Radar on Specialty Pharmacy

The year after President Joe Biden signed the Inflation Reduction Act (IRA) into law, policymakers have now focused their efforts on PBMs and their business models. Members of Congress on both sides of the aisle have introduced multiple bills focusing on issues such as the lack of transparency into PBM practices, spread pricing, direct and indirect remuneration (DIR) clawbacks, rebates and anticompetitive behavior. And some industry experts say they are hopeful that such legislation could improve transparency around drug pricing, including in the high-cost specialty arena.

There was much talk but little action around bringing down prescription drug prices during the previous administration, which floated tactics such as implementing a most-favored-nation model that would have tied drug prices in Medicare Parts B and D to other countries’ prices, lowering prices for insulin and distributing $200 prescription drug credits to Part D beneficiaries.   

Plan sponsors’ use of copayment accumulators, copay maximizers and alternative funding companies to keep spending on specialty drugs down has been a fairly recent trend but one that continues to pick up speed, noted longtime industry expert Adam J. Fein, Ph.D., CEO of Drug Channels Institute, during a recent webinar. But as that use continues to increase, multiple questions exist around the practices and what the future holds for them.

The focus of the June 23 webinar, titled PBMs and the Battle Over Patient Support Funds: Accumulators, Maximizers, and Alternative Funding, mainly affects specialty drugs, which now represent more than half of payer spending on drugs due to two main reasons, he said. The first is the specialty drug pipeline and the costly prices of those agents, while the second is the dramatic growth in generic dispensing over the past 20 years.

The FDA recently expanded the indication of AbbVie Inc.’s Rinvoq (upadacitinib), making it the first oral treatment and the first Janus kinase (JAK) inhibitor for Crohn’s disease. Still, the agent is entering a highly competitive class in which manufacturer rebates play a big role. And while respondents to a Zitter Insights survey said the drug will somewhat lessen the unmet need in the treatment of the condition, they said that a moderate level of need still exists with the agent’s approval.

On May 18, the FDA expanded the label of Rinvoq to include the treatment of adults with moderately to severely active Crohn’s disease who have had an inadequate response or intolerance to at least one tumor necrosis factor (TNF) inhibitor. The agency initially approved the JAK inhibitor on Aug. 16, 2019. This is the seventh indication the drug has gotten across rheumatology, dermatology and gastroenterology.

As expected, early July saw the launch of multiple biosimilars of AbbVie Inc.’s Humira (adalimumab). Most of them launched with wholesale acquisition costs (WACs) just slightly less than that of the reference drug, but a few undercut that price fairly significantly.

Of the eight agents (including a branded and an unbranded version of Hyrimoz (adalimumab-adaz) from Sandoz, a division of Novartis Pharmaceuticals Corp., which will be spun off into a new publicly traded standalone company in the second half of this year), five launched with a WAC 5% off Humira’s $6,922 price tag:

Eisai Co., Ltd. and its partner Biogen, Inc. crossed over the biggest barrier in their quest to commercialize Leqembi (lecanemab) now that Medicare will cover the cost of the Alzheimer’s disease drug. The next hurdles for doctors and patients will be obtaining blood tests and PET scans for confirming amyloid pathology in the brain, genetic testing to assess APOE4 status, MRIs to monitor for amyloid-related imaging abnormalities (ARIA) and infusion centers to administer the medicine — facilities that exist, but not in the numbers and locations needed to serve all of the US patients eligible for treatment.

CMS said that it will cover the cost of Leqembi on July 6, the day that the FDA converted the amyloid protofibril-targeting antibody’s accelerated approval for the treatment of mild cognitive impairment or mild dementia associated with Alzheimer’s disease (AD) into full approval. Eisai and others believe that while uptake of Leqembi will be slow as the health care system catches up with the diagnostic, monitoring and infusion requirements associated with the therapy, Medicare coverage gives providers the confidence they need to offer those services.