Industry Trends

Radar On Market Access: Industry Groups Praise OIG Report on Medicare Part D Rebates

September 26, 2019

Industry trade groups that would like rebates preserved in the Medicare Part D purchasing system were thrilled to see a Sept. 13 report from the HHS Office of Inspector General that they viewed as dispelling the oft-purported “myth” that rebates are responsible for high drug prices, AIS Health reported.

Industry trade groups that would like rebates preserved in the Medicare Part D purchasing system were thrilled to see a Sept. 13 report from the HHS Office of Inspector General that they viewed as dispelling the oft-purported “myth” that rebates are responsible for high drug prices, AIS Health reported.

The report examining the more than 1,510 brand-name drugs with Part D reimbursement and rebates between 2011 and 2015 found that rebates did not always go up when unit reimbursement grew.

The report also observed that total rebates for brand-name drugs reviewed in Part D rose from $9 billion in 2011 to $17 billion in 2015, but the majority (60%) of that rebate growth was driven by only 10% of drugs. Furthermore, OIG said that while rebates substantially reduced overall Part D spending growth, “they did not prevent increased overall Part D spending…as Medicare still spent $2 billion more for brand-name drugs with rebates in 2015 than in 2011.”

America’s Health Insurance Plans issued a statement from President and CEO Matt Eyles: “This new HHS-OIG report…clearly demonstrates our effectiveness as a negotiator — and the rebates we secure for seniors in Part D lead to lower costs.”

The Pharmaceutical Care Management Association also praised the report for putting to rest “the false narrative about PBM-negotiated rebates” and confirming that rebates lead to lower prescription drug costs in Part D.

But one industry expert says he doesn’t think this will alter any possible government action on drug pricing and Part D.

“The OIG’s analysis is unfortunately a historical document — in that it only reports on changes in drug prices through 2015,” observes Avalere Health Founder Dan Mendelson. And while rebates are “an important market mechanism” for negotiating drug prices, rebates “alone won’t solve the consumer crisis of drug affordability,” he says.

Radar On Market Access: AML Therapy Class Has Seen Boom Over Past Couple of Years

September 19, 2019

The FDA has approved nearly 10 therapies for acute myeloid leukemia (AML) over the past couple of years. Because most of them target a specific biomarker, it’s critical that people diagnosed with the condition undergo genetic testing to determine whether they fall into a particular patient subgroup, AIS Health reported.

The FDA has approved nearly 10 therapies for acute myeloid leukemia (AML) over the past couple of years. Because most of them target a specific biomarker, it’s critical that people diagnosed with the condition undergo genetic testing to determine whether they fall into a particular patient subgroup, AIS Health reported.

“Prior to two years ago, we had no new drugs for over a decade, and now we have eight new drugs approved in just the last two years, so the whole field has changed,” said Daniel J. DeAngelo, M.D., Ph.D., chief, division of leukemia, institute physician, professor of medicine, Harvard Medical School, in an interview published on the website obroncology.com.

Many of the newer drugs are oral formulations, which, “in general, are easier to administer,” points out Mesfin Tegenu, R.Ph., president of PerformRx, LLC. “Rather than having to go into a hospital or clinic for treatment, a patient can simply take a medication orally for their condition.”

Payers utilize a variety of management tactics with AML therapies. “Payers often require prior authorization of these therapies due to safety, concern for off-label usage and cost,” says Tegenu. A variety of drugs are used off-label for certain patient populations, he notes.

Asked if AML is a condition suited for value-based contracting, Tegenu asserts that “all therapies associated with high cost should have some kind of value-based payment models to make drug manufacturers an integral part of the health care delivery system. We plan to initiate this discussion with all leading pharmaceutical companies.”

According to Winston Wong, Pharm.D., president of W-Squared Group., the newer drugs would be better candidates for such deals due to AML’s heterogenicity and the fact that “the treatment foundation is still conventional chemotherapy, which for the most part is available as a generic.”

Perspectives on Million-Dollar Treatments

September 19, 2019

For large, self-insured U.S. employers, their No. 1 concern related to pharmacy benefits is how to finance treatments that come with seven-figure price tags.

For large, self-insured U.S. employers, their No. 1 concern related to pharmacy benefits is how to finance treatments that come with seven-figure price tags.

That’s one finding of the National Business Group on Health (NBGH) 2020 Large Employers’ Health Care Strategy and Plan Design Survey, AIS Health reported. Among the 147 employer respondents, 86% said they were either concerned or very concerned about “the impact of million-dollar treatments getting approved by the FDA.”

Ellen Kelsay, NBGH’s chief strategy officer, said at a press briefing in Washington, D.C., “the pipeline is looming — there are an estimated 14 new therapies in excess of $1 million each that are on the docket for FDA approval in the coming months and years.”

Nearly a quarter of large employers polled said that as of 2019, they are delaying the inclusion of newly launched treatments from their formulary to enable their PBM or health plan to better determine the treatment’s efficacy and safety, the NBGH survey noted.

Kelsay also highlighted the fact that 46% of employer respondents in the 2020 survey indicated they would consider a role for government in helping to negotiate prices for high-cost therapies.

“I think that’s a reflection of the frustration employers have” with how to finance high-cost treatments, NBGH President and CEO Brian Marcotte said at the briefing. “It’s not a question of are these good therapies. It’s a question of what can society afford — not just what can employers afford.”

When it comes to specialty drug management, the most notable area of growth is in the use of prior authorization (PA) for medications billed under the medical benefit. The share of employers using PA for drugs under the medical benefit rose from 36% in 2019 to 59% in 2020.

Trends That Matter for RM/AT Products

September 12, 2019

This past quarter saw two new gene therapies: Novartis AG subsidiary AveXis, Inc.’s Zolgensma (onasemnogene abeparvovec-xioi) received FDA approval May 24 for the treatment of spinal muscular atrophy, and bluebird bio’s Zynteglo (autologous CD34+ cells encoding βA-T87Q- globin gene) received conditional marketing authorization from the European Commission for transfusion-dependent beta thalassemia.

This past quarter saw two new gene therapies: Novartis AG subsidiary AveXis, Inc.’s Zolgensma (onasemnogene abeparvovec-xioi) received FDA approval May 24 for the treatment of spinal muscular atrophy, and bluebird bio’s Zynteglo (autologous CD34+ cells encoding βA-T87Q- globin gene) received conditional marketing authorization from the European Commission for transfusion-dependent beta thalassemia.

While only a handful of therapies in the broader regenerative medicine/advanced therapy (RM/AT) space are available globally, a new report shows that is likely to change, as there are more than 1,000 products in the pipeline, AIS Health reported.

The Alliance for Regenerative Medicine published the report, titled Quarterly Global Regenerative Medicine Sector Report: Q2 2019, on Aug. 1. It shows there are 1,069 clinical trials using specific RM/AT technologies, which include gene therapy, gene-modified cell therapy, cell therapy and tissue engineering. Ninety-four of those products are in Phase III trials.

Radar On Market Access: Novartis’ Zolgensma Crisis May Not Impact Pickup

September 12, 2019

The FDA in August put out a statement addressing “data accuracy issues” with Zolgensma (onasemnogene abeparvovec-xioi), a new gene therapy to treat spinal muscular atrophy in people less than two years old who have bi-allelic mutations in the survival motor neuron 1 gene, AIS Health reported.

The FDA in August put out a statement addressing “data accuracy issues” with Zolgensma (onasemnogene abeparvovec-xioi), a new gene therapy to treat spinal muscular atrophy in people less than two years old who have bi-allelic mutations in the survival motor neuron 1 gene, AIS Health reported.

The FDA approved the drug from AveXis, Inc., which was acquired by Novartis AG last year, on May 24. On June 28, AveXis notified the FDA that there was “a data manipulation issue that impacts the accuracy of certain data from product testing performed in animals submitted in the biologics license application (BLA) and reviewed by the FDA.”

The FDA said Novartis learned about the issue March 14, but rather than informing the agency, which was assessing Zolgensma’s BLA at the time, the company conducted its own internal investigation, reporting its findings to the FDA after the investigation was completed. Still, the agency said that it “remains confident that Zolgensma should remain on the market.”

The one-time therapy is the most expensive drug in the world, with a price tag of $2.1 million.

In response, Novartis issued a press release Aug. 6 that read, in part, “we maintain that the totality of the evidence demonstrating the product’s effectiveness and its safety profile continue to provide compelling evidence supporting an overall favorable benefit-risk profile.”

Novartis recently said that Zolgensma has coverage plans from payers representing 40% of commercial lives, and high-profile news reports name Aetna Inc. and Anthem, Inc. among insurers expanding their policies to cover more patients. So will the current situation have any impact on pickup among payers and providers?

Based on the FDA’s statement, “I expect there will be no more than a minor and temporary blip in pickup of Zolgensma among providers and payers,” says Elan Rubinstein, Pharm.D., principal at EB Rubinstein Associates.

Radar On Market Access: Insurers Welcome Changes to Addiction Treatment Privacy Rules

September 10, 2019

A recent federal proposal — which would loosen privacy rules surrounding substance use disorder (SUD) treatment — is being applauded by health insurer trade groups. But some advocates are worried about potential harms to patients, AIS Health reported.

A recent federal proposal — which would loosen privacy rules surrounding substance use disorder (SUD) treatment — is being applauded by health insurer trade groups. But some advocates are worried about potential harms to patients, AIS Health reported.

At the center of the debate is legislation enacted in the 1970s and the subsequent regulations implementing that law, known as 42 CFR Part 2, which was designed to protect the confidentiality of SUD patient records created by federally funded treatment programs. Under the proposed changes to 42 CFR Part 2, opioid treatment programs would be able to enroll in state prescription drug monitoring programs and submit the dispensing data for controlled substances consistent with applicable state laws. SUD patients also would be able to consent to disclosure of their Part 2 treatment records to an entity, without having to name a specific person.

“At the highest level, ACHP does see the proposed rule as a positive development,” says Connie Hwang, M.D., chief medical officer of the Alliance of Community Health Plans. When an individual is undergoing treatment for SUD, “you want to make sure that all the other groups engaged in the ongoing care are aware and don’t inadvertently interfere with that or put the patient at greater danger,” she adds.

However, not everyone shares that view.

“While the Legal Action Center strongly supports the need for coordinated flow of health information between providers, it must be done so with patient consent in disclosure and re-disclosure,” Paul Samuels, president and director of the advocacy group, said in a news release.

The current privacy rules are “a necessary protection for individuals who would otherwise be susceptible to a multitude of detrimental consequences if their SUD information was disclosed without their permission to potential employers, housing providers, law enforcement and more,” Samuels added.