Radar on Drug Benefits

As part of a sweeping new Medicare Advantage rule, CMS recently proposed a policy aimed at reforming a reimbursement system that local pharmacies have long claimed is straining them to the breaking point. PBMs, on the other hand, argue that the proposal could hamper value-based contracting in Part D and potentially increase Medicare spending.

At issue are arrangements in which Part D plan sponsors can recoup money from pharmacies for dispensed drugs if the pharmacies do not meet certain metrics. Generally speaking, these payments to plan sponsors are known as price concessions, and when assessed retrospectively — as they currently are — they are counted as direct and indirect renumeration (DIR).

This year, PBMs will continue to face growing pressure from plan sponsors, regulators and policymakers to prove that they deliver value and keep drug costs down — and could face additional legislative or regulatory challenges to the way they do business. Meanwhile, investors are likely to put even more capital into startups that challenge the traditional pharmacy benefit paradigm, and the post-pandemic boom in risk-based contracting could expand into pharmacy benefits.

Federal and state regulators have increased scrutiny on PBMs in recent years. In particular, state efforts to regulate PBMs were buoyed by the Supreme Court’s 2020 decision in Rutledge v. Pharmaceutical Care Management Association (PCMA), a lawsuit in which the justices held that states were not in violation of the Employee Retirement Income Security Act of 1974 (ERISA) in attempting to regulate the rates at which PBMs reimburse pharmacies. According to the National Academy for State Health Policy (NASHP), a think tank and policy advocacy group, so far this year 42 states considered 111 bills relating to PBM regulation in 2021. That activity is likely to continue in 2022.

CMS on Jan. 11 issued its long-awaited proposed National Coverage Determination (NCD) for Aduhelm (aducanumab), the Alzheimer’s drug that has been the subject of controversy since the FDA approved it last June. In what officials acknowledged was an unusual decision, CMS said Medicare will cover Aduhelm — and any other FDA-approved monoclonal antibodies that target amyloid plaques — only for people who are enrolled in qualifying clinical trials.

Health insurer trade groups praised the decision, which comes after Aduhelm manufacturer Biogen cut the price of the drug approximately in half in a bid to encourage both provider uptake and payer coverage.

A new biologic for severe asthma, a drug for anemia related to chronic kidney disease (CKD) and a long acting pre-exposure prophylaxis (PrEP) for HIV-1 are among the first-in-class therapies featured in OptumRx’s Q1 2022 Drug Pipeline Insights Report. In addition to these new drugs, the PBM also calls attention to the likelihood of more COVID-19 vaccines and treatments receiving full approval and additional uses in 2022.

Tezepelumab (brand name Tezspire) was approved by the FDA for maintenance treatment of severe asthma in December 2021. Many biologics for severe asthma are already on the market, but these drugs target asthma subtypes determined by baseline blood eosinophil counts, according to the OptumRx report. On the other hand, tezepelumab, developed by AstraZeneca and AmGen Inc., has been developed with a broader indication.