Despite the new Medicare inflation rebate, the U.S. price of 27 Part B drugs grew faster than inflation in the last quarter of 2022, triggering the new rebate provision in the Inflation Reduction Act. The manufacturers of those single-source drugs will be billed for the rebates in 2025, but Medicare beneficiaries should see a drop in their coinsurance for those drugs, for the next quarter at least. According to the Biden administration, the decrease in out-of-pocket costs for those drugs will range from $2 to as much as $390 per average dose from April 1 through June 30.
The U.S. Veterans Health Administration (VA) is being applauded for doing what Medicare has refused to do – provide coverage for Leqembi (lecanemab) in the early stages of Alzheimer’s disease. Under the March 13 VA decision, the Eisai Co. Ltd. drug, which was partnered with Biogen Inc. and granted accelerated approval in January, will be listed as a nonformulary therapy that must be prescribed by a VA-board certified neurologist, geriatric psychiatrist or geriatrician who specializes in treating dementia.
The Biden administration offered a sneak peek March 7 at its fiscal 2024 budget by outlining ways it proposes extending the life of the U.S. Medicare Hospital Insurance Trust Fund by at least 25 years.
In decrying high U.S. drug prices, lawmakers often cite statistics about the number of patients who forgo or ration their prescriptions because of the out-of-pocket cost. Those discussions overlook the role payer utilization management tactics, including prior authorization, may play in patients abandoning their treatment, be it a specific drug or an imaging service.
A trio of proposed Medicare drug payment models that made a Feb. 14 debut in the U.S. is playing to mixed reviews. Two of the models to be tested by the U.S. Centers for Medicare & Medicaid Services (CMS) Innovation Center seem to “address the real problems underlying prescription drug pricing – patient out-of-pocket expenses and better payment systems that reward the value a medicine brings to the patient and the overall health care system,” said John Murphy, chief policy officer for the Biotechnology Innovation Organization. But he called the third model, which is expected to restrict Medicare payment for some Part B drugs that have indications with accelerated approval, “an attack on the accelerated approval pathway,” which Congress mandated to spur investment and innovation in areas of unmet medical need.
In decrying high U.S. drug prices, lawmakers often cite statistics about the number of patients who forgo or ration their prescriptions because of the out-of-pocket cost. Those discussions overlook the role payer utilization management tactics, including prior authorization, may play in patients abandoning their treatment, be it a specific drug or an imaging service.
While the new inflation-based rebate on certain Part B drugs may generate billions of dollars in savings for Medicare, implementing the rebate could be more challenging than the U.S. Congress and the Biden administration expected when the Inflation Reduction Act was enacted last August.
With the passage of the Inflation Reduction Act in the U.S. in August 2022, biopharma company leaders have re-evaluated pipelines, sought legal advice, and discussed ways to mitigate the potential impacts the legislation will have on pricing therapies and extending their reach to new indications.
Although the U.S. Inflation Reduction Act charges the Centers for Medicare & Medicaid Services with negotiating prices of the Part B and D drugs with the highest Medicare spend, the first two rounds of negotiations will focus solely on Part D drugs, which are dispensed through pharmacies.
Topping biopharma regulatory news in 2022 was the signing of the Inflation Reduction Act (IRA), as its provisions requiring Medicare to directly negotiate certain prescription drug prices will open the door for the first time to a degree of government price controls in the U.S., affecting the bottom line of drug companies around the world.
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