The U.S. Food and Drug Administration (FDA) approved Biogen’s Aduhelm (aducanumab) for Alzheimer’s disease on June 7, but the fallout continues.
By Mark Terry
Published: Jun 28, 2021
The controversial drug was granted approval despite the agency’s Peripheral and Central Nervous System Drugs Advisory Committee voting against the drug in November 2020 and assured that the agency was not considering an accelerated approval. But the agency did approve it via an accelerated approval pathway, which used surrogate endpoints, in the case of Aduhelm, removal of amyloid plaques, instead of clinical evidence of improvement in cognition and memory. It also requires post-marketing studies with a nine-year timeline.
On Friday, June 25, the House Committee on Oversight and Reformannounced plans to investigate the approval and pricing of the drug. The drug has a list price of $56,000 per year.
In their statement, the House Committee said, “We have serious concerns about the steep price of Biogen’s new Alzheimer’s drug Aduhelm and the process that led to its approval despite questions about the drug’s clinical benefit.” The investigation was announced by Rep. Carolyn Maloney (D-NY), chair of the committee and Rep. Frank Pallone, Jr. (D-NJ), chair of the Committee on Energy and Commerce.
Biogen, on its part, has defended the price of the drug, noting that Merck’s checkpoint inhibitor Keytruda (pembrolizumab) for certain types of cancer can run up to $150,000 per year and AbbVie’s Humira for inflammatory conditions like psoriasis and rheumatoid arthritis, can cost more than $70,000 per year.
“There is no perfect analog in this space,” Biogen’s spokeswoman Allison Parks told the Boston Globe, “but we have priced Aduhelm at roughly 1/3 the level of cancer immunotherapies and roughly 25% below the average level of psoriasis biologics,” such as Humira.
Critics of the drug pushed back hard.
Brian Skorney, an analyst at Baird, who doesn’t think the FDA should have approved Aduhelm, said, “Keytruda is an expensive drug, but for patients with non-small cell lung cancer, you have clinical data showing it improves survival. The concern here with Aduhelm’s price is there’s no argument that it does for Alzheimer’s patients what Keytruda does for cancer patients.”
Parks indicated that Biogen believes the $56,000 price tag “reflects the overall value this treatment brings to patients, caregivers and society.”
Prior to the approval, the Institute for Clinical and Economic Review (ICER), a drug-pricing watchdog,issued a preliminary report attacking the drug’s clinical trial data over insufficient efficacy and recommended a price, if approved, of $2500 to $8300 per patient per year. ICER does not have official standing with drug pricing, although they are influential in bringing attention to drug-pricing issues.
In a recent statement, Steven Pearson, president of ICER, said, “Based on the evidence we have today, this drug is nowhere near to being that effective, if it’s effective at all.”
The Kaiser Family Foundation has made projections that at $56,000 a year, Medicare might spend $57 billion or more annually on Aduhelm, which is more than Medicare Part B spends on all other drugs combined.
Pearson’s organization recently attempted to calculate a reasonable price for a hypothetical therapeutic that didn’t cure Alzheimer’s but stopped it from progressing in early-stage patients. They estimated it would be a breakthrough, and a reasonable price would be $50,000 to $70,000 per year and based on that $500 billion in annual costs to the U.S. health care system.
Drug pricing is an enormously controversial subject. For example, Novartis’ one-time gene therapy, Zolgensma, for spinal muscular atrophy (SMA), has a price tag of $2.1 million. That therapy, however, is essentially a cure, and the disease, which kills very young children, is sporadic. So the criticism of Aduhelm, per se, isn’t over the price itself, but over the accumulative price given the large population of potential patients and on the ambiguity over its efficacy.
Other politicians, including Senator Elizabeth Warren (D-Mass.) and Bill Cassidy (R-Louisiana) called on Congress to study the effect Aduhelm would have on the federal budget. Biogen and Eisai have indicated they expected to market the drug to the 1 to 2 million people in the U.S. with mild cognitive impairment. However, it’s not clear yet if or how much insurance companies will be willing to pay or place limitations on the patients who can receive it.
Biogen has indicated it is negotiating with Connecticut-based CIGNA and the Veterans Health Administration on “innovative access agreements.” Michael Sherman, chief medical officer of Point32Health, the second-largest health insurer in Massachusetts, told the Boston Globe they were studying whether to cover the drug, not only because of the price, but because the experts they have consulted over it have “uniformly … been negative about their belief in the efficacy of the drug.”
Even the Alzheimer’s Association, which supported the approval, is critical of the price. Joanne Pike, the organization’s chief strategy officer, said, “The association does not determine drug costs, but we’re adamant that the treatment be affordable and accessible. The price as it is today is unacceptable.”
When Marleen Kemper was a child, she watched two of her primary-school classmates get ill. One had a brain tumour, and the other contracted an infection in his gut. Both of them died. Kemper was around ten at the time, and knew that she didn’t want to see another friend perish. She told her parents she wanted to do something that would prevent others dying. She wanted to be a doctor.
By Chris Stokel-Walker
Posted Monday, June 28, 2021 – 10:23 am
But training is hypercompetitive in the Netherlands, where Kemper was growing up. She didn’t quite have the grades. She liked chemistry, so chose a career in pharmacy instead. She studied for six years, and did a residency for another four. Today, she’s a highly respected hospital pharmacist based at Amsterdam UMC’s Academic Medical Center, a cavernous building crafted out of concrete on the south-east fringe of the Dutch capital.
To understand what happened next, you have to understand several things about Kemper. Two date back to her childhood. One was those early experiences of losing friends to illness, which ensured she’ll do everything she can to make sick people better.
The second is that, though she’s highly accomplished, Kemper is self-admittedly hard-headed, and has always had a rebellious streak. She once dyed her hair black to stand out from the crowd. Sometimes she likes to shock people.
Which leads into the third, more recent trait: a steely determination to do right by her patients, whatever the cost. And the cost can be great. In 2017, when the price of a drug to treat a rare genetic disorder skyrocketed, Kemper wasn’t happy. The result was a dispute that’s still going on today and has spread beyond the four walls of the UMC hospital. It’s spread beyond the city of Amsterdam. And it’s even spread beyond the borders of the Netherlands.
Most of us never have to worry about chenodeoxycholic acid (CDCA), one of the two primary bile acids produced by our livers. But for a tiny fraction of us, a rare genetic trait means we end up short.
Having this gene variant prevents the body from creating sterol 27-hydroxylase, a liver enzyme. Without it, the liver won’t convert enough cholesterol into CDCA. The result is an overabundance of other bile acids and substances, which then get pumped out of the liver and through the body, causing untold damage.
The illness that results is called cerebrotendinous xanthomatosis, or CTX. It can cause cataracts, dementia, neurological problems and seizures, but it can be treated. Since the 1970s, the pharma industry has been able to produce CDCA, and so people who need it can supplement their shortage. The system worked well; the drug was relatively cheap for such a niche illness. A year’s treatment cost around €30,000 per patient.
Until suddenly it didn’t. In 2017, Leadiant Biosciences, which was supplying CDCA to these patients in the EU, raised the price of its version of the drug – known as CDCA Leadiant – to over €150,000 per patient per year.
The price increase soon had an effect. The Netherlands has an insurance-based health system, and in April 2018, Dutch insurers – who had been paying for 50 or so patients across the country to receive the drug – balked at the fivefold increase, refusing to pay. Patients unable to pay themselves would have gone without treatment, so Kemper – whose hospital was one of the treatment centers for CTX – stepped in. Amsterdam UMC would produce the medicine for these patients itself, at cost price.
She was upset, she admits. “Patients have a medical need. If those patients with CTX don’t get their medication, they get neurological implications, they get complications with their cholesterol and dementia, epilepsy… it is an essential medicine.”
Anyone wanting to manufacture a drug must get a marketing authorization to do so. But Leadiant had become the only game in town, the owner of exclusive rights to manufacture CDCA commercially in the EU.
Yet there was a solution. Under EU rules, pharmacies can make (or ‘compound’) a prescribed drug on a small scale for their patients.
So Kemper began researching where she could find the ingredients to make CDCA. It was difficult: In the pursuit of better margins, vast numbers of manufacturing companies have closed their factories across the world and concentrated their efforts in China, where the costs of producing pharmaceutical ingredients are lower. Just one European company manufactures the ingredients to EU standards.
Kemper approached them, and they declined to supply her the raw material. In the end, she found a Chinese manufacturer instead. She went to the hospital’s executive board and gained approval to manufacture the drug. It cost the pharmacy €28,000 per patient per year – pretty much exactly the same as the price of the drug beforehand.
CDCA wasn’t initially used to treat CTX. Originally it was developed to treat gallstones. This main use of the drug – which from the mid-1970s had been sold in the Netherlands as Chenofalk – became outmoded when the standard procedure to deal with troublesome gallstones became to just cut out the gallbladder entirely.
At the turn of the millennium, Dutch doctors started using Chenofalk off-label to treat CTX – a practice that carried on for several years. At this time, in the mid-2000s, a year’s supply of the drug cost less than €500.
But in 2008, Leadiant acquired the rights to Chenofalk. Then, nine days before Christmas 2014, it succeeded in getting its version of CDCA classified as an “orphan medicine” for treating CTX. That classification gave Leadiant the exclusive right to manufacture its CDCA drug commercially in Europe for the next 10 years. Leadiant then took Chenofalk off the market in 2015.
Introduced by EU regulation in the year 2000, orphan drug classification is given to drugs that treat serious illnesses that affect fewer than five in every 10,000 people in the EU. Its purpose is to help companies recoup the costs of developing treatments that would otherwise be unlikely to generate a profit. Without it, the pharma industry wouldn’t be incentivized to seek new drugs for the rarest diseases.
But in this case, CDCA was already known as a CTX treatment, with Chenofalk having been used off-label to treat it for years. Kemper believes that Leadiant is getting the financial benefits of orphan designation, but for a drug that had gone through development and been released to market long ago. “There were publications already in the 1980s,” she says. “There’s no patents, nothing. It’s really bizarre.”
Kemper isn’t the only one concerned about the price rise and CDCA’s orphan drug status. In September 2018, a lobby group, the Dutch Pharmaceutical Accountability Foundation, asked the Dutch competition authority to investigate the price increase. And this spring Test Achats, a nonprofit consumer-protection organization in neighboring Belgium, lodged a complaint against Leadiant with the Belgian Competition Authority.
“We noticed that in 2005, the price for the treatment of a patient in one year was around €500. Now it’s more than €150,000,” explains Laura Marcus, legal counsel to Test Achats. “It’s bad for the sick person but also for the Belgian health system, which is paying most of the [cost of the] treatment.”
When a drug company raises the price of its treatment, and a hospital pharmacy decides not to accept the increase but instead endeavors to compound its own version, undercutting the drug company’s price, things tend to get interesting.
In June 2018, Kemper received a phone call from the Dutch health inspectorate. It had received a letter of concern – who it came from, Amsterdam UMC doesn’t know, though the health inspectorate has said it was acting in response to an enforcement request from Leadiant – with a long list of things for the investigators to check.
Kemper took the news in her stride. She had expected a rocky road. “As a pharmacist, I am a professional and I know what I’m doing, and we have standards for compounding,” she explains. So she wasn’t worried when a team of four inspectorate monitors turned up at the door of her pharmacy in Amsterdam that summer. Two were there to take samples of the raw materials she was using to compound CDCA, and to ensure that all the correct processes were being followed. They rifled through the reams of paperwork and procedures that Kemper had spent hours developing for her staff to follow, while the other two inspectors combed through coverage of the case to ensure that Kemper and her team weren’t advertising their work, which isn’t allowed for medicines that haven’t been given market authorization.
The lab checked out: Its processes were up to standard, and the paperwork was all in order. But in July, Kemper got a phone call that floored her: The inspectorate’s analysis of the raw materials her pharmacy was using to compound the CDCA had discovered that they weren’t up to snuff. Two components found in it were above allowed limits.
“As a professional you think: What did I miss? It was very emotional, a bit heavy,” she says. With the board of directors at the hospital, Kemper decided to immediately withdraw the product from patients; the health insurers said they’d step in and cover putting the patients back on the Leadiant version of the drug.
Kemper personally called the 50 or so patients she was providing with the drug. “The first one was hard,” she admits. “I expected they’d be angry or something like that. But no, no one [was]. The patients said: ‘Well, please go on with this job.’”
The Dutch inspectorate has said that Kemper can resume compounding CDCA provided she can find a raw material that doesn’t contain impurities – something Kemper is keeping tight-lipped about.
So, if she can get the materials she needs, Kemper is hopeful to be able to continue compounding CDCA in the future.
But for now, it’s back to square one – paying the full price for CDCA Leadiant.
These events have had wider consequences. What was initially a dispute inside the Netherlands has bled across borders, with Belgian patients with CTX now being affected.
It started with a conversation between the Dutch and Belgian health ministers shortly after Kemper’s production of CDCA was halted, says Thomas De Rijdt, head of pharmacy at University Hospitals Leuven. The Dutch minister wanted to know from his Belgian counterpart why Belgian hospitals were able to make the same drug without any issues.
“For Belgium, we have about 10 patients,” De Rijdt says. “So 10 patients are helped with the preparations from our hospital and the University Hospital in Antwerp.”
These hospitals had been compounding CDCA capsules for CTX patients for years. Leuven had sourced raw materials that had been tested and approved by a laboratory accredited by the Belgian government. But when the case in the Netherlands started entering conversation at diplomats’ dinners, the Belgian government wanted to double-check that its raw materials were OK.
It ran a second battery of tests – with a different accredited laboratory – which came back with a problem. A single impurity was found. The government ordered a quarantine of the raw material and recalled all the CDCA it had made.
“The patients had to return all their medication,” says De Rijdt. Recalling every capsule of the drug from Belgium, and freezing the work of the only two suppliers in the country, meant that people with CTX were suddenly left without any medicine.
“If you know the disease, you know you can deteriorate very quickly,” says De Rijdt. This was a problem. So, he says, the hospital pharmacists, the National Institute for Health and Disability Insurance, the health minister and the pharmaceutical inspectorate hit upon a solution. For a year, the Belgian government would reimburse the costs of Leadiant’s drug, allowing those patients to still be treated (normally the government only reimburses a portion of a person’s health costs, with the rest being picked up by the patient or insurance). Over the course of that year, the relevant authorities would then work together to adapt the requirements a raw material must comply with – to allow versions of drugs with minor impurities, providing they pose no threat to the patient.
“We have bought time to find a solution with the compounding, because we think by compounding we can save healthcare a lot of money for the same quality of therapy,” says De Rijdt. He hopes to have a solution by the end of 2019.
But in early September, things took another turn. Wouter Beke, the Belgian consumer affairs minister, used his price-regulation powers to bring down the price of CDCA Leadiant to just over €3,600 a month – roughly a quarter of the amount Leadiant was charging. If the drug becomes more cheaply available in Belgium, says De Rijdt, then it could end up being exported and available at a lower price elsewhere.
But exactly how this will pan out remains unclear. In the meantime, Beke has urged the Belgian Competition Authority to prioritize investigating Leadiant, following the complaint lodged by Test Achats.
Debate over what constitutes a fair price for drugs isn’t anything new. Nor is it limited to Europe.
Because of his willingness to play the bad guy in the press (and an odd moment when he bought a Wu-Tang Clan record), Martin Shkreli has attracted more criticism on drug pricing than perhaps anyone else. In 2015, Turing Pharmaceuticals, of which Shkreli was CEO, raised the price of its recently acquired antimalarial drug Daraprim, also used to treat AIDS-related illnesses. A pill went from $13.50 to $750 overnight – a 55-fold increase.
Shkreli’s capitalist tendencies were criticized by almost everyone. This was unlike the situation with CDCA Leadiant – there was no argument that this increase was to cover Daraprim’s development costs – and Shkreli himself was unrepentant: “If there was a company that was selling an Aston Martin at the price of a bicycle, and we buy that company and we ask to charge Toyota prices, I don’t think that that should be a crime,” he told reporters.
But the Daraprim situation was just the highest-profile example of a contest that is going on constantly between big pharmaceutical companies seeking to profit from drugs and medical staff on the front line who worry that such profit-seeking does damage to patients needing treatment. (For what it’s worth, a competitor to Turing Pharmaceuticals announced soon after that it would produce a compound drug containing the same active ingredient in Daraprim – pyrimethamine – for $1 a pill, rather than the $750 Shkreli wanted to charge.)
One front in this battle has recently opened up in the US. In May, more than 40 states filed an antitrust lawsuit against some of the world’s biggest manufacturers of generic drugs, alleging they that have colluded to fix the price of more than a hundred medicines over a number of years. When prices should go down after a drug’s market exclusivity ended, the antitrust lawsuit claims that many prices have instead shot up – in some cases by more than 1,000 percent.
And back in Europe, the consumer organization Euroconsumers – of which Test Achats is part – is investigating the prices of other drugs beyond CDCA. “We’ve noticed a few problems with a few other drugs,” says Laura Marcus of Test Achats. “It’s often about drugs that are able to cure or deal with rare diseases. For sure, it’s not only CDCA.”
No one doubts that developing drugs costs money. A 2016 paper in the Journal of Health Economics estimated that the average cost of developing a prescription drug to the point of reaching the market is nearly $2.6 billion.
But the lack of hard, openly available statistics on the cost of drug development is something that many people, including Marcus and Marleen Kemper, want to change. “In most of the cases, society is willing to pay some price,” says Kemper, “but now the discussion is: What is an acceptable price?”
Marcus acknowledges that Leadiant has to cover its costs, but she thinks that cannot explain the rise of CDCA to over €150,000 – “the profit cannot be that high”. When I ask her how much profit she thought Leadiant was making from the drug, she admits she doesn’t know. “Of course we don’t have access to those numbers,” she says. “That’s what the Belgian Competition Authority is opening an inquiry for – to know more about the figures and the costs the company has to bear.” However, when the price for CDCA has surged from €500 to over €150,000, “nothing justifies it, because there was no new research, no new nothing,” she says.
Leadiant rejects this. Although CDCA had been authorized in the past, the company says that “the active pharmaceutical ingredient as well as the manufacturing of the finished product needed to be upgraded” to make sure that its version was compliant with current EU standards. These, Leadiant says, are more extensive and significantly more strict today than they were when earlier CDCA drugs were developed.
Leadiant says that its CDCA “is not a ‘copy’ of an old product”. The very fact that it gained orphan drug status proves this, it argues. The company also says that “there was no robust evidence that CDCA was effective in CTX until Leadiant produced the data”. Demonstrating this, it says, required “entirely new studies, creating new data sets” – which make up “the largest ever collection of clinical data for CTX”.
“CDCA Leadiant has been developed and brought to market at substantial cost,” the company says. “Our pricing is justified by our costs and investments.”
But the problem is not just that Leadiant’s drug is so expensive: potential alteratives have disappeared. Willemijn van der Wel, a lawyer working at European law firm AKD, has written about Leadiant’s connection to competitors who previously produced CDCA. After buying the marketing authorizations for other products that contained CDCA, he says, “Leadiant began to withdraw these alternative CDCA products from the market, until only one CDCA medicinal product remained”. Marcus has also queried what has happened to these products that might have been competitors to Leadiant’s. But, she says, it’s not clear what is behind their CDCA monopoly.
Leadiant, though, says that it’s willing to negotiate a lower price for its drug with the Dutch Ministry of Health and Dutch insurance companies. “The only reason an improvement has not been determined yet, is that the insurers have been uninterested or unwilling to enter into any substantive negotiations,” it claims. (Leadiant did not respond to follow-up questions asking for more details of the negotiations, or what level of price reduction the company was offering.) It also emphasizes that it has not taken legal action against the UMC hospital for seeking to compound its own CDCA, but that it is “involved in a legal discussion with the Dutch Inspectorate about the interpretation of EU and Dutch medicines law.”
Regardless of the outcome of such discussions, something needs to be done. Having pharmacies self-compound medicines is not a sustainable model – it might reduce incentives for developing drugs for rare conditions.
It also, Leadiant argues, exposes patients to risk. Pharmacies do not have to have their compounding processes checked by the European Medicines Agency or the national regulator. “There is no product control by any independent regulatory authority before or after compounding.”
When it comes to market authorization and orphan drugs, Leadiant says, “it should not be about small or large scale, but safe scale”.
Marleen Kemper’s husband warned her that taking on Leadiant would be more difficult than she first thought. “He said, ‘With this initiative, don’t be naive’,” she recalls. “The pharmaceutical industry is very powerful, so you really have to have backup from the [hospital] board” – which she had. More than a year into her attempt to make her own version of the drug, she’s recognizing just how deeply dug in both sides are to their positions.
She’s at pains to point out that she’s not against the pharma industry. “What people forget is that the pharmaceutical industry is responsible for a lot of innovation.” But if drug pricing means that patients potentially get left behind? “Then I’m getting angry,” she says.
But righteous anger alone can’t sustain someone over a months-long case involving lawyers and regulators, not least when they’re also raising a family, running part of a pharmacy that’s actively studying hundreds of drugs, and doing their job keeping patients supplied with medicine. At times Kemper has felt frustrated and worn down by the effort of taking on the price rise – but she vows to continue.
“I’ve said that sometimes I’ve thought, well, I’ll stop and quit doing it because it’s too much work, too emotionally draining. But due to the support, I think we’ll go on. I’m patient,” she says. “It has to be solved, for the patients.”
Kemper’s determined that she’s going to provide affordable care for her patients by following the letter of the law. “I’m using the rules,” she says. “I’m not cheating.” Leadiant, she accepts, has used the rules and followed them to serve its own purposes. So she will too.
“I’m allowed to make medication for patients. They don’t like it? So what. I’m following the rules.”
This article by Chris Stokel-Walker was originally published in Mosaic Science. It’s republished here with permission under a Creative Commons license.
Every time I hear a constituent struggling to afford next month’s medications, wondering whether they’ll have to choose between paying for a lifesaving prescription and paying rent, the same question — the same frustration — rushes through my mind...
By Sen. Tammy Duckworth (D-Ill.), opinion contributor — 06/23/21 08:00 AM EDT 26 The views expressed by contributors are their own and not the view of The Hill
In the year 2021, how are we still allowing Big Pharma to have such a stranglehold on our country? How are we still letting the health care industry force the people whose health it’s supposed to care for to count pennies in order to give themselves another day?
Right now, it’s an understatement to say that the American people are being priced out of needed medical treatments. On average, Americans pay two to four times what people in other developed countries pay for certain name-brand prescription drugs, with seniors and families bearing the brunt of those increased prices. Sadly, this has major consequences on our collective health, with one-third of Americans reporting they’ve been forced to skip refilling their prescriptions, and a quarter of insulin users saying they’ve had to ration their medication — a dangerous choice that costs lives. Yet despite these trade-offs, as well as the added toll that the COVID-19 pandemic has taken on people’s well-being, drug companies still chose to hike the prices of hundreds of important prescription drugs just a few months ago.
As a veteran, the prescription medications I need are affordable because the U.S. Department of Veterans Affairs (VA) can negotiate with drug manufacturers to bring down prices. But most other Americans, including many who rely on Medicare or private insurance for their prescription medicines, don’t benefit from those negotiations and remain boxed out of accessing the lower prices that are readily available for others.https://b4e41c3177636a0a4e64bf79211a7bda.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
It’s past time to level the playing field. Every American deserves access to affordable prescription drugs, along with a health care system that actually cares about families’ well-being more than corporations’ profits.
In the Senate, we have an opportunity to make drug pricing reform a reality right now by increasing transparency and granting Medicare the ability to negotiate drug pricing, like VA already does, so that more Americans could afford the medications they need. We could limit what patients would have to pay out-of-pocket and stop drug manufacturers from brazenly charging seniors and families more than they can afford for lifesaving medications, bringing pharma to the table in order to set fair prices.
Passing this kind of policy wouldn’t just be a matter of common decency — it’d be a matter of common sense as well. Lowering drug prices is extremely important to Americans across the political spectrum. No matter who they vote for, folks understand that their prescriptions are just too expensive, and a vast majority of Democrats and Republicans alike want our government to be able to directly negotiate prices with drug manufacturers, which would allow taxpayers to save money that could be better put to use paying the gas bill come the first of the month.
President Biden said it best when he told Congress in April, “Let’s give Medicare the power to save hundreds of billions of dollars by negotiating lower drug prescription prices… [T]hat won’t just help people on Medicare. It will lower prescription drug costs for everyone.”
We have both a duty and a mandate to take action now. Americans have the right to know that their elected officials stand on the side of patients and affordable health care, not corporate CEOs and shareholders. They have the right to know that we will not let the status quo stand, as it is simply unsustainable for too many seniors and families.
We can give them that assurance, extra dollars in their pocket and, hopefully, more tomorrows filled with better health by reining in drug pricing, making clear once and for all that we will no longer tolerate an environment in which out-of-pocket drug costs force Americans to choose between their health — or even their lives — and putting food on the table for their families.
This is an example of a growing trend: medications, including many generics, with “hyperinflated” prices, experts at CVS Caremark say. The pharmacy benefit manager giant culled 72 such drugs from its formulary in 2020 alone, leading to savings of $1.2 billion compared to 2018.
Prem Shah, executive vice president of specialty pharmacy at CVS Health, told Fierce Healthcare in an interview that this trend is a recent one. The approach began to shift as drugmakers took heat for making high annual price hikes on certain therapies.
A drug’s price may become hyperinflated if the manufacturer introduces a new formulation or dosage at a significantly higher price, or if it’s introduced under another name. Monitoring these therapies, he said, allows the PBM to eliminate “outlier” spend on drugs that may have low value.
“We want to make sure we have all the tools available for our customers to manage this appropriately,” Shah said.
CVS first launched a program to address hyperinflated drugs in 2017, and it pulls drugs from its formulary when they have a far cheaper equivalent or if the price doesn’t match up with quality metrics.
Another drug pulled from the formulary last year was a certain brand of muscle relaxant chlorzoxazone, which was priced at $2,356 for a 30-day supply. An alternative costs $1.64.
Shah said that in addition to inflating spend for plan sponsors and health insurers, these therapies can also impact the patient’s costs. A member enrolled in a co-insurance plan, for example, pays their cost-share as a percentage of the drug’s cost; a hyperinflated product will have a much higher price tag for them.
He said the team tracks pricing information through its data and analytics platform, then coordinates with the clinical team about any unusual pricing behavior or outliers. Once products are identified, they’re subject to disciplinary action that can include full removal from the formulary, he said.
Shah said the goal is to proactively identify products that could drive up spending and avoid unnecessary costs.
“Our clients’ expectation is that we eliminate this wasted spend,” Shah said. “It’s something we’re actively doing.”
On June 7, the Food and Drug Administration approved the sale of a new drug, aducanumab, (brand name Aduhelm) to treat Alzheimer’s disease. That might seem like good news for people suffering from this debilitating affliction and their families. But the agency’s failure to follow normal approval procedures raises serious concerns.
By Marcia Angell Jun 22, 2021, The Santa Fe New Mexican
Prescription drugs cannot be sold in the U.S. without FDA approval. Approval is usually based on at least two company-sponsored clinical trials that show safety and effectiveness, called positive trials. Normally one of the FDA’s standing advisory committees, which consist of independent experts from academic institutions around the country, evaluates the evidence. It then votes on whether the new drug should be approved, and the FDA almost always follows that advice.
In the case of Aduhelm, nothing like that happened. Instead of the usual two positive clinical trials, Biogen (the company that makes Aduhelm) submitted one positive and one negative trial. Even the positive trial showed only marginal benefits with significant side effects, including brain swelling and hemorrhages. The FDA’s relevant advisory committee — the Peripheral and Central Nervous System Drugs Advisory Committee — voted overwhelmingly against approval. Since then, three members of the committee have resigned in protest against the FDA decision to approve the drug anyway.
When the FDA overruled its own panel of experts, it made approval conditional on Biogen conducting another clinical trial after Aduhelm is already on the market. The FDA sometimes grants this sort of conditional approval for important drugs, but companies seldom complete these “commitment” studies. Although the FDA may then pull the drug from the market, it has never done so. Thus, Aduhelm is almost certainly on the market to stay, no matter how useless and how many side effects.
About 6 million Americans are now afflicted with Alzheimer’s disease, and the prevalence is rising. With no treatment available (other than a few drugs to delay symptoms), these patients and their families will naturally want to try Aduhelm. Because it’s received FDA approval, clinicians will be reluctant not to prescribe it.
Biogen intends to charge about $56,000 per year initially. The price will almost certainly increase, as it always does for top-selling drugs. Adding to the costs are the facts that the drug must be given in monthly intravenous infusions, and repeated brain scans are recommended to check for brain swelling and hemorrhage.
Because most patients with Alzheimer’s disease are over 65, Medicare will be on the hook for much of the costs. But Medicare is not free to patients (as originally intended when it was enacted in 1965). Its out-of-pocket costs are rising, as they are for private supplementary insurance. One way or another, the enormous expenditures for Aduhelm will come from our pockets in the form of rising premiums, deductibles and copayments.
Some might respond that Alzheimer’s disease is a terrible and incurable condition, so why not approve any drug that has any chance of success? But that argument underscores the necessity of getting it right, not putting unproven remedies on the market. After all, cancer is also often incurable, but we still require treatments to be based on reasonable evidence from clinical trials and to meet the standards of the FDA advisory committee. The very magnitude of the need should argue against dropping standards.
Moreover, if millions of people are taking Aduhelm, it will be nearly impossible to conduct clinical trials of more promising drugs, since people taking Aduhelm will not be eligible for a clinical trial of a new drug compared with a placebo. Thus, doing the necessary studies to find a genuinely effective treatment will be difficult.
Why would the FDA approve a drug based on flimsy and contradictory evidence, against the recommendation of its advisory committee? One possible explanation is the growing closeness of the agency with the industry it is supposed to regulate. In fact, the FDA has actually been on the payroll of the pharmaceutical industry since 1992, when Congress enacted the Prescription Drug User Fee Act.
The measure requires drug companies to pay fees to the FDA for each new drug application it reviews. The more drugs reviewed and the faster it’s done, the more income for the FDA. These fees now account for more than half of the support for the FDA’s center that reviews new drugs. If you are an FDA drug reviewer and your salary is paid mainly by drug companies, you will naturally be tempted to smile favorably on their drugs. But it’s a clear conflict of interest, and it should be seen as such.
As enacted, the Prescription Drug User Fee Act must be reauthorized every five years, and it’s due next year. It’s time to let this harmful law sunset. The FDA is a vital public agency, and it should be supported entirely by the public and serve only the public. It should not be the captive of the industry it regulates.
Aduhelm will be a blockbuster drug, with annual sales of billions of dollars. But the biggest cost will be that millions of Americans, victims of falsely generated hope, will be taking a drug not shown to be safe and effective, while the development of a truly effective treatment will be delayed.
Dr. Marcia Angell is the former editor-in-chief of the New England Journal of Medicine and author of the Random House book, The Truth About the Drug Companies. She lives in Santa Fe.
A new medicine could cost taxpayers hundreds of billions of dollars. Will Washington crack down on drug prices in response?
June 20, 2021, 5:02 AM MDT
By Benjy Sarlin
WASHINGTON — A new pharmaceutical treatment may or may not be effective at slowing the effects of Alzheimer’s disease, but it’s already causing heartburn in Washington.
The FDA’s surprise approval of the drug, Aduhelm, despite near-unanimous opposition from an independent advisory panel, has the potential to explode the federal budget and move an already simmering debate over drug prices in Congress and the White House onto the front burner.
The stakes surrounding the issue are enormous. For Alzheimer’s patients, Aduhlem, made by Biogen, is the first approved treatment intended to slow the progression of the disease, even if modestly. But it faces questions about both its efficacy and cost, an estimated $56,000 per year.
If approved by Medicare, it could single-handedly cost the government hundreds of billions, even trillions, of dollars, and seniors and their families thousands of dollars a year.
Biogen has said its drug, which is intended for patients in the disease’s early stages, may apply to as many as 1.5 million people. An analysis by the nonpartisan Kaiser Family Foundation estimated that if even just 1 million were approved for treatment under Medicare, which covers the vast majority of about 6 million estimated Alzheimer’s patients, it would cost the government $57 billion a year. That’s $20 billion more than Medicare Part B spent on all drugs combined in 2019.
Medicare patients without additional insurance would also be on the hook for up to 20 percent of the cost of their treatment, about $11,500 per year. And premiums could spike for supplemental plans that cover the treatment.
Three members of the independent FDA panel that advised against approving the drug have resigned in protest, arguing that there is insufficient and conflicting evidence regarding its benefits and a risk of side effects. They say further trials are needed to answer those concerns. The Centers for Medicare & Medicaid Services ultimately will decide whether federal health programs will cover the treatment and under what circumstances, but they tend to follow the FDA’s lead.
It all has observers worried that the country may be heading for the worst of both worlds, one in which taxpayers and patients alike are squeezed like never before by a costly treatment whose benefits are questionable.
“It’s in many ways a version of other drug pricing and FDA debates we’ve had over the last several years, but it turns the knobs up to 10,” said Rachel Sachs, a law professor at Washington University in St. Louis who researches health policy.
“You have the perfect storm of a drug where there’s questions about whether it’s effective at all, the patient population is very broad, and there’s a potential here to spend a very large amount of not just taxpayer dollars, but also seniors’ dollars.”
Saying no to covering the drug, however, would also mean saying no to families desperate for help.
Prominent Alzheimer’s advocates celebrated the FDA decision, arguing that it offered new hope against the disease where none existed and that it would encourage more companies to develop treatments. But they also share concerns about the cost.
“We believe it will pose an insurmountable barrier to many,” said Robert Egge, chief public policy officer of the Alzheimer’s Association, which supported the drug’s approval.
The news comes as lawmakers are considering a series of potential measures to reduce the price of drugs. Americans pay over 2.5 times as much for brand-name prescription drugs as other countries, according to a study by the RAND Corporation, and politicians in both parties have explored ways to close the gap in recent years. Medicare is currently not allowed to negotiate drug prices, leaving the government with little leverage over costs.
Lawmakers leading drug reform efforts expressed shock at Biogen’s price.
“Unconscionable,” Sen. Ron Wyden, D-Ore., said in a hearing last week.
“Who the hell can afford that?” Sen. Bernie Sanders, I-Vt., asked reporters.
In a letter to President Joe Biden, Sen. Joe Manchin, D-W.Va., slammed the FDA’s decision to overrule its independent advisory panel and asked the president to nominate a new agency head to replace acting commissioner Janet Woodock in response.
“Dr. Woodcock is not the right person to lead the FDA,” he wrote.
But while proposed policy changes on the table might have a significant impact on drug prices overall, perhaps even saving hundreds of billions of dollars, it’s not clear they’d immediately address issues raised by the new drug, experts told NBC News. Critics of pricing reform efforts, including the drug industry, also argue that reducing profits by too much could discourage research into new treatments.
H.R. 3, a bill backed by the Democratic leadership, would authorize the federal government to negotiate over the most used drugs and set a maximum rate for public and private purchases that’s tied to international prices. A proposed rule by the Trump administration would also tie some Medicare drugs to prices abroad. A bill co-written by Wyden and Sen. Chuck Grassley, R-Iowa, would penalize drug manufacturers who raise prices faster than inflation.
But Aduhelm is a new drug and it’s not yet clear if other countries will approve it or negotiate a different price. Biogen has also said it doesn’t plan to raise the price for at least several years. Its price also wouldn’t trip a proposed provision in H.R. 3 that would allow negotiations over drugs whose starting price is more than the median household income.
“There is no one silver bullet to deal with drug prices in the U.S.,” said Juliette Cubanksi, deputy director of the Program on Medicare Policy at the Kaiser Family Foundation. “There are different options that could be implemented simultaneously that would handle the problem from different angles.”
Biogen, in a statement, said that it was “committed to providing access to Aduhelm for patients across a spectrum of financial situations” and that its price “reflects the overall value this treatment brings to patients, caregivers and society — and one that will enable continuous innovation.”
The Institute for Clinical and Economic Review, a nonprofit that independently evaluates drug prices, concluded that Aduhelm justified an annual price of $2,500 to $8,300 based on current evidence. But if the more optimistic claims around the drug proved accurate, the price could be as high as $23,100. And a drug that truly halted the progression of Alzheimer’s, without curing it, would be worth roughly Aduhelm’s asking price, in part because it would save money by reducing existing treatment costs.
In the case of Biogen’s new treatment, there’s a debate over whether it has value at all. But the level of upheaval caused by just one drug points to difficult questions ahead about how to evaluate the relative benefits of new medicine as the population ages, more breakthroughs hopefully follow, and health care takes up a larger and larger share of the economy.
As America’s notoriously expensive medical system indicates, it’s a conversation that the country has often been squeamish about having. Several of the drug reforms on the table would effectively outsource the job to other countries by mimicking their prices, rather than instituting a formula of their own to determine value.
“Americans tend to want to have everything, and American politicians like to give Americans everything,” said Christopher Holt, director of health care policy at the right-leaning American Action Forum. “But you have to make a choice and be honest about what those trade-offs are.”
The health care system is supposed to incentivize the development of wonder drugs and then apply market forces to squeeze prices to a minimum. But a new report shows how at least for one drug, incentivizing is working a lot better than price-squeezing.
At least when insurance is involved.
For example, Blueberry Pharmacy in the Pittsburgh area opted out of the traditional insurance system. It can offer versions of a new generic for $25 a month, while programs connected with middlemen and insurance companies are offering it for $75 in the best instance and often for more than $1,000.
The example illustrates how prices of most generic drugs are wildly inflated in a bewildering system of insurers and the middlemen they use to handle the transactions, Blueberry owner Kyle McCormick said.
And, he added, they do so when prices for the vast majority of generics are so low that the expense doesn’t need to be insured against the way you would against having to buy a new car or house or to get a heart transplant.
“Most generic medications are less than a bottle of Tylenol,” McCormick said. “We don’t need to pay for insurance to cover a bottle of Tylenol.”
Here’s how the system’s supposed to work: Drugmakers are granted patents so they have exclusive rights to sell new medicines and charge high prices for a period. That way they can recoup their research costs and turn a profit.
The profits the high prices bring give drugmakers a reason to go looking for the next new drug. And the next.
The way the system’s supposed to work, as patents expire, so does the drugmaker’s exclusive right to produce it. Other manufacturers can swoop in with their own generic versions and ruthlessly undercut one another until the price of the drug is as cheap as possible while still being profitable for a company to make.
But the great majority of those paying for generic Truvada are unlikely to see anything close to those minimum prices even though its patent expired in late 2020 and 11 generic versions subsequently swarmed into the marketplace, 46brooklyn Research, a nonprofit drug analysis firm, wrote in a report that was published Tuesday.
It analyzed Truvada, an antiviral drug that greatly reduces the risk of contracting Human Immunodeficiency Virus — which causes AIDS — and can slow the progress of the disease in those who have contracted it when combined with other medications.
There was keen interest in producing generic versions of brand-name Truvada, with eight companies bringing products to market on the last two days of March alone. Increased competition cut the cost for pharmacies to buy generic Truvada by 90% off of the $1,800 for the brand-name version of the drug, the report said.
That might seem like the invisible hand of the market doing its stuff.
“However, this announcement, while welcomed, may miss a key point: Will patients actually see these generic savings at the pharmacy counter?” the analysis asked, suggesting that middlemen involved with insurers would ensure they won’t.
There is a tangled web of reasons why most customers at the drug counter won’t see that 90% price drop, according to the report’s authors.
One is that pharmacists working with insurers don’t see it as in their interest to pass the discount along.
Insurance companies that provide prescription benefits hire pharmacy benefit managers to administer them. The middlemen contract with networks of pharmacies, negotiate with drugmakers, decide which drugs are covered and determine how much to reimburse pharmacies for the drugs they dispense.
The pharmacy benefit managers, or PBMs, have enormous leverage over the other players in the drug supply chain. Three — CVS Caremark, OptumRx and Express Scripts — control more than 70% of the market, Ohio Attorney General Dave Yost said recently in a lawsuit.
That means that if drugmakers and pharmacies want access to PBMs’ millions of clients, or “covered lives,” they have to do business with those three companies.
Insurers, too, want access to the bargaining power of the big three PBMs, although each now belongs to a corporation that also owns a big insurer. CVS owns Aetna. OptumRx is owned by UnitedHealth. And Express Scripts is owned by Cigna.
The PBMs typically reimburse pharmacies based on the lesser of two, seemingly arbitrary numbers: the “usual and customary” charge — or “cash” price — determined by the pharmacy and the “maximum allowable cost” determined by the PBM.
Ohio community pharmacists have for years been saying that the big PBMs use a non-transparent set of cost lists to cut reimbursements to the bone, in some instances not even covering their cost to dispense a drug. Those low reimbursements give pharmacies an incentive to keep cash prices high in non-insured transactions so they can make up for low PBM reimbursements, the 46brooklyn report said.
So if you go to pharmacies that rely on business with insurers and PBMs and ask for the cash price of generic Truvada, it’s likely to be much, much more than the $25 or so it would cost on the open market, the report said.
What your insurance company and government programs like Medicare and Medicaid are paying is likely to be a lot higher, too.
PBM reimbursement data are confidential, but one window onto how much more might be seen through the aggregator GoodRx. It groups patients not using insurance to cover their drugs and contracts with the PBMs to get pharmacies in their networks to discount their “cash” prices.
When 46brooklyn shopped GoodRx on May 17, the lowest retail pharmacy price it could find for generic Truvada was $112 — more than four times what it would cost a pharmacy working outside the insurance-PBM system to buy and dispense.
For mail order, the lowest price on GoodRx was $75. That’s about three times the price that Blueberry Pharmacy, which opted completely out of the insurance-PBM system, can sell it for.
The big PBMs have set up their own, GoodRx-like networks and their prices were almost as high as brand-name Truvada: $1,606 for OptumRx’s Optum Perks and $1,105 for Express Scripts’ Inside Rx, the report said.
And Amazon, that great disruptor that’s supposed to be reintroducing market forces to drug pricing? It’s charging $1,566 — or 8,000% — of what Blueberry’s McCormick says he can sell the drug for.
Greg Lopes is a spokesman for the Pharmaceutical Care Management Association, an industry group that represents PBMs. He said the group’s members save consumers money on generics as well as more-expensive brand-name and specialty drugs.
“America’s pharmacy benefit managers, PBMs, have a long history of supporting generic drugs to lower prescription drug costs for patients,” Lopes said in an email. “The key to lowering prescription drug costs is through enhanced competition among brand-name drugs from generic and biosimilar medications.”
However, the 46brooklyn analysis described another way American system of pricing drugs drives costs to consumers up instead of down.
When PBMs negotiate with manufacturers for discounts on generic drugs, they ask for a big cut off of the “average wholesale price” set by the manufacturer.
These can be discounts in excess of 80%, so that gives manufacturers an incentive to set an inflated average wholesale price. That way, the manufacturer will get 20% of a bigger number.
In the case of generic Truvada, the average wholesale price the 11 manufacturers came up with was indeed inflated. At $2,100, it was more than 15% higher than the cost of brand-name Truvada before the patent expired — and 84 times as much as Blueberry Pharmacy can sell it for.
So much for generic competition bringing down list prices.
“There’s some rent-seeking going on,” McCormick said. “There’s no way you can use insurance and not see prices go up.”
If, as the 46brooklyn report asserts, “cash” and wholesale prices for generics in the insurance-PBM system are artificially and wildly inflated, those prices might seem to be just that: artificial. But with most insured Americans now on high-deductible plans and for 33 million more without any insurance, that inflation can mean much higher generic costs at the pharmacy counter.
As with Pittsburgh’s Blueberry, Columbus-area pharmacist Nate Hux decided to take a big step out of that system, opening Freedom Pharmacy in December. He’s still operating his Pickerington Pharmacy under the PBM-insurance system the same way the vast majority of American pharmacies do.
But he decided that for most generic medications, that system just doesn’t make sense.
“People have been brainwashed for so long to believe that these (insurance) cards bring value, but they really don’t,” he said. “They only make the rich richer and keep everybody else poor.”
VICTORIA, British Columbia, May 31, 2021 /PRNewswire/ — Somewhere within 3% of the United State’s GDP – more than $10,000 for each person, on average – is spent paying end user costs for prescription medication each year. High prescription medication costs are a harsh reality for the average American, and these days relief from paying high costs for life-saving medication is needed more than ever. The July 2020 White House Executive Order was supposed to initiate a solution for more affordable drug options for Americans. But many medications are now no longer covered under Medicare Part D, so Americans are looking beyond the border at international pharmacies like Canada Drugs Direct to pay less when having their prescriptions filled.
Big pharma always insists there are legitimate reasons why Rx medications are so expensive, but many of them aren’t legitimized. The most common reason big pharma gives an explanation as to why medication prices are high is because R&D and manufacturing are expensive on the production end. Although this holds to be true, profits generated from selling prescription medication cover for those costs and produce tidy profits.
What disproves big pharma’s reasoning is the fact that both Canadians and Mexicans have much lower prices on prescription medication, and they have modernized healthcare systems just like America does. America’s healthcare system is funded by taxpayer money, which makes the funding for it even better given the population size. What really drives the high medication costs in America is that the pharmaceutical industry has always had the protection of monopoly pricing. In every other country in the world, there are regulations that limit the prices big pharma companies can place on prescription medication.
In America, companies have patents on their pharmaceuticals, and while the patents are still in place, the prescription medications can be valued at whatever price point they think is best. Once a patent expires, a generic version of the medication may become available at a slightly lower cost. But the lower cost is still more than the price others pay for that same medication elsewhere in the world. This is the main reason why the USA pays around 50% of what the entire world spends on prescription medication in a year.
Giving lower-income Americans access to international pharmacy medication and pricing can be part of the solution to help individuals and families get the medication they need. But there still needs to be action at the level of the government as well. Some suggested solutions have been to follow up on what was proposed in the Government’s 2019 Blueprint to Lower Drug Prices and Reduce OOP Costs: improved competition, better negotiation, and incentives to lower list costs.
But if this is to be a new era of trust-busting, advocates say, prescription drugs should be a top priority.
With bipartisan support, Sens. Chuck Grassley, R-Iowa, and Maria Cantwell, D-Wash., in April introduced a bill that would require the Federal Trade Commission to launch such an investigation. It would look at whether the health care giants that own the biggest pharmacy middlemen are using their market power to drive up the cost of drugs and diminish access to care by driving out competing pharmacies.
The middlemen, known as pharmacy benefit managers, or PBMs, control more than 77% of the prescription marketplace in the U.S. That gives them power to decide which drugs are covered, the size of rebates manufacturers grant them and how much pharmacies will be reimbursed if those pharmacies want access to the millions of patients the PBMs represent.
The largest PBM, CVS Caremark, is owned by a company that also owns the largest retail chain, CVS Pharmacy. So as a PBM, it’s determining how much its own stores and its competitors will be reimbursed when they supply drugs to CVS Caremark’s clients.
CVS maintains that it doesn’t advantage its own pharmacies when determining reimbursements. But The Columbus Dispatch obtained confidential documents showing that in 2017, CVS Caremark reimbursed CVS pharmacies far more for generic Medicaid drugs than it did large competitors such as Walmart.
In addition, the Arkansas Insurance Department last year published an analysis showing that the big three PBMs — CVS Caremark, UnitedOptumRx, and Express Scripts — reimbursed national pharmacy chains at substantially higher rates than they did regional chains and independent pharmacies. The smaller chains and independents are often in underserved areas, and if they go out of business, it could create “pharmacy deserts.”
In another possible instance of abuse, CVS Caremark in late 2017 slashed reimbursements under the Ohio Medicaid program. Then it sent letters to struggling independent pharmacists acknowledging that reimbursements were down and saying that CVS wanted to buy their pharmacies.
Meanwhile, each of the PBMs has combined with a major health insurer since 2014. CVS owns Aetna. OptumRx is owned by Minnesota-based UnitedHealth. And Express Scripts is owned by Cigna.
The companies say they maintain firewalls between their business units to keep one from unfairly advantaging the others. But suspicions abound.
Alabama, Tennessee, Texas and West Virginia have passed laws in recent months banning the companies from using their insurance or PBM operations to steer clients to certain pharmacies. They were passed after residents offered testimony such as, “‘I got a prescription filled at Joe’s pharmacy and when I got home there’s a message on my voicemail saying, ‘We know you just got prescription X filled. You can go to the CVS down the street and get it filled at a better rate, a better copay,’” Anne Cassity, Vice President of Federal and State Government Affairs for the National Community Pharmacists Association, said Friday.
CVS didn’t respond to a request for comment.
A group representing the PBM industry, the Pharmacy Care Management Association, earlier this month said it had no problem with a Federal Trade Commission antitrust investigation.
“The core mission for PBMs is to advocate on behalf of patients to increase access to affordable prescription drugs,” PCMA spokesman Greg Lopes said. “We look forward to working with Sens. Grassley and Cantwell on real solutions to lowering drug costs.”
Sens. Marsha Blackburn, R-Tenn., Richard Blumenthal, D-Conn., Thom Tillis, R-N.C., and Joni Ernst, R-Iowa, have signed onto the bill requiring an investigation, but it’s unclear how many others in Congress have tuned in.
Rep. Tim Ryan, D-Ohio, last week held a virtual press event in which he promoted H.R. 3, a drug pricing bill that seeks to control costs by focusing solely on drugmakers. Among its provisions, the bill would require manufacturers selling drugs to Medicare patients to peg their costs to those in foreign countries such as Australia.
Insurers and PBMs play an enormousrole in determining prescription drug costs, but Ryan said he wanted to address their role in other legislation.
The office of Sen. Sherrod Brown, D-Ohio, was asked if he supported the bill requiring an antitrust investigation of the corporations that own the big PBMs and insurers.
“That is a Judiciary Committee bill, of which Sen. Brown is not a member,” a spokeswoman said on background. “Requiring more information is important. However, Sen. Brown is focused on reforms to increase oversight over PBMs and curb PBM abuses, as part of his efforts to address prescription drug costs through the committee on which he serves — the Senate Finance Committee.”
She listed several transparency measures Brown included in a bill that passed out of the Finance Committee last year.
The office of Sen. Rob Portman, R-Ohio, didn’t respond when asked if he supported legislation requiring an antitrust investigation.
Cassity, of the community pharmacists association, said her group and others need to work to explain an admittedly complex matter to lawmakers.
“I think it’s a little early and there’s been so much focus on pharmaceutical manufacturers since January,” she said. “I think there’s an opportunity here. It’s very complicated and many members of Congress don’t understand it the way they need to, but a lot of them do.”
She added, “There has been more understanding, but there needs to be more education. And frankly, antitrust, a lot of folks hear that and they back off if they’re not intimately involved with it in their committee.”
This story was originally published by Ohio Capital Journal, which is part of States Newsroom. Follow Ohio Capital Journal on Facebook and Twitter.
A key Biden administration health official said Thursday that she is "taking a look" at one of former President Trump's proposals to lower drug prices, but did not commit to pursuing the plan.
“I think we’re, you know, taking a look at those concepts,” Liz Fowler, director of the Center for Medicare and Medicaid Innovation, said when asked about Trump’s “most favored nation” proposal to lower drug prices.
Trump had touted that initiative as a way to lower the prices Medicare paid for certain drugs to be in line with the prices paid in other wealthy countries. But the proposal, which Trump put forward at the end of his term, never went into effect after it was blocked by the courts for failing to follow proper procedural steps in its implementation. The path forward is therefore up to the Biden administration.
Fowler noted the court rulings during an interview with Health Affairs.
“I think you can expect that we’ll continue looking at this issue,” she said. “I don’t think we’re going to let our foot off the gas, but I don’t know that it’ll take that form. We can’t because it’s in court.”
The issue is unusual in that it marks an area where Trump put forward a proposal that is closer to the Democratic position than the usual Republican position.
Fowler even offered some tempered praise for the Trump administration’s approach on drug pricing.
“I thought that the previous administration was very creative in a lot of the ideas and areas that they were looking at tackling,” she said.
Fowler noted that Congress is working on potentially more sweeping drug pricing legislation, though it remains unclear what if anything can get enough votes to pass.
“Let’s see what Congress can do, because it’s a lot easier to make progress on this issue there,” she said. “But if that’s not possible, I think we stand ready to work with them and look and see how far we can get.”
