Opin­ion: CMS needs to do FDA’s job and lim­it the use of Bio­gen’s pricey new Alzheimer’s drug

Now that the FDA has ap­proved Bio­gen’s ex­pen­sive new Alzheimer’s drug with lit­tle clin­i­cal ben­e­fit po­ten­tial, but plen­ty of po­ten­tial to speed the bank­rupt­cy of the gov­ern­ment’s health care pro­gram for se­niors, it’ll be up to the Cen­ters for Medicare and Med­ic­aid Ser­vices to lim­it pay­ment for it and dri­ve the con­ver­sa­tion on ac­cess.

While such ac­cess de­ci­sions are nor­mal­ly re­served for the FDA, the agency ab­di­cat­ed its re­spon­si­bil­i­ty be­cause of the wide la­bel and be­cause it’s al­low­ing Bio­gen to take al­most a decade to fig­ure out if ad­u­canum­ab ac­tu­al­ly works.

But what CMS does now will have a mas­sive im­pact on the fi­nan­cial health and well-be­ing of its Medicare pro­gram, es­pe­cial­ly as Aduhelm may speed Medicare’s path to in­sol­ven­cy, cur­rent­ly set for 2026.

The fi­nan­cial im­pli­ca­tions of Aduhelm range from daunt­ing to down­right dis­turb­ing.

Ron­ny Gal

As Bern­stein biotech Ron­ny Gal point­ed out, “The to­tal cost of Medicare part B drugs was $37B in 2019, grow­ing at 13%. This is the bud­get seg­ment Pres­i­dent Trump called ‘out of con­trol’. If 1M pa­tients use Aduhelm at the cur­rent price point, to­tal Medicare part B spend­ing would dou­ble.”

While Bio­gen has said they will have the man­u­fac­tur­ing ca­pac­i­ty to treat 1 mil­lion Alzheimer’s pa­tients, Gal not­ed that the fi­nan­cial im­pli­ca­tions of a more re­al­is­tic sce­nario of just half that pop­u­la­tion “is equal­ly mind-bog­gling.”

If 50% of new­ly di­ag­nosed pa­tients start Aduhelm at the cur­rent price, then the to­tal cost to Medicare will be equal to the top five drugs in Medicare Part B com­bined (Mer­ck’s Keytru­da, Re­gen­eron’s Eylea, BMS’ Op­di­vo, Roche’s Rit­ux­an and Am­gen’s Pro­lia – at $10.7B based on the Medicare dash­board), ac­cord­ing to Gal.

“We can eas­i­ly see a sit­u­a­tion where the com­bi­na­tion of the un­re­strict­ed la­bel and the high price could lead in-pa­tient fa­cil­i­ties treat­ing se­vere AD pa­tients to [get] as many of their res­i­dents on treat­ment as pos­si­ble,” he wrote in an in­vestor note ear­li­er this month.

Rep. Pe­ter Welch (D-VT) sent a let­ter to Bio­gen’s CEO Michel Vounatsos on Tues­day, not­ing, “In 2019, the to­tal amount of spend­ing for all Part B drugs was on­ly $37 bil­lion, so Bio­gen’s price for one drug and one treat­ment would cost near­ly $20 bil­lion more than the en­tire ex­ist­ing Medicare Part B drug pro­gram for all ben­e­fi­cia­ries.”

The ma­jor­i­ty of Amer­i­cans suf­fer­ing from Alzheimer’s— more than 6 mil­lion peo­ple—are Medicare ben­e­fi­cia­ries, Welch added, not­ing, “Bio­gen has abused the pric­ing pow­er that it holds.”

So what will CMS need to do?

The cen­ters may be tasked with in­sti­tut­ing what’s known as a Medicare Na­tion­al Cov­er­age De­ter­mi­na­tion on Aduhelm, which is usu­al­ly re­served for Medicare ser­vices and not new drugs. But such a de­ter­mi­na­tion could pro­tect Medicare ben­e­fi­cia­ries from FDA’s wide la­bel, and re­strict the use of the drug to on­ly the sub­groups of se­niors who might ben­e­fit and who were stud­ied in Bio­gen’s failed tri­als.

Rachel Sachs

“If CMS were to use the NCD process to re­strict cov­er­age for Aduhelm be­yond the FDA’s broad la­bel for the drug, it would set a very im­por­tant prece­dent by delink­ing the FDA’s de­ci­sion to ap­prove a drug from CMS’s de­ci­sion to pro­vide re­im­burse­ment for it,” Rachel Sachs, law pro­fes­sor at Wash­ing­ton Uni­ver­si­ty in St. Louis, wrote re­cent­ly in Health Af­fairs.

Biden’s new­ly con­firmed CMS ad­min­is­tra­tor Chiq­ui­ta Brooks-La­Sure said she’s look­ing in­to all the ev­i­dence in de­cid­ing whether to make a na­tion­al cov­er­age de­ter­mi­na­tion.

Oth­ers are sug­gest­ing that CMS con­duct its own re­search on pay­ing for Aduhelm.

Pe­ter Bach, di­rec­tor of the Drug Pric­ing Lab at Memo­r­i­al Sloan Ket­ter­ing Can­cer Cen­ter, and Craig Garth­waite, di­rec­tor of the Pro­gram on Health­care at the Kel­logg School of Man­age­ment at North­west­ern Uni­ver­si­ty, called on Medicare’s re­search cen­ter, the Cen­ter for Medicare and Med­ic­aid In­no­va­tion, to eval­u­ate whether CMS should pay for the drug and whether those pay­ments are cost-ef­fec­tive.

To eval­u­ate such pay­ments while Bio­gen’s 9-year con­fir­ma­to­ry tri­al is on­go­ing, Bach and Garth­waite called on CMS to se­lect some coun­ties where it would re­im­burse Aduhelm’s cur­rent price, and oth­ers where it would re­im­burse $0, and see what the dif­fer­ences are.

“Medicare must study ad­u­canum­ab re­im­burse­ment now, and pre­pare to do the same when­ev­er the FDA ap­proves oth­er cost­ly, im­por­tant drugs that lack ev­i­dence of ef­fec­tive­ness,” Bach and Garth­waite wrote. “Drug com­pa­nies should know that if their med­i­cines reach the mar­ket be­fore the ev­i­dence is in, pay­ment will not be au­to­mat­ic.”

2023 Spot­light on the Fu­ture of Drug De­vel­op­ment for Small and Mid-Sized Biotechs

In the context of today’s global economic environment, there is an increasing need to work smarter, faster and leaner across all facets of the life sciences industry.  This is particularly true for small and mid-sized biotech companies, many of which are facing declining valuations and competing for increasingly limited funding to propel their science forward.  It is important to recognize that within this framework, many of these smaller companies already find themselves resource-challenged to design and manage clinical studies themselves because they don’t have large teams or in-house experts in navigating the various aspects of the drug development journey. This can be particularly challenging for the most complex and difficult to treat diseases where no previous pathway exists and patients are urgently awaiting breakthroughs.

Dipal Doshi, Entrada Therapeutics CEO

Ver­tex just found the next big ‘trans­for­ma­tive’ thing for the pipeline — at a biotech just down the street

Back in the summer of 2019, when I was covering Vertex’s executive chairman Jeff Leiden’s plans for the pipeline, I picked up on a distinct focus on myotonic dystrophy Type I, or DM1 — one of what Leiden called “two diseases (with DMD) we’re interested in and we continue to look for those assets.”

Today, Leiden’s successor at the helm of Vertex, CEO Reshma Kewalramani, is plunking down $250 million in cash to go the extra mile on DM1. The lion’s share of that is for the upfront, with a small reserve for equity in a deal that lines Vertex up with a neighbor in Seaport that has been rather quietly going at both of Vertex’s early disease targets with preclinical assets.

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Ahead of ad­comm, FDA rais­es un­cer­tain­ties on ben­e­fit-risk pro­file of Cy­to­ki­net­ic­s' po­ten­tial heart drug

The FDA’s Cardiovascular and Renal Drugs Advisory Committee will meet next Tuesday to discuss whether Cytokinetics’ potential heart drug can safely reduce the risk of cardiovascular death and heart failure in patients with symptomatic chronic heart failure with reduced ejection fraction.

The drug, known as omecamtiv mecarbil and in development for more than 15 years, has seen mixed results, with a first Phase III readout from November 2020 hitting the primary endpoint of reducing the odds of hospitalization or other urgent care for heart failure by 8%. But it also missed a key secondary endpoint analysts had pegged as key to breaking into the market.

David Light, Valisure CEO

Val­isure in the hot seat: New Form 483 over a 2021 in­spec­tion as CEO fires back

The notorious drug testing company Valisure, which has made a name for itself by forcing FDA’s hand with some of its safety-related uncoverings, received a letter this week after the FDA uncovered violations at its Connecticut-based testing lab in 2021.

The letter, which was sent on Dec. 5, stated that the FDA is “concerned” that Valisure was not aware of  drug supply chain security requirements.

WIB22: Am­ber Salz­man had few op­tions when her son was di­ag­nosed with a rare ge­net­ic dis­ease. So she cre­at­ed a bet­ter one

This profile is part of Endpoints News’ 2022 special report about Women in Biopharma R&D. You can read the full report here.

Amber Salzman’s life changed on a cold, damp day in Paris over tiny plastic cups of lukewarm tea.

She was meeting with Patrick Aubourg, a French neurologist studying adrenoleukodystrophy, or ALD, a rare genetic condition that causes rapid neurological decline in young boys. It’s a sinister disease that often leads to disability or death within just a few years. Salzman’s nephew was diagnosed at just 6 or 7 years old, and died at the age of 12.

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FDA re­view­ers head back to White Oak in 2023, with lead­er­ship look­ing to ap­pease a new Con­gress

Republicans have taken a stand against the pandemic era habit of lax work-from-home schedules. Now that they’ve wrestled control of the House majority, the FDA’s leadership is playing ball, sending many of the agency’s more than 18,000 employees back to their desks early next year.

Whether this exodus back to White Oak in Silver Spring, MD (many staff will still be allowed to work from home for multiple days per week) will mean more defections to industry and elsewhere remains to be seen.

Bags of shred­ded docs: In­di­an drug­mak­er Lupin hand­ed a Form 483 by FDA in­spec­tors

The generics manufacturer Lupin has been given another Form 483 from the FDA this year.

US regulators inspected Lupin’s pharmaceutical manufacturing site in the town of Mandideep, India from Nov. 14 through Nov. 23, with the 14-page report marking 16 observations.

The inspection report stated that the site did not have the appropriate controls over its computer systems to ensure that changes in “master production” or records are only done by authorized personnel, along with written procedures not being established to conduct annual reviews of records associated with drug batches.

Bro­ken promis­es? FDA needs more pow­er to re­move drugs from mar­ket­place, JA­MA analy­sis finds

The FDA is struggling to remove drugs from the marketplace that don’t show effectiveness in late stage trials, new JAMA analyses found, thanks to the persistent tension between speed and confidence in early clinical data.

Congress, regulated industry and patients have urged the FDA to shorten the amount of time that the market has to wait for drugs to become available that may help severe and prevalent diseases – and the FDA has listened, offering up a quick accelerated approval pathway that’s frequently used by new cancer drugs.

Ab­b­Vie slapped with age dis­crim­i­na­tion law­suit, fol­low­ing oth­er phar­mas

Add AbbVie to the list of pharma companies currently facing age discrimination allegations.

Pennsylvania resident Thomas Hesch filed suit against AbbVie on Wednesday, accusing the company of passing him over for promotions in favor of younger candidates.

Despite 30 years of pharma experience, “Hesch has consistently seen younger, less qualified employees promoted over him,” the complaint states.