Major News On GLP-1 Weight-Loss Drugs
Denmark-based Novo Nordisk CEO Lars Fruergaard Jørgensen appeared before the Senate HELP Committee today but refused to absolutely commit to reducing the price of his GLP-1 weight-loss drugs, Wegovy and Ozempic. In a usual tactic for brand drug makers, the CEO blamed pharmacy benefits managers (PBMs) for the high costs of such drugs as they do not largely pass-through rebates to consumers at the point of sale. But what the CEO did not mention is that net prices for his drugs in the U.S. would still be measurably higher than in other developed countries.
Brand drug makers are making money hand over fist on their drugs and could easily solve the issue by lowering their list prices to reasonable levels and getting rid of rebates altogether. The truth is the brand drug makers and PBMs both benefit from the opaque rebate scheme. The rebate protects brand drugs’ market share.
The CEO argued that lower costs would not ensure that PBMs would keep providing coverage if prices went down and rebates went away. The astute and indefatigable Chairman, Sen. Berine Sanders, I-VT, pushed back and said that PBMs confirmed to him that they would not suddenly change their coverage of the drugs. The CEO was skeptical.
Sanders also attacked on the issue of price disparity with other developed nations. Sanders pointed out that Americans with diabetes pay as much as $969 per month for Ozempic. The same drug can be purchased for $155 in Canada, $122 in Denmark and $59 in Germany. The Wegovy price disparity is similar. “Treat the American people the same way that you treat people all over the world,” Sanders said. “Stop ripping us off.” Well said. Go Bernie!
As I have argued, the solution may be to outlaw rebates altogether as kickbacks. Reform the system by having all drugs be net prices and then have drugs fight for formulary space based on clinical effectiveness over others.
In other news on the GLP-1 front:
- A group of House and Senate Democrats are backing drug pricing advocates’ idea to use a little-known patent-breaking law, which requires companies to allow the government to license drugs. The government would then allow generic drug makers to produce the drugs. A major generic maker told Sanders it could produce and sell a GLP-1 for under $100 a month.
- Generic drug makers are asking Congress to pass more protections for generic introduction, including reforming patent thickets.
Additional articles: https://www.modernhealthcare.com/politics-policy/ozempic-wegovy-novo-nordisk-pbm-pharmacy-benefit-managers-bernie-sanders and https://insidehealthpolicy.com/daily-news/lawmakers-push-1498-statute-cut-glp-1-drug-prices-generic-lobby-seeks-broader-reform and https://www.beckershospitalreview.com/pharmacy/novo-nordisk-ceo-open-to-glp-1-price-drop-5-takeaways.html and https://insidehealthpolicy.com/daily-news/aam-calls-action-boost-generics-market-hatch-waxman-anniversary
(Some articles may require a subscription.)
#drugpricing #branddrugmakers #glp1s #weghtlossdrugs
AMCP Has Potential List Of Next Drugs Subject To Price Negotiations in Medicare
AMCP has published in their journal a study that seeks to identify the leading drugs that will be announced as the next 15 to have price negotiations in Medicare. Using criteria in the Inflation Reduction Act as well as current and expected spending, AMCP identified 13 likely drugs and another 7 possible candidates.
#ira #drugpricing #branddrugmakers
https://www.jmcp.org/doi/10.18553/jmcp.2024.24167
Senate GOP Fearful Of Trump Push for ACA Repeal
GOP senators, some public and others in private, are urging former President Trump to stay away from another battle over the Affordable Care Act (ACA). Two senators who voted against repeal in 2017 are still in the Senate and many others are also urging caution. The House GOP is far more radical on the issue. And the senators are now worried as VP candidate JD Vance told an interviewer that one option would be to introduce something akin to high-risk pools. This and other half-baked ideas were proposed back in 2017 and would have led to a huge erosion of coverage. As some of the senators now note, the ACA is woven into the fabric of the healthcare system. They are right.
#healthcarereform #aca #exchanges #medicaid #election2024
https://thehill.com/policy/healthcare/4895188-trump-avoid-healthcare-reform
McKinsey Explains MA Financial Pressures
A good white paper from McKinsey explaining the numerous financial pressures and headwinds hitting Medicare Advantage (MA) plans. The authors note, MA plans are facing up to $80 per month in lost revenue per member in 2025. McKinsey also discusses possible levers MA plans can pull to get back to adequate margins.
In other news, Becker’s Hospital Review also lists 25 hospitals or healthcare systems that have termed MA plans in 2025. MA plans will reduce benefits, increase premiums, and exit certain markets due to the headwinds the industry is taking.
Additional article: https://www.beckershospitalreview.com/finance/15-health-systems-dropping-medicare-advantage-plans-2024.html
#medicareadvantage
Harris Plan To Cap Commercial Out Of Pocket Drug Costs Somewhat Panned
Kamala Harris is proposing to cap commercial out-of-pocket (OOP) costs in the commercial world at the Medicare level of $2,000 (in 2025). But analysis suggests it would impact few and lead to higher costs in other areas. Less than 1% of people in employer plans would benefit. And one analyst speculated it would be paid for by higher OOP costs for other services.
Let’s remember that the IRA capped OOP costs in Medicare Part D and we are now seeing a huge surge in premiums because the Democrat-sponsored bill did not fund the costs. Thus, plans had to cut benefits elsewhere or raise premiums.
#harris #election2024 #drugpricing
https://www.beckershospitalreview.com/strategy/harris-drug-spending-cap-plan-4-things-to-know.html
— Marc S. Ryan
