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This past year was filled with news in the prescription drug policy area, from the Food and Drug Administration’s (FDA) most controversial drug approval in many years to ongoing discussions in Congress over drug pricing reform. Through it all, the importance of responding to the COVID-19 pandemic has remained at the forefront of these challenges.
In this post, I review five key developments from the past year and offer five items to watch for in 2022.
In June, the FDA approved Biogen’s aducanumab (Aduhelm) for the treatment of Alzheimer’s disease. But the agency’s first approval of an Alzheimer’s drug in nearly two decades was highly controversial. The agency’s own advisory committee voted overwhelmingly that Biogen’s clinical trials did not demonstrate sufficient evidence of effectiveness, the FDA used its already-controversial accelerated approval pathway to approve the drug (after disclaiming the pathway’s use during the advisory committee meeting), and the drug was initially approved with a label that was broader than many had anticipated.
The fallout from the FDA’s decision has unfolded over the last six months. Three members of the FDA’s advisory committee resigned in protest over the approval. Major hospital systems have refused to prescribe or administer the drug. Key insurers have declined to pay for the drug, given the lack of evidence of its clinical benefits. Just weeks after its initial approval, the FDA and Biogen agreed to significantly narrow the language on the drug’s label. The agency is now investigating the death of a patient who had been taking the drug during a trial.
Other consequences have stemmed from Biogen’s initial setting of a $56,000 price, for a drug with uncertain clinical efficacy. The Alzheimer’s Association itself criticized the price upon its release, a highly unusual move. Immediately after approval, experts quickly warned that the drug could have significant cost implications for Medicare and its beneficiaries, a concern which was borne out in November, when Medicare administrators attributed a significant portion of the 2022 increase in Part B premiums to the approval of Aduhelm. In late December, Biogen announced that it would cut the drug’s price in half, given weak sales, though a price of $28,200 is still several times higher than existing cost-effectiveness analyses.
The FDA’s choice has had—and will continue to have—serious implications for both the FDA and for health care policy more generally moving forward. Aduhelm’s approval has strengthened calls for reform of the FDA’s accelerated approval program, both as the drug approvals themselves are questioned and as insurers ask why they ought to provide reimbursement for drugs that lack evidence of clinical efficacy. The approval threatens to jeopardize the public’s trust in the FDA itself going forward, which may be especially problematic in the face of ongoing public health challenges, including the COVID-19 pandemic. And the agency’s decision may lead to a breaking of the traditional link between FDA approval and Centers for Medicare and Medicaid Services (CMS) reimbursement (more on this below, in 2022), to say nothing of the impact it has had already on Medicare beneficiaries’ premiums.
The FDA ended an already-busy 2020 by authorizing two vaccines against COVID-19—those from Pfizer/BioNTech and from Moderna—in record time. In 2021, the FDA had another incredibly busy year. The agency authorized a third vaccine (from J&J); fully approved Pfizer’s vaccine and extended its emergency authorization down to include people ages five and up; authorized several dozen diagnostic tests, including more than a dozen for home use; and ended the year by authorizing two antiviral pills against the disease.
The FDA has often faced criticism for moving too slowly to authorize or fully approve these products. This criticism was particularly prominent as the FDA was proceeding to analyze and fully approve Pfizer’s vaccine. After the agency had issued an emergency use authorization on December 11, 2020, Pfizer submitted its full approval application in May 2021, and the vaccine was fully approved on August 23, 2021, just a few months later. By any standards, this was an incredibly fast approval, occurring in approximately three months—even the agency’s Priority Review pathway is intended to take six months. And of course the vaccine itself was already available to patients and had been since the previous December. Full approval may have simplified the process for employers or other entities to mandate the vaccine, but it likely was not legally necessary.
But other features of this criticism have received less public focus. As the FDA’s former acting chief scientist said, “there should be no illusion that this comes at zero cost.” The prioritization of full approval for Pfizer’s vaccine (even putting aside the agency’s review of other COVID-19 products) likely meant that other projects would be deprioritized. Relatedly, news reports have recently emphasized the FDA’s rising backlog of manufacturing facility inspections, or the increasing frequency with which the agency is missing its targets to review applications to approve drugs for other, non-COVID-19 conditions. Importantly, those approval delays come for drugs that are not yet available under authorization for patients, unlike the COVID-19 vaccines.
In 2021, there was a significant amount of discussion at the federal level about drug pricing reform, but little has changed yet. From a legislative perspective, in November, the House of Representatives passed the Build Back Better bill, which includes significant drug pricing reforms to seniors’ out-of-pocket costs in Medicare Part B, mandatory rebates for pharmaceutical companies whose price increases outpace inflation, and Medicare drug price negotiation (though in a form more limited than the previous version articulated in H.R. 3). But with Senator Joe Manchin (D-WV) currently opposed to the form of the law in general, its future remains unclear.
In the absence of legislative changes, the Biden Administration has begun to signal potential administrative moves, but has yet to take significant action. In early September, the Biden Administration released its Comprehensive Plan for Addressing High Drug Prices, a report that centered the role that a lack of competition plays in establishing—and maintaining—high drug prices. The FDA itself has begun to take additional actions to assert its role in ensuring that pharmaceutical companies are not seeking to unduly delay generic or biosimilar competition. A letter from the FDA to the Patent and Trademark Office (PTO) lays out the agency’s concerns that certain pharmaceutical company patent practices may be creating obstacles to timely competition; the letter expresses the FDA’s desire to work with the PTO to address these challenges. And the FDA took the notable step of responding to a citizen petition filed by a branded pharmaceutical company by noting that the petition “appears to have been submitted with the primary purpose of delaying [generic] approval.” The FDA referred the petition to the Federal Trade Commission for investigation.
In previous years’ recaps, I have written about Texas v. California, the lawsuit brought by several Republican state Attorneys General and supported by the Trump Administration aiming to overturn the entire Affordable Care Act (ACA). In 2022, the Supreme Court finally issued its opinion in the case. As Katie Keith summarized here, the Court rejected the challengers’ argument on standing grounds, 7-2.
Invalidating the entire ACA (during a pandemic, no less) would have had significant impacts not only on health care policy in general, but on prescription drug policy more specifically. The ACA includes the Biologics Price Competition and Innovation Act, which gives the FDA the legal authority to approve follow-on biosimilar versions of innovator biologic drugs. The ACA also closed the Medicare Part D donut hole, financially supporting tens of millions of seniors in affording their prescription drugs. More generally, overturning the law would have stripped health insurance, including prescription drug coverage, from tens of millions of Americans.
Instead, 2021 saw an expansion of access to health insurance, and therefore prescription drug coverage. Over 2.8 million Americans signed up for ACA health insurance coverage during the Special Enrollment Period created by the Biden Administration, likely driven in part by the enhanced premium support provided by the American Rescue Plan Act of 2021. Oklahoma and Missouri both opted in to the ACA’s Medicaid expansion (through ballot initiatives), making eligible for coverage hundreds of thousands of Americans. And states have begun to opt into the American Rescue Plan’s new Medicaid state plan option to provide continuous postpartum coverage for 12 months after the end of pregnancy (compared to 60 days previously), an important change given high perinatal mortality rates and insurance churn and inconsistent access to care through the postpartum period.
Although health care policy is generally not a topic on which there is agreement between Republicans and Democrats in Congress, elected leaders of both parties in 2021 have continued to signal their support for robust investments in scientific research, particularly, though not only, in the health care context. Most recently, President Biden signed into law the bipartisan Accelerating Access to Critical Therapies for ALS Act, which provides $100 million per year for a range of activities designed to support both research into ALS— amyotrophic lateral sclerosis, or Lou Gehrig’s disease—and expanded access to investigational drugs for the disease. The United States Innovation and Competition Act has gone to conference, with unresolved issues remaining after the two Congressional chambers each advanced their own legislation. While the Act goes far beyond health issues, one key area of focus is on biotechnology investments.
In November, Representatives Diana DeGette (D-CO) and Fred Upton (R-MI) introduced their “Cures 2.0” legislation. Following on from 2016’s 21st Century Cures Act, the bill’s sponsors aim to “speed up the delivery of groundbreaking, new—and potentially lifesaving”—medical products. The bill would create a new agency within the National Institutes of Health, the Advanced Research Projects Agency for Health (ARPA-H), to drive innovation in particularly challenging therapeutic areas, such as cancer and Alzheimer’s disease. ARPA-H, a proposal originating with President Biden, is in many ways modeled after the successful Defense Advanced Research Projects Agency (DARPA).
Looking ahead to 2022, here are five drug policy issues to watch, outside of the ongoing COVID-19 pandemic.
The fallout over Aduhelm will continue into 2022, as CMS is scheduled in mid-January to release a draft National Coverage Determination (NCD) detailing the circumstances under which Medicare will pay for the drug. The NCD itself will have important implications for the manufacturers of other monoclonal antibodies seeking FDA approval for the treatment of Alzheimer’s disease, as noted below. CMS may take this opportunity to clearly assert that the FDA’s standard for approval—“safe and effective”—doesn’t compel Medicare reimbursement under its “reasonable and necessary” standard.
The FDA itself will face a series of decisions in 2022 that will test the breadth of the precedent set by its Aduhelm approval. Other manufacturers of monoclonal antibodies for the treatment of Alzheimer’s are expected to file for FDA approval or to read out the results of trials in 2022. The agency may, or may not, take a different approach towards them in the wake of its Aduhelm decision. The FDA has also faced criticism for not using its flexibilities to advance potential ALS therapies in the way that it has fast-tracked these Alzheimer’s products, and in 2022 the agency will face decisions regarding products intended to treat ALS.
Every five years, Congress must pass the User Fee Amendments (UFAs) that reauthorize the FDA’s primary source of funding. That time has come once again, and FDA-watchers are looking ahead to the 2022 passage of the various UFAs (for prescription drugs, generic drugs, biosimilars, and medical devices). Departing from previous versions of the Amendments, the 2017 version of the law was largely focused on the funding reauthorization and lacked a large number of extraneous, controversial provisions. It is possible that the 2022 reauthorization will be similarly focused, but it would not be a surprise for it to include COVID-informed reforms to the agency’s policies and procedures or elements of bills focused around drug pricing reforms involving the FDA, such as citizen petition issues.
Given the public popularity of prescription drug reform, the administration may continue to pursue legislative opportunities to advance these goals. If those are unsuccessful, the administration may begin developing and implementing executive actions to achieve these aims. The scope of ambitious ideas (though ultimately none were implemented) laid out by President Trump may offer a potential guide to the range of possibilities for administrative action.
Having failed to strike down the entire ACA in California v. Texas, ACA opponents are back in court—again before Judge Reed O’Connor, the district court judge who would have invalidated the entire law—to challenge the law’s requirement that insurance plans provide coverage for preventive products and services with no cost sharing. A ruling in favor of the challengers could threaten patients’ no-cost access to preventive services like mammograms or colonoscopies, but also to HIV prevention medication and contraception. More generally, as the Supreme Court considers whether and how to overturn Roe v. Wade, we may begin to see litigation around the country involving conflicts between state and federal law regarding medication abortions. That is, given that the FDA has determined abortion medications to be safe and effective through ten weeks of pregnancy, states may face additional legal challenges if they seek to ban these medications—following a principle applied several years ago to prevent Massachusetts from banning the prescription of a new opioid that the FDA had approved.
Prescription drug policy will continue to be an important area of policy discussion in 2022. Actions by our pharmaceutical regulators will be essential to assisting us during the pandemic, and patients continue to clamor for prescription drug pricing relief. But many of 2022’s most important developments will stem from the FDA’s own decision to approve Aduhelm, a decision that will continue to have implications for years to come for federal agencies, pharmaceutical companies, providers, and patients alike.
The author sits on the Midwest Comparative Effectiveness Public Advisory Council of the Institute for Clinical and Economic Review (ICER), but was not involved in ICER’s evaluation of Aduhelm. The author also receives grant funding from Arnold Ventures on a project examining the relationship between the FDA’s accelerated approval pathway and state Medicaid programs.
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