Drug Benefits

Datapoint: FDA Approves Second Drug for Rare Neuromuscular Disorder

May 14, 2019

The FDA last week approved Jacobus Pharmaceuticals’ Ruzurgi for the treatment of Lambert-Eaton myasthenic syndrome (or LEMS), a rare neuromuscular disorder. Only one other drug is approved to treat LEMS, Catalyst Pharmaceuticals’ Firdapse, which currently holds preferred status for 7% of covered lives, and is not covered for 11% of lives. Firdapse made waves for its $375,000 list price when it was approved in December. Pricing information for Ruzurgi has not yet been released.

The FDA last week approved Jacobus Pharmaceuticals’ Ruzurgi for the treatment of Lambert-Eaton myasthenic syndrome (or LEMS), a rare neuromuscular disorder. Only one other drug is approved to treat LEMS, Catalyst Pharmaceuticals’ Firdapse, which currently holds preferred status for 7% of covered lives, and is not covered for 11% of lives. Firdapse made waves for its $375,000 list price when it was approved in December. Pricing information for Ruzurgi has not yet been released.

SOURCE: MMIT Analytics, as of 5/9/19

CBO Says Proposed Drug Rebates Rule Will Increase Government Spending by $177B

May 13, 2019

When HHS unveiled a proposed rule in late January aimed at eliminating drug rebates in Medicare Part D and Medicaid managed care, the proposal was met with mixed responses. A recently released score from the Congressional Budget Office (CBO) calls into question whether the administration chooses to move forward with the proposal in its current form.

The proposal would do away with the safe harbor protection in the anti-kickback statute for rebates negotiated between manufacturers and PBMs starting Jan. 1, 2020.

By Angela Maas

When HHS unveiled a proposed rule in late January aimed at eliminating drug rebates in Medicare Part D and Medicaid managed care, the proposal was met with mixed responses. A recently released score from the Congressional Budget Office (CBO) calls into question whether the administration chooses to move forward with the proposal in its current form.

The proposal would do away with the safe harbor protection in the anti-kickback statute for rebates negotiated between manufacturers and PBMs starting Jan. 1, 2020.

In the CBO’s report, the agency projects that if the rule is implemented as proposed, it will increase federal spending by approximately $177 billion from 2020 to 2029. Of that total, spending on Medicare Part D premiums would increase by about $170 billion. Without rebates to keep premiums low, beneficiaries would face higher premiums. The agency anticipates that “rather than lowering list prices, manufacturers would offer the negotiated discounts in the form of chargebacks,” which are shared with beneficiaries via a manufacturer payment to a pharmacy.

The report, however, also concludes that “no current system could both meet the proposed rule’s standards and facilitate chargebacks.”

If “rebates could no longer be paid to PBMs in Medicare Part D,” but “systems are not available to support retail pharmacy chargebacks,…this would be an untenable situation,” says Elan Rubinstein, Pharm.D., principal at EB Rubinstein Associates, making it “reasonable to delay” the proposed implementation date.

“The increase in premiums was expected by many, but the growth in federal spending was somewhat surprising given that lower upfront prices would generally benefit the end payer, which in this case is the federal government,” says Jeremy Schafer, Pharm.D., senior vie president, director, access experience team at Precision for Value. “It seems changing the safe harbor may not accomplish patient savings or reduced government spending as hoped for by the administration.”

Datapoint: Pfizer’s New Heart Drug Scores FDA Nod, Lower Price Than Competitors

May 9, 2019

Despite a previous rejection, the FDA this week approved Pfizer’s Vyndaqel (and sister formulation Vyndamax) for the treatment of both hereditary and spontaneous ATTR cardiomyopathy (ATTR-CM), a rare and deadly form of heart disease. Pfizer’s drug stands to face two rivals, Alnylam’s Onpattro and Ionis’s Tegsedi, if it can score an additional FDA approval for hereditary ATTR polyneuropathy (hATTR-PN). Onpattro is also working to score an ATTR-CM nod. For the treatment of hATTR-PN, both rival drugs hold preferred status for only 1% of covered lives. Pfizer’s drug has a much lower list price than its competitors ($225,000 per year vs. $450,000) and is an oral pill, while Onpattro and Tegsedi are both injectables.

Despite a previous rejection, the FDA this week approved Pfizer’s Vyndaqel (and sister formulation Vyndamax) for the treatment of both hereditary and spontaneous ATTR cardiomyopathy (ATTR-CM), a rare and deadly form of heart disease. Pfizer’s drug stands to face two rivals, Alnylam’s Onpattro and Ionis’s Tegsedi, if it can score an additional FDA approval for hereditary ATTR polyneuropathy (hATTR-PN). Onpattro is also working to score an ATTR-CM nod. For the treatment of hATTR-PN, both rival drugs hold preferred status for only 1% of covered lives. Pfizer’s drug has a much lower list price than its competitors ($225,000 per year vs. $450,000) and is an oral pill, while Onpattro and Tegsedi are both injectables.

SOURCE: MMIT Analytics, as of 5/8/19

Datapoint: FDA Approves Second Enbrel Biosimilar

May 6, 2019

The FDA on April 26 approved a second biosimilar for Amgen Inc.’s Enbrel, Samsung Bioepis’ Eticovo, sacross all of Enbrel’s indications. Enbrel’s first biosimilar, Sandoz’s Erelzi, was approved in 2016, but has yet to hit the market as Amgen is fighting the drug’s U.S. launch in court. For the treatment of rheumatoid arthritis, Enbrel holds preferred formulary status for 7% of covered lives, which grows to 49% with the inclusion of step therapy and/or prior authorization requirements.

The FDA on April 26 approved a second biosimilar for Amgen Inc.’s Enbrel, Samsung Bioepis’ Eticovo, sacross all of Enbrel’s indications. Enbrel’s first biosimilar, Sandoz’s Erelzi, was approved in 2016, but has yet to hit the market as Amgen is fighting the drug’s U.S. launch in court. For the treatment of rheumatoid arthritis, Enbrel holds preferred formulary status for 7% of covered lives, which grows to 49% with the inclusion of step therapy and/or prior authorization requirements.

SOURCE: MMIT Analytics, as of 5/1/2019

Three Major PBMs Log Low Commercial Drug Trend

May 3, 2019

CVS Health Corp.’s 2018 drug trend report shows a 3.3% trend for its commercial clients last year, driven by utilization increases and adherence improvements. Overall, the company cited savings of more than $141 billion on pharmacy spend from 2016 to 2018. Earlier this year, PBM giant Express Scripts, now a part of Cigna Corp., reported a record low drug trend of 0.4% across its commmercial clients (RDB 2/14/19, p. 4). Commercial clients of another leading PBM, Prime Therapeutics, saw a 3.3% trend in 2018 (RDB 3/28/19, p. 4).

by Jinghong Chen

CVS Health Corp.’s 2018 drug trend report shows a 3.3% trend for its commercial clients last year, driven by utilization increases and adherence improvements. Overall, the company cited savings of more than $141 billion on pharmacy spend from 2016 to 2018. Earlier this year, PBM giant Express Scripts, now a part of Cigna Corp., reported a record low drug trend of 0.4% across its commmercial clients (RDB 2/14/19, p. 4). Commercial clients of another leading PBM, Prime Therapeutics, saw a 3.3% trend in 2018 (RDB 3/28/19, p. 4). As the rising costs of diabetes treatments have been a major concern, these PBMs applied formulary strategies to keep insulin affordable. CVS Health reported a -1.7% trend for antidiabetic drugs, despite increasing utilization and 5.6% average wholesale price inflation for brand drugs.

NOTES: CVS Health’s 2018 Drug Trend Report only cited year-over-year drug trend for its commercial clients. PMPY refers to per member per year. PMPM refers to per member per month.

SOURCES: CVS Health 2018 Drug Trend Report (https://bit.ly/2viXj2B), Express Scripts 2018 Drug Trend Report (https://bit.ly/2TIV1ED), Prime Therapeutics Annual Drug Trend Results (https://bit.ly/2CDXU2Q).

California Insurers Show Concern about Medicaid Pharmacy Carve Out Plan

May 1, 2019

California is quietly plowing ahead on plans by Gov. Gavin Newsom, a Democrat, to create a statewide bulk purchasing system for prescription drugs — and to transition pharmacy services for Medi-Cal, the state’s Medicaid program, from managed care to fee-for-service (FFS) by January 2021.

In the latest development related to the initiatives, Los Angeles County tentatively has agreed “to sit at the same bargaining table” with Newsom’s administration to negotiate prices with drug manufacturers, the Los Angeles Times reported April 17.

By Judy Packer-Tursman

California is quietly plowing ahead on plans by Gov. Gavin Newsom, a Democrat, to create a statewide bulk purchasing system for prescription drugs — and to transition pharmacy services for Medi-Cal, the state’s Medicaid program, from managed care to fee-for-service (FFS) by January 2021.

In the latest development related to the initiatives, Los Angeles County tentatively has agreed “to sit at the same bargaining table” with Newsom’s administration to negotiate prices with drug manufacturers, the Los Angeles Times reported April 17.

The California Association of Health Plans (CAHP) says its main concerns relate to ongoing work on the Medi-Cal pharmacy services “carve-out.”

In its April 5 report, the state Legislative Analyst’s Office (LAO) says the state’s Medicaid pharmacy carve out plan likely will generate net savings to the state. But it notes many details have yet to be released concerning how the carve out will be implemented and how the administration believes it will affect Medi-Cal spending and stakeholders. Thus, the LAO recommends that “the Legislature withhold approval of future new state operations resources to implement the carve out until the administration provides key information that adequately answers major outstanding questions.”

According to CAHP spokesperson Mary Ellen Grant, the LAO report “says the state may save money [by shifting Medi-Cal’s pharmacy benefit from managed care to FFS], but there are a lot of trade-offs and even the savings are uncertain.”

She notes that analyses by The Menges Group and other researchers have found transitioning the drug benefit back to FFS would be costly to state Medicaid programs.