FEDERAL LEGISLATIVE UPDATES
Biologics and Importation
Biologic drugs make up a small portion of prescriptions but can cost thousands of dollars. They are one of the main drivers of drug spending in the country and have little competition. The current language in the U.S.-Mexico-Canada Agreement (USMCA) gives branded biologics – drugs that are made from living organisms rather than synthetic chemicals – 10 years of protection from cheaper alternatives. Now, the administration is reportedly considering scaling back the protections to allow cheaper, generic versions of biologic drugs to come to the market quicker. The change would leave it up to the individual countries to set their own laws on biologics. In the U.S., current law protects patents for 12 years, but in Mexico the period is five years and in Canada it is eight.
The Food and Drug Administration issued a proposed rule that would allow states to pursue pilot programs to import drugs from Canada and draft guidance that would allow drug makers to import their own products and sell them under different drug codes. The proposed rule lays the groundwork to allow the importation of certain drugs could help to make medicine more affordable for the American public in the foreseeable future but the proposed pathway that would allow states and other non-federal government entities to ask the Food and Drug Administration to review and authorize their importation plans – perhaps with a pharmacist, wholesaler, or other entity as a cosponsor – excludes biological products. States wouldn’t be allowed to import biologics, including insulin, but drug makers could do so under the second regulatory avenue detailed in the draft guidance.Excerpted from The Hill, “Trump targets drug protections to save trade deal”; Modern Healthcare, “HHS moves forward with prescription drug import plan”; and Healthleaders, “Why Insulin Is Ineligible for Buyer-Led Drug Importation Under Trump’s Proposal”
STATE LEGISLATIVE UPDATES
Michigan governor signs bill to allow remote pharmacies. People will be able to pick up prescriptions at certain pharmacies in Michigan that are not staffed by an on-site pharmacist under legislation signed by Gov. Gretchen Whitmer.
The measure allows for “remote” pharmacies, which proponents support as a way to expand access to pharmacy services and improve health outcomes in rural and underserved areas. Pharmacists at “parent” pharmacies will be able to use a real-time audio and video link to review a prescription before it is dispensed by pharmacy technicians.
A remote pharmacy generally cannot be located within 10 miles of a regular pharmacy, unless it gets a waiver from regulators. A remote pharmacy can dispense an average of 150 prescriptions a day.Excerpted from Modern Healthcare, “Michigan Governor Signs Bill to Allow Remote Pharmacies”
Massachusetts outlines deal for Zolgensma, a one-time infusion that replaces a defective gene in babies born with spinal muscular atrophy. Early results are promising. The drug hit the market last June, priced at $2.1 million dollars.
If it works, we pay. If not, we get most — if not all — of our money back. That’s the gist of a deal the Massachusetts Medicaid program, MassHealth, has reached for one of the most expensive drugs on the market.
State payments, evaluations and refunds if the drug is not effective would stretch over five years. Novartis routinely offers a five-year payment plan for Zolgensma. The company said in a statement that these so-called value-based or outcomes-based agreements are becoming routine as well. It says it is in “active discussions” with Massachusetts. Such agreements aren’t routine within Medicaid. Massachusetts is one of just a few states with approval from the Centers for Medicare and Medicaid Services to pursue these deals.Excerpted from Wbur, “Mass. Outlines Deal For A $2 Million Drug: Pay Only If It Works”
Lawmakers who want to tackle the high cost of prescription drugs in a short legislative session rolled out a bill that caps the monthly cost of insulin at $50. Connecticut’s bill also would limit the price of insulin-related supplies, such as syringes, pumps and blood sugar meters, to $100 a month.
The measure is more aggressive than similar efforts in Illinois and Colorado, which last year championed legislation capping insulin costs for users. Under laws passed in Colorado and Illinois, the price of a 30-day supply of insulin is capped at $100. Insurance companies must absorb the balance.
The legislation also includes a provision giving pharmacists the authority to dispense insulin without a prescription in emergency situations, as well as, a plan to set up an emergency fund for people who can’t otherwise afford the medication.Excerpted from The CT Mirror, “Insulin bill would cap monthly supplies of drug at $50”
A fight is coming to California over whether to list one of the world’s most common over-the-counter drugs as a carcinogen, echoing recent high-profile battles over things like alcohol and coffee. The drug is acetaminophen, known outside the U.S. as paracetamol and used to treat pain and fevers. It is the basis for more than 600 prescription and over-the-counter medications for adults and children, found in well-known brands like Tylenol, Excedrin, Sudafed, Robitussin and Theraflu.
Acetaminophen has been available in the U.S. without a prescription since 1955. Concerns about its potential link to cancer come from its relationship to another drug: phenacetin. That drug, once a common treatment for headaches and other ailments, was banned by the FDA in 1983 because it caused cancer.
“The Consumer Healthcare Products Association, a trade group representing over-the-counter medicines and dietary supplements, conducted its own review and found most studies suggest no risk for most forms of cancer, although some studies did show increased risk for kidney, liver and some forms of blood cancer.“ — ABC News
The Consumer Healthcare Products Association, a trade group representing over-the-counter medicines and dietary supplements, conducted its own review and found most studies suggest no risk for most forms of cancer, although some studies did show increased risk for kidney, liver and some forms of blood cancer.Excerpted from ABC News, “California considers declaring common pain killer carcinogen”
Diplomat & OptumRx
The companies said Diplomat, which is a provider of specialty pharmacy and infusion services, will combine with the OptumRx pharmacy benefit management company. Optum will pay Diplomat “$4.00 per share through a cash tender offer and assumption of outstanding debt, ” the companies said. Financial terms include the $300 million cash price plus the assumption of more than $560 million in debt. In buying Diplomat, executives involved say the company brings “expertise in managing specialty medications that treat patients with complex diseases, such as oncology and immunology, and provides specialized infusion therapies offered in convenient and clinically appropriate settings in all 50 states and Washington, D.C.” The addition of Diplomat comes as Optum executives begin to roll out what they hopes will be a “city-by-city” effort to make medical care more seamless to patients.Excerpted from Forbes, “UnitedHealth’s Optum To Buy Diplomat Specialty Pharmacy For $300M”
Express Scripts & Prime Therapeutics
Cigna’s Express Scripts pharmacy benefit management unit and a PBM owned by 18 Blue Cross and Blue Shield plans have joined forces to tame drug costs for a massive client list that covers 100 million people. Express Scripts and Prime Therapeutics said their new three-year collaboration is “designed to deliver more affordable care for clients and their members by enhancing pharmacy networks and pharmaceutical manufacturer value.” The collaboration will allow Prime’s member Blue Cross health plans to gain leverage through Express Scripts’ buying clout and large pharmacy network. The collaboration could put pressure on drug makers that are already under fire for rising prescription costs at a time the pharmaceutical industry is already taking heat and facing bipartisan legislation wending its way through Congress that appears to have the support of the Trump administration. PBMs are the middlemen between drug makers and patients when it comes to purchasing drugs in bulk and leveraging their buying clout to negotiate better discounts for consumers and employers on prescription drugs.Excerpted from Forbes, “Cigna’s Express Scripts And Big Blue Cross PBM In Major Deal To Tame Drug Costs”
DRUG PRICE INCREASES — GENERIC LABELS
Several major U.S. drug manufacturers announced price increases for more than 330 drugs, and the price hikes in most cases have taken effect. The increases remain below 10% because under pressure from politicians and consumers, drug companies promised to cap their U.S. drug price increases at that rate.
According to GoodRx, which tracks the cost of more than 3,500 drugs, the cost of 411 drugs have increased an average of 5%, most of them are brand name drugs. The drug with the biggest cost increase so far this year: Neos Therapeutics’ Cotempla XR, a stimulant used to treat ADHD and narcolepsy, whose list price is up more than 13%. Other commonly prescribed drugs that are getting pricier include Eliquis (up 6%), often prescribed to prevent blood clots, and Humira (7.4%), used to treat inflammation in patients with autoimmune disease. While some consumers will feel the pinch, others will not notice the difference in prices, said Eric Pachman, president and co-founder of 3 Axis Advisors. Several factors will determine who’s affected and to what extent, including the type of insurance your employer has, and whether you’re in your deductible phase or not, he said.Excerpted from Dayton Daily News, “U.S. drug makers raise prices on more than 330 drugs” and CBS News, “2020 is three days old and drug prices are already jumping”
California Discussing Generic Prescription Label
California could become the first state with its own prescription drug label under a proposal Gov. Gavin Newsom unveiled. Newsom wants California, home to nearly 40 million people, to contract with generic drug companies to make prescription medications on its behalf so it could then sell them to the public. The goal, according to the governor’s office, is to lower prices by increasing competition in the generic market. An example could be insulin for diabetes patients. The drug has been on the market for decades and has steadily increased in price. Three drug companies control most of the market for insulin.Excerpted from Modern Healthcare, “California could launch generic prescription drug label” and CBS News, “California could create a prescription drug label, a first among states”
Blue Cross Partners with Civica Rx to Champion Generics
The Blue Cross Blue Shield Association has partnered with Civica Rx to make generic drugs in a bid to avoid high prices, and is wanting more insurers to join them. The association – which represents 18 Blue Cross insurers – is the first payer to partner with Civica, a nonprofit consortium of hospitals that make their own generic drugs to combat shortages and price spikes. The subsidiary will acquire and get FDA approval for the generics and Civica, along with its manufacturing partners, will make the products. Civica and BCBSA expect to have the first generic drugs available on the market by 2022.Excerpted from FierceHealthcare, “BCBSA becomes first payer to join hospital-led Civica Rx to make generics”
RARE DISEASES & GENE THERAPY
Fairness in Orphan Drug Exclusivity Act
Drug companies developing medications for extremely rare diseases could lose their longer exclusivity period if they later turn a profit under changes to the drug approval process Congress is set to debate.
The bill would change the way research and development costs are calculated to stop potentially profitable drugs from getting the extra exclusivity and other financial benefits that come with orphan drug designation. The orphan drug law encourages drug companies to develop treatments for rare diseases. It gives drug companies seven extra years of exclusivity for a product, among other perks, if the drug treats less than 200,000 people. Companies can also win the designation if they can show that sales of the drug won’t cover research and development costs. While at least three drugs have been approved using that low sales argument, critics say some of the drugs given that special status by the Food and Drug Administration have gone on to make billions for drug companies.Excerpted from Bloomberg Law, “Rare Disease Drugs Turning Huge Profits Catch Congress’ Eye”
Gene Therapy Keeping Costs from Negating Its Unprecedented Potential
In addition to those already approved, numerous gene therapies are in development, which could help treat, and even cure, other previously untreatable conditions. Some target relatively rare monogenic illnesses, such as cerebral adrenoleukodystrophy, Sanfilippo syndrome, and adenosine deaminase deficiency. However, treatments in development, with potential approval and market launch expected by 2021, also include much more common genetic disorders like hemophilia A and B, which together have a prevalence of at least 20,000 individuals in the United States. An estimated 70,000-100,000 Americans have sickle cell disease. Muscular dystrophy affects more than 200,000 Americans. Both conditions could potentially have gene therapies available by 2023.
A gene therapy treatment, which can effectively cure the disease, could not only prevent much suffering but also lead to cost savings in the long-term from a reduction in the attendant costs of care.
While the life-changing and life-saving potential of gene therapies is tremendously exciting, finding ways to pay for these treatments is a significant challenge for families and payors. With prices for a single treatment as high as $2 million, many employers are struggling to find ways to offer coverage without bankrupting their health plans, or even their companies. What’s more, these costs will hit plans – and the health care system – in one massive blow rather than being spread out over time.CVS Health, Gene Therapy: Keeping Costs from Negating its Unprecendented Potential
NEW DRUG RELEASES
Palforzia - First peanut allergy drug approved by FDA
The therapy isn’t a cure and comes with significant risks of triggering the very reactions it is supposed to quell. But for families and children who have re-engineered their routines to minimize potential exposures – changing how and whether they travel, eat out, socialize and feel safe in their daily lives – it could offer an important layer of protection and relief.
Even with strict avoidance, inadvertent exposures can and do occur. When used in conjunction with peanut avoidance, Palforzia provides an FDA-approved treatment option to help reduce the risk of these allergic reactions,” said Peter Marks, director of the Food and Drug Administration’s Center for Biologics Evaluation and Research.Excerpted from Washington Post, “First peanut allergy drug approved by FDA”
Voltaren and Pataday - FDA Approves Three Drugs for Nonprescription Use Through Rx-to-OTC Switch Process
The U.S. Food and Drug Administration approved three drugs for nonprescription, or over-the-counter (OTC), use through a process called a prescription (Rx)-to-OTC switch. The FDA approved Voltaren Arthritis Pain (diclofenac sodium topical gel, 1%) for the temporary relief of arthritis pain; Pataday Twice Daily Relief (olopatadine HCl ophthalmic solution/drops, 0.1%) for the temporary relief of itchy and red eyes due to pollen, ragweed, grass, animal hair or dander; and Pataday Once Daily Relief (olopatadine HCl ophthalmic solution/ drops, 0.2%) for the temporary relief of itchy eyes due to pollen, ragweed, grass, animal hair or dander, for nonprescription use.
For a drug to switch to nonprescription status, the data provided must demonstrate that the drug is safe and effective for use in selfmedication as directed in proposed labeling. The manufacturer must show that consumers can understand how to use the drug safely and effectively without the supervision of a healthcare professional.Excerpted from Food and Drug Administration News Release, “FDA Approves Three Drugs for Nonprescription Use Through Rx-to- OTC Switch Process”
Nexletol - FDA approves drug that lowers cholesterol in a new way
U.S. regulators approved a new type of cholesterol-lowering drug aimed at millions of people who can’t tolerate – or don’t get enough help from – widely used statin pills like Lipitor and Crestor. High LDL, or bad cholesterol, is one of the top risks for heart attacks and other problems. Studies showed that Nexletol could lower LDL by about 25% when taken alone and by an additional 18% when combined with a statin.
“Millions of people take cheap, generic statins, but the medicines don’t lower LDL cholesterol enough for many patients and others experience side effects such as muscle pain.“ — Modern Healthcare
Millions of people take cheap, generic statins, but the medicines don’t lower LDL cholesterol enough for many patients and others experience side effects such as muscle pain. Other options include Zetia pills, also sold in generic form as ezetimibe for about $13 to $50 a month.Excerpted from Modern Healthcare, “FDA approves drug that lowers cholesterol in a new way”
Immune cell that kills most cancers discovered by accident by British scientists
A new type of immune cell which kills most cancers has been discovered by accident by British scientists, in a finding which could herald a major breakthrough in treatment. That new immune cell carries a never-before-seen receptor which acts like a grappling hook, latching on to most human cancers, while ignoring healthy cells.
In laboratory studies, immune cells equipped with the new receptor were shown to kill lung, skin, blood, colon, breast, bone, prostate, ovarian, kidney and cervical cancer.Excerpted from The Telegraph, “Immune cell that kills most cancers discovered by accident by British scientists”
The financial burden of cancer treatments prices some out completely
According to the findings of the study, “The High Cost of Cancer Treatment,” the latest cancer therapies are extending the lives of cancer patients, but that not all Americans can benefit because some cannot afford the treatments.
Not surprisingly, drug and radiation treatments are responsible for high costs to both insurance plans and consumers. The study noted that, depending on the type of cancer and the drugs used, the average monthly cost of chemotherapy drugs can range from $1,000 to $12,000. Even with insurance, a cancer patient requiring four chemo visits a year could be responsible for more than $10,000 a year in out-of-pocket costs, depending on their plan.Excerpted from BenefitsPRO, “The financial burden of cancer treatments prices some out completely”
For now, Facebook Preventative Health is keeping it simple and relatively unthreatening. Users must opt into the feature and in return they get push notifications suggesting they engage in various preventative health measures, such as an annual physical or a flu shot. The tool takes into account a user’s age and gender in its recommendations. For instance, it might advise a 50-year-old to get screened for colorectal cancer.
In early 2018 Facebook was in talks with hospitals in the hopes of getting access to patient data. The idea was that Facebook could compare a patient’s medical information with his or her activity on Facebook, since a person’s online activity can provide valuable insights that may help medical providers target certain patients for special treatment.Excerpted from BenefitsPRO, “Facebook is getting into the health care game”
In 2016, Imran Cronk launched Ride Health, a company that developed a real-time transportation coordination platform. The web-based and mobile-enabled platform connects health plans and healthcare providers to a national network of transportation providers, whether that’s a ride-hailing company or a mom and pop transportation company. Most recently, they announced, they will partner with Uber Health.
The company’s platform integrates with dispatch, clinical, and customer relationship management systems to deliver real-time visibility and decision support, the company said. The company also tracks ride-level performance data and feedback to produce a rating of both the quality of service and cost of a ride.Excerpted from FierceHealthcare, “He drove a stranger home from the hospital. Now, his company’s partnered with Uber on medical transportation”
Moderna Therapeutics is working with Amazon’s cloud service to deliver a new class of medicines that apply messenger RNA, which is the “software of life,” CEO Stephane Bancel said Wednesday. The biotech company is undergoing clinical trials with mRNA, a single-stranded molecule used to make protein in cells, to develop personalized cancer vaccines.
“We have a phase two study going on where we are designing every product for every patient,” he said in a “Mad Money” interview. “So we start by taking a biopsy of a cancer, we next-gen sequence it, we nextgen sequence a healthy cell of a body [and] we send everything to AWS” in order to “compare every letter of a DNA ... of a healthy cell and a cancer cell, and from that we deduce what do we need to do in our product just for your cancer.”Excerpted from CNBC, “How Moderna is using Amazon cloud to produce personalized cancer vaccines”