By Ricardo Alonso-Zaldivar | Associated Press
WASHINGTON — Medicare said Tuesday it will limit coverage of a $28,000-a-year Alzheimer’s drug, whose benefits have been widely questioned, a major development in the nation’s wrangling over the real value of new drugs that offer tempting options but come with unaffordable prices.
The first finding from the Centers for Medicare and Medicaid Services means that, in order to pay for Medicare, patients taking Biogen’s Aduhelm medication must participate in clinical trials to assess the drug’s effectiveness in slowing the progression of dementia in an early stage, as well as its safety . The determination of Medicare nationwide coverage would become final by April 11, after a public comment period and further evaluation by the agency.
“Alzheimer’s disease is a devastating disease that has touched the lives of millions of American families,” Medicare administrator Chiquita Brooks-LaSure said in a statement. “CMS is and remains committed to providing the American public with a clear, trusted, fact-based decision that will be made only after a thorough analysis of public feedback on the benefits and risks of coverage for Medicare patients.”
The requirement for clinical trials applies to the entire class of drugs of which Aduhelm is a pioneer, monoclonal antibodies that work against amyloid, a type of protein that forms plaques characteristic of Alzheimer’s disease.
Biogen strongly disapproved of Medicare’s decision. The company said in a statement that the decision “negates the daily burden of people with Alzheimer’s disease.” Randomized clinical trials “will rule out nearly all patients who may benefit from them.” The company said clinical trials can take months to years to set up and “hundreds of Alzheimer’s patients…evolve every day from mild to moderate stages of disease, where treatment may no longer be an option.”
Biogen’s initial introductory price of $56,000 per year for Aduhelm led to a nearly $22 increase in Medicare’s monthly “Part B” outpatient premium, the highest ever in dollars, but not in percentage terms. Medicare attributed about half of this year’s increase to emergency planning for Aduhelm. Faced with skepticism about its medication, Biogen recently lowered the price to $28,200, but Medicare enrollees were already on the hook for the $170.10 premium. Health and Human Services Secretary Xavier Becerra has ordered Medicare to reassess the premium increase.
Medicare officials on Tuesday emphasized that they did not factor costs into the coverage decision, but rather question whether Aduhelm is “reasonable and necessary” for the treatment of Alzheimer’s patients enrolled in the program. “While there is potential for promise with this treatment, there is also the potential for harm,” said Dr. Lee Fleisher, medical director of Medicare. “This damage can range from headaches, dizziness and falls to other potentially serious complications such as brain haemorrhage.” Clinical trials will try to determine the balance between risks and benefits, he said.
Medicare payment rates will be determined through a different process, officials said. The program pays for drug costs and other services for patients in agency-approved studies.
Nevertheless, the high price of Aduhelm and the fact that most of the 6 million Americans with Alzheimer’s are old enough to be covered by Medicare pushed the boundaries.
“Biogen came to the market with an eye-watering price tag,” said Tricia Neuman, a Medicare expert with the unbiased Kaiser Family Foundation. “Even after cutting the price of their drug in half, it’s still over $28,000, which isn’t insignificant. At that price, it’s clearly a problem for the Medicare program, premiums and out-of-pocket costs.”
Aduhelm has sparked controversy since its approval by the Food and Drug Administration last June, which went against the recommendation of the agency’s outside advisers.
The drug, given through IV in a doctor’s office, has not been shown to reverse or significantly slow Alzheimer’s disease. But the FDA said its ability to reduce clumps of plaque in the brain is likely to slow dementia.
Many experts say there is little evidence to support that claim. And a federal watchdog and congressional investigators are conducting separate investigations into how the FDA rated the medication. Of particular note are several undocumented meetings between FDA reviewers and business leaders leading up to the drug’s approval.
Biogen has defended its medication and pricing. But when the company announced the price cut days before the Christmas holidays, it acknowledged that cost had become a stumbling block.
“Too many patients are not given the choice of Aduhelm for financial reasons and thus go beyond the point of benefiting from the first treatment to address an underlying pathology of Alzheimer’s disease,” CEO Michel Vounatsos said at the time. “We recognize that this challenge must be addressed in a way that is considered sustainable for the U.S. health care system.”
Some insurers have refused to pay for the drug, while several medical centers across the country have either been slow to decide to use it or said they have no plans to prescribe it for the time being.
Biogen’s Vounatsos said this week the company now has about 220 sites that treat patients with Aduhelm. In October, the company said a total of 120 sites had infused at least one patient.
Biogen said in June, shortly after FDA approval, that approximately 900 locations in the US have the equipment and expertise to begin administering the drug immediately, requiring monthly infusions.
The FDA has said Aduhelm is suitable for patients with mild symptoms or early-stage Alzheimer’s. But that agency has asked Biogen for more research.
Because the drug is administered in a doctor’s office, Medicare pays for it under the Part B outpatient benefit, which is funded in part by enrollment premiums.
The financial consequences of expensive drugs are usually most severe on patients with serious diseases such as cancer, rheumatoid arthritis or multiple sclerosis. But with Aduhelm, the pain would generally be spread among Medicare patients, not just Alzheimer’s patients who need the drug.
That has turned the drug into a case study of how one expensive treatment can affect government spending and affect family budgets. People who don’t have Alzheimer’s would still be on the hook for the cost of Aduhelm, because it’s big enough to affect their premiums.
Alzheimer’s disease is a progressive neurological disease for which there is no known cure. The vast majority of U.S. patients are old enough to qualify for Medicare, which covers more than 60 million people, including those age 65 and older, and disabled people under the age of 65.
Associated Press Science writers Tom Murphy in Indianapolis and Matthew Perrone in Washington contributed.