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INFLECTION POINT/
From Zero to 60: How Imminent Is an IRA Fix? 

I had assumed that this was a consensus-building year when it came to reforms to the IRA. There are too many competing priorities, I figured, for lawmakers to truly focus on fixes to Medicare negotiations. 

But maybe I have that wrong. Endpoints’ Zach Brennan had a piece on Friday suggesting that pro-innovation voices are pushing hard for the EPIC Act -- that’s the bill that would fix the disparity between the treatment of biologics and small molecules -- which included this quote from Incubate’s John Stanford on EPIC: “This is our priority one, two and three.”

It’s one thing for folks like Stanford to be all-in on IRA fixes. But a CPAC-allied group is also making noise about having EPIC included in the big reconciliation bill this spring, which suggests a certain amount of support from the conservative base. 

I’m not a politics guy, so I’m loath to handicap any of this. I don’t know if there’s fire here right now, but I’m definitely seeing smoke. 

***

BTW: A different IRA fix -- the MINI Act -- which would address the “pill penalty” but protect a broader swath of medicines from price controls, has now been introduced. 

THE ARC/
Mesoblast Nails a Launch Price Disclosure

One of my biggest areas of focus is how companies announce the launch price of their medicines. I often treat this as a binary decision: you disclose or you don’t. 

But the reality is that there is a huge range of ways to disclose. The biggest distinction is between proactive and reactive disclosures, but you can subdivide even further, with a spectrum of transparency. 

At one end of that spectrum is the reactive disclosure of a per-dose price with no additional context. At the other end is a full-on, value-driven explanation of the price and the underlying logic. (Eisai remains the gold-standard example of what that looks like.)

Most of the time, we’re closer to the just-the-numbers end of the spectrum, but Mesoblast’s disclosure of the list price of Ryoncil, its stem-cell derived therapy for graft-vs-host disease, is a great example of what more robust disclosure looks like. (Here’s the deck, and here’s the press release.) 

Over a series of five slides, Mesoblast walks through the value proposition: there’s an unmet need, there is a high cost of inaction, Ryoncil makes a difference in both clinical and economic terms, and the actual price -- $194,000 per infusion (most patients will require eight infusions -- is well below the economically justifiable price. 

Is it perfect? I would have liked to have seen the math broken out or a callout to an HEOR paper, but I’ll take the high-level conclusions that the company proffered. Definitely a clip-n-save example of what launch-price transparency looks like. 

QUICK TURNS/
ICER, IRA, and Patient OOPs

ICER just published its analysis of Trelegy Ellipta and Breo Ellipta in the context of the about-to-kick-off IRA negotiations for those two drugs. There is not a simple, one-number answer to what an appropriately “negotiated” price is, so what you’re about to read is my gross oversimplification of a lot of work. 

My take is that the net prices on those products are not particularly high, but there are a lot of moving pieces from a comparator therapy POV. What CMS decides is a reasonable alternative, and how they parse the clinical data, may have an outsized impact on the ultimate price.

I’m not brave enough to draw a more detailed conclusion, but ICER does a good job of laying out the fundamentals of the closed-door discussions to come. 

ELSEWHERE

• Speaking of the next round of IRA “negotiations,” GSK -- which makes Trelegy and Breo -- told Endpoints it would participate in the next round of price setting. Ditto six other companies. The assumption is that everyone will end up playing ball here, but it’s worthwhile to see how different companies are framing up the negotiations. (Novo, for instance, told Endpoints that it “remain committed to working with new agency leadership to advance meaningful solutions for patients,” but didn’t explicitly mention whether they’ll start the process.)

• This is an elegant JAMA Health Forum piece illustrating how pharmacy markups on generic drugs hit Medicare patients right in the wallet. I’m not sure how this intersects with the 2024 bar on clawbacks, so I would take this mostly as a general reminder that the market for generic medicines -- which ought to be straightforward -- is not straightforward.

Cost Curve is produced by Reid Strategic, a consultancy that helps companies and organizations in life sciences communicate more clearly and more loudly about issues of value, access, and pricing. We offer a range of services, from strategic planning to tactical execution, designed to shatter the complexity that hampers constructive conversations. 

To learn more about how Reid Strategic can help you, email Brian Reid at [email protected].