Citing the First Amendment, the Fifth Amendment and the logic of fair play, Pfizer Inc. is taking on a Health and Human Services’ (HHS) antitrust policy that prohibits drug companies from helping Medicare beneficiaries with hefty copays.
The government’s “position on copay assistance leads to perverse and unequal results depending on a Medicare beneficiary’s economic status,” the New York pharma said in a suit seeking declaratory judgment that the company’s proposed patient assistance programs for Vyndaqel (tafamidis meglumine) and Vyndamax (tafamidis) for Medicare beneficiaries do not violate antitrust laws.
The drugs are the only products approved by the FDA to treat transthyretin amyloid cardiomyopathy (ATTR-CM), a rare, fatal heart condition that disproportionately affects people older than 60. The genetic form of the disease primarily afflicts African American men. The only other potential treatment is a dual heart and liver transplant. Prior to the FDA approval of the drugs last year, life expectancy for people with ATTR-CM typically was two to three-and-a-half years from the time of diagnosis.
The drugs currently list at $225,000 for a one-year course of treatment, which Pfizer said “is well below comparable novel therapies approved to treat other rare diseases.” The price also is substantially less than a transplant.
But at that price, a patient would have to pay about $13,000 annually out-of-pocket under the standard Medicare Part D benefit. “These costs are prohibitively expensive for many patients,” Pfizer said, noting that even if the list price were halved, many patients wouldn’t be able to afford the out-of-pocket costs because of the way Part D is structured.
“The result is that tafamidis is only affordable to those patients wealthy enough to pay the out-of-pocket costs or those with incomes so low that Medicare waives most of the out-of-pocket costs under the Low Income Subsidy program,” Pfizer said in the suit filed in the U.S. District Court for the Southern District of New York.
That leaves middle-income Medicare patients with ATTR-CM facing copays and co-insurance they can’t afford. And when they forgo filling their prescriptions, “Medicare pays nothing,” Pfizer said. As a result, patients who can’t meet the Part D copay obligations are denied access to their Medicare benefits and life-changing medical breakthroughs, the company added.
HHS’ Office of Inspector General (OIG) “takes the view that any manufacturer who helps those middle-income patients with their out-of-pocket costs has committed health care fraud and may be subject to prosecution or other enforcement action under the [Antikickback Statute and the Beneficiary Inducement Statute],” according to the suit, Pfizer v. HHS.
“That interpretation effectively bars middle-income Medicare recipients from accessing their federal health care insurance benefits based solely on their economic status,” the suit continued. “Such a fundamentally irrational application of the Medicare Part D benefit scheme would violate the equal protection principles enshrined in the Fifth Amendment’s due process clause.”
Pfizer already offers Vyndaqel and Vyndamax free to all ATTR-CM patients, including Medicare beneficiaries, who have an annual income of up to 500% of the federal poverty level, which, for this year, would be $86,200 for a family of two. One of the programs it’s proposing would help Medicare beneficiaries above that income level by directly providing copay and coinsurance assistance through a copay card or coupon – similar to a program available to all commercially insured patients with the condition.
Pfizer also proposed funding an existing independent charity that would provide copay assistance to Medicare patients with ATTR-CM who need financial help to access Vyndaqel and Vyndamax, as well as other prescription drugs used to treat ATTR-CM symptoms.
In addition to the income-based health disparities fostered by current government policy, the suit questioned how the OIG construes such patient assistance as illegal kickbacks under the Antikickback Statute and the Beneficiary Inducement Statute, which prohibit remunerations made with the intent to corrupt medical decision making at the expense of Medicare and other federal health care programs.
Pfizer’s proposed copay assistance doesn’t constitute “remuneration” and isn’t intended to influence prescribing of the drugs in the corrupt or improper way addressed by those laws, the company said, as the programs wouldn’t kick in until after a doctor had objectively diagnosed a patient and then prescribed the only FDA-approved treatment available.
A related challenge raised in the suit claimed that HHS’ rules prohibiting drug companies from communicating with charities that provide assistance to Medicare beneficiaries violate the First Amendment free speech clause.
Pfizer said it filed the suit after working with the OIG for the past year through a formal advisory opinion process, but the OIG has refused to acknowledge the proposed assistance programs are legal or to suggest modifications that would make them acceptable.
Those efforts came after the company agreed, in May 2018, to pay $23.85 million to resolve Department of Justice claims that it used a foundation as a conduit to pay the copays of Medicare patients taking two cancer drugs, Sutent (sunitinib malate) and Inlyta (axitinib), and arrhythmia drug Tikosyn (dofetilide).
In the past, lawmakers and policymakers have justified the Medicare prohibitions of patient assistance programs and high copays in Part D as a way to ensure beneficiaries “have skin in the game” and to shed more light on the true cost of drugs.