The FDA on June 7 delivered its much-anticipated approval of Biogen Inc.’s Aduhelm (aducanumab-avwa), immediately stirring up a furor over its high cost, reigniting doubts about its effectiveness, and spurring speculation about how public and private payers will approach coverage for the first novel treatment approved for Alzheimer’s disease since 2003.
Alzheimer’s, which affects more than 6 million Americans and tens of millions of people worldwide, is marked by progressive cognitive and functional decline that eventually results in death. It kills more people than breast and prostate cancers combined and, along with other forms of dementia, is expected to cost the U.S. $355 billion this year alone, according to the Alzheimer’s Association.
Aduhelm stands out from the other drugs currently used to treat Alzheimer’s (see infographic, p. 4) because it aims to slow the progression of the disease rather than just address its symptoms, Douglas Scharre, M.D., tells AIS Health, a division of MMIT. Scharre is a neurologist and director of the division of Cognitive Neurology at Ohio State Wexner Medical Center, and he worked on clinical trials for the drug.
“Aducanumab is the first of a kind in that it is designed to get rid of this protein called amyloid from the brain,” Scharre says.
“No other therapies we’ve had so far for Alzheimer’s [were] able to remove some of these toxic proteins that cause these plaques and lead to a whole cascade of events of cognitive impairments.”
Yet controversy has surrounded Aduhelm for some time. Biogen and its partner Eisai Inc. in March 2019 temporarily halted two ongoing Phase III trials, citing an independent data monitoring committee’s findings that the trials “were unlikely to meet their primary endpoint upon completion.” A later analysis, based on additional data, showed one of the trials did in fact meet its goal of slowing the progression of cognitive and functional impairments, but the other trial did not.
Decision Contradicts Independent Panel
Still, the FDA agreed in August 2020 to give Aduhelm priority review, and the agency said in its June 7 press release unveiling its accelerated approval decision that all studies showed it “consistently and very convincingly reduced the level of amyloid plaques in the brain in a dose- and time-dependent fashion.”
The FDA’s move goes against the advice of its independent Peripheral and Central Nervous System Drugs Advisory Committee, which in its November 2020 review “did not agree that it was reasonable to consider the clinical benefit of the one successful trial as the primary evidence supporting approval,” the agency acknowledged. Ultimately, the FDA gave Aduhelm an accelerated approval, which means that it will require Biogen to conduct a post-approval trial to verify the drug’s clinical benefit.
The Institute for Clinical and Economic Review (ICER), slammed the FDA’s decision, saying in a June 7 press release that the agency “failed in its responsibility to protect patients and families from unproven treatments with known harms.” ICER questioned why the FDA approved the drug for treating all Alzheimer’s patients despite the fact that it was studied only in individuals with mild cognitive impairment and mild dementia.
Scharre says he’s aware that the FDA’s decision to approve Aduhelm has drawn criticism, but he argues that the drug represents a valuable step in the fight against Alzheimer’s.
“It’s not a miracle cure or a reversing drug or anything like that, so people need to understand that. It helps for a small sliver of individuals” who are very early on in the progression of Alzheimer’s disease, Scharre explains. “But I’m very glad they did approve it, primarily because it’s the first drug that gets rid of this amyloid protein — it takes that off the table.”
Amyloid plaques are just one of many factors that contribute to Alzheimer’s symptoms, and therapies are being tested to address those other factors, which include inflammation and an abnormal buildup of tau protein, Scharre says. “In my opinion, in the future we’ll have five, six different drugs for someone that has Alzheimer’s depending on what stage they’re in.”
Aduhelm, which is infused once every four weeks, has a wholesale acquisition cost (WAC) of $4,312 per infusion for people who are the average weight of a U.S. patient with mild cognitive impairment or mild dementia, according to Biogen and Eisai.
While the cost for the first year of treatment is lower — roughly $41,000 — the annual WAC for the average patient taking the full maintenance dose is $56,000.
The companies said they will not raise the price of the drug for the next four years.
David Steinberg, Pharm.D., director of pharmacy insights at Scripta Insights, says he is not convinced that Aduhelm is worth its high cost. Scripta is a health care IT company that works with self-insured employers and their PBMs to reduce drug spending.
“We not only take into account the clinical data, which is very important to us, but we also take into account the price tag. And it looks like it’s going to be about $56,000 per year for the medication,” Steinberg says. “With that price tag and the lack of clinical data to support its effectiveness above and beyond the current therapies that are on the market, it does not yield a Scripta recommendation. But it doesn’t mean that the medication is not safe and effective, which is often what the FDA uses to evaluate drugs.”
Scharre says he believes the key to ensuring that Aduhelm provides value is to limit which patients can take it. “If you get it early and you get the right person, the cost may be well worth it,” he says. Because the drug is likely to be administered by dementia experts, Scharre says it’s more likely that it will be judiciously administered.
April Kunze, senior director of clinical formulary development and trend management strategy at Prime Therapeutics, says there are still many uncertainties surrounding Aduhelm. “Questions remain on how to select patients for aducanumab, when to start treatment, how to monitor patients during treatment, and how long to treat,” she says. “It is expected there will be a lot of interest from patients and/or caregivers.”
Indeed, “that’s where the bottleneck is going to be; a lot of people won’t be able to get in, be evaluated, get the particular studies” needed to determine if they can be helped by Aduhelm, Scharre says. “At Ohio State, we’re trying to overcome this by having a very sophisticated triage system, so that we’re not filling up all our clinics with the worried well who think they may be a candidate” or people who are too far along in their disease progression, he adds.
Unlike the other Alzheimer’s treatments on the market, which are covered under the pharmacy benefit, Aduhelm will be covered under patients’ medical benefit because it has to be infused in a clinical setting. For Medicare patients, that means the drug will be covered under Part B.
Medicare Impacts Will Be Substantial
Tricia Neuman, senior vice president of the Kaiser Family Foundation and executive director of its Program on Medicare Policy, says Aduhelm’s approval has considerable implications for the Medicare program and its enrollees.
“People who take the drug would pay the 20% coinsurance, so it affects users directly,” she explains. “If they have supplemental coverage, they may not be liable for the 20% coinsurance, but in all likelihood, supplemental insurance premiums would go up, and that affects roughly 10 million people in Medicare who have Medigap policies.
“The largest group of people who would be affected would be all Part B enrollees, who would be responsible for any increase in the Part B premium associated with higher spending for the new drug, because premiums cover 25% of program costs,” Neuman continues. That applies to beneficiaries of both fee-for-service Medicare plans and Medicare Advantage plans, she adds, because “they’re not calculated separately.”
States likely will also feel an impact, as their Medicaid programs will be responsible for covering the drug for dually eligible Medicare-Medicaid beneficiaries, Neuman says.
Meanwhile, some of the country’s largest publicly traded health insurers — including Humana Inc., Cigna Corp., UnitedHealth Group and Anthem, Inc. — saw their stock prices dip following the news of Aduhelm’s approval, Citi equities analyst Ralph Giacobbe pointed out in a June 8 note to investors.
Investors Raise Concerns About Cost
“Most of our discussions with investors simply centered on the notion of a new costly drug…resulting in higher medical spending for a subset of the MA population,” Giacobbe wrote. “That said, we believe that the reaction was overdone, as we expect the government to pick up the tab initially and expect plans to ultimately price for or potentially exclude coverage.”
If CMS makes a national coverage determination (NCD) to reimburse providers for Aduhelm, “it would temporarily be carved out as a fee-for-service pass-through payment if the financial impact is 10 [basis points] or more of the total Medicare budget — a ‘significant cost’ threshold of less than $1B very likely to be exceeded in this case,” Evercore ISI analysts explained in a June 7 note to investors. “Then later Medicare Advantage plans would take responsibility for payment after the cost can be added into prospective capitated rates at the next annual update.”
For its part, Biogen said in a slide deck accompanying a June 8 conference call that it is engaging Medicare Administrative Contractors “to support consistent regional access” to Aduhelm and that it expects “most Medicare Advantage plans to define medical policies within the first several months.”
In a June 7 press release, Biogen and Eisai also said they “intend to enter into a value-based contract” with Cigna “to ensure that there is a streamlined path” for qualifying patients to access treatment. As part of that agreement, according to the release, the insurer and drug manufacturers will also “be tracking performance towards certain outcome metrics for patients.”
Citi analysts “expect that other MCOs may develop separate agreements with [Biogen],” Giacobbe noted. The companies also unveiled an education-focused partnership with Aetna owner CVS Health Corp.