Drug Coupons

As Debate Rages Over Copay Accumulators, State Bans Proliferate

The copay accumulator bans passed in 15 states affect about 15 million people, or 11% of U.S. commercial plan members, according to research by consulting firm Avalere Health. Experts say the drug manufacturer-backed bans pick winners between payers and patients, but don't come close to solving the persistent problem of sky-high prices for life-saving drugs.

Copay accumulators are the practice, implemented by PBMs, of preventing the value of copay assistance programs from counting toward a plan member's deductible and out-of-pocket maximum calculation. A related practice, copay maximizers, spreads out the value of a copay coupon over 12 months while also preventing that coupon from counting toward a patient’s deductible/out-of-pocket maximum. Fifteen states and Puerto Rico have banned these practices in fully funded plans, which states can regulate — self-insured plans, since they are regulated by the Employee Retirement Income Security Act, are not included.

Payers May Balk at Newly Approved ALS Drug’s $158K Price

The FDA on Sept. 29 approved Relyvrio (sodium phenylbutyrate/taurusodiol), making it only the third medication to treat patients with amyotrophic lateral sclerosis (ALS). While ALS advocates and some clinicians applauded the agency’s decision, other providers have questioned the drug’s effectiveness, and some experts believe the drug is not cost-effective with its approximately $158,000 annual wholesale acquisition cost (WAC).

For instance, the nonprofit Institute for Clinical and Economic Review (ICER) found that Relyvrio, which was formerly known as AMX0035, would be cost-effective if it was priced at between $9,100 and $30,600 per year. And Bruce Booth, a former scientist who’s now a partner at the Atlas Venture biotechnology venture capital firm, wrote on Twitter that the $158,000 price for Relyvrio was “even more egregious than I thought!”

News Briefs: Drug Spend Increased by 12% in 2021

Spending in the U.S. on medicines increased by 12% in 2021, primarily because of COVID-19 vaccines and therapies, according to the IQVIA Institute’s annual report on drug trends. The report also found that “Despite an increase in overall spending, costs per prescription on average are flat or slightly declining. Prescription drug use reached a record 194Bn daily doses in 2021 as new prescription starts for both chronic and acute care recovered from the slowdown recorded in 2020…[but] spending on medicines is expected to return to pre-pandemic growth trend lines by 2023.”

A federal appeals court on July 25 held that a Pfizer Inc. coupon program violated the federal Anti-Kickback Statute. The Second Circuit Court of Appeals ruled that Pfizer offering copay assistance to Medicare beneficiaries was illegal under the statue. AHIP applauded the ruling, arguing that “By upholding these protections, the courts have taken an important step to protect Americans from what would otherwise be an unchecked multi-billion-dollar price tag that would make coverage and care less affordable for everyone.”

Some Employers Embrace Alternate Funding Programs Despite Legal Issues

Pharmacy benefit consultants have mixed views on how many plan sponsors are turning to alternate funding programs, which aim to save on specialty drug costs by eliminating coverage for certain drugs and diverting costs to pharmaceutical companies’ patient assistance programs. But scrutiny of the programs is growing, with one major pharma company challenging the legality of these programs in court.

“A large percentage” of WTW’s employer clients now are using this strategy, Chantell Sell Reagan, Pharm.D., the national pharmacy practice clinical lead for WTW, tells AIS Health, a division of MMIT.

Court Decision on Accumulator Rule Could Encourage State Bans

Under a May 17 court decision striking down a CMS final rule slated to take effect in 2023, pharmaceutical manufacturers will not have to ensure that financial assistance provided to patients goes only to patients and not to payers under their copay accumulator and maximizer programs. However, the renewed attention to these programs could spur more states to take action of their own against them, industry experts tell AIS Health.

The Accumulator Rule (CMS-2482-F), published Dec. 31, 2020, could have resulted in patients facing increased out-of-pocket drug costs and pharma companies being held responsible for ensuring they know exactly where their assistance is going, industry experts tell AIS Health, a division of MMIT.

Study: With High Prices, Rebate Revenue Is Growing for PBMs

New research published in JAMA Health Forum found that rebate revenue for PBMs grew between 2015 and 2019 — but that growing rebate revenue was not passed on to patients.

The research letter’s authors measured both prerebate and postrebate drug costs taken from medical loss ratio (MLR) filings made by plans to CMS. The research sample includes commercial insurance filings from small group, individual and large group health plans across “approximately 2,200 unique health plans” covering 70 million lives.

Many Medicare Enrollees Can’t Afford Cancer, Specialty Drugs

Large numbers of Medicare beneficiaries who are ineligible for low-income subsidies and have been prescribed high-price prescription drugs for conditions such as cancer don’t initiate their treatment, likely because they can’t afford it, according to new research published in Health Affairs. One of the study’s authors tells AIS Health that severe illness is a possible outcome of noninitiation in the studied clinical areas and adds that proposals under consideration in Congress to cap out-of-pocket spending for Medicare beneficiaries would make a big difference to the affected patients.

According to the paper, “among beneficiaries without subsidies, we observed noninitiation for 30 percent of prescriptions written for anticancer drugs, 22 percent for hepatitis C treatments, and more than 50 percent for disease-modifying therapies for either immune system disorders or hypercholesterolemia.”

States Pass More PBM Laws, Including Copay Accumulator Bans

PBMs have drawn more attention than ever from state officials responding to the steep cost of prescription drugs. As federal efforts to manage the rising cost of medications have stalled, state lawmakers across the country have considered hundreds of bills that affect PBMs, ranging from prescription drug affordability boards to banning copay accumulators.

The National Academy for State Health Policy (NASHP), a think tank and policy group, identified 118 bills introduced to state legislatures across the country that would change PBM regulations during 2022 sessions. In addition, NASHP found state legislators nationwide have introduced 44 bills that would reform drug coupons, including bans on copay accumulators and maximizers. That follows more than 100 laws passed since 2017 by state legislatures, according to a June 2021 NASHP blog post.

Many Medicare Enrollees Can’t Afford Cancer, Specialty Drugs

Large numbers of Medicare beneficiaries who are ineligible for low-income subsidies and have been prescribed high-price prescription drugs for conditions such as cancer don’t initiate their treatment, likely because they can’t afford it, according to new research published in Health Affairs. One of the study’s authors tells AIS Health that severe illness is a possible outcome of noninitiation in the studied clinical areas and adds that proposals under consideration in Congress to cap out-of-pocket spending for Medicare beneficiaries would make a big difference to the affected patients.

According to the paper, “among beneficiaries without subsidies, we observed noninitiation for 30 percent of prescriptions written for anticancer drugs, 22 percent for hepatitis C treatments, and more than 50 percent for disease-modifying therapies for either immune system disorders or hypercholesterolemia.”

Pharma Industry Spent Big to Block Drug Reform in 2021

With drug price reforms on the agenda, pharmaceutical companies last year rallied their significant lobbying resources to block or water down transformational policies. Partly as a result of those lobbying efforts, drug price reform is on the ropes, though sources say there is a meaningful chance that a standalone drug price reform bill could pass Congress this year before the midterm elections.

Drug price reform efforts have most recently been part of the proposed Build Back Better Act (BBBA), a bill that contains much of President Joe Biden’s proposed policy agenda. That bill stalled out in December, when centrist Sen. Joe Manchin (D-W.Va.) said he could not back the measure as proposed. When Congress disbanded for the holiday recess, the BBBA had several notable drug-pricing provisions. The federal government would have been able to negotiate the prices of certain high-cost medications with pharmaceutical manufacturers. Also, drug prices would be barred from rising at a higher rate than inflation, the Medicare Part D benefit design would be revamped to lower beneficiaries’ out-of-pocket costs and the price of insulin would be capped. Moreover, the never-implemented Trump-era rule that would have overhauled the prescription drug rebate structure in Medicare Part D would have been repealed.