MANAGED CARE NEWSSTAND

Senate Judiciary Committee Advances Drug Patent Reform, FDA-PTO Bills to Floor

The Senate Judiciary Committee voted to advance a handful of bipartisan bills that promote drug competition and biosimilar market entry:

The Interagency Patent Coordination and Improvement Act, which passed the committee in summer 2022, would establish a task force that coordinates efforts and shares information on drug patent decision making between the United States Patent and Trademark Office (USPTO) and the U.S. Food & Drug Administration (FDA), including information on patent-application evaluations, training, and FDA approvals.

The Stop STALLING Act would penalize brand drug makers for filing “sham” citizen petitions with the FDA that interfere with the approval of competing generics and biosimilars.

The Preserve Access to Affordable Generics and Biosimilars Act aims to limit the use of “pay-for-delay” agreements by making them presumptively anticompetitive, illegal, and increasingly difficult for drug makers to justify in court.

The Prescription Pricing for the People Act, which was reintroduced earlier this month, would require the Federal Trade Commission (FTC) to examine price consolidations and anti-competitive practices within the entire pharmaceutical supply chain that may impact the cost of prescription drugs for consumers.

The Affordable Prescriptions for Patients Act, which passed the Senate Finance Committee in 2020, aims to stop abuse of patents via product hopping and other tactics used by brand-name drug makers to prevent generics and biosimilars from entering the market.

CMS Drug Price Negotiation Timeline 2026

The Inflation Reduction Act (IRA), signed into law in August 2022, included key healthcare provisions. One of these major provisions regarded allowing Medicare to negotiate drug prices. Centers for Medicare & Medicaid Services (CMS) released a Drug Price Negotiation Timeline for 2026, which outlines initial actions for the program. According to the timeline, CMS will publish the maximum fair prices for drugs selected for negotiation for 2026 with these prices going into effect on Jan. 1, 2026.

Provision in the FY23 Omnibus Spending Bill

On Dec. 29, President Joe Biden signed the Consolidated Appropriations Act, 2023 into law, including $1.7 trillion in fiscal year (FY) 2023 discretionary government funding across all 12 annual spending bills. This bill included a number of other healthcare provisions, which touch on the following:

CBO Access to DIR Data: Authorizes the Congressional Budget Office (CBO) to access prescription drug payment data including rebate and Direct and Indirect Remuneration (DIR) data under Medicare Part D.

CHIP: Extends the Children’s Health Insurance Program (CHIP) until 2029; children on CHIP get one year of continuous eligibility.

Medicaid: Allows states to begin reevaluating who is still eligible for Medicaid beginning in April, while requiring states to attempt to contract beneficiaries before disenrolling them from the program; gradually phases out 6.2% increased pandemic Medicaid funding.

COVID-19 EUA Coverage: No additional COVID-19 funding, but it allows Medicare Part D plans to cover products for COVID-19 approved under an emergency use authorization (EUA) through 2024.

Mental Health Parity: Requires selffunded, nonfederal government health plans to comply with mental health parity requirements beginning six months after the date of enactment or longer, contingent on the terms of the plan agreement.

Interchangeable Biosimilars: Clarifies the FDA’s authority to tentatively approve a subsequent interchangeable biosimilar while a first interchangeable product’s exclusivity period is pending. Multiple interchangeable biosimilars can share a period of first interchangeable exclusivity if they are approved the same day.

FDA Post-Approval Studies: Adds to requirements for post-approval studies for drugs approved under accelerated approval, including targets, milestones, and dates for study completion — and clarifies the FDA’s authority to withdraw products where sponsors fail to conduct the studies.

FDA: Requires the FDA to make timely therapeutic equivalence evaluation for follow-on drugs approved through the 505(b)(2) pathway — a pathway in between novel new drugs and generics — that have similar formulations as other approved pathways, and it facilitates the availability of lower-cost drugs available for automatic substitution in pharmacies.

MTM for Opioids: Eliminates a current requirement for medication therapy management (MTM) for opioid addiction that those registered to dispensecontrolled substances also apply for a separate Drug Enforcement Administration (DEA) waiver to dispense buprenorphine.

Generic Drug Labeling: Provides that a generic drug is eligible for approval despite differences in proposed labeling.

CMS Draft Guidance for Medicare Prescription Drug Inflation Rebate Program

On Feb. 8, the Department of Health and Human Services (HHS) released an initial guidance for the Medicare Prescription Drug Inflation Rebate Program. The program requires pharmaceutical manufacturers to pay a rebate if the prices of certain drugs are increased at a rate faster than the rate of inflation. Medicare Part B prescription drug inflation rebates were established for single-source drugs and biologics with faster-increasing prices than the rate of inflation and provides lower Part B beneficiary cost sharing on those drugs. The guidance outlines how CMS will calculate drug inflation rebates in Medicare Part B and D as required under the IRA.

PHE Will Expire on May 11

On Feb. 9, HHS released a COVID-19 Public Health Emergency (PHE) Transition Roadmap noting that the PHE will end on May 11. The roadmap includes an outline of what program and flexibilities will and will not be affected.

Senate Hearing on Transparency and Accountability for PBMs

The Senate Committee on Commerce, Science, and Transportation held a hearing titled “Bringing Transparency and Accountability to Pharmacy Benefit Managers” in February to focus on the role of PBMs in how Americans access their medications as well as the operations of PBMs. The hearing addressed how the Pharmacy Benefit Manager Transparency Act will bring transparency into PBM business practices.

Proposed PBM Bills in the New Congress

The PBM Accountability Act has been reintroduced as S. 127. Sen. Maria Cantwell (D-WA) chairs the committee and is eager to move forward with the bill. Last year, the bill passed out of the committee by a wide bipartisan margin but never made it to the Senate floor due to other priorities. The bill would regulate PBMs through the FTC.

New IQVIA Report Notes Increase in Biosimilar Spending in Next Five Years

According to the new “IQVIA Biosimilars in the United States 2023-2027” report, spending on biosimilars in the U.S. is expected to increase substantially over the next five years. Due to expected launches and uptake in biosimilar utilization, biosimilar spending is expected to reach $129 billion by 2027. Savings associated with biosimilars are expected to increase by $180 billion in the same timeframe. In the previous five years, the U.S. biologics market has grown by 12.5% annually. Currently available and launched biosimilars account for 24% of the competitive volume.

IRA: CMS Implementation Timeline

CMS released an IRA Implementation Timeline, outlining when changes brought by provisions of the IRA will go into effect. Some notable dates in 2023 include:

April 1: Individuals with traditional Medicare may pay a lower coinsurance for some Part B drugs if the drug’s price increased faster than the rate of inflation in a benchmark quarter.

July 1: Individuals with traditional Medicare who take insulin through a traditional pump will not pay more than $35 for a month’s supply of insulin.

Sept. 1: CMS will announce by this date the first 10 Medicare Part D drugs selected for the Drug Price Negotiation Program.

Oct. 1: Most adults with coverage from Medicaid and CHIP will be guaranteed coverage of vaccines recommended by the Advisory Committee Immunization Practices at no cost to them.