Spotlight on Market Access

As manufacturers continue to bring more advanced therapies onto the U.S. market, payers are grappling with how to afford these agents. And while the products may be life-changing for some patients, they may not have the desired outcome in others, leaving payers on the hook for an unsuccessful treatment. This has resulted in various contracting opportunities, including warranties.

While such agreements can make payers more confident in their coverage of treatments, particularly high-cost ones and products whose effectiveness or durability are uncertain, they also are beneficial for pharma companies, which are seeing utilization of their therapies.

Select Health is the wholly owned health insurance unit of Intermountain Healthcare, a Salt Lake City-based health system of 33 hospitals. Select Health is the largest insurer in Utah and also has a presence in Idaho, Nevada and Colorado. The majority of Select Health’s members are enrolled in commercial risk-based products, with the insurer holding a robust Affordable Care Act exchange presence in Utah and Idaho, leading both states' exchange markets. Select Health also holds a Medicaid contract in Utah and has expanded its Medicare Advantage presence in recent years. Intermountain successfully merged with Colorado system SCL Health in 2022 and spearheaded the founding of Civica Rx, a nonprofit generic drug manufacturer that focuses on drugs in short supply or those with high mark-ups.

Although the FDA has approved five biosimilars of Regeneron Pharmaceuticals, Inc.’s best-selling Eylea (aflibercept), patent infringement lawsuits by the drugmaker have kept those competitors off the U.S. market — until now. Following a successful defense of its Pavblu (aflibercept-ayyh), Amgen Inc. recently launched the drug at risk. The agent is entering an increasingly crowded therapeutic class, but it’s one that’s also costly for payers, which may be seeking some savings, say industry experts. But is its price good enough to pull market share?

Small-molecule drugs and biologics may produce similar health benefits, but because small molecules tend to be priced lower than biologics, they often represent better value, according to a recent Health Affairs study. And the study authors argued those findings suggest it could be worth revising how the Medicare Drug Price Negotiation Program is set up.

The Inflation Reduction Act of 2022 requires that Medicare negotiate a Maximum Fair Price for selected small-molecule drugs nine years after they were approved by the FDA. Whereas for selected biologics, the negotiated price takes effect after 13 years.

The second administration of Donald Trump may well run the gamut as far as its impact on health care and pharma. Biotech companies may benefit from a good business environment, prompting more mergers and acquisitions, but they may also experience challenges in working with what could be somewhat unconventional leaders of federal agencies, such as Robert F. Kennedy Jr., whom President-elect Trump tapped on Nov. 14 to run HHS.

RFK Jr., a politician and environmental activist who has questioned the safety and efficacy of vaccines and spread misinformation about them, has said that “there are entire departments, like the nutrition department, at FDA that have to go, that are not doing their job.”