Radar on Drug Benefits
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Number of Highly Rated PDP Contracts Shrinks in 2023
Only 9% of Medicare beneficiaries who sign up for a stand-alone Prescription Drug Plan (PDP) in 2023 will be in contracts rated 4 stars or higher, compared to 42% in the 2022 plan year, CMS recently estimated based on current enrollment figures. The average star rating for stand-alone PDP plans declined to 3.25 in 2023 from 3.70 in 2022, with only two PDP contracts receiving a 5-star rating. The change in distribution is largely due to adjustments in measure scores, and “the unusual circumstance of nearly all contracts qualifying for the regulatory adjustment for extreme and uncontrollable circumstances” driven by the pandemic, which led to higher than normal 2022 Star Ratings distributions, CMS explained in a fact sheet accompanying the release of the 2023 Star Ratings.
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News Briefs: CMS to Hire “Small Army” of Drug Pricing Staff
After Michelle McMurray-Heath, M.D., resigned from her position as president and CEO of the Biotechnology Innovation Organization, the major industry trade group said on Oct. 11 that Rachel King, co-founder and former CEO of GlycoMimetics, Inc., agreed to serve in those roles on an interim basis while BIO searches for a permanent successor. Before her departure, McMurray-Heath was on leave following disagreements with some board members over whether BIO should engage on social issues not directly connected to health care policy, which the molecular immunologist opposed, The Wall Street Journal reported. Her exit also comes in the wake of Congress’ passage of major drug pricing reforms as part of the Inflation Reduction Act, representing a rare defeat for the powerful pharma lobby.
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Study: Pharma Companies Often Profit From Donations to Patient Assistance Charities
Pharmaceutical companies often profit from their donations to non-profit patient assistance charities that are intended to help people afford high-cost medications, according to a study published in this month’s edition of the journal Health Affairs.
HHS’s Office of Inspector General (OIG) has provided guidance on the charities and cracked down in recent years on several charities and drug manufacturers. However, the authors noted that “the current regulations or enforcement permit donations that violate the spirit of Medicare’s Anti-Kickback Statute,” which prohibits pharma companies from covering Medicare Advantage enrollees’ out-of-pocket drug spending for the drugs they manufacture.
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Drug Price Negotiation Will Require New CMS Regulations, Staffing
Now that Medicare can negotiate the price of prescription drugs it purchases, the Biden administration needs to figure out how it will hash out deals with drugmakers. Experts tell AIS Health, a division of MMIT, that implementation of the long-sought negotiation program will come with plenty of challenges and pitfalls.
The administration will have to issue new regulations, hire hundreds of staff, determine which drug prices will be negotiated first and design the criteria that will select drugs for negotiation in the future.
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Accelerated Approval Prices Are Unrelated to Clinical Value, Study Says
The manufacturers of many drugs granted accelerated approval by the FDA do not complete timely confirmatory trials of the drugs’ efficacy, according to a recent study published in the journal Health Affairs — meaning that the pricing for many accelerated approval drugs has nothing to do with their clinical efficacy. The study’s author tells AIS Health, a division of MMIT, that “the market doesn’t work very well” for drugs that have received accelerated approval, and “what it leads us to is overpaying at the beginning and underpaying, potentially, later.”
After a drug is granted accelerated approval, the FDA mandates that the drug be evaluated using confirmatory clinical trials. The accelerated approval designation is given to new, unproven drugs that could potentially meet a dire need for a new or more effective therapy to treat a terminal disease. The intention behind the confirmatory trial system is to make sure that the drug actually does what its developer says it will.
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