Radar on Drug Benefits

In its sixth annual Unsupported Price Increases (UPI) report, the Institute for Clinical and Economic Review (ICER) found that five of the top 10 drugs with substantial net price increases in 2023 did not have adequate clinical evidence to support the increases. That was the fewest number of drugs with unsupported price increases in the six years of the report and was down from eight out of 10 in last year’s report.

The other five drugs with substantial net prices did have new clinical evidence last year, which manufacturers could use to justify the net price increases. However, ICER noted it did not conduct a thorough analysis to determine whether the price increases met its strict cost-effectiveness criteria.

The FDA on Dec. 23 approved the first generic GLP-1 once-daily injectable for patients with Type 2 diabetes. The generic for Victoza (liraglutide) is particularly important because Victoza is in shortage, noted the FDA, which also approved the first generic version of twice-daily GLP-1 Byetta (exenatide) last month.  Liraglutide reduces blood sugar in patients ages 10 and older with Type 2 diabetes. On Dec. 20, the FDA also approved a new indication for another GLP-1, Zepbound (tirzepatide), for the treatment of obstructive sleep apnea in adults with obesity.

Johnson & Johnson sued The Cigna Group’s Express Scripts PBM and Accredo specialty pharmacy, accusing them of profiting from J&J’s copay assistance funds, the Wall Street Journal reported. J&J added the Cigna divisions to its original lawsuit against middleman SaveOnSP LLC, accusing all three of working together to drain J&J of $100 million more in assistance funds. According to the suit, SaveOn increased the copay amount on certain drugs, billed J&J’s copay assistance program, and pushed payments to SaveOn’s drug benefit plan, paying itself a commission. The amended lawsuit accuses Express Scripts and Accredo of working with SaveOn in this arrangement. J&J is seeking damages to be specified in court.

If the Senate confirms them as the next leaders of CMS and HHS, Mehmet Oz, M.D., and Robert F. Kennedy Jr. will quickly be faced with a Catch-22 concerning the Medicare Part D program. Namely, they and their staffs must decide whether to extend a Biden administration-created program that has both garnered withering criticism from Republicans and helped ensure that 2025 premiums for stand-alone Prescription Drug Plans (PDPs) wouldn’t leave seniors with sticker shock. 

The program in question is the Part D Premium Stabilization Demonstration, which CMS under President Joe Biden debuted in July. For PDPs opting into the program, CMS applied a $15 reduction to the Part D base beneficiary premium, which helps calculate plan-specific basic premiums. It also placed a $35 limit on participating PDPs’ plan-specific year-over-year premium increases, and it adjusted risk corridors to allow greater government risk sharing for potential losses experienced by PDPs.  

Policy changes to the Medicare Part D benefit that were included in the Inflation Reduction Act, namely a $2,000 out-of-pocket drug costs cap, will lead to lower out-of-pocket spending for some Part D enrollees but higher costs for Part D plans overall in 2025, according to a KFF analysis.

Six in 10 enrollees in Medicare Advantage Prescription Drug (MA-PD) plans will be in a plan that charges a deductible for drug coverage if they stay in their current plan, compared with just 21% in 2024. The average drug deductible charged by MA-PD plans will increase four-fold from $59 in 2024 to $225 in 2025. In addition, a larger share of MA-PD enrollees will be in plans charging coinsurance rather than flat copayments for preferred brands and nonpreferred drugs: 28% will be required to pay coinsurance for preferred brands versus 2% in 2024, and 57% will face coinsurance for nonpreferred drugs versus 11% in 2024.

Manufacturers of two high-cost gene therapies for sickle cell disease recently agreed to participate in CMS’s Cell and Gene Therapy Access Model, which is set to launch next year. The deals could allow the companies to more widely market their treatments and improve access for Medicaid beneficiaries, although it remains to be seen how many states will choose to participate in the voluntary model. 

CMS said in a Dec. 4 press release that it is seeking to have state Medicaid agencies join the model via an application process that runs through the end of February. The agency will then strike outcomes-based agreements (OBAs) with Vertex Pharmaceuticals Inc. and CRISPR Therapeutics, the manufacturers of Casgevy (exagamglogene autotemcel), and Bluebird Bio Inc., the manufacturer of Lyfgenia (lovotibeglogene autotemcel). Casgevy and Lyfgenia were both approved on Dec. 8, 2023, to treat sickle cell disease, a genetic blood disorder that is primarily found in Black people. States that choose to participate have until Jan. 1, 2026, to implement the model, which will run for six years. Patients will be followed for five years to track outcomes.