacsmaryk ordered the FDA to suspend its approval of mifepristone, which the agency first issued in 2000. The judge gave the Biden administration seven days to appeal.

On April 10, the Dept. of Justice asked the 5th U.S. Circuit Court of Appeals to block the ruling and keep the drug on the market as litigation plays out. On April 12, the court ruled that mifepristone will remain available for now but with new restrictions, including a requirement for in-person doctor visits to obtain the drug. The Biden administration then responded that it would immediately seek emergency relief from the Supreme Court to restore full access to mifepristone.

Meanwhile, states including New York, Massachusetts, California and Washington are rushing to stockpile abortion pills.

The Cigna Group’s PBM, Express Scripts, on April 13 unveiled a “fully transparent pricing model” called ClearCareRx, which allows private sector and government employers as well as health plans to “pay exactly what Express Scripts pays for drugs.” That means clients will receive 100% of drug rebates that Express Scripts negotiates and will pay “one simple fee” to cover PBM services, the administration of pharmacy benefits, reporting and analytics, the company said. Express Scripts also rolled out what it’s calling the Copay Assurance Plan, which caps copays on prescription drugs: no more than $5 for generics, $25 for preferred brand drugs, and $45 for preferred specialty brand drugs for consumers enrolled in the program.

CMS on March 15 revealed the first drugs that will be sanctioned for having their prices increase faster than the rate of inflation, as part of the Inflation Reduction Act. The 27 medications are all covered under Medicare Part B, and many of them are treatments for cancer, chronic kidney disease and the aftereffects of organ transplants. Beneficiaries who normally pay 20% coinsurance under Part B will see their share decline based on an inflation-adjusted price for these drugs.

The federal government will invoice the manufacturers for 2023 and 2024 Part B inflation rebates no later than fall 2025, and those funds will be deposited into the Medicare Trust Fund. A Kaiser Family Foundation analysis found that, from 2019 to 2020, half of all drugs covered by Medicare had price increases above the rate of inflation over that period.

The Senate Committee on Commerce, Science and Transportation on March 22 advanced the Pharmacy Benefit Manager Transparency Act, sending the PBM-regulating legislation to the full Senate. The bill would ban spread pricing, the process in which PBMs charge payers more for a prescription drug than what they reimburse the pharmacy and pocket the difference. It would also “prohibit PBMs from arbitrarily, unfairly, or deceptively clawing back payments made to pharmacies, or arbitrarily, unfairly, or deceptively increasing fees or lowering reimbursements to offset reimbursement changes in federally-funded health plans.” And it would require PBMs to file an annual report with the Federal Trade Commission (FTC) that discloses a variety of information, such as “the aggregate total amount of fees the PBM charged to pharmacies and the total amount of reimbursements the PBM clawed back from pharmacies.” To enforce those new mandates, the bill would authorize the FTC and state attorneys general to seek civil penalties from PBM companies for each violation, plus an additional penalty of up to $1 million.

The FDA recently approved a new HIV drug for a small patient population desperately in need of treatments. And the twice-yearly medication’s annual price is below the level that respondents to a Zitter Insights poll said they would consider a good value. The medication comes with both potential advantages and disadvantages for patients, providers and payers, say industry experts.

On Dec. 22, the FDA approved Gilead Sciences, Inc.’s Sunlenca (lenacapavir) for the treatment, in combination with other antiretroviral(s) (ARVs), of HIV-1 infection in heavily treatment-experienced adults with multidrug resistant HIV-1 infection who are failing their current antiretroviral regimen due to resistance, intolerance or safety considerations. The agency gave the first-in-class capsid inhibitor priority review, fast track and breakthrough therapy designations.

While drugs are increasingly hitting the market that address unmet needs and even offer cures for some rare diseases, private insurers are highly concerned about such therapies’ eye-popping price tags, a recent survey indicated. But one prominent payer executive who spoke during AHIP’s Medicare, Medicaid, Duals & Commercial Markets Forum suggested that insurers are better off working collaboratively with drugmakers to ensure prices are tied to value — rather than engaging in an inter-industry war of words.

“More and more we’re seeing drugs come through with limited evidence through accelerated approval processes, which generally is a marker for an unmet need, which is a good thing. But the evidence can be thin,” said Michael Sherman, M.D., executive vice president and chief medical officer of Point32Health. During a March 14 panel at the AHIP forum, Sherman pointed to the example of Makena (hydroxyprogesterone caproate), a drug that aims to reduce preterm births but failed to prove clinical effectiveness in trials conducted after it received accelerated approval. With the FDA poised to make a final decision on the drug’s status, Clovis Pharma Group recently announced it would voluntarily pull Makena off the market.

The FDA is expected to approve several biosimilar medications in the next few years, potentially leading to billions of dollars in savings for payers and patients, according to a recent report from Cardinal Health. However, Bruce Feinberg, D.O., Cardinal Health’s chief medical officer, tells AIS Health that the promise of biosimilars to decrease medication and overall health care costs remains uncertain. He adds that the price differential between biologic drugs and their biosimilars has not reached anywhere near the levels seen between small-molecule medications and their generics.

Feinberg says that “in most of the biosimilars to date, none of the manufacturers have been quite willing to initiate that race to the bottom on price,” in large part due the high costs of producing biosimilars and funding research and development of them. Whereas the introduction of a generic can reduce prices by 90%, Feinberg says “we’re not seeing those kinds of changes [with biosimilars],” claiming the range is usually from 10% to 30% with an average of 15%.