Future therapies’ costs worry Medicaid programs

Delivered every Tuesday and Friday by 12 p.m., Prescription Pulse examines the latest pharmaceutical news and policy.

Oct 12, 2022 View in browser   By Lauren Gardner and David Lim With Megan R. Wilson Drug Pricing Expensive specialty drugs on the horizon could wreck havoc on state budgets. | Michael Dwyer/AP Photo WHAT COMING BLOCKBUSTER DRUGS COULD MEAN FOR MEDICAID — Last month's approval of a controversial and pricey drug for amyotrophic lateral sclerosis, plus the prospect of another Alzheimer's treatment winning accelerated approval in January, got us thinking — the implications for Medicare are pretty clear, but what about Medicaid, which is required to cover FDA-approved drugs? It's not an apples-to-apples comparison, Lauren found after talking to Medicaid experts. Medicare will likely pick up the bulk of the tab on both treatments (keeping in mind one approval hasn't happened yet). Medicaid is typically responsible for cost-sharing obligations for dually enrolled beneficiaries on Part B drugs, which is why the controversial Alzheimer's treatment Aduhelm caused a stir in that program, too. But if the prospective Alzheimer's drug lecanemab is approved and covered under the same restriction as Aduhelm — that patients are enrolled in a required confirmatory trial — "likely the concerns for Medicaid aren't that high from just a cost-exposure perspective," said Jack Rollins, director of federal policy at the National Association of Medicaid Directors. And it's worth noting that ALS is a condition for which patients may be eligible to enroll in Medicare before age 65, meaning Relyvrio, the powder medication FDA approved in September, could be covered under Medicare Part D, which leaves Medicaid off the cost-sharing hook. Blockbusters to watch out for: Medicaid experts say states are closely watching the ongoing development of cell and gene therapies over the next several years, especially those targeting illnesses affecting pediatric and non-white populations. Those specialty drugs may potentially be curative, but high upfront costs in the millions of dollars, plus a small-but-uncertain pool of patients who could benefit, could wreak havoc on state budgets in the future. One example is Zynteglo, which the FDA approved in August as the first cell-based gene therapy to treat beta thalassemia, a blood disorder that can require regular red blood cell transfusions. Donna Sullivan, the Washington State Health Care Authority's chief pharmacy officer, told Lauren her state had identified about five or six Medicaid clients who are transfusion-dependent and could be candidates for the treatment, which has a list price of $2.8 million for a one-time treatment. The authority is also watching drugs at a more "moderate" price point — in the tens of thousands annually — that are prescribed to a larger population covered by Medicaid, such as HIV and cystic fibrosis treatments taken over a patient's lifetime. IT'S WEDNESDAY. WELCOME TO PRESCRIPTION PULSE. Feline friends, rejoice — an NIH study dubbed CATNIP, naturally) suggests a monoclonal antibody-allergy shot combination may provide long-lasting relief to cat allergy sufferers. Send tips and feedback to David Lim (dlim@politico.com or @davidalim), Lauren Gardner (lgardner@politico.com or @Gardner_LM ) or Katherine Ellen Foley (kfoley@politico.com or @katherineefoley). TODAY ON OUR PULSE CHECK PODCAST, Alice Miranda Ollstein shares with Krista Mahr a dispatch from her reporting in Pennsylvania and Michigan about doctors taking to the campaign trail ahead of the midterms. Plus, Dr. Katie McHugh on moving her abortion practice to other states. Listen to today's Pulse Check podcast In Congress Doctors are pressing Congress to overhaul the market for novel antimicrobial drugs. | Joe Raedle/Getty Images DOCTORS URGE PATIENT FOCUS IN ANTIBIOTICS BILL — Physicians are lobbying lawmakers to push through legislation that would overhaul the market for novel antimicrobial drugs. The objective is to make improving patient outcomes the chief priority for any new incentives created by Congress, Lauren reports. Doctors like Yale School of Medicine's Reshma Ramachandran and former FDA official John Powers argue that the bill, known as the PASTEUR Act. 3932, doesn't focus primarily on identifying and promoting new treatments that could be effective in treating patients with resistant bugs. Previous efforts by Congress to address antibiotic market challenges resulted in "more drugs, and none of them improved patient outcomes," said Powers, now a professor of clinical medicine at the George Washington University School of Medicine, who argues that's because the drugs aren't studied in the people who actually need them. Updated version: Sens. Michael Bennet (D-Colo.) and Todd Young (R-Ind.), two of PASTEUR's lead sponsors, have offered an updated version as an amendment to the fiscal 2023 defense authorization bill "based on feedback we received to ensure that the contracts are awarded to treatments that improve patient outcomes," a Bennet spokesperson said. The amendment also comes with a $6 billion price tag, down from $11 billion in the original version. But clinician advocates say the changes aren't enough. The bill's payments are another incentive "being tacked on for new antibiotics instead of thinking clinically, 'are these drugs going to address resistant infections we're seeing now?'" Ramachandran said.   TUNE IN TO THE PULSE CHECK PODCAST: Keep your finger on the pulse of the biggest stories in health care by listening to our daily Pulse Check podcast. POLITICO's must-listen briefing decodes healthcare policy and politics, and delivers reality checks from health professionals on the front lines. SUBSCRIBE NOW AND START LISTENING.     Eye on the FDA CDRH LAUNCHING TAP PILOT — The FDA is already moving forward on its Total Product Life Cycle Advisory Program Pilot for medical devices. In January, the agency will unveil a soft launch of its Medical Device User Fee Amendments V initiative. And the FDA plans to enroll up to 15 devices within its Office of Cardiovascular Devices' Office of Health Technology 2 in fiscal 2023. The pilot — which appears consistent with language in the MDUFA V commitment letter — aims to provide FDA feedback early in a medical device's development cycle to identify submission issues and help avoid setbacks. Initially, the pilot will focus on breakthrough designated devices before moving to include Safer Technologies Program devices in fiscal 2026. The agency is requesting feedback on the order in which the offices of health technologies should be added to the pilot, what information is helpful for manufacturer decision making and which specific patient groups, insurers and provider organizations are well-suited to provide insights on evidence-generation strategies for sponsors. Industry Intel BIO LEADER OUSTED OVER THE WEEKEND — The pharmaceutical world is trying to catch up with all the details surrounding what looks to be the ouster of ex-Biotechnology Innovation Organization CEO Michelle McMurry-Heath, who stepped down Monday evening amid turmoil between her and the association's board members, Megan reports. Industry lobbyists and executives say part of the reason for McMurry-Heath's departure stems from a push by certain board members to be more active in promoting social justice issues. (Megan urges you to call her if you know anything more — she can keep you anonymous.) McMurry-Heath, a doctor by training who last year had been on the Biden administration's shortlist to helm the FDA, reportedly resisted engaging on non-biotech issues. Trade association politics — and managing competing member interests and egos — can be brutal, but leading BIO comes with its own challenges: The group has several dozen people who sit on its board and roughly 1,000 members across the biopharmaceutical, agriculture sciences and biodefense industries. The Wall Street Journal first reported over the weekend that McMurry-Heath was "on leave. " By Monday evening, BIO announced she had resigned. Then, after 11 p.m. that same night, the group appointed an interim replacement: Rachel King, co-founder and former CEO of GlycoMimetics, a biotechnology company working to develop therapies for diseases like cancer. Quick Hits The Biden administration is ramping up its campaign to convince Americans to get a bivalent booster this month, but uptake to date is low, POLITICO's Krista Mahr and Adam Cancryn report. Document Drawer The FDA on Friday published a notice outlining generic drug user fee rates for fiscal 2023 after withdrawing a previously published version.   STAY AHEAD OF THE CURVE: Our Future Pulse newsletter will continue to bring you the biggest stories at the intersection of technology and healthcare, but now five times a week. Want to know what's next in health care? Sign up for our Future Pulse newsletter. If you aren't already subscribed, follow this link to start receiving Future Pulse.       Follow us on Twitter David Lim @davidalim Lauren Gardner @Gardner_LM Katherine Ellen Foley @katherineefoley   Follow us

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