Drug Pricing

With IRA Impacts Looming, Manufacturers Should Focus on Providing Patient Support

Most industry experts likely would agree that certain provisions in the Inflation Reduction Act (IRA), such as a $2,000 out-of-pocket spending cap for Medicare Part D beneficiaries and copay smoothing — known as the Medicare Prescription Payment Plan (M3P) — are no-doubt wins for patients. But other aspects of the law, particularly Medicare drug price negotiations and inflation-based rebates, have prompted disagreements over their ultimate outcomes, with some experts claiming that they will hurt drug development and will prompt more restrictive utilization management among payers. Ultimately, said pharma industry experts during a recent webinar, stakeholders should keep patient support top of mind as they navigate these changes.

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FDA Moves Bring Total Biosimilar Approvals to 53

With the FDA’s approval of three biosimilars in May, that brings the total number of these drugs to 53 since the agency’s green lighting of Sandoz’s Zarxio (filgrastim-sndz) on March 6, 2015. With all three agents also gaining interchangeability status, that brings the count to 13 biosimilars with this designation. Payer and provider respondents to a Zitter Insights survey said they expect to see increased use in rheumatoid arthritis (RA) and ophthalmic biosimilars, among others, this year, while oncologists cited agents for non-small cell lung cancer (NSCLC) as the area in which they expected to see the most increase.

On May 20, the FDA approved the first biosimilars of Regeneron Pharmaceuticals, Inc.’s Eylea (aflibercept): Biocon Ltd. subsidiary Biocon Biologics Ltd.’s Yesafili (aflibercept-jbvf) and Samsung Bioepis Co., Ltd. and Biogen Inc.’s Opuviz (aflibercept-yszy).

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News Briefs: State Officials Urge SCOTUS Review of PBM Regulation Case

A bipartisan group of state attorneys general recently filed an amicus brief with the Supreme Court, asking it to review an appeals court decision that limited states’ ability to regulate PBMs. In August 2023, the U.S. Court of Appeals for the Tenth Circuit ruled to block an Oklahoma law that contained provisions such as setting uniform standards for pharmacy networks and banning PBMs from using discounts to drive customers to pharmacies owned by their parent companies. That ruling was the result of a challenge to the Oklahoma law brought by the Pharmaceutical Care Management Association (PCMA). In PCMA v. Mulready, the PBM trade group argued that Oklahoma’s law is preempted by the Employee Retirement Income Security Act of 1974 (ERISA) and the statues governing Medicare Part D. But in their brief urging the Supreme Court to review the case, Minnesota Attorney General Keith Ellison (D) and his colleagues argue that the Tenth Circuit’s broad approach to federal preemption would “severely and unduly impede states’ abilities to protect their residents and regulate businesses.” In a similar case regarding an Arkansas law regulating PBMs, Rutledge v. PCMA, the Supreme Court rejected the PBM trade group’s ERISA-preemption argument.

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Midsize Plans Struggle to Pay for Cell, Gene Therapies, Execs Say

It's no secret that health plans are concerned that they may not be able to afford gene and cell therapies with new or anticipated approvals. With expensive launches on the horizon, plans are searching for payment models that can grant patients access to lifesaving or life-changing therapies without blowing budgets.

Those concerns are particularly acute for smaller, regional health insurers and employer plan sponsors. Those payers may have tight balance sheets and lack the pricing advantages that national insurers can leverage in negotiations with manufacturers. Midsize plan executives say their organizations are figuring out what to do as they go along.

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Medicaid Programs Are Slow to Cover GLP-1s, but That Could Soon Change

Most states do not cover GLP-1s and other obesity medications for Medicaid beneficiaries, according to a recent analysis. However, one of the report’s authors tells AIS Health, a division of MMIT, that more states are pondering whether to place GLP-1s on their formularies and weighing the drugs’ health benefits with their high costs.

The Strategies to Overcome and Prevent (STOP) Obesity Alliance and the Obesity Action Coalition (OAC) released the report on June 3 based on data from fee-for-service and managed Medicaid programs in 2023. STOP, which is housed within the Milken Institute School of Public Health at George Washington University, conducts research, makes policy recommendations and develops online resources. OAC is an advocacy organization with more than 80,000 members.

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Optum Rx’s PBM Pricing Model May Have Hidden Costs

Experts say they’re skeptical that a pricing tool unveiled on May 20 by Optum Rx, UnitedHealth Group’s PBM division, will make significant changes to the PBM business model or generate major savings for plan sponsors. Indeed, some experts say that the model, Clear Trend Guarantee, could in practice be used to obscure rebate revenue that plan sponsors would otherwise collect.

According to a UnitedHealth press release, the new product “combines guarantees into a single per member cost” that “will offer drug benefit plan sponsors greater predictability of pharmacy spend to help manage total lowest net cost.”

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News Briefs: Multiple Developments Around Biosimilar Humiras Occurred

Multiple developments around biosimilar versions of AbbVie Inc.’s Humira (adalimumab) have occurred. Teva Pharmaceuticals, a unit of Teva Pharmaceuticals Industries Ltd., and Alvotech launched Simlandi (adalimumab-ryvk) in the U.S., the companies disclosed on May 20. The FDA approved the interchangeable, high-concentration, citrate-free drug on Feb. 23 for nine of its reference drug’s indications.…Boehringer Ingelheim said on May 13 that it had signed an agreement with Quallent Pharmaceuticals, a private-label pharmaceutical distributor that is a wholly owned subsidiary of The Cigna Group, to offer both high- and low-concentration, citrate-free versions of adalimumab-adbm through a copay assistance program. The tumor necrosis factor (TNF) inhibitor’s interchangeable designation applies to the low-concentration version. Boehringer will continue to commercialize that agent and its branded version, Cyltezo, which has approval for nine of Humira’s indications.…Celltrion USA has made its high-concentration, citrate-free adalimumab-aaty available at a low wholesale acquisition cost that is an 85% discount to Humira’s WAC, the company revealed on May 9. Its branded version, Yuflyma, remains available at a 5% discount to Humira’s WAC. The agent is approved for eight of Humira’s indications.

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How Will Beqvez Fare in Challenging Market for Cell and Gene Therapies?

The FDA recently approved the second gene therapy for hemophilia B, Pfizer Inc.’s Beqvez (fidanacogene elaparvovec-dzkt). While the agent offers an additional treatment option with the potential for freedom from regular infusions of factor therapy, its price — which is equal to that of its competitor — may be too high for many payers, according to a Zitter Insights survey. Industry experts say that it may suffer from some of the challenges other cell and gene therapies have faced in gaining a foothold in the U.S. market.

On April 25, the FDA approved Beqvez for the treatment of adults with moderate to severe hemophilia B who use factor IX (FIX) prophylaxis therapy; have current or historical life-threatening hemorrhage; or have repeated, serious spontaneous bleeding episodes and do not have neutralizing antibodies to adeno-associated virus (AAV) serotype Rh74var (AAVRh74var) capsid as detected by an FDA-approved test. The manufacturer launched a warranty program for the intravenous infusion based on durability of patient response to treatment.

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At Investor Conferences, Execs Paint PBM Reform as Afterthought

During recent investor conference presentations, executives from major managed care companies expressed little concern that PBM reform — which once seemed like a much more acute threat — will impact their businesses anytime soon. Those remarks come even as a large coalition of interest groups is hoping to push lawmakers into refueling the issue’s momentum.

“I would say it is difficult to get alignment and bipartisan support on the specifics relative to PBM [reform],” CVS Health Corp. CEO Karen Lynch said during a “fireside chat” on May 29 at the Bernstein Strategic Decisions Conference. “I think if anything happens, it'll be on transparency, but you have seen time and time again that there's been some challenges.”

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Companies Should Make Sure Patient Assistance Is Robust, Keep Eye on External Factors

Pharma manufacturers began offering patient assistance programs (PAPs) as a way to help patients afford their medications. And as list prices of drugs continue to rise, so does that assistance. Companies can take a variety of steps to make sure that their offerings are not being hamstrung due to common pitfalls and instead are truly helping patients access and remain adherent to their medicines, say industry sources. In addition, manufacturers should be keeping an eye on copay offset programs, as well as the Inflation Reduction Act (IRA), for their potential impact on PAPs.

In 2023, manufacturer-provided copay assistance in the form of coupons and debit cards offset patient costs of $23 billion, according to the IQVIA Institute for Human Data Science report titled “The Use of Medicines in the U.S. 2024: Usage and Spending Trends and Outlook to 2028. Released in April, the report also found that such assistance offset costs of $84 billon over the last five years.

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