Colorado PDAB Renders a Split Decision on Affordability for Enbrel and Genvoya

After a chill week, we’re back to drinking from the firehose.

One of the larger, if not sufficiently heralded, wins for the patient advocacy community last year was the effort to get the Colorado Prescription Drug Affordability Board to declare that Trikafta, a cystic fibrosis drug, was not unaffordable. Trikafta was the first of five medicines that the PDAB was assessing, and the big question after the Trikafta vote was whether it would be a precedent. 

The answer: not really. The PDAB considered two other drugs last week, finding Enbrel to be unaffordable but Genvoya to be affordable. That clears the way for the PDAB to price-control Enbrel, though, because this is the first time through the process, the outcome there is pretty hard to predict. (Cosentyx or Stelara have yet to be discussed by the group.)

Nonetheless, the PDAB’s reasoning on the three drugs it has weighed is worthy of note. With Trikafta and with Genvoya, a big part of the PDAB’s logic for sparing them from price controls was the reality that, for most patients, patient access programs and broad insurance coverage meant that affordability wasn’t a real concern. 

The board surveyed a couple dozen Genvoya patients, and not one was paying more than $100 a month for the medicine. That doesn’t mean that no one was struggling, but it put the problem in context. It’s similar to the phenomenon with Trikafta, where the board couldn’t really find any patients for whom cost was an issue, regardless of the list price. 

Enbrel went the other way: in the survey, nearly a quarter of patients said the medicine had left them with medical debt. Nine of 38 said they’d skipped doses. Ergo, per the PDAB’s logic: unaffordable. 

But all of this means, in some way, that the PDAB is no longer assessing whether the price of a medicine is appropriate. It’s measuring benefit design. A medicine that’s widely (and well) covered is going to be affordable. A medicine where insurers can play games with formularies is going to leave gaps. That seems like an issue with benefit design, not prices. How Colorado deals with that disconnect will be worth tracking.

I know that you all can tell that I’m ambivalent about the Orange Book brouhaha. I get that there are a lot of important people paying close attention to the topic, but absent some evidence that the companies targeted are actively weaponizing Orange Book listings, this just feels like an opportunity to kick pharma in the shins. 

On Friday, I linked to a low-context USA Today piece on the latest from Sen. Elizabeth Warren and Rep. Pramila Jayapal -- a letter from the members to the FDA -- but USA Today didn’t include the interesting bits. That letter said a bunch of companies have delisted their patents, which is being presented as a victory for the muckrackers. 

But -- far more fascinating to me -- is that Warren and Jayapal also released the letters they’ve received from the companies involved. And that communication really gets at the controversies at the heart of the matter. For the most part, companies have made explicit that they’re NOT weaponizing Orange Book listings to keep generic competition at bay. 

And the letters paint a picture of an industry that’s been trying to get clarity on what should and should not go in the Orange Book from the agency that actually oversees the listings: the FDA. And that effort to seek clarity is not going well. Boehringer Ingelheim noted that the industry has asked the FDA for clarification -- unsuccessfully -- at least five times over the past two decades.

And yet, somehow -- even despite the Warren/Jayapal letter -- the FDA is never at the center of this controversy.

There were two mind-expanding Health Affairs Forefront pieces published on Friday on how government price-setting under the IRA would work.

The first delves into the process by which the “ceiling prices” are set. You all know the basics here: the ceiling price is either a 25% haircut from a list price proxy (larger for drugs that have been on the market for a while) or the average net price in Part D. The government can go lower than that, but that’s the ceiling. 

But the reality is that the actual lowest net price -- the price that big commercial payers get, or Medicaid/340B -- might be a lot lower than the average net price used in the IRA calculation. So it’s possible that the final “maximum fair price” (MFP) could end up being higher than the price paid by other payers, only Medicare wouldn’t know that, because those other net prices aren’t publicly known. 

Per the authors: “It would appear inconsistent with a key policy goal of proponents of the IRA if the MFP limiting what manufacturers may charge Medicare were set above the actual average net price from most-favored commercial customers and, for those advocating sharply lower drug costs, the actual average price from all payers.”

The second piece posits an interesting hypothetical: what if manufacturers and Medicare agreed to a higher MFP but then tacked on a secret, supplemental rebate for Medicare? That way, it would appear to the outside world (and commercial payers!) like prices were higher, but Medicare would still get a sweetheart discount. That doesn’t feel very likely, but it’s fun to think about. 

I haven’t done either piece much justice in this writeup, so if you’re in the weeds on IRA and haven’t read ‘em, they’re worth the printer paper. Wonky but good.

• I cannot endorse enough this piece by RA Capital’s Chris Morrison and Renny Gleeson on the need for biopharma to be more aspirational in its advertising. Regardless of what you think of the Pfizer Super Bowl ad, it’s the right instinct. Well worth the read. 

• Earlier in the month, the judge overseeing four IRA lawsuits asked the four companies -- plus the government -- to propose an oral argument for early March. That process did not generate consensus. The companies are cool with one, four-hour hearing, either March 7 or March 8, but the government is objecting because briefings aren’t yet complete in a couple of the cases. Stand by … 

• This is a smart NPR article about Bayer’s move to sell certain birth control products via Mark Cuban’s pharmacy. On the one hand, it’s a little weird because insured patients can get birth control with no cost-sharing (thanks, Obama). On the other hand, there’s definitely a trend of people just avoiding insurance altogether, even if it costs them more. 

• I wish this STAT story was better sourced, but HHS is apparently considering modifying the rules governing marketplace health plans so that drugs banned in Medicare -- notably obesity meds -- can be offered in marketplace plans. 

• Nice op-ed from a biotech CEO arguing for the ORPHAN Cures Act -- a fix to the IRA’s limited protection of rare-disease drugs -- that makes the case that fewer patients will have access to rare diseases in the future if orphan drug provisions aren’t addressed.